Inflation: A Five-Month X-Ray View
Doug Short | Apr 16, 2014 01:47AM ET
Here is a table showing the annualized change in Headline and Core CPI, not seasonally adjusted, for each of the past five months. I've also included each of the eight components of Headline CPI and a separate entry for Energy, which is a collection of sub-indexes in Housing and Transportation.
We can make some inferences about how inflation is impacting our personal expenses depending on our relative exposure to the individual components. Some of us have higher transportation costs, others medical costs, etc.
A conspicuous feature in the table through the latest data is the volatility of energy, essentially the fluctuation in gasoline prices, which is also reflected in Transportation.
Here is the same table with month-over-month numbers (not seasonally adjusted). The change in energy costs is clearly illustrated, reflected here too in transportation.
The Trends in Headline and Core CPI
The chart below shows Headline and Core CPI for urban consumers since 2007. Core CPI excludes the two most volatile components, food and energy. I've highlighted the 2% to 2.5% range that the FOMC targeted in their Inside the Consumer Price Index .
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