The Consumer Price Index (CPI) announced a seasonally adjusted 0.2% increase in April, right in line with economic projections. This small increase helped lower 12-month inflation to 2.3%, the lowest point since February of 2021. Analysts were pleased to see this number fall below the forecasted 2.4%. This continuing shift trend indicates that there are long-term easing inflationary pressures taking place in the economy.
The Employment Cost Index, on the other hand, is one of the best measures we have of the costs of employing a worker in terms of total compensation. Note that the food category actually decreased in April by 0.1%. This plunge happened despite the fact that shelter prices rose 0.3%, accounting for over half of the month’s total movement in the index. Egg prices fell dramatically, down 12.7% this month. Even with this drop, prices remain expensive—up a shocking 49.3% from the same time last year.
In the automotive sector, the data showed the opposite trend. Used vehicles fell by 0.5%, and new vehicles were essentially unchanged. There was no growth from last month. Apparel costs declined by 0.2% as well, a move in line with some other consumer products that have seen significant price stabilization on the inflation front.
Medical care services experienced a 0.5% jump, reflecting continued upward pressures on healthcare costs. In a perfect example of the volatility common to this sector, energy prices rebounded strongly, with a 0.7% gain.
September’s Consumer Price Index monthly reading came in line with Dow Jones’ consensus estimate. It’s a good sign that economists’ predictions were