Tuesday, November 14, 2023

The Seasonally Adjusted CPI Was up 0.04% in Oct & 3.2% over the last 12 months

See Consumer Price Index for All Urban Consumers: All Items in U.S. City Average from FRED (Federal Reserve Economic Data) compiled by the Research Division at the Federal Reserve Bank of St. Louis for data on the seasonally adjusted CPI.

That site shows a graph but if you click on the Download button you will get the actual numbers in Microsoft Excel.

The Consumer Price Index for All Urban Consumers: All Items in U.S. City Average (CPIAUCSL) was 307.481 in Sept. and 307.619 in Oct. Since 307.619/307.481 = 1.0004, that means it was up 0.04% in Oct. If we had that every month for 12 months it would be up 0.54%.

It was 297.987 in Oct. 2022. Since 307.619/297.987 = 1.032, that means it was up 3.2% over the last 12 months.

The non-seasonally adjusted CPI was 307.671 in Oct. and 298.012 in Oct. 2022. That was up 3.2% since 307.671/298.012 = 1.032. So pretty close to the seasonally adjusted CPI. This is still above the Fed's target of 2.0% (although they prefer to use the Personal Consumption Expenditures Price Index).

For more information, see Prices rise slower than expected, but there’s still a ‘long way to go’ in taming inflation, financial expert says by Mike Winters of CNBC. Excerpts:

"Inflation dropped from a year-over-year rate of 3.7% to 3.2% in October, according to the latest consumer price index report released by the U.S. Bureau of Labor Statistics Tuesday morning. The CPI is a basket of goods and services that Americans typically buy.

While the slowdown is good news for consumers, that dip is largely based on a momentary downturn in gas prices.

Perhaps more importantly, core inflation — which excludes volatile food and energy prices — dropped from 0.3% in September to 0.2% in October, which was lower than expected.

That’s slowed from the month-over-month increases of 0.4% and 0.5% in first few months of 2023. At an annualized rate of 2.4%, core inflation is trending closer to the Federal Reserve’s overall year-over-year target rate of 2%.

While encouraging, core inflation will need to “weaken consistently over the next three to six months to support the notion that core inflation’s pace is headed for a sustainable 2% pace,” says Kurt Rankin, senior economist at PNC Financial Services Group.

“We still have a long way to go” before core inflation is under control, Greg McBride, chief financial analyst at Bankrate, tells CNBC Make It."

"PNC expects core inflation to eventually subside next year, with overall inflation dropping to 2% by July 2024. This forecast reflects expectations of a weakening labor market and growing consumer debt.

Similarly, a recent survey of professional forecasters has inflation pegged at 2.5% by summer 2024."

Other related links:

Consumer Price Index Data from 1913 to 2023

Personal Consumption Expenditures Price Index 

The Bureau of Labor Statistics makes seasonal adjustments. See Consumer Price Index Summary.

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