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| December Consumer Prices (#1) - Jan. 18, 2006 |
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Summary
Earlier this morning, the Labor Department produced its latest performance of "Inflation Follies," when it reported that overall consumer prices fell 0.1% during December. This followed a reported decline of 0.6% in November.
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* Led by a 2.2% decline in energy prices, the Consumer Price Index fell 0.1% during December, versus the reported 0.6% decline in November.
* For consumers who thought their October through December costs were higher, take heart! According to Labor, the CPI actually fell at a 1.6% annual rate during the period.
* For the few of us who do not eat, heat or drive, the CPI's at least semi-meaningless "core" rate, which excludes food and energy, was reported to have risen 0.2% in December.
* It will be entertaining to watch Wall Street bulls bull the overall rate instead of the core rate, the latter usually being the center of attention and spin!
* As of the end of December, the overall CPI stood 3.4% higher than a year earlier. For the 12 months ended December 2004, the year-over-year increase also was 3.4%. Thus, as was the case with the Producer Price Index, the CPI's above-average reported change of the last couple years has persisted.
* Excluding food and energy, the CPI's year-over-year increase as the end of December 2005 was 2.2%, the same as the 12-month change as of December 2004.
Now that all have been reported, I will soon publish a detailed statistical summary of results for the CPI, PPI and import prices. In addition, the graph on the home page of the GRA website will be updated shortly to incorporate December's data.
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