The March 2014 Consumer Price Index (CPI-U) year-over-year inflation rate grew moderately fueled by food, natural gas and electricity prices.
The Consumer Price Index (CPI-U) year-over-year inflation rate rose from 1.1% to 1.5%. Core inflation (CPI less food and energy) rose from 1.6% to 1.7%. The market expected month-over-month CPI-U growth at 0.0% to 0.3% (consensus 0.1%) versus 0.2% actual, with the core inflation (less food and energy) expectations at 0.1% to 0.2% (consensus 0.1%) versus 0.2% actual.
Unadjusted CPI-U – Year-over-Year Change (blue line, left axis) and Month-over-Month Change (red line, right axis)
The Producer Price Index showed finished goods rose from 0.9% in February 2014 to 1.4% in March 2014. The CPI rate of inflation is generally higher the PPI.
As a generalization – inflation accelerates as the economy heats up, while inflation rate falling could be an indicator that the economy is cooling. However, inflation does not correlate well to the economy – and cannot be used as a economic indicator.
Food and Energy Services by far was the major influence on this month’s CPI.
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in March on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.5 percent before seasonal adjustment.
Increases in the shelter and food indexes accounted for most of the seasonally adjusted all items increase. The food index increased 0.4 percent in March, with several major grocery store food groups increasing notably. The energy index, in contrast, declined slightly in March as decreases in the gasoline and fuel oil indexes more than offset increases in the indexes for electricity and natural gas.
The index for all items less food and energy also rose 0.2 percent in March. Besides the 0.3 percent increase in the shelter index, the indexes for medical care, for apparel, for used cars and trucks, and for airline fares also increased. The indexes for household furnishings and operations and for recreation both declined in March.
The all items index increased 1.5 percent over the last 12 months; this compares to a 1.1 percent increase for the 12 months ending February. The index for all items less food and energy has increased 1.7 percent over the last 12 months, as has the food index. The energy index has risen slightly over the span, advancing 0.4 percent.
