Feb CPI rose .4% headline, the most since April but in line with expectations. The core rate was up .1%, below the estimate of .2%. The y/o/y gains were both in line at 2.9% and 2.2% respectively. Energy prices were up 3.2% m/o/m but food prices were flat. While actual ‘rent of primary residence’ rose another .2%, owners equivalent rent, 24% of CPI (asking home owners how much they think they can rent their home for, thus very subjective), was up just .1%. Apparel prices were down by .9% after a .9% gain in Jan. Vehicle prices were up .2%. Commodity prices ex food and energy were up just .1%. Bottom line, headline CPI is now above the Fed’s new target rate of 2% for a full year. Also, to put the sharp move higher in the 10 yr yield this week to 2.33%ish in perspective, we are now back to where we were before Operation Twist was 1st discussed in late August and actually implemented at the Sept FOMC meeting. All those $100′s of billions spent just to keep rates unchanged.
The 1st look at UoM confidence in March saw an unexpected decline of 1 pt to 74.3 from Feb. That’s versus expectations of a gain to 76 and the modest decline is likely due to the spike in one year inflation expectations to 4.0% from 3.3%, the highest since May ’11. We can of course point our finger directly at gasoline prices, which are up another .07 w/o/w, for the jump. Current Conditions rose 1.2 pts but the Outlook fell 2.3 pts.
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.