CPI for all items rises 0.4% in September; food, shelter among indexes rising

[mahatmakanejeeves]

Source: U.S. Bureau of Labor Statistics

Economic News Release USDL-21-1831

Consumer Price Index Summary


Transmission of material in this release is embargoed until 8:30 a.m. (ET) October 13, 2021

Technical information: [phone] [e-mail] www.bls.gov/cpi
Media Contact: [phone] [e-mail]

CONSUMER PRICE INDEX - SEPTEMBER 2021

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent in September on a seasonally adjusted basis after rising 0.3 percent in August, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 5.4 percent before seasonal adjustment.

The indexes for food and shelter rose in September and together contributed more than half of the monthly all items seasonally adjusted increase. The index for food rose 0.9 percent, with the index for food at home increasing 1.2 percent. The energy index increased 1.3 percent, with the gasoline index rising 1.2 percent.

The index for all items less food and energy rose 0.2 percent in September, after increasing 0.1 percent in August. Along with the index for shelter, the indexes for new vehicles, household furnishings and operations, and motor vehicle insurance also rose in September. The indexes for airline fares, apparel, and used cars and trucks all declined over the month.

The all items index rose 5.4 percent for the 12 months ending September, compared to a 5.3-percent rise for the period ending August. The index for all items less food and energy rose 4.0 percent over the last 12 months, the same increase as the period ending August. The energy index rose 24.8 percent over the last 12 months, and the food index increased 4.6 percent over that period.

{snip}

Contact Information

For additional information about the CPI visit www.bls.gov/cpi or contact the CPI Information and Analysis Section at 202-691-7000 or [e-mail].

For additional information on seasonal adjustment in the CPI visit www.bls.gov/cpi/seasonal-adjustment/home.htm or contact the CPI seasonal adjustment section at 202-691-6968 or [e-mail].

Information from this release will be made available to sensory impaired individuals upon request. Voice phone: [phone]; Federal Relay Service: 1-800-877-8339.

Read more: https://www.bls.gov/news.release/cpi.nr0.htm

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Placeholder articles for today's consumer price index release

ECONOMY U.S. ECONOMY

Inflation Likely Stayed High in September

https://www.wsj.com/articles/us-inflation-consumer-price-index-september-2021-11634074529?modhp_lead_pos1

https://www.wsj.com/articles/us-inflation-consumer-price-index-september-2021-11634074529

Worker shortages and strained supply chains kept driving up prices last month, economists say

By Gwynn Guilford
https://twitter.com/sinoceros
[e-mail]
Oct. 13, 2021 5:30 am ET

U.S. inflation likely remained high in September, as pandemic-related shortages of labor and materials continued to push up prices.

Economists surveyed by The Wall Street Journal estimate the Labor Department will report the consumer-price index--which measures what consumers pay for goods and services--rose a seasonally adjusted 0.3% in September from August. That is the same pace as in August and down markedly from June's 0.9% pace, but wouldn't be enough to slow inflation last month compared with a year ago, economists say.

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Yahoo Finance
Stock market news live updates: Stock futures rise as investors eye bank earnings, await inflation data
Emily McCormick
Emily McCormick·Reporter
Wed, October 13, 2021, 7:32 AM

https://finance.yahoo.com/news/stock-market-news-live-updates-october-13-2021-221448905.html

Stock futures gained on Wednesday as investors digested new earnings data and awaited a key inflation report, which will help show the extent to which rising prices have weighed on the economic recovery and corporate profits.

{snip}

The latest batch of economic data due Wednesday is likely to confirm that these supply and demand mismatches translated to ongoing inflationary pressures at the start of the fall. In the Labor Department's Consumer Price Index due out Wednesday morning, consensus economists expect to see core prices, excluding food and energy, rise by 4.0% in September over last year, coming down only slightly from June's 30-year high of 4.5%.

Wall Street analysts are looking for third-quarter earnings growth of about 27% on a year-over-year basis, according to FactSet data. Though this would still be the third-fastest earnings growth rate since 2010, it would be a marked slowdown from the second quarter's nearly 90% pace.

