CPI was flat in November as gasoline prices fell over 4%. Core CPI was up 0.2%, 2.2% versus a year ago. The three-month average pace is nearly in-line with the 6-month average pace for core , suggesting the modest deceleration we saw over the last half of 2018 might be ending with core stable around 2%. That said, there are still hints a modestly decelerating trend in Owner's Equivalent Rent, a key driver of the price of shelter and about a third of core. The three-month average annualized pace for OER is 2.69%, modestly below the six-month pace of 2.85% annualized and well below the 12-month pace of 3.31%. Looking through downside volatility in apparel and upside volatility in used autos in the last few months, .overall inflationary pressures at the consumer level are stabilizing at the 2% level with the trend largely now dependent on OER, where there are still hints of deceleration.
was UNCHANGED in November, compared with market expectations for an increase of 0.3%.
- Food prices increased by 0.22% while energy prices fell by 2.2%.
- Prices for gasoline fell by 4.2% while prices for fuel oil declined by 2.5%, prices for electricity climbed by 0.3%, and prices for natural gas rose by 0.7%. Energy prices are now 3.2% ABOVE their year ago level.
Overall consumer prices are now 2.2% ABOVE their year ago level; in November 2017, consumer prices were 2.2% ABOVE their year ago level.
The Core CPI
ROSE by 0.2%, compared with market expectations for an increase of 0.2%.
- Prices for commodities excluding food and energy commodities rose by 0.2%.
- Gains in used cars & trucks (+2.4%), tobacco (+0.4%), were offset by declines in apparel (-0.9%).
- Prices for services excluding energy services rose 0.2% with moderate increase in medical care services (+0.4%), shelter (+0.3%), and owner's equivalent rent (+0.3%).
Core consumer prices are now 2.2% ABOVE their year ago level; in November 2017, consumer prices were 1.7% ABOVE their year ago level.