CPI report

2022 - 5 - 11

Post cover — Image courtesy of "The New York Times"

Live Updates: April CPI Report and Inflation News (The New York Times)

Inflation data shows a modest deceleration, but prices are still climbing at a brisk pace, suggesting that underlying inflation pressures remain strong.

This study suggests, however, that high-frequency spending categories like food tend to motivate consumer psychology more than changes in the cost of rent, for example, which most people encounter only once a year. Policymakers have been struggling to avoid a “wage-price spiral,” in which price and wage increases become self-reinforcing and escalate out of control. “What stands out in April 2022 is the above-average increases in food prices,” the office said in a statement. Consumer prices in Germany, Europe’s largest economy, rose at an annual rate of 7.8 percent in April, the Federal Statistics Office said Wednesday, citing preliminary figures that are adjusted to make them comparable with inflation data from other E.U. countries. Agricultural prices started to skyrocket in the second half of last year, meaning year-over-year price increases will start to look less steep since they are measured from a higher starting point. The interest rate resets every six months and is linked to the rate of inflation. But in the process, the Fed has disrupted financial markets and contributed to big price reductions for stocks and bonds. White House officials in recent weeks have repeatedly referred to “ Putin’s price hike,” a reference to the role that Russia’s invasion of Ukraine has played in driving up oil and gas prices. On Tuesday, Mr. Biden said in a speech at the White House that inflation was his “top domestic priority” and that his administration was taking whatever steps it could to try to reduce costs. But 67 percent of respondents in the survey — including 42 percent of Republicans — said they approved of the law, the same level of support as when it passed last year. The pickup in housing costs is an especially big deal, because they make up about a third of the overall inflation index. The reality that annual inflation has possibly peaked will give the White House and Fed a positive talking point and a dose of comfort.

Inflation barreled ahead at 8.3% in April from a year ago, remaining ... (CNBC)

Inflation as gauged by the consumer price index was expected to rise 8% year-over-year in April, according to Dow Jones estimates.

Airline fares continued their climb as more people take to the skies amid increased business travel and vacations. Auto sales also have been a big contributor to inflation as supply chain issues, especially with the semiconductors vital to vehicle operating systems, have pushed prices up. Stock market futures reacted negatively to the report, turning negative after being positive earlier in the morning. Real wages adjusted for inflation decreased 0.1% on the month despite a nominal increase of 0.3% in average hourly earnings. On a 12-month basis, energy costs were still up 30.3% while food rose 9.4%, according to unadjusted data. However, Wednesday's data shows that the Fed has a big job ahead. That represented a slight ease from March's peak but was still close to the highest level since the summer of 1982. Rising prices at the pump and in grocery stores have been one problem, but inflation has spread beyond those two areas into housing, auto sales and a host of other areas. Over the past year, real earnings have dropped 2.6% even though average hourly earnings are up 5.5%. The CPI gains came even though energy prices declined 2.7% for the month, including a 6.1% drop for gasoline. Used vehicle prices fell 0.4% on the month but new vehicle prices rose 1.1%. Prices rose 22.7% and 13.2% for the two categories respectively over the past year. The month-over-month gains also were higher than expectations — 0.3% on headline CPI vs.

Inflation decelerates slightly from 40-year high as CPI rises 8.3% in ... (Yahoo Finance)

CONSUMER PRICES RISE BY THE MOST SINCE 1981. U.S. CONSUMER PRICE INDEX, YEAR-OVER-YEAR CHANGE SINCE 1970.

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GRAPHICS-CPI, PPI: Markets look for signs of U.S. inflation peak (Nasdaq)

In the wake of the 50-basis-point interest rate hike by an increasingly hawkish Federal Reserve, markets have gyrated wildly ahead of this week's U.S. ...

Any number at or below consensus on Wednesday would likely be welcomed by investors. "Corporations have been able to pass on higher costs as demand remains strong," Carter added. "Under the hood, there continue to be signs that inflation, labor market tightness, and supply chain woes may all have peaked," said Yung-Yu Ma, chief investment strategist at BMO Wealth Management. "The market is in 'prove it' mode, and those early signs are still far from adequate proof to calm the markets." NEW YORK, May 10 (Reuters) - In the wake of the 50-basis-point interest rate hike by an increasingly hawkish Federal Reserve, markets have gyrated wildly ahead of this week's U.S. economic data, which will be closely parsed for signs that inflation is peaking. On Tuesday, while 32% of survey participants in the National Federation of Independent Business' (NFIB) Business Optimism survey rated inflation their top concern -- a record-high reading -- fewer respondents reported raising prices and hiking wages. Recent survey data, particularly from the Institute for Supply Management's (ISM) purchasing managers' indexes (PMI) reveal that two main drivers of inflation -- supply scarcity and the ongoing worker drought -- remained significant headwinds in April. In the wake of the 50-basis-point interest rate hike by an increasingly hawkish Federal Reserve, markets have gyrated wildly ahead of this week's U.S. economic data, which will be closely parsed for signs that inflation is peaking. "If inflation prints at expectations, it would be the first meaningful decline in the annualized inflation rate since the depths of the COVID recession," writes Matt Weller, global head of research at StoneX Financial. Food eaten at home rose 1.5% on a monthly basis, and grocery prices rose by 10% year-on-year, the fastest annual growth in more than four decades. On Wednesday, analysts expect the consumer price index (CPI) USCPI=ECI to show a sharp pullback in monthly growth, cooling to 0.2% in April from 1.2% in March -- the biggest monthly jump in more than 16 years -- and an annual increase of 8.1%, 0.4 percentage point lower than the prior 8.5%, which was the hottest reading since December 1981. Energy prices posted an 11% monthly jump in March, with gasoline surging by a jaw-dropping 18.3%. Average prices at the pump hit a record high in March, according to motorist group AAA. Price growth has soared to the highest level since the early 1980s due to the collision of a post-pandemic demand boom and a gummed up global supply chain, and has stoked fears that the Fed's aggressive attempts to rein it in could lead the economy into recession.

