Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

U.S. Core Consumer Prices Are Unchanged, Showing Scant Inflation

Economic IndicatorsFeb 10, 2021 08:45AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Bloomberg. Shoppers walk through a mall in Tampa, Florida. Photographer: Eve Edelheit/Bloomberg

(Bloomberg) -- A key measure of prices paid by U.S. consumers was unchanged in January for a second straight month, underscoring the pandemic’s lingering restraint on inflation.

The core consumer price index, which excludes volatile food and energy costs, increased 1.4% from the prior year, a Labor Department report showed Wednesday. The broader CPI once again got a boost from higher gasoline prices, advancing 0.3% from the prior month and 1.4% from a year earlier.

The median estimate in a Bloomberg survey of economists for month-over-month core CPI was for a 0.2% gain. The overall measure was projected to rise 0.3%.

The CPI data are part of an intensifying debate in financial markets over the course of inflation. Despite the tame January figure, price pressures are set to firm in the months ahead. That’s partly a reflection of expectations that Congress will pass another large aid package and an anticipated pickup in demand as more are vaccinated against the coronavirus.

At the same time, a jobless rate that indicates elevated slack in the labor market is seen limiting wage growth, which makes up the biggest share of companies’ total costs.

The report showed declining prices for used and new vehicles and transportation services. At the same time, Americans are paying higher prices for fuel, apparel and medical care services.

Lawmakers continue to debate the size of the next pandemic relief package. President Joe Biden has proposed a $1.9 trillion plan, which some economists have warned could spur an outbreak of inflation. Other economists say there’s plenty of room for fiscal stimulus without fear of a more durable increase in price pressures.

Looking ahead, inflation metrics are expected to be distorted by so-called base effects in the coming months. Because of the pandemic and the recession it spurred, the CPI fell in March, April and May. When the annual figures are calculated this year, inflation will appear to be quickly accelerating when compared with the first three months of the health crisis.

Federal Reserve Chair Jerome Powell has said policy makers will ensure monetary policy continues to be a strong support to the economy “until the recovery is complete.” That, paired with the central bank’s willingness to let inflation run above its 2% objective for a period, means the Fed will likely leave interest rates near zero for some time.

How fast the labor market recovers will also play a role. Persistently high unemployment would limit workers’ ability to demand higher wages, limiting the degree to which inflation heats up. Powell is scheduled to speak Wednesday afternoon on the economic outlook.

©2021 Bloomberg L.P.

U.S. Core Consumer Prices Are Unchanged, Showing Scant Inflation
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (11)
Steve Lora
Steve Lora Feb 10, 2021 2:09PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
DJT had a good 4th Qtr.
Sol Wein
Sol Wein Feb 10, 2021 1:43PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Is this a joke? Are we all watching the same commodities exploding higher or is it just me? Lol
gene morris
gene morris Feb 10, 2021 1:38PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Nobody believes these phony CPI numbers but the FED and bureaucrats.
Benjamin McIntire
Benjamin McIntire Feb 10, 2021 11:53AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Commodities, real estate, stocks are all up huge. These numbers are bordering on useless. Do we really believe consumers arent paying more for stuff? The metrics are way off.
Vlad Lozovskiy
Vlad Lozovskiy Feb 10, 2021 11:11AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Reminds me of my Soviet childhood. You go outside and you see a disaster, but on TV they told us how much better everything is.  More cast iron, more wheat, more coal, more meat!  Prices are down! LOL
Old Stone
Old Stone Feb 10, 2021 10:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Lol... Have you been grocery shopping lately... All commodities up biggly... Figures don't add up..smh
Louis Irving
Louis Irving Feb 10, 2021 10:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
If the way to improve the economy is to get people to spend money, what incentive would the Bureau of Labor Statistics have to manipulate the CPI to be lower? If people believe that consume prices are not increasing, then they would be more inclined to save rather than spend because they do not have to worry as much about the value of their dollars going down, right?
Roger Miller
Roger Miller Feb 10, 2021 10:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Louis Irving You’re reasoning seems correct, but is based on people regarding the reported numbers as legitimate. Ultimately people base their inflation estimates on what they actually encounter. There us also large politcal motivation for government to report lower.
ben sc
ben sc Feb 10, 2021 9:50AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
fuel up 8% and insulin/prescription drugs going up 25% thanks to Beijing EO's. Housing and equity markets at all time highs. but most Americans can afford stuff, sure.
AY Haych
AY Haych Feb 10, 2021 9:35AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
J Pow be like BRRRRRRR this arvo
Casador Del Oso
Casador Del Oso Feb 10, 2021 9:33AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Happy days are here again! No need for further stimulus. The economy is doing just fine without it.
Anthony Ewers
Anthony Ewers Feb 10, 2021 9:21AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Because food, lumber, fuel, and etc. doesn't count. What a joke.
The Chad Bull
The Chad Bull Feb 10, 2021 9:03AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
All the inflation is in stocks and housing. Nobody is spending money right now the middle class is wiped out.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email