U.S. Sept. CPI up 0.2%, core rate up 0.3% -
Tuesday, October 19, 2004 1:15:57 PM
afxpress.com
WASHINGTON (AFX) - Despite lower energy costs, U.S. consumer price inflation accelerated in September, rising 0.2 percent, the Labor Department said Tuesday
[WTF?? Lower energy costs. Someone stop Russ from reading this he might either have a heart attack or die laughing, not sure which - mish]
The seasonally adjusted core consumer price index, which excludes food and energy prices, rose 0.3 percent, the most since April. Economists were expecting both the CPI and the core CPI to rise 0.2 percent, according to a survey of 37 economists by CBS MarketWatch. Bonds extended their losses on the release of the data. The dollar was lower. "Next month will be dominated by surging energy prices but the key point is that broad core inflation is very benign," said Ian Shepherdson, chief U.S. economist for High Frequency Economics. The CPI rose 0.1 percent in August, while the core CPI had increased 0.1 percent for the previous three months
About three-fourths of the gain in the core CPI in September was due to the 2.9 percent increase in prices for lodging away from home, the Labor Department said. Hotel and motel prices have gyrated wildly in the past few months and are up 7.3 percent in the past year
Consumer prices are up 2.5 percent over the past 12 months. The core CPI has risen 2 percent year-over-year, breaking that key barrier for the first time in nearly two years
The Federal Reserve has adopted a loose and informal target of 2 percent for consumer inflation, based on a different gauge of inflation produced by the Commerce Department. The Federal Open Market Committee is expected to raise rates for a fourth time this year when policymakers meet on Nov. 10 in an effort to stay ahead of inflation
"The data certainly leave the FOMC on course for a November hike, and we suspect December as well," said economists at Action Economics
Those receiving Social Security checks will receive a cost-of-living adjustment, or increase, of about 2.7 percent in their checks beginning in January, based on the rise in the CPI for workers over the past four quarters. The Social Security Administration will make a formal announcement later Tuesday
Real earnings were unchanged in September. In the past year, real wages are up 0.6 percent
Energy prices, down for three straight months, fell 0.4 percent in September, led by a 3.4 percent decline in natural gas prices. Gasoline prices rose 0.1 percent. Fuel oil prices rose 2.1 percent
However, energy prices have turned higher in October, according to the weekly Energy Department data Food prices were unchanged in September. Dairy prices fell 2 percent, while vegetable prices increased 1.5 percent
Housing prices rose 0.2 percent, including 0.1 percent increases for rent and home ownership costs. Medical prices rose 0.3 percent in September, bringing the year-over-year gain to 4.4 percent. Drug prices rose 0.4 percent
Transportation costs increased 0.2 percent. New car prices fell 0.2 percent while airline fares fell 1.6 percent
Apparel prices were unchanged in September
Education and communication prices rose 0.4 percent, while recreation prices dropped 0.2 percent. In a separate report, the Commerce Department said housing starts fell about 6 percent to a seasonally adjusted annual rate of 1.90 million units in September, a bit weaker than the 1.93 million expected. |
