Global| Jul 14 2017U.S. CPI Again Weaker than Expected in June
by:Sandy Batten
|in:Economy in Brief
Summary
The Consumer Price Index continued to underperform market expectations in June. The headline index was unchanged from May (+1.6% y/y) against a market expectation (from the Action Economics Forecast Survey) of a 0.1% m/m increase. [...]
The Consumer Price Index continued to underperform market expectations in June. The headline index was unchanged from May (+1.6% y/y) against a market expectation (from the Action Economics Forecast Survey) of a 0.1% m/m increase. This index had unexpectedly slipped 0.1% m/m in May. The core index (that excludes food and energy prices) edged up 0.1% m/m (1.7% y/y, remaining at its lowest reading since May 2015) in May but market expectations were for a 0.2% m/m rise in June.
The energy index declined again in June, falling 1.6% m/m (+2.3%y/y), offsetting the monthly increase in the index for all items less food and energy. This was this index's fifth monthly decline in the past six months. All the major energy component indexes declined in June, with the gasoline prices falling 2.8% m/m (-0.4% y/y). The food index was unchanged in June from May (+0.9% y/y) following a 0.2% m/m increase in May.
The June increase in the index for all items less food and energy was its third straight such increase. The rise was due to core services prices. Goods prices excluding food and energy fell 0.1% m/m (-0.6% y/y) for their fourth consecutive monthly decline. Of the major categories, only prices of medical care goods posted a monthly increase (+0.7% m/m, +3.2% y/y) in June.
Prices of services excluding energy rose 0.2% m/m in June (+2.5% y/y) with monthly increases in all the major subcategories. The shelter index continued to rise (+0.2% m/m), and the indexes for medical care (+0.3% m/m), motor vehicle insurance (+1.0% m/m), education (+0.3% m/m), and personal services (+0.3% m/m) also increased. Airfares (-2.7% m/m) and prices for wireless telephone services (-0.8% m/m) fell in June.
The consumer price data is available in Haver's USECON database while detailed figures can be found in CPIDATA. The expectations figure is from Action Economics and is found in the AS1REPNA database.
| Consumer Price Index, All Urban Consumers (%) | Jun | May | Apr | Jun Y/Y | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|
| Total | 0.0 | -0.1 | 0.2 | 1.6 | 1.3 | 0.1 | 1.6 |
| Total less Food & Energy | 0.1 | 0.1 | 0.1 | 1.7 | 2.2 | 1.8 | 1.7 |
| Goods less Food & Energy | -0.1 | -0.3 | -0.2 | -0.6 | -0.5 | -0.5 | -0.3 |
| Services less Energy | 0.2 | 0.2 | 0.1 | 2.5 | 3.1 | 2.6 | 2.5 |
| Food | 0.0 | 0.2 | 0.2 | 0.9 | 0.3 | 1.9 | 2.4 |
| Energy | -1.6 | -2.7 | 1.1 | 2.3 | -6.6 | -16.7 | -0.3 |
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