Stock Market Live Updates: Investors Digest Inflation Report (The Wall Street Journal)

Full coverage of the stock market as investors digest the inflation report, which showed an easing in the consumer price index.

Gold is up 1.4% this year as investors have sought a measure of security in the precious metal amid concerns about geopolitics and economic strength world-wide. The tech-focused Nasdaq composite was down about 1%. On Monday, the U.S. Department of Agriculture said 22% of corn was planted, compared with 50% for the previous-five-year average. On Wednesday, the notes at auction sold at a 2.943% yield. After a bumping trading day, the Dow, the S&P 500 and the Nasdaq all ended Wednesday in the red. Industry advisers say that the rate increase will not likely lead many students to change their educational plans. The broader pace of inflation eased slightly last month but remained historically high. The consumer-price index rose to 8.3% in April, slightly above investors' forecasts, easing for the first time in months. Yields then fell, though, as the S&P 500 shed earlier gains and slid more than 1% while investors sought out safer assets. Treasury yields, which rise when bond prices fall, jumped immediately after the Labor Department said that the consumer-price index, excluding volatile food and energy categories, climbed 0.6% in April from the previous month. Meanwhile, West Texas Intermediate, Brent's U.S. equivalent, rose $5.95 per barrel, or 6%, to $105.71. WTI is up about 41% this year. The results are in.

U.S. inflation rate slows to 8.3%, CPI shows, but price pressures still ... (MarketWatch)

The yearly rate of U.S. inflation fell to 8.3% in April to mark the first decline in eight months, but the upward pressure on prices is unlikely to ease...

The cost of clothing fell for the first time in seven months and used-vehicle prices also declined. Looking ahead: “The slowdown in CPI was largely due to March’s decline in gasoline prices after April’s surge. The rate of inflation over the past year slowed to 8.3% from 8.5% — the first time it’s declined since last summer. Shelter costs account for a third or more of a typical household budget. And lockdowns in China could further disrupt the shipment of critical supplies that American companies need to produce their goods and services. Consumers got a temporary break from higher gas prices in April. They fell 6.1% last month. Oil prices surged after the Russian invasion of Ukraine and then leveled off in April. Food prices jumped almost 1% last month. Prices are climbing again. The cost of rent and housing both rose sharply again in April and helped explain the big increase in the core rate of inflation. It’s already raised rates twice this year. The increase in the core rate over the past year slowed to 6.2% from from a 40-year high of 6.5% in March.

Soaring inflation slowed in April. Will it bring a bit of relief to price ... (USA TODAY)

The consumer price index increased 8.3% annually, down from 8.5% in March, as a drop in gasoline prices offset a continuing run-up in food, rent and other costs ...

Breakfast cereal prices rose 2.4% in April and are up 12.1% from a year ago, and bread costs increased 2% and 9.1% yearly. Consumers’ pivot to more spending on services, along with worker shortages that propelled wages higher, drive up a different set of prices. Rent climbed 0.6% monthly and 4.8% from a year ago. Grocery costs jumped 1% monthly and 10.8% from a year ago. Much of the slowdown in the yearly measure reflected a 6.1% monthly drop in gas prices. Fish was up 0.9% and 13% annually. But the monthly rise in core prices "indicates that underlying inflation pressures are stronger than we had expected." Pork chop prices rose 1.9% monthly and 14% annually. That has begun moderating increases in the price of furniture, appliances and other items. Clothing prices fell 0.8% monthly, lowering the annual rise to 5.4%. But the 3,300-mile trip will cost an extra $550 or so in gas, so they decided to skip it this year. Regular unleaded hit a record $4.37 a gallon Tuesday, up from $4.12 a month ago, according to AAA.

Prices in US Outstrip Forecasts in Sign of Inflation Persisting (Bloomberg)

Core consumer price index rose 0.6%, exceeding all estimates · April CPI driven by airfares, new vehicles, food and shelter.

US consumer prices rose by more than forecast in April, indicating inflation will persist at elevated levels for longer and keeping the Federal Reserve on the path of aggressive interest-rate hikes.

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