So last week here, we mentioned the street was expecting a hot CPI – Consumer Price Index – Broadest measure of inflation… at that time the expectation was 3.56% – well it came in at 3.8% !
Hotter than expected!!
Energy component
While the majority of the move was from Energy and Oil related movement, the actual extra increase from street expected was from a weird Owner’s equivalent rent adjustment that was made during the Government shutdown – and this months comparable inflated the reading… No matter, Energy made the CPI hot!
The Flow Through
As a point of reference, it is very interesting (ya – nerds!) to see the quick movement in Oil prices filter through the system… first up was the price of Oil, then as a reference to the first chart, CPI starts moving….
This is really a great exercise and shows the lagging effects of the Economic numbers… but THEY DO eventually catch up, just not in real time!
Going to be tough for any FOMC Chair to lower rates …for now at least…. Higher prices will and do filter through the rest of the Economy too!
Have a Great “CPI was Hot” day!
John A. Kvale CFA, CFP
AI Content Authenticity: AI created the CPI graph. All of the following text content has been completed by myself and has not been edited or created by AI. Occasionally we do use AI for images and will note when appropriate.
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