{snip}

[BumRushDaShow]

1. WaPo just did a breaking

Prices rise 5.4 percent in September over last year, as delta holds back economic recovery

By Rachel Siegel
Today at 8:31 a.m. EDT


Prices rose 5.4 percent in September compared with a year ago, as the delta variant of the coronavirus continues to hamper supply chains, the job market and the Federal Reserve’s own expectations for the economy. Data released Wednesday by the Bureau of Labor Statistics showed that prices rose 0.4 percent in September compared with August. Economic data from September underscored how susceptible the economic recovery remains to the pandemic — and how policymakers underestimated the threat posed by delta when the surge began a few months ago.

On the labor front, the economy gained only 194,000 jobs last month, and officials said ongoing concerns about child care, and fear of the virus, kept people from returning to work. On the inflation side, Fed leaders have long said that price increases are a “transitory,” or temporary, feature of an economy battered by the pandemic. Their message is that as supply chains clear up, inflation will settle back down closer to the Fed’s 2 percent annual target, sometime next year. Yet, that timeline has been complicated by the delta variant and the uncertainty it brings for global supply chains.

For example, in a recent speech, Fed governor Lael Brainard pointed to builders who can’t get enough construction materials and to North American auto production, which was paused by shutdowns in Malaysia and Vietnam. The Fed’s take that inflation is temporary has left the American public asking how much longer it will take for gas or grocery prices to simmer down. On Tuesday, Atlanta Fed President Raphael Bostic said the word “transitory” had become a “swear word” to his staff. That’s in part because the public has a different understanding of transitory inflation from economists, who aren’t necessarily referring to a fixed period of time, but rather expect that inflation will eventually pass through the economy, and is tied more specifically to the pandemic.

Another worry is that as people face higher prices at the checkout counter, or as businesses weigh the costs of getting supplies and materials on time, consumers may change their spending habits before they believe the price tag will sting even worse. That cycle of behavior only pushes prices higher, making those very inflation expectations self-fulfilling. Fed leaders say that’s not what they’re seeing yet, and that they would change policy if any signs started to bubble up.

https://www.washingtonpost.com/business/2021/10/13/september-inflation-cpi-fed/

Waiting to hear what the final SS/CSRS COLA is going to be since this is around when they announce that.

[mahatmakanejeeves]

2. Good morning. Thanks. She was fast about it. She got it out at 8:31. NT

[BumRushDaShow]

3. I think I found the answer to my question buried in the CPI report

https://www.bls.gov/news.release/cpi.nr0.htm

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)
increased 5.9 percent over the last 12 months to an index level of 269.086
(1982-84=100). For the month, the index rose 0.3 percent prior to seasonal
adjustment.

So I expect "5.9%" will be it (although I think they calculate based on a year over year change, using a specific quarters or something, so that might not be what it will be )

EDIT - and 5.9% it is (just breaking on WaPo and I posted) - https://www.democraticunderground.com/10142812409

[mahatmakanejeeves]

4. Regarding the various flavors of CPI, and that thing called the PCE:

Fri Jul 30, 2021: Regarding the various flavors of CPI:

Here's an oldie but a goodie.

On that day, July 30, 2021, the index being reported was the PCE, the personal consumption expenditures price index. The Bureau of Economic Analysis does this. It's in the Department of Commerce.

CPI, the consumer price index, is measured by the Bureau of Labor Statistics. That's in the Department of Labor.

Wed May 12, 2021: Regarding the various flavors of CPI:

Some time ago, I had a post that went into the various types of CPI. Here it is. It might be outdated by now, but I've never let a thing like that stop me in the past, so why start now?

Wed Jun 12, 2019: BLS Report: CPI for all items rises 0.1% in May as shelter, food indexes increase

More on the CPI:

Set the WABAC Machine for a year ago:

BLS Report: CPI-U for all items rises 0.1% in June as shelter, gasoline, food indexes increase

From CPI for all items falls 0.1% in December as energy and food indexes decline:

Not all CPI's are alike. For an earlier discussion at DU about that, see:

CPI for all items rises 0.2% as gasoline and shelter prices rise; food prices decline

From the zeroeth post:

I added the bolding.

Cryptoad points out the significance of the CPI-W. It is used to calculate Social Security's Cost-of-Living Adjustment (COLA):

Based on the increase in the Consumer Price Index (CPI-W) from the third quarter of 2013 through the third quarter of 2014, Social Security and Supplemental Security Income (SSI) beneficiaries will receive a 1.7 percent COLA for 2015.

