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Consumer Prices Rise Most Since May 2014, Led By Gas Prices & Shelter Costs
Following the first YoY deflation since 2009 in January, February's CPI YoY data managed to scrape its way back to unchanged (very modestly better than the 0.1% drop expected). Consumer prices rose 0.2% MoM - the most since May 2014 with gas prices up MoM for the first time since June. So what is the narrative now: if tumbling gas prices didn't get consumers to spend, rising gas costs will? Ex food and energy, prices rose 0.2% MoM (slightly hotter than the 0.1% rise expected) led by the shelter index (which increased 0.2 percent) accounting for about two-thirds of the monthly increase. The rent continues to be too damn high for most, and finally the BLS is starting to realize this.
MoM, Consumer prices have jumped from the worst drop since Lehman to the biggest jump since May 2014.
Deflation over?
Under the covers, gasoline prices rose MoM for the first time since June...
The details for those unlucky few who still eat and use gas (because yes, after sliding for seven straight months, gas prices are once again on the way up):
Food
The food index increased 0.2 percent in February. The index for food at home, which declined in January, rose 0.1 percent in February. Major grocery store food group indexes were split, with three increases and three declines. The index for nonalcoholic beverages increased 0.6 percent in February, its largest increase since September 2012. The index for other food at home, which declined in January, rose 0.5 percent in February. Also turning up in February was the index for meats, poultry, fish, and eggs, which rose 0.3 percent after declining slightly the prior month. The index for beef and veal rose 0.7 percent, its thirteenth consecutive increase. In contrast to these increases, the index for dairy and related products continued to fall, declining 1.0 percent after a 0.9-percent decrease the previous month. The index for fruits and vegetables declined 0.3 percent; the fresh fruits index rose 0.6 percent but the index for fresh vegetables declined 2.0 percent. The index for cereals and bakery products, which rose in January, declined 0.2 percent in February. The index for food at home has risen 2.9 percent over the past year, with all six of the major grocery store food group indexes increasing over the span. The index for food away from home increased 0.3 percent in February and has risen 3.1 percent over the last 12 months.
Energy
The energy index rose 1.0 percent in February, ending a series of seven consecutive declines. The gasoline index turned up after a series of sharp declines, rising 2.4 percent. (Before seasonal adjustment, gasoline prices rose 5.3 percent in February.) The fuel oil index also increased after recent declines, rising 1.9 percent. The electricity index rose 0.3 percent in February after a 0.9-percent increase in January. The only major energy component index to fall in February was natural gas, which declined 2.0 percent following a 3.4-percent decrease the prior month. Despite the February increases, the gasoline and fuel oil indexes have declined sharply over the past year, falling 32.8 percent and 31.2 percent, respectively. The index for natural gas has also declined over the past year, falling 6.5 percent, but the electricity index has increased 3.2 percent.
Finally, here are the bad news for everyone else, and those who actually have to purchase their shelter:
All items less food and energy
The index for all items less food and energy increased 0.2 percent in February. The shelter index increased 0.2 percent and accounted for about two-thirds of the monthly increase in the all items less food and energy index. The index for rent increased 0.3 percent, while the index for owners' equivalent rent rose 0.2 percent. The index for lodging away from home declined 0.5 percent after rising in January. The index for used cars and trucks turned up in February, rising 1.0 percent after declining in each of the four previous months. The apparel index rose 0.3 percent in February, the same increase as in January. The index for new vehicles advanced 0.2 percent, as did the index for airline fares, while the tobacco index rose 0.5 percent. The index for medical care was unchanged in February. The index for medical care commodities rose 0.7 percent, as the index for prescription drugs increased 0.6 percent. However, the index for medical care services declined 0.2 percent, its first decline since November 1975. The indexes for physicians' services and hospital services both decreased. The index for personal care, which rose in January, fell 0.4 percent in February.
So aside from all the rising prices, let's talk deflation.
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Because nothing spells 'RECOVERY' like $2.40 a gallon gasoline with crude in the mid 40's & dropping.
You don't need us to tell you gas prices are back on the rise.
https://www.youtube.com/watch?v=dAkxR9T01pw
Actually prices in my area started declining again.
What 3 cents?
Gas hit $2.59 here in Michigan on Saturday! IT'S A RECOVERY!!!!!
The closer you live to cushing, the more you will pay.
Companies are raising prices to boost profits and people pay them.
So keep raising prices while the government and Federal Reserve boast about having no inflation.
Companies are doing their annual "Pass through all costs we can" to improve Q1 Earnings, or lack there of.
Some major inflation coming.
The Federal Reserve will not raise rates until forced to. At that point it will be too little, too late.
My best guess is that this is a dead cat bouncing.
but, but, but, there's "no inflation"...
There is no inflation. Supply constraint is a tax, not inflation.
Increasing prices, declining earnings, bullish.
I just quit going to the "store"--saves alot of money-and gas---no beer, no cigarettes, no drinks/candy--no potato chips--no cakes /cookies, no lines, no traffic, no "consumerism" --fuck their system--
Prices up, sales down and going lower, makes sense; sustainable asset price growth! Double plus good!
Make the number what the FED needs to do a June rate increase?
Re-telling of a fictional account by a bigger story teller.
Pretty desparate for inflationist to get excited in a ONE month change.
My flying car does't need gas.
It runs on dark matter plasma.
AFTER ANOTHER STRING OF BAD ECONOMIC DATA BLAMED ON THE WEATHER, OBAMA BANS THE WINTER
The Congress will soon vote on a bill to ban the Winter during the Winter time, to prevent it from affecting key economic indicators.
Source: www.financialpaparazzi.com
As long as you don't eat food or drive you should be just fine.
"One of the most useful strategies for rebuilding financial strength and savings in households is the choice to avoid or pay down debt while renting and taking public transit. Turn key rentals and a bus pass are increasingly being chosen over a mortgage, property upkeep and a car loan/lease. Perhaps forced by necessity, but this is a rational, secular shift in both younger and older under-saved people who are facing the realities of income stagnation and over-priced housing costs.A behavioral change to more frugal habits and less spending is part of the critical rebuilding of household wealth which is so needed for future stability. It also means less demand and sales today. Now that ‘financial engineering’ gimmicks have run their reckless course, it is time for self-discipline, and fiscal restraint to come back into vogue. What is good for people and families will be bad for financial firms and companies banking on levered sales. But then they had their glory days getting the world into the present mess. Payback time is long overdue." http://www.financialsense.com/contributors/danielle-park/new-american-dream-rented-housing-public-transit
Lifetime Income: The Next Real Estate Wave – Boomers Becoming Landlords in Their Own Homes http://www.financialsense.com/financial-sense-newshour/lifetime-income-series/real-estate-wave-boomers
Sherman anti trust can't be used--all rusted up. The big guys just need some play money. Milestones