The CPI rose 0.2 percent vs. the consensus estimate of 0.3 percent. The good news stops there.
The BLS CPI Report for April was a mixed basket of good, bad and indifferent. Here are the numbers.
CPI Month-Over-Month Details
- The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent on a seasonally adjusted basis in April.
- The index for shelter rose 0.3 percent in April, accounting for more than half of the all items monthly increase. Owner’s Equivalent Rent (OER) rose 0.4 percent and rent of primary residence rose 0.3 precent.
- The energy index also increased over the month, rising 0.7 percent as increases in the natural gas index and the electricity index more than offset a decline in the gasoline index.
- The index for food fell 0.1 percent in April as the food at home index decreased 0.4 percent and the food away from home index rose 0.4 percent over the month.
- The index for all items less food and energy rose 0.2 percent in April, following a 0.1-percent increase in March.
- Indexes that increased over the month include household furnishings and operations, motor vehicle insurance, education, and personal care.
- Medical care services rose 0.5 percent and medical care commodities rose 0.4 percent.
- The indexes for airline fares, used cars and trucks, communication, and apparel were among the major indexes that decreased in April.
It’s great that food at home dropped 0.4 percent. But it’s not exactly good news that food away from home rose 0.4 percent.
Shelter rose 0.33 percent and unlike food, shelter is sticky. All items except food and energy is reported at 0.2 percent but carried to 2 decimal places was 0.24 percent.
Medical care services rose 0.5 percent with commodities up 0.4 percent and that has a bigger influence on the PCE price index than the CPI. The PCE price index is the Fed’s preferred measure of inflation.
Importantly, April does not include Trump’s tariff hikes.
CPI Year-Over-Year Percent Change
Year-Over-Year Details
- CPI: 2.3%
- CPI Excluding Food and Energy: 2.8%
- Food and Beverage: 2.7%
- Food at Home: 2.0%
- Food Away from Home: 3.9%
- OER: 4.3%
- Rent of primary residence: 4.0%
- Medical Care Services: 3.1%
- Medical Care Commodities: 1.0%
Year-over-year the CPI is up 2.3 percent vs the expected 2.4 percent.
It’s easy to find something to cheer about, but there are some troubling details as well.
Looking Ahead
Looking ahead, the year-over-year numbers are probably as good as they will get for another four months.
I expect year-over-year increases for 3-4 months, starting in either May or June. And that is without tariff price increases. I will explain in a subsequent post.
Finally, the bond market reaction to this report was negative and that’s arguably the best measure of the report.
Also weighing on the bond market is a massive increase in the deficit and debt if Trump gets the One Big Beautiful Bill that he wants.
Spending is up a whopping 58 percent in six years and Congress doesn’t want to challenge Trump on it.
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Food and energy are excluded from core inflation anyhow. So why is anyone happy?
Curious what “food” dropped in price? I do the shopping in our household and quality proteins continue to get more expensive.
Food Price Drop – Not by me – BLS still using Biden staffing?
Trump accepts 200 million dollar pimp mobile from Nigeria. Stock market goes crazy.
What The Endgame in Gaza Means For Middle East Security And Oil Prices
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Goldman Sachs and JP Morgan drop calls for recession, boost GDP and S&P targets.
Yeah, they now think Trump’s Presidency may end up fairly close to Biden’s (and his four years of GDP growth and low unemployment) if Trump can just stay away from his late-night Tweets
Similar to Biden’s economy:
No significant tariff increases
No major government unemployment (DOGE was a distracting joke)
Tax decreases and deficit increases to keep people spending and buying
= no recession (and GDP increases) for the short run
Trump: Thank you, Biden, for your proven recipe LOL
its difficult, if possible, to undo the damage done by Biden
Did GS and JPM say that manufacturing was coming back from China and going to MAGA too?
But don’t worry, Trump can’t help but open his big mouth again at some point, guaranteed.
It’s straight up from here! All those people who bought future puts are screwed! [lol]
“Bureau of Lies, Damned Lies and Statistics”.
The real news is, how these numbers were produced.
Comparing them to reality, I could believe they boiled the frog in an cauldron at full moon.
So is this inflation report because of Joe Biden or Trump? Who is going to take ownership from this point forward?
“…always and everywhere a monetary phenomenon…”
Who was Milton Friedman, Alex.
Considering that Trump will always refuse ownership of any problem, and assume credit for any success, you should fully know the answer to your question is “Trump will never take ownership of a problem, ever”
Good News = Trump did it
Bad News = Biden, Obama, & Democrats did it
its from the creative writing group of the BLS
All the hand-wringing over inflation because it can be infinite and that is frightening.
What we’re watching is a continued decline in the purchasing power of the dollar, which can’t go lower than zero. Just rotate the coordinate axis clockwise 90 degrees and it’s far less scary😉
Some food items are falling in price because consumers are buying less. Less demand, price point drops. For example crackers, like Ritz.
S
D
P
Graph
People need to start making their own crackers.
The demand for money is up turning the velocity of circulation down. This should reverse.
If BLS measurement is so exact that a difference of 0.1 of a point is meaningful, can we add another digit and extend to .01 significance?
A much more accurate estimate of “real inflation:”
The Atlanta Fed’s sticky-price consumer price index (CPI)—a weighted basket of items that change price relatively slowly—rose 3.8 percent (on an annualized basis) in April, following a 2.2 percent increase in March. On a year-over-year basis, the series is up 3.2 percent
Exactly. These numbers are what the economic politburo wants the sheep to believe.
“Consumers rejoice as eggs fall below 50 cents each”
Cat food fell a few cents to 1 dollar or so on a bag of kibble. I don’t see anything dropping other than that. I see sales on foods that bring them to their prices before the run up with inflation.
You know this because you have cats or you eat cat food? [lol]
Why not both 🙂
Recalling a book title: ‘Would You Eat Your Cat?’
Maybe he is actually a cat?
Remember just one month ago when the media was acting like tariffs were a guarantee of 100 years of inflation, famine, plague and pestilence?
No, I don’t remember that.
Exaggerate much?
That is why the SP500 fell 20%. Media fear.
No. Actual uncertainty. And it had one wilful source.
The fear subsided when Trump basically completed backed down from his tariff threats — surrendered to the markets, for the moment. Not that I’m happy to say that, because the problems he highlighted are unresolved.
If there’s one thing a Trump supporter cannot tolerate aside from immigration, it’s the notion that Trump is ever weak. Which is quite funny, as he is one of the weakest minds there is.
Trump’s dumb antics on the global commerce stage were nearly 100% responsible for the fall and the snap back rally.
Where’s the graph on the price of a dozen eggs?
The government continues to understate the average inflation rates that individuals face on a daily basis, including food prices, both within grocery stores and worse so, in restaurants.
This is why the acronym BLS that in the 70s was known as Bureau of Labor Statistics has been reclassified as the Bureau of Lying Statistics since then.
auto insurance is inflating again, sorry car owners.
https://data.bls.gov/timeseries/CUUR0000SETE?output_view=data
But I am generally shocked at the price of beef in grocery stores these days.
I remember when Poppy Bush was doing a photo op at a grocery store and saw a scanner for the first time.
Trump would never make up whatever numbers he wants 😉