This page has been archived and commenting is disabled.
Plunging Energy Prices Drag Down CPI, Offseting Jumping Food Costs
For the fourth month in a row, the shale-revolution crushing plunge in crude prices managed to push energy costs down, with the BLS reporting that "the gasoline index fell for the fourth month in a row, declining 3.0 percent, and the indexes for natural gas and fuel oil also decreased." As a result, October CPI was unchanged from a month earlier, and up 1.7% from a year ago, below the Fed's 2.0% target. However, stripping away plunging energy prices, things were a little different, with CPI ex food and energy up 0.2%, slightly above the 0.1% expected, and up from 0.1% before. But before everyone screams deflation, here is what also happened: the shelter index, airline fares, household furnishings and operations, medical care, recreation, personal care, tobacco, and new vehicles were among the indexes that increased. And for those few who have to eat, "The index for food at home has risen 3.3 percent over the last 12 months, the largest 12-month increase since April 2012." and "The index for nonalcoholic beverages rose 0.6 percent, its largest increase since September 2012."
In other words, pretty much everything except for gasoline, but luckily no Fed member is every concerned about "those" rising prices. They are noise. One thing however certainly did not increase: real wages.
Here is a table breakdown of the data:
Further details on the key product groups:
Food
The food index rose 0.1 percent in October, its smallest increase since June. The index for food at home also rose 0.1 percent, with four of the six major grocery store food groups posting increases. The fruits and vegetables index rose the most, increasing 0.9 percent in October after rising 0.1 percent in September. The index for nonalcoholic beverages rose 0.6 percent, its largest increase since September 2012. The index for dairy and related products increased 0.5 percent, and the cereals and bakery products index rose 0.3 percent. In contrast to these increases, the index for meats, poultry, fish, and eggs, which had been rising sharply in recent months, declined 0.4 percent. The beef and veal index rose 0.3 percent, but the indexes for pork, poultry, and eggs all declined. The index for other food at home also fell 0.4 percent in October. The index for food at home has risen 3.3 percent over the last 12 months, the largest 12-month increase since April 2012. All six major grocery store food groups increased over the span. The index for food away from home rose 0.2 percent in October and has increased 2.8 percent over the last 12 months.
Energy
The energy index fell 1.9 percent in October, its fourth consecutive decline. The gasoline index declined 3.0 percent in October and has fallen 8.0 percent over the last 3 months. (Before seasonal adjustment, gasoline prices fell 6.3 percent in October.) The index for natural gas also declined in October, falling 2.7 percent after rising in September. The fuel oil index decreased as well, falling 4.0 percent. In contrast to these declines, the index for electricity rose in October, increasing 0.5 percent after declining in September. The energy index has fallen 1.6 percent over the last 12 months. The fuel oil index has declined 6.5 percent and the gasoline index has fallen 5.0 percent. However, the index for natural gas has increased 3.4 percent and the electricity index has advanced 3.1 percent.
All items less food and energy
The index for all items less food and energy rose 0.2 percent in October after increasing 0.1 percent in September. The shelter index, which rose 0.3 percent in September, increased 0.2 percent in October. The indexes for rent and for owners’ equivalent rent both rose 0.2 percent, while the index for lodging away from home rose 0.7 percent. The index for household furnishings and operations rose 0.4 percent in October, its largest increase since November 2012. The index for airline fares turned up, rising 2.4 percent in October after declining sharply in recent months. The medical care index increased 0.2 percent in October, with the index for prescription drugs increasing 0.7 percent and the hospital services index advancing 0.2 percent. The recreation index rose 0.2 percent, as did the new vehicles index. Also rising were the indexes for personal care, which increased 0.3 percent, and tobacco, which rose 0.6 percent after declining in September. In contrast to these increases, the index for used cars and trucks fell 0.9 percent in October, its sixth consecutive decline. The apparel index also fell, declining 0.2 percent.
