The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in March, before seasonal adjustment, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The index has decreased 0.4 percent over the last year, the first 12 month decline since August 1955.Looking at the chart below, we see the only area that saw price declines year over year was transportation, dropping 12.5% year over year.
This 12.5% had a weighted impact on CPI of -2%, thus CPI "ex transportation" was at 1.6% year over year. Remarkably, the change in the price of gasoline itself had an impact of -1.2% of that -2%.
Where is the inflation in housing? House prices are down about 20% since one year, mortgage rates are at historic lows, rents are down in most places. How do they get a 1% increase in prices?
ReplyDeleteOwners Equivalent Rent. I've had a long standing problem with that:
ReplyDeletehttp://econompicdata.blogspot.com/2008/06/case-shiller-price-index.html