Economic News | March CPI lower than expected

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“… Turmoil in global markets snowballed into one of the worst routs in recent memory after President Trump said he will stay the course with aggressive, economically disruptive tariffs.

“What’s going to happen to the markets, I can’t tell you,” Trump said late Sunday. “I don’t want anything to go down. But sometimes you have to take medicine to fix something.”





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SmilingJack said:
Crude falling but pump prices were over $3 a gallon on my travels today. That may just be the refuel folks gouging though.
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Gas stations are pretty consistent about pricing in price spikes immediately while pricing in the drops when the relevant refined gas at the lower price is actually delivered.
 


“… The Consumer Price Index climbed 2.4 percent last month from a year earlier, a far slower pace than February’s 2.8 percent increase and less than economists had expected. Over the course of the month, prices fell 0.1 percent.

A gauge tracking underlying “core” inflation, which strips out volatile food and energy items, slipped to 2.8 percent in March, following a 0.1 percent monthly increase. …”
 
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“… Prices excluding food and energy categories—the so-called core measure economists watch in an effort to better capture inflation’s underlying trend—rose 2.8%, below forecasts for a 3% increase. That was the smallest increase in the core measure since March 2021.

Normally, a slowdown in year-over-year price increases would be welcome news. But this time, it will be hard for investors, policymakers and businesses to read too much into the March data.

… Economists expect tariffs will dent economic growth and raise prices for consumers and businesses in the months ahead, teeing up a new battle for the Federal Reserve. The central bank has spent the past few years struggling to bring inflation down to its 2% target after prices spiked during the Covid-19 pandemic.

“A majority of participants noted the potential for inflationary effects arising from various factors to be more persistent than they projected,” according to minutes of the Fed’s March 18-19 policy meeting, published Wednesday.

The Fed next meets May 6-7. …”
 




“Up 2 down 1 is not a bad ratio or up 10 down 5 … as we go through the queue and settle with these countries who are going to bring us their best offers … we will end up in a place of great certainty on tariffs [cites drop in oil and good Treasury auction] so I don’t see anything unusual today”
 
CFordUNC said:
In theory, shouldn’t today’s “more positive than expected” CPI report lead to the lowering of mortgage rates?
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No. The only reason it would is that the market would be expecting the Fed to cut rates. Obviously the Fed has a lot on its plate. I don't think there's much point to reading into a single CPI report. Inflation has been running hot for four months and this is the first respite. Let's see if it holds up.
 
nycfan said:
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“… Prices excluding food and energy categories—the so-called core measure economists watch in an effort to better capture inflation’s underlying trend—rose 2.8%, below forecasts for a 3% increase. That was the smallest increase in the core measure since March 2021.

Normally, a slowdown in year-over-year price increases would be welcome news. But this time, it will be hard for investors, policymakers and businesses to read too much into the March data.

… Economists expect tariffs will dent economic growth and raise prices for consumers and businesses in the months ahead, teeing up a new battle for the Federal Reserve. The central bank has spent the past few years struggling to bring inflation down to its 2% target after prices spiked during the Covid-19 pandemic.

“A majority of participants noted the potential for inflationary effects arising from various factors to be more persistent than they projected,” according to minutes of the Fed’s March 18-19 policy meeting, published Wednesday.

The Fed next meets May 6-7. …”
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Who puts together the information for the CPI? For that matter, who compiles the stats for unemployment? Any governmental statistic from this administration should be viewed with a high degree of skepticism. If they will lie about almost anything, including January 6, why wouldn't they lie about CPI, unemployment, and other economic measures?
 
UNCMSinLS said:
Who puts together the information for the CPI? For that matter, who compiles the stats for unemployment? Any governmental statistic from this administration should be viewed with a high degree of skepticism. If they will lie about almost anything, including January 6, why wouldn't they lie about CPI, unemployment, and other economic measures?
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My understanding is that it would be really hard for them to rig the process. Paul Krugman is pretty fucking skeptical and cynical, and he says there's nothing to worry about in this regard.

One reason is that it could be quite obvious if they were trying to rig it, because there are other price gauges published by private companies. If the MIT Billion Price Index were to suddenly diverge from the CPI, it would raise some eyebrows.
 
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