Finally for those who have to live somewhere, "The shelter index has risen 3.0 percent over the last 12 months." Almost, but not quite, in line with the real non-increase in wages/
»
- 4585 reads
- Printer-friendly version
- Send to friend
- advertisements -
Because Obama.....and mandatory 29.5 hr/wk jobs.
BOYCOTT ALL MEXICAN OWNED BUSINESSES AND ALL MEXICAN RESTAURANTS! TAKE YOUR OWN EXECUTIVE ACTION!
I don't have a problem with Mexican restaurants.....as long as there here legally. I have similar feelings about Swedish food.
you're a fool, then. the legal businesses generally shelter, employ and even take advantage of the illegal contingent. take your own executive action as a consumer to fight the invasion and constitutional usurpation.. it's a pinto bean revolution motherfucker. and yeah, those damn Swede's are sucking our social services dry by the millions and taking our yobs.
When double down fails to work......there's always triple down.
maybe you like your mexican food more than your constitution. so roll over and take it from Obama tonight.
ive gone from steak to roast to hamburger to less hamburger while our elected officials are whined and dined at ruth chris' steakhouse 24/7 by any and all PACs
deny those fuckers beef
take it from Obama tonight.
Yeah well.......I don't see anyone that's going to stop him.
We could make Ted Cruz speaker of the house......very few people know that would be completely legal.
You could be a plumber and be the speaker of the house.....go look it up.
"If you like your Mexican food, you can keep your Mexican food." - Dear Leader
No shit? Well, actually, shit. And then, you get to shit later!
So let's see... Food prices are going up because TRANSPORTATION costs [not to mention fertilizer & packaging] are going down & the dollar is stronger... Only in the fucked up world that we live in... Where's that Goldman 2015 forecast page again?
We had a modest 1-3% price increase back in the spring, in part to rising shipping costs and every Tom, Dick and Harry tacking on bullshit fuel surcharge and random fees on our invoices (no, not the usual fuel surcharge that we normally pay and pass on). So while our price per pound of raw material hasn't really jumped on paper, it has when you include all the fees and whatnot.
Also, now that we've gotten some relief on freight and customers are paying the new price, I don't forsee a price increase (or decrease) if these fuel costs remain low through next spring.
My thinking exactly! Lower fuel costs should bring down food prices.
maybe they did lower costs... just not enough to offset the "other" inflation.
It takes awhile to get from one end to the other but only if everybody plays by the same rules and there are some greedy fucks in the pipeline.
I hate it when my costs go down. We need old Yeller to whip up some inflation stat.
costs going up becasue free shit army lives free!! live free or die!!
Not sure who's paying for this......but thanks whoever you are!
Now would be a good time to tax gasoline at a couple of dollars a gallon so the money can be used to fight global warming.
Oh my God it's growing bigger!
My living expenses (food, rent, transportation) have gone up 5-10%. My health care premiums have more than doubled. Air fares are up 20% from last year. Where are they getting this 1.7% number from?
the cornhole is connected to the piehole
I belive the Ministry of Truth provides those numbers.... The food number is especially laughable, beef, butter, eggs, cold cuts, etc easy 10% y on y........
Just wait until those 5 million illegals become legal. Does anyone think they will stay on the farms? They will start moving into legit jobs, pushing those folks onto the dole, plus the farmers will need to pay more to get the crops in.
Next year will be interesting as we see the unemployment rate of blacks go up even further.
They were wrong about the black and white race war......it's going to be the black and latino race war.....and it's going to be nasty.
I have never seen two cultures that hated each other more than blacks and hispanics.
pods
Welcome to Thunderdome....
I disagree. BMW e39 m5 burnout scares Jews
The actual unemployment rate of blacks is grossly overstated, as their workforce participation rate, cant be much more than 20%, The few that want to work can and do. Was in NYC last weekend, every manual labor service job was being done by a spanish speaker
Its simple. never, ever, ever, hire one.
