Nicholas A. Juhle, CFA®

Chief Investment Officer

April Inflation – Moderating, but Hotter Than Expected

U.S. Consumer prices rose more than forecast in April, indicating that elevated levels of inflation could persist longer than expected and keeping the Federal Reserve on an aggressive path of monetary tightening.  The report did show a slight moderation in price increases, but a 0.6% month-over-month increase in core consumer prices (excluding food and energy) underscores rising prices in stickier categories.

  • Consumer prices (CPI) increased 8.3% year-over-year.  In April, the consumer price index (CPI) increased 8.3% compared to the same period a year ago, down from 8.5% in March.  Expectations ranged from 7.9% to 8.5% with a median of 8.1%.  Core CPI (excludes food and energy) increased 6.2% year-over-year, down from 6.5% in March.  While price increases were broad-based, energy costs (+30%) and new and used vehicles (+13% and +23%) were among the larger contributors to the year-over-year change.
  • Consumer prices (CPI) increased 0.3% month-over-month.  In April, consumer prices as measured by CPI increased 0.3% compared to March, marking deceleration from a 1.2% increase last month.  Expectations ranged from 0.0% to 0.5% with a median of 0.2%.  Core CPI (excludes food and energy) increased 0.6% year-over-year, up from 0.3% in March, a sign that price increases are accelerating in stickier categories.  Energy costs declined 2.7% MoM (likely outdated at this point) while transportation services (+3.1%), Food (+0.9%), shelter (+0.5%) and medical care services (+0.5%) moved higher.