Consumer Prices Rise Another 0.4% a Bit More Than Economists Expected

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent in September on a seasonally adjusted basis after rising 0.3 percent in August, According to the BLS. 

Month-Over-Month Details 

•  The indexes for food and shelter rose in September and together contributed more than half of the monthly all items seasonally adjusted increase. 
• The index for food rose 0.9 percent, with the index for food at home increasing 1.2 percent. 
• The energy index increased 1.3 percent, with the gasoline index rising 1.2 percent.
• The index for all items less food and energy rose 0.2 percent in September, after increasing 0.1 percent in August. 
• Along with the index for shelter, the indexes for new vehicles, household furnishings and operations, and motor vehicle insurance also rose in September. The indexes for airline fares, apparel, and used cars and trucks all declined over the month. The all items index rose 5.4 percent for the 12 months ending September, compared to a 5.3-percent rise for the period ending August. The index for all items less food and energy rose 4.0 percent over the last 12 months, the same increase as the period ending August. The energy index rose 24.8 percent over the last 12 months, and the food index increased 4.6 percent over that period.  

CPI Year-Over-Year Percent Change 

Year-Over-Year Details 

• The all items index rose 5.4 percent for the 12 months ending September, compared to a 5.3-percent rise for the period ending August. 
• The index for all items less food and energy rose 4.0 percent over the last 12 months, the same increase as the period ending August. 
• The energy index rose 24.8 percent over the last 12 months
• The food index increased 4.6 percent over that period.
• Food and beverages rose 3.2% from a year ago.
• Owners’ Equivalent Rent (OER), a mythical price consumers would pay to rent their own house from themselves, unfurnished and without utilities rose 2.9%.
• Rent of primary residence rose 2.4% year-over-year.

I believe OER is dramatically understated. Finally, I don’t chart energy because at 24.8% it grossly distorts the scale of the chart. 

Expectations 

The Bloomberg Econoday expectations were for a rise of 0.3% month-over-month and 5.3% year-over-year. The BLS reported 0.4% and 5.4% respectively.

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