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April 10, 2020 | Rare Territory: Consumer Prices On the Decline

Mike 'Mish' Shedlock

Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
The CPI declined 0.4% month-over-month in March, with gasoline and energy leading the way.
The BLS CPI report shows an event that is quote infrequent. A negative Core CPI.

  • The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.4 percent in March on a seasonally adjusted basis, the largest monthly decline since January 2015.
  • The index for all items less food and energy fell 0.1 percent in March, its first monthly decline since January 2010.
  • The energy index fell 5.8 percent as the gasoline index decreased 10.5 percent. The food index rose in March, increasing 0.3 percent as the food at home index rose 0.5 percent.
  • The indexes for airline fares, lodging away from home, and apparel, the index for new vehicles declined in March.
  • The index for shelter was unchanged, with increases in the indexes for rent and for owners’ equivalent rent offsetting the decline in the index for lodging away from home.
  • Indexes that increased in March include medical care, used cars and trucks, motor vehicle insurance, and education.
  • The index for all items less food and energy rose 2.1 percent over the last 12 months. The food index rose 1.9 percent over the last 12 months, while the energy index declined 5.7 percent.

CPI Month-Over-Month and Year-Over-Year

April rates to be very interesting.

I expect big declines in many categories.

Consumers welcome these lower prices. The fools at the Fed don’t, which is why we have huge bubbles that just burst.

Mike “Mish” Shedlock

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April 10th, 2020

Posted In: Mish Talk

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