Part I of II
As we’ve reached another month end, it’s time to look at the behavior of real-time CPIs over May and see what they indicate for the official CPI release, out June 10th.
We review our real-time headline CPI and some key drivers in this post, and go into some details in our Part II. The high level themes: Gasoline price indexes were modestly higher in May, both SA and NSA which pushed Transportation inflation back into positive territory after a negative April print, and despite declines in Used Car inflation and a slowdown in Airfares inflation. Apparel and other general merchandise categories had positive inflation prints in May after several months of discounts (which may show up in this month’s CPI data, i.e. with a lag). Shelter and medical services inflation remains in line with previous months prints, at a 0.3-0.5 percent monthly run rate.
Dotdat’s real-time headline CPI declined with gasoline prices in early May but has since reversed, as shown in the figure below. Its final print for the month was 0.3 percent as of May 31st. It is a few tenths below the Bloomberg consensus for May of 0.7 percent (as of June 3). This difference may, in part, reflect the tendency of the online price indexes to run a bit below brick-and-mortar price indexes across categories, though that hasn’t been the case over the past few months.
Gasoline prices rose from the second week of May on, hitting record average highs across the country of over $4.00 a gallon. Dotdat’s Gasoline CPI was up almost over 8 percent over May (NSA) as shown by the blue line in the figure below, and up by 3.2 percent for the month after accounting for seasonality (SA), as illustrated by figure’s grey line.
Dotdat’s Used Vehicle CPI was down again in May on a seasonally-adjusted basis by 1.6 percent, though up marginally NSA.
Other categories in Transportation generally continued their positive trends from April, including New Cars and Auto Insurance, though Airfares showed some deceleration of its blistering 18+ percent print for April.
For general merchandise inflation, as discussed in previous posts, real-time inflation came down about a month earlier than the BLS’s CPI-U with greater weakness in March and April. This is illustrated by our real-time Apparel inflation figure below, which has since shown some signs of normalization.
Real-time Apparel inflation declined 1.5 percent in March (vs. a 0.6 percent increase in the CPI-U) and 1.0 percent in April (vs. a 0.8 percent decline in the CPI-U), and has returned to a positive trend in May, at 0.3 percent for the month. Our data look more in line with major retailers’ description of their pricing over Q1 and Q2 than the official statistics so far this Spring. See also Part II of the May recap.
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