Were you waiting nervously for September’s report on the Consumer Price Index? You can relax now. The data, delayed by the government shutdown, are finally out and they hold no big surprises. None at all.
all-items CPI rose in September at a seasonally adjusted 2.18 percent
annual rate. On a year-over-year basis, the CPI was up just 1.18 percent.
September increase in the CPI was spurred by an uptick in energy
prices, which rose 0.8 percent in the month. The increase, however, was
entirely due to seasonal adjustment. On an unadjusted basis, energy
prices actually dropped in the month. Another way of removing seasonal
influences is to note that energy prices in September 2013 were 3.1
percent lower than they were in September 2012.
another CPI component that is often volatile, were unchanged for the
month, both with and without seasonal adjustment. The food index was up
1.4 percent for the year.
Removing both food and energy gives the
core CPI, often thought to better reflect long-term inflation trends.
The core CPI rose at a seasonally adjusted annual rate of 1.2 percent in
September. Year-on-year it was up by 1.7 percent.
chart shows that both the all-items and core CPI have followed a gentle
arc over the past three years. After falling essentially to zero at the
depth of the recession, inflation speeded up until the middle of 2011,
when the trend lines for both the core and all-items CPI reached the 2
percent mark. Since then, inflation has lost steam and shows little sign
of turning up any time soon. More data will be coming soon, but this
release provides little to support the arguments of those who would like
to tighten either monetary or fiscal policy.
Follow this link to view or download a classroom-ready slideshow with additional charts of the latest inflation data. This post was originally published at Economonitor.com.