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CPI index in USA
Nostradamus Supreme	19-Jul-2006 22:39 Nostradamus About Contact Quote this Post!
x 0 x 0 Alert Admin	By the way, wholesale price index = producer price index or PPI. One of the biggest increases in the core inflation (core CPI) categories was a 3.1% jump in airline ticket prices, reflecting rising jet fuel costs. In a second report today, the Commerce Department said that construction of new homes fell by 5.3% in June, another signal that the once-booming housing market is beginning to slow. Builders started construction on new homes at a seasonally adjusted annual rate of 1.85 million units last month. Applications for building permits, considered a good sign for future activity, fell for a fifth straight month.
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billywows Elite	19-Jul-2006 20:49 billywows About Contact Quote this Post!
x 0 x 0 Alert Admin	ECONOMIC REPORT Core CPI up 0.3% on rising rents Consumer prices rise moderate 0.2% in June as energy prices fall By Rex Nutting, MarketWatch Last Update: 8:40 AM ET Jul 19, 2006 WASHINGTON (MarketWatch) -- U.S. consumer prices increased a moderate 0.2% in June, the smallest gain in four months, but core inflation rose 0.3% for the fourth straight month, putting pressure on the Federal Reserve to raise interest rates again. The Labor Department said Wednesday the consumer price index increased 0.2% in June after rising 0.4% in May. Energy prices fell 0.9%, while food prices rose 0.3%. The CPI increased at a 5.1% annual rate in the second quarter and is up 4.3% in the past 12 months, matching the biggest gain since last October. The core CPI increased at a 3.6% annual rate in the second quarter and is up 2.6% in the past year, a bit more than the Fed would like. It's the fastest increase in core inflation since December 2001. The major factor driving higher inflation was the cost of shelter, which represents more than 30% of the CPI. Residential rents rose 0.4%, while owners' equivalent rent also increased 0.4%. Economists were expecting 0.2% gains in both the headline CPI and the core CPI, which excludes food and energy costs, according to a survey conducted by MarketWatch. See Economic Calendar. The Fed has said the recent increases in inflation have been unwelcome and has signaled it may raise interest rates for an 18th time next month to keep inflation contained. Most analysts expect the Fed to boost the overnight lending rate by a quarter percentage point to 5.50% on Aug. 8. Federal Reserve Chairman Ben Bernanke will testify later Wednesday on Capitol Hill about the Fed's outlook for inflation and growth. The rise in the core CPI presents a dilemma for the Fed, because the increase in inflation is largely due to the unwinding of the housing boom, and not to underlying inflationary pressures. Rents are going up in part because buying a house has become more unaffordable, thus increasing demand for rental properties. But because of the odd way the government measures the cost of owning a house, rising rents also mean a higher imputed cost for owning a home. Inflationary pressures abated in most categories in June. Energy costs fell, but that was only temporary, we know, as gasoline prices have risen since then. Apparel costs were flat after rising 1.8% in the past three months. Medical costs rose 0.3%, matching May's increase. Transportation costs fell 0.2%, on lower fuel costs. New vehicle prices fell 0.1%, while airfares rose 3.1%. Tobacco prices rose 0.8% in June, the biggest gain in a year. Rex Nutting is Washington bureau chief of MarketWatch.
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Nostradamus Supreme	19-Jul-2006 18:45 Nostradamus About Contact Quote this Post!
x 0 x 0 Alert Admin	It does include energy and food prices. Wholesale prices rose by 0.5% in June, spurred by a big jump in food prices and continuing increases in energy costs. The bigger-than-expected rise raised concern about possible further interest rate hikes. Core inflation, excluding volatile food and energy prices, edged up just 0.2% in June, in line with market expectations. Core inflation is the one that strips out food and energy prices. From here, you can see that high energy prices have not been passed on to other goods. Perhaps high energy prices don't have that much of an effect yet.
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newmoon Veteran	19-Jul-2006 12:06 newmoon About Contact Quote this Post!
x 1 x 1 Alert Admin	The CPI index makes a mockery out of calculating inflation as it does not include energy and food without which no economy can survive. If energy is not included why worry about the price of crude oil. The world economic boom of the last 30 odd years has been fuelled by cheap oil.Unfortunately the supply of oil has reached it's mid-life cycle and the price can only go up unless cheaper alternative sources of energy can be found The conflict in the middle east is a result of the importance of energy as modern society cannot function witout it.
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