The latest CPI numbers are out and still high

Investment Analysis Clubs Macro Economic Trends and Risks
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The latest CPI ex-food and energy up 5.5% and total CPI number up 7% vs year ago.

So the numbers are still hot vs last year.

OTFoolish

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The latest CPI ex-food and energy up 5.5% and total CPI number up 7% vs year ago.

So the numbers are still hot vs last year.

Yep, it’s worrisome. I expect the Fed will be raising rates and begin unwinding their bond holdings very soon.

The year over year nature of the statistic is useful for some things, but less useful for others.

This article shows various contributions to the currently reported year over year inflation, including 50% for motor fuel and 41% for fuel oil. That’s something that people surely notice and feel when they fill up their tank!

https://www.nytimes.com/2022/01/12/business/inflation-supply…

However motor fuel inflation has abated in recent months: we’re right about where we were in October and down ~3.5% from November.

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&…

We’ll continue to see high year over year gasoline inflation contributing to the commonly reported year over year CPI gains for months to come, unless prices drop a lot more. By about August the year over year gains will moderate to ~5%, if we assume prices stay about where they are now.

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We’ll continue to see high year over year gasoline inflation contributing to the commonly reported year over year CPI gains for months to come, unless prices drop a lot more. By about August the year over year gains will moderate to ~5%, if we assume prices stay about where they are now.

There is also the seasonal aspect. Demand for gasoline tends to go up throughout the summer, so June, July, and August will probably see some rise in prices. However, I suspect we will see some more declines this winter (in gasoline, not necessarily other fossil fuels like gas).

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There is also the seasonal aspect. Demand for gasoline tends to go up throughout the summer, so June, July, and August will probably see some rise in prices.

This article forecasts an increase in petroleum demand in the second half of 2022:

https://www.spglobal.com/platts/en/market-insights/latest-ne…
Sheldon said planned OPEC+ production hikes will reduce “sustainable spare capacity” to an uncomfortably low 800,000 b/d by June, just as oil demand is set to grow by 3.5 million b/d in H2 2022 over the first half of the year.

DB2