U.S. CPI & Core Prices Increase Modestly in July
by:Tom Moeller
|in:Economy in Brief
Summary
- Core goods prices fall again; service price gain moves up.
- Core prices less shelter ease.
- Food & energy prices increase negligibly.
Price inflation has stabilized. The Consumer Price Index rose 0.2% in July, the same as in June. The gain matched expectations in the Action Economics Forecast Survey. The 3.2% y/y rise was increased from 3.0% in June, but still nearly the weakest since March 2021 and down from the 9.1% high in June 2022. Prices excluding food & energy also rose an expected 0.2% last month, the same as in June but below the three consecutive 0.4% increases from March through May. The 4.7% y/y increase was the lowest since October 2021 and down from a 6.6% high in September 2022.
The CPI less food, energy and shelter, another measure of core pricing power, eased 0.1% during July after holding steady in June. The 2.5% y/y increase remained below the 7.6% peak in February of last year.
In July, used car & truck prices weakened 1.3% (-5.6% y/y) following a 0.5% June decline. The CPI excluding food, energy, shelter and used car & truck prices held steady for the second straight month. The 3.4% y/y rise remained well below the 6.7% high in September of last year.
Goods prices less food, energy and used car & trucks eased 0.2% in July (+2.5% y/y) after holding steady for three consecutive months. Education & communication goods costs fell 1.2% (-7.8% y/y), after modest declines in the three prior months. Recreation product prices fell 0.8% (+1.0% y/y) following a 0.4% June decline. Home furnishings prices weakened 0.4% (+2.2% y/y), off for the fourth straight month but appliance costs rose 0.5% (-0.5% y/y) following three straight monthly declines. Apparel prices held steady (3.2% y/y) after four straight 0.3% increases and new vehicle prices eased 0.1% (+3.5% y/y) after holding steady in June.
Service costs less energy in July increased 0.4% (6.1% y/y) for the fourth time in five months. Shelter prices rose 0.4% (7.7% y/y) for a second straight month as owners’ equivalent rent of primary residences increased 0.5% (7.7% y/y) down from a 0.8% December high. Rents of primary residences rose 0.4% (8.0% y/y) after two 0.5% increases. Education & communication prices rose 0.3% (2.7% y/y) after falling moderately for two straight months while transportation service prices rose 0.3% (9.0% y/y) after a 0.1% uptick. Recreation service prices rose 0.8% (6.2% y/y) after increasing 0.5%, but medical care service costs fell 0.4% (-1.5% y/y) after holding steady in June.
Energy prices ticked 0.1% higher last month (-12.5% y/y) after a 0.6% June rise. Gasoline prices increased 0.2% (-19.9% y/y) after rising 1.0% in June. Fuel oil & other fuel costs rose 3.7% (-21.2% y/y) after weakening 1.4% in June but electricity prices fell 0.7% (3.0% y/y), down for the fourth month in the last five. Natural gas prices surged 2.0% (-13.7% y/y) after five straight months of decline.
Food prices rose 0.2% (4.9% y/y) in July following a 0.1% June rise. Egg prices fell 2.2% (-13.7% y/y), off for the sixth straight month. Meat, poultry & fish prices improved 0.7% (0.9% y/y) after edging 0.1% higher in June, while cereal & bakery product prices held steady (7.0% y/y) after little change in the prior two months. Fruit & vegetable prices jumped 0.4% (2.9% y/y) after rising 0.8% and dairy prices rose 0.5% (1.3% y/y) after four straight months of decline. Nonalcoholic beverage prices held steady (5.4% y/y) after easing 0.1% in June.
The Consumer Price figures can be found in Haver's USECON database. The expectations figure is contained in the AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
