U.S. CPI Continues to Rise Moderately in October
by:Tom Moeller
|in:Economy in Brief
Summary
- Services price gain slips with lessened increase in medical care prices.
- Core goods prices hold steady.
- Food prices moderate as energy costs hold steady.
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.
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.
