CPI figure released today

Sven

The Labor Department said Friday that consumer prices in May were 8.6% higher than a year ago — the largest increase since December of 1981. Prices rose 1% between April and May, led by jumps in the price of gasoline, groceries and rent.

Shoppers who swallowed price increases for much of the pandemic without batting an eye are starting to blink now that gasoline prices have topped $5 a gallon in much of the country and grocery prices continue to climb at a rapid rate.

https://npr.org/2022/06/10/1103995329/inflation-americans-spending-consumer-behavior-prices

The Fed relies on the PCE rather than CPI numbers. Here is an article explaining the difference.

The Consumer Price Index (CPI) and Personal Consumption Expenditures Price Index (PCE) are two U.S. inflation metrics that use different methodologies, and therefore produce different estimates. The differences can be grouped into four effects: formula, weight, scope, and 'other.' This research evaluates two effects, weight and scope, and discusses their implications. The weight effect is a result of differences in how consumer expenditure data are sourced. CPI sources data from consumers, while PCE sources from businesses. The scope effect is a result of the different types of expenditures CPI and PCE track. For example, CPI only tracks out-of-pocket consumer medical expenditures, but PCE also tracks expenditures made for consumers, thus including employer contributions. The implications of these differences are considerable. Many contracts and government programs are tied to inflation, from rental agreements to social security.

https://bls.gov/osmr/research-papers/2017/pdf/st170010.pdf

The broader market is down over 2.8% on Friday morning. Next week we will likely to see a 50 bps rate hike.

hank

Yes - Gloomberg covered it.