Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: UnBelievable who wrote (53998)	6/14/2000 8:33:00 AM
From: UnBelievable	Read Replies (2) \| Respond to of 99985

+DJ US May Consumer Prices +0.1%; Consensus +0.2% 06/14/2000 Dow Jones News Services (Copyright ¸ 2000 Dow Jones & Company, Inc.) (MORE) DOW JONES NEWS 06-14-00 08:30 AM DJ US May CPI Ex-Food & Energy +0.2%; Consensus +0.2% (MORE) DOW JONES NEWS 06-14-00 08:30 AM DJ US May CPI Energy Prices -1.9%; Food Prices +0.5% (MORE) DOW JONES NEWS 06-14-00 08:30 AM *DJ US Real Average Weekly Earnings -0.3% In May (MORE) DOW JONES NEWS 06-14-00 08:30 AM =DJ Data Snap: May CPI Shows Inflation Remains Under Wraps ====================================================== Consumer Price Index !Surprise: No ! May April !Trend: Non- ! CPI Index +0.1% 0.0% ! inflationary ! Core Index +0.2% +0.2% !Consensus: ! Energy -1.9% -1.9% ! +0.2% ! ====================================================== WASHINGTON (Dow Jones)--U.S. consumer prices ticked up between April and May, but the increases represented little inflationary menace and should convince investors that the Federal Reserve will wait until August before raising interest rates again. The Labor Department said Wednesday that the Consumer Price Index advanced 0.1% in May following an unchanged performance in April. When the volatile food and energy components are removed, the index rose 0.2%, matching Wall Street expectations and April's rate of increase. With economic growth beginning to level off after six Fed interest rate hikes, financial markets should be encouraged by more evidence that inflation remains under control. But stock and bond prices are likely to show little reaction because the CPI figures were close to expectations. Wall Street predicted 0.2% increases in the overall and core indexes, according to a Dow Jones-CNBC poll of 12 economists. The continuation in May of recent low monthly inflation readings should give the Fed plenty of breathing room to leave interest rates unchanged at the June 27-28 meeting of the Federal Open Market Committee. Economists increasingly believe the central bank will hold back this month, before reassessing the situation in August. Though other data also bode well for a slowdown in the consumption that the Fed has feared may be inflationary, the central bank is likely to regard much of the recent softness as temporary. Retail sales have declined for two months straight, the first time that's happened in almost two years, as the unemployment rate climbed unexpectedly above its 30-year low. "While it might be tempting...to sit back and declare victory (on inflation), nothing could be more foolish," New York Fed President William McDonough said Tuesday. As a result, many economists expect the Fed to raise the key funds rate at least to 7% by the end of the year from 6.5% currently. Little inflation has emerged so far, however. Year-over-year, the CPI rose 3.1% in May. The core index increased 2.4% in annual terms. And further up the pipeline, the inflationary threat also is tame. Prices for wholesale, or producer, goods were flat in May after falling in April. Much of the soft May consumer-price performance was attributable to falling energy costs, which fell 1.9% for the second month in a row. The most recent dip included a 3.5% drop in gasoline prices. But gas prices are expected to rise next month: Service stations have recently pushed prices at the pump above $2 per gallon in some areas of the country. Food prices rose 0.5% during May, the largest gain in 19 months. Consumer food prices had advanced just 0.1% in March and April. Within the core index, consumer housing prices, which account for a hefty 40% of the entire CPI, increased 0.2% in May after rising 0.1% in the previous month. Transportation and apparel costs, however, fell for the second consecutive month. Consumer clothing prices were down 0.2% during May after declining 0.5% in April. Transportation prices dropped 0.5% in May following a 0.7% decrease in April. Airline fares rose 0.8% in May after declining 0.5% in April. Prices for new vehicles increased 0.2% in May, following a 0.3% rise in April. In a separate report, the Labor Department said average hourly earnings of U.S. workers, adjusted for inflation, fell 0.3% in May. The gain was caused by a 0.3% decline in average weekly hours and a 0.1% increase in the CPI for urban wage earners and clerical workers. -By Henry J. Pulizzi and Joseph Rebello, Dow Jones Newswires; 202-862-9255 (END) DOW JONES NEWS 06-14-00 08:30 AM