U.S. CPI Gain Picks Up in April; Core Prices Increase Steadily
by:Tom Moeller
|in:Economy in Brief
Summary
- Core goods price strength is spotty.
- Services prices move higher.
- Energy prices decline; food prices remain strong.
The Consumer Price Index rose 0.4% in April (4.9% y/y) following a 0.1% uptick in March. A 0.4% increase had been expected in the Action Economics Forecast Survey. Prices excluding food & energy rose 0.4% for the fourth month in the last five. The 5.5% y/y gain was below the 6.6% September high. A 0.3% increase had been expected.
The CPI less food, energy and shelter, another measure of core pricing power developed by Haver, increased 0.4% during April. It was the strongest increase since September. The 3.7% y/y increase has been steady for three months, remaining below the 7.6% peak in February of last year.
A 4.4% jump (-6.6% y/y) in used car & truck prices accounted for much of the strength in the CPI last month. The outsized rise followed nine consecutive monthly declines. The CPI excluding food, energy, shelter and used car & truck prices rose 0.2% (4.7% y/y).
Goods prices less food, energy and used car & trucks held steady m/m (4.0% y/y). Home furnishings prices fell 0.4% (+4.8% y/y) while appliance costs weakened 1.9% (-0.4% y/y). Apparel prices rose 0.3% (3.6% y/y) but new vehicle prices eased 0.2% (+5.4% y/y). Education & communication goods costs slipped 0.2% (-8.3% y/y). Recreation goods prices rose 0.3% (2.9% y/y).
Service costs less energy increased 0.4% (6.8% y/y). Shelter prices rose 0.4% (8.1% y/y) as owners’ equivalent rent of primary residences increased 0.5% (8.1% y/y). Rents rose 0.5% (8.2% y/y). Education & communication prices edged 0.1% higher (3.1% y/y), while transportation service prices fell 0.2% (11.0% y/y). Recreation service prices jumped 0.7% (6.4% y/y), but medical care service costs slipped 0.1% (+0.4% y/y), down for the sixth month in the last seven.
Energy prices rose 0.6% last month (-5.1% y/y). Gasoline prices increased 3.0% (-12.2% y/y). Fuel oil & other fuel costs held steady (-15.2% y/y and electricity prices weakened 0.7% (+8.4% y/y). Natural gas prices fell 4.9% (-2.1% y/y).
Food prices held steady (+7.7% y/y) for the second consecutive month. Egg prices fell 1.5% (+21.4% y/y). Meat, poultry & fish prices eased 0.2% (1.5% y/y) while cereal & bakery product prices rose 0.2% (12.4% y/y). Fruit & vegetable prices fell 0.5% (2.0% y/y) and dairy prices weakened 0.7% (+8.0% y/y). Nonalcoholic beverage prices eased 0.1% (9.5% y/y).
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.
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