Maybe Barack Ofuckhead can issue an Exec Order dictating no price increases. After all, it worked out great for Nixon, his mentor.
Of course we will all need Whip Inflation Now buttons or it'll never work.
I don't expect energy cost to stay low for very long. For a while I was one of the people concerned we would see the world tumble into a massive deflationary cycle as debts went unpaided and credit collapsed. Now I have come to think inflation is getting closer every day.
This would mean the "major deflationary period" is mostly behind us and it has not been disinflation as much as inflation being kept in check because of several factors, including where the money flowed, weak demand, dropping velocity of money, and the onetime benefit of lower interest rates. Before you discount the possibility that we will move directly from where we are into stagflation then hyperinflation please consider that hyperinflation paves the way for governments and those in power to make a transition to a replacement currency and a reset of the whole system.
http://brucewilds.blogspot.com/2014/11/deflation-i-think-not.html
Your perspective makes sense to me, good article thanks
Americans: if your grocery bill is going up it is because of the 'free' trade agreements that don't allow your country to freely import food produce. Australia could solve your rising food price problems within a year, but your system won't allow us entry. Instead, you pay subsidies to your farmers who are not able to supply enough food to you.
grocery bills are high, but not for the reason you state. Farms are all big business suckling on the governments teet. We have plenty, its just at government dictated inflated prices.... All Aussies have to do to get in is buy some politicians which are expensive.
So in a hypothetical situation, where Australia sent, say, 20million tonne of grain to her good ally, the food price of her ally would not go down?
Are you saying that supply and demand doesn't work in America anymore?
Winner winner sawdust burger dinner
Garbage in , garbage out .
You are about 3 times richer than you think .
See
https://www.academia.edu/9405720/The_Economics_of_Disrespect_Update_I
or
http://andreswhy.blogspot.com/2014/11/the-economics-of-disrespect-update...
Looks like USD is rolling over from same highs set in 08, 09 and 10.
I bet this marks the bottom for gold for a while anyway.
It's a good thing Obama and the Democrats broke their promise on Obamacare saving people money because if it did that would hurt the economy /sarcasm
Their trying to build the case for massive inflation.
So lower prices are bad and lower wages are good.
Don't believe the enemy.
shutup and eat your ipad.
And airline prices...couple that with the strong dollar and tourism in Europe should be booming...just avoid the molotov cocktails and general strikes.
Wanna bet that higher food prices (and smaller sized packaging) will remain even as price pressure on food producers lessens?
One sheet of toilet paper is enough.
-Sheryl Crow
Ahahahahahaha.
Food at home up 3.3% YoY
Electric/Gas bills up 3.4% YoY
Shelter up 3% YoY
This shit about now growth is hilarious. I guess banks revenue streams is not growing to match the average household's bills growth. Need. Moar. Liquidity. Injections.
shelter has gone up by %3 and food by %3 that is six percent less that i have to spend. No inflation here, also i don't drive. I take the bus to work and walk home. I'm always ahead of the curve ;)
and thats if you believe the inflation numbers they provide in the first place
That's not stopping the EU and Russia pairing up on energy deals
http://newworldorderg20.wordpress.com/2014/11/20/russias-gazprom-already-part-owner-of-so-called-alternative-energy-sources-for-e-u-energy/
http://newworldorderg20.wordpress.com/2014/11/20/russian-gazprom-and-german-basf-to-swap-assets/
Every well in the Bakken is being shut in, the oil companies are burning their buildings down, and we are all unemployed now. A soon to be zerohedge headline
Er.. every time I've bought an airplane ticket in the last 10 years, there's been a fuel surcharge that normally starts with some guff like "When the price of WTI exceeds $85/bbl for (some period - 3 months?), a fuel surcharge may be imposed". So now that the price of WTI is below that threshhold, shouldn't those surcharges disappear? And wouldn't that reduce the price of flights, since, as the airlines remind us, fuel is their biggest operating cost? But the price of airfares has gone up?
"The man in the pet shop was lyin'!"