U.S. CPI Continues to Rise Moderately in October

The Consumer Price Index increased 0.2% during October, the same as in each of the prior three months. The gain matched expectations in the Action Economics Forecast Survey. The y/y increase picked up to 2.6% from 2.4% in September. The three-month increase rose to 2.5% (AR) from 2.1% but remained below the 4.6% April high this year. Prices excluding food & energy rose 0.3% for the third consecutive month, as expected. Core consumer prices increased 3.6% (AR) during the last three months (3.3% y/y), up from 1.6% in July. Food prices rose 0.2% last month (2.1% y/y) after a 0.4% gain while energy prices were roughly steady (-4.9% y/y), following a 1.9% decline.

The CPI less food, energy and shelter, another measure of core pricing power, rose 0.2% after a 0.4% gain. The 2.1% y/y rise remained below the 7.6% y/y peak in February 2022 and compared to a low of 0.3% y/y in May 2020.

Services costs less energy rose 0.3% in October (4.8% y/y) after rising 0.4% in both of the prior two months. Shelter costs rose 0.4% (4.9% y/y) following a 0.2% rise in September. Owners’ equivalent rent of primary residences increased 0.4% (5.2% y/y), following a 0.3% rise. Rents of primary residences gained 0.3% (4.6% y/y), the same as in September, while the cost of lodging away from home rose 0.4% (-0.1% y/y) following a 1.9% September decline. Transportation service prices increased 0.4% last month (8.2% y/y) following a 1.4% September strengthening, as public transportation prices increased 2.4% (2.5% y/y), about the same as in both of the prior two months. Medical care service costs rose 0.4% (3.8% y/y) after strengthening 0.7%. Education & communication prices eased 0.2% (+2.1% y/y) following a 0.1% rise. Recreation services prices rose 0.7% (2.8% y/y) after falling 0.5% in September.

During October, the CPI for goods less food & energy held steady (-1.0% y/y) after rising 0.2% in September. Apparel costs plunged 1.5% (+0.3% y/y) after rising 1.1%. Home furnishings prices held steady (-2.2% y/y), and appliance costs fell 0.6% (-2.3% y/y), both for the second straight months. Education & communication product costs fell 1.1% (-6.7% y/y) after falling 0.7% while medical care product prices declined 0.2% (NSA, +1.0% y/y) in October after a 0.7% decline. Prices for recreation products held steady (-1.7% y/y), after three months of modest decline. To the upside, transportation product prices rose 0.8% (-1.7% y/y) after improving 0.3%. New vehicle prices held steady (-1.3% y/y) after rising 0.2% while used car & truck prices strengthened 2.7% (-3.4% y/y) after a 0.3% rise.

Food prices rose 0.2% (2.1% y/y) in October following a 0.4% September increase. Egg prices slumped 6.4% (+30.4% y/y) after rising for four straight months. Meat, poultry & fish prices fell 0.8% (+0.1% y/y) after rising 0.2% while cereal & bakery product prices jumped 1.0% (0.9% y/y) after a 0.3% rise. Fruit & vegetable prices rose 0.4% (0.9% y/y) after increasing 0.9%, while dairy prices jumped 1.0% (1.3% y/y) after rising 0.1% in September. Nonalcoholic beverage prices rose 0.4% (1.7% y/y) after holding steady in September.

Energy prices remained unchanged (-4.9% y/y) in October after falling 1.9% in September. Gasoline prices fell 0.9% (-12.2% y/y), the fifth decline in the last six months. Amongst other energy products, fuel oil & propane prices weakened 2.2% (-11.9% y/y) after declining 3.1%. Electricity prices rose 1.2% (4.5% y/y) after a 0.7% gain, while natural gas prices improved 0.3% (2.0% y/y) after rising 0.7% in September.

The Consumer Price figures can be found in Haver's USECON database. The expectations figure is contained in the AS1REPNA database.