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US Consumer Price Index up 4.2%

bls.gov

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Re: US Consumer Price Index up 4.2%

#51

Post by JumpCrisscross »

Up 4.2% (2.9% core, i.e. stripping out food and energy) over the last 12 months before seasonal adjustment.

The higher-frequency data are more concerning. CPI “increased 0.5 percent on a seasonally adjusted basis in May, after rising 0.6 percent in April” and 0.9 percent in March [1]. (0.3, 0.2, 0.3 percent for December, January, February, respectively.)

So a linear trend of 6% from March, closer to 9% if one extrapolates the March-April-May quarter. Almost all of that driven by food and energy. Core spiked to 0.4% MoM in April, but calmed down to 0.2% in May, on trend with pre-war numbers. It’s up 2.9% YoY, but trending a bit lower. (Looked at another way, we’ve already “booked” 2.5% of inflation for ‘26. If we continue at 0.5% MoM, we close the year +5.6%. Even if it drops to pre-war 0.2%, we’re still going to be +3.8%. Given the resumption of hostilities, I’m betting we’ll be closer to the former.)

Together with the jobs numbers, it would be weird for an independent Fed to not raise rates.

[1] https://www.bls.gov/news.release/cpi.nr0.htm

Re: US Consumer Price Index up 4.2%

#52

Post by adithyareddy »

23ahgfqa wrote: post #10

The Iran conflict will continue on a low flame (occasional pinpricks like now) forever. It serves the US Energy Dominance Agenda against China, Japan, India and the EU. The Trump administration does not care about "its" population. There were already rumors early in the Trump term that Trump would not mind a recession so that his real estate cronies could buy cheap foreclosures. So it is all a double win for the olig…

If this ends up being the case, 15 years from now we might look back at this as the catalyst for supercharging the energy transition across the world ex-US.

Re: US Consumer Price Index up 4.2%

#53

Post by bluGill »

JumpCrisscross wrote: post #43
bluGill wrote: post #7

Remember this next time you get your yearly review/raise. 4.2% is what you need to stay even, anything less is a pay cut.

> 4.2% is what you need to stay even On average, nationally. Look up your state or metropolitan-area CPI. Or better yet, track your actual expenses and project forward.

True, but how inflation affects each person is different. This isn't a good measure, but it is the best we have, and usually close enough to the truth.

Re: US Consumer Price Index up 4.2%

#55

Post by dehrmann »

toasty228 wrote: post #41
bluGill wrote: post #7

Remember this next time you get your yearly review/raise. 4.2% is what you need to stay even, anything less is a pay cut.

Much more since the numbers are cooked anyways. Car model N cost 10k, and car model N+1 costs 15k, if N+1 has 2 more airbags, one more gear, a keyless starter it will be counted way under 50% inflation, even though you pay 50% more. Most of the average joe's money is spent on housing + food + energy these things are all way above the calculated """average""" inflation

They're not necessarily "cooked," (but they certainly can be). Inflation is genuinely hard to calculate since it's different for everyone, goods and services purchased drift over time, and as you mentioned, that exact good also changes over time. CPI (and others) are more useful in a MoM or YoY context. At 10 years, it's better viewed as best guess cost of typical living rather than an economic indicator comparing apples and oranges.

> housing

This is actually the hardest to get right because it's the largest, and 2/3 of Americans own homes, so part of their costs are fixed.

Re: US Consumer Price Index up 4.2%

#56

Post by win311fwg »

mjamesaustin wrote: post #50

Prices have doubled since 1999!? Restaurant prices near me have doubled since 2015, easily. And that's not counting delivery going from free to 25% of the meal cost.

Not quite. The value of the currency has declined by 33% since 1999.

Prices are subject to the combination of the value of the currency and the value of the good. Food may be worth more than in the past, for example, so you cannot look at the value of the currency alone.

Re: US Consumer Price Index up 4.2%

#57

Post by JumpCrisscross »

TuringNYC wrote: post #49
thewebguyd wrote: post #16

Earlier quoted context omitted.

Not necessarily, depends on the distribution of your own expenses. If you deviate from the average urban household (lets say, you have a particularly long commute or your car isn't as fuel efficient as the average. Look at the increase on fuel prices, 40.5%!). If you're at $5,000/month, a 4.2% raise puts you at $5,210. If you're spending $600/month on gas (not unreasonable for someone that drives an SUV and lives in…

>> If you're at $5,000/month, a 4.2% raise puts you at $5,210. If you're spending $600/month on gas (not unreasonable for someone that drives an SUV and lives in the suburbs instead of in the urban core), you still come out behind. This is the problem with people treat CPI as some word from the heavens...it is not. CPI is a highly constructed figure which conveniently includes/excludes things and is really more a flo…

> CPI is a highly constructed figure which conveniently includes/excludes things and is really more a floor

It’s an attempt at a central tendency in a complex economy with non-linear variability.

> Anyone living in the real world knows experienced inflation is way higher

Here is a map of wage changes across the U.S., 2024 to 2025 [1]. Lots of variance! If you’re on the West Coast, right now, you’re seeing above-CPI inflation. If you’re in the Northern Rockies, where I am, you’re seeing less.

[1] https://www.bls.gov/charts/county-employment-and-wages/perce...

Re: US Consumer Price Index up 4.2%

#58

Post by twoodfin »

win311fwg wrote: post #56
mjamesaustin wrote: post #50

Prices have doubled since 1999!? Restaurant prices near me have doubled since 2015, easily. And that's not counting delivery going from free to 25% of the meal cost.

Not quite. The value of the currency has declined by 33% since 1999. Prices are subject to the combination of the value of the currency and the value of the good. Food may be worth more than in the past, for example, so you cannot look at the value of the currency alone.

The value of the currency relative to an evolving bag of reference goods.

Re: US Consumer Price Index up 4.2%

#59

Post by tclancy »

compumike wrote: post #21

Here are some N-year rolling total inflation charts to put this datapoint in a longer-term perspective: https://totalrealreturns.com/inflation . Zooming out always smooths the noise.

I am not sure what the perspective is: we aren't the same economy (there are true financial system differences between now and say, 1985) and, even if we were the same, the three other shocks that rise like this are two world wars and an oil crisis. This is some dunderding old narcissist thinking he's the toughest kid on the block. You could argue the oil crisis was a similar result of the US never, ever learning a lesson about intervening in others' political systems (especially if there's oil involved), but trend line or not, no one had to go through this.

And the trend line would bend differently if we could just learn the lesson.

Re: US Consumer Price Index up 4.2%

#60

Post by sriacha »

adithyareddy wrote: post #52
23ahgfqa wrote: post #10

The Iran conflict will continue on a low flame (occasional pinpricks like now) forever. It serves the US Energy Dominance Agenda against China, Japan, India and the EU. The Trump administration does not care about "its" population. There were already rumors early in the Trump term that Trump would not mind a recession so that his real estate cronies could buy cheap foreclosures. So it is all a double win for the olig…

If this ends up being the case, 15 years from now we might look back at this as the catalyst for supercharging the energy transition across the world ex-US.

Might be wishful thinking, but I see this as the silver lining of the conflict
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