Red Hot CPI

Consumer Price Index Summary

In retrospect, pretty much everyone was wrong, with headline CPI coming in at a "shocking", red hot 8.3%...a number which 47 of 50 economists missed!

Where did the surprises come from?

Well, developments in food and energy prices came with few surprises. Energy prices fell 5.0% M/M..... with gasoline prices down 10.5%, and food prices rose 0.8%. Both numbers were in line with expectation.

The prints for both core goods and core services were stronger than anticipated, however: core CPI rose 0.6% mom versus consensus expectation of a 0.3% rise, and the yoy rate rose to 6.3% from 5.9% previously, as consumers seemingly shifted purchases away from cheaper staples (lower gas prices) to discretionary goods, lifting prices in the process.

Core commodities prices surged 0.5% on gains in a number of categories including apparel (0.2%), new vehicles (0.8%), medical care commodities (0.2%), and alcoholic beverages (0.4%); most on Wall Street had expected a small decline in apparel and a smaller increase in new car prices which unexpectedly increased sharply.

Below is a pdf copy of the full report:

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