Consumer Price Index Frequently Asked Questions (FAQs)

What goods and services does the CPI cover?

The CPI represents all goods and services purchased for consumption by the reference population (U or W) BLS has classified all expenditure items into more than 200 categories, arranged into eight major groups. Major groups and examples of categories in each are as follows:
FOOD AND BEVERAGES (breakfast cereal, milk, coffee, chicken, wine, full service meals, snacks)
HOUSING (rent of primary residence, owners' equivalent rent, fuel oil, bedroom furniture)
APPAREL (men's shirts and sweaters, women's dresses, jewelry)
TRANSPORTATION (new vehicles, airline fares, gasoline, motor vehicle insurance)
MEDICAL CARE (prescription drugs and medical supplies, physicians' services, eyeglasses and eye care, hospital services)
RECREATION (televisions, toys, pets and pet products, sports equipment, admissions);
EDUCATION AND COMMUNICATION (college tuition, postage, telephone services, computer software and accessories);
OTHER GOODS AND SERVICES (tobacco and smoking products, haircuts and other personal services, funeral expenses).

The CPI-U is used by the Treasury Department to set the interest rates on I Bonds.

I Savings Bonds

How do I Bonds earn interest?

Interest on an I Bond rates is a combination of two rates:
1.A fixed rate of return which remains the same throughout the life of the I Bond

and
2.A variable inflation rate which we calculate twice a year, based on changes in the nonseasonally adjusted Consumer Price Index for all Urban Consumers (CPI-U) for all items, including food and energy (CPI-U for March compared with the CPI-U for September of the same year, and then CPI-U for September compared with the CPI-U for March of the following year).

In specific, there is a discussion of the Cost of Living Index here:

Let's look at that.

The CPI-W is discussed here:

CPI-W methodology

- - - - -

Note that there is a:

Consumer Price Index for All Urban Consumers (CPI-U)

Chained Consumer Price Index for All Urban Consumers (C-CPI-U)

Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)

The fine print goes into the distinction.

Here's the thread from three months ago about the March CPI:

CPI for all items rises 0.2% as gasoline and shelter prices rise; food prices decline

Cryptoad points out the significance of the CPI-W. It is used to calculate Social Security's Cost-of-Living Adjustment (COLA):

Based on the increase in the Consumer Price Index (CPI-W) from the third quarter of 2013 through the third quarter of 2014, Social Security and Supplemental Security Income (SSI) beneficiaries will receive a 1.7 percent COLA for 2015.

Consumer Price Index Frequently Asked Questions (FAQs)

What goods and services does the CPI cover?

The CPI represents all goods and services purchased for consumption by the reference population (U or W) BLS has classified all expenditure items into more than 200 categories, arranged into eight major groups. Major groups and examples of categories in each are as follows:
FOOD AND BEVERAGES (breakfast cereal, milk, coffee, chicken, wine, full service meals, snacks)
HOUSING (rent of primary residence, owners' equivalent rent, fuel oil, bedroom furniture)
APPAREL (men's shirts and sweaters, women's dresses, jewelry)
TRANSPORTATION (new vehicles, airline fares, gasoline, motor vehicle insurance)
MEDICAL CARE (prescription drugs and medical supplies, physicians' services, eyeglasses and eye care, hospital services)
RECREATION (televisions, toys, pets and pet products, sports equipment, admissions);
EDUCATION AND COMMUNICATION (college tuition, postage, telephone services, computer software and accessories);
OTHER GOODS AND SERVICES (tobacco and smoking products, haircuts and other personal services, funeral expenses).

The CPI-U is used by the Treasury Department to set the interest rates on I Bonds.

I Savings Bonds

How do I Bonds earn interest?

Interest on an I Bond rates is a combination of two rates:
1.A fixed rate of return which remains the same throughout the life of the I Bond

and
2.A variable inflation rate which we calculate twice a year, based on changes in the nonseasonally adjusted Consumer Price Index for all Urban Consumers (CPI-U) for all items, including food and energy (CPI-U for March compared with the CPI-U for September of the same year, and then CPI-U for September compared with the CPI-U for March of the following year).

[Calista241]

5. Inflation, if it remains at this level, is going to destroy us at the ballot box next year

regardless of whatever else happens.

[mahatmakanejeeves]

6. You are correct. Voters ask themselves, "are you better off now than you were four years ago?" NT