Keeping you up to date on the latest data releases.
The CPI rose at an annualized rate of 3.1 percent in August, largely on an energy price spike (up 31.2 percent). Excluding food and energy prices (core CPI), the index was virtually unchanged in August, rising just 0.6 percent. Over the past three months, the core CPI is up 1.3 percent, which is a little higher than its 12-month growth rate of 0.9 percent. Measures of underlying inflation produced by the Federal Reserve Bank of Cleveland, the median and 16 percent trimmed-mean CPI, rose 0.6 percent and 1.2 percent, respectively in August, roughly in line with their 3-to-12 month growth rates. While there were some unusual price movements this month (car and truck rental prices, infant and toddler apparel, among others), they occurred at both ends of the price change distribution. That distribution has tightened up over the past three months relative to the first five months of the year, as roughly 48 percent of the overall index has exhibited price changes in the tails of the distribution (rising at rates over 5 percent, or posting outright price decreases) from June to August, compared to an average of 62 percent from January through May. Importantly, the average weight in that lower tail (outright price declines) has shifted from near 50 percent over the first five months of the year to roughly 33 percent over the past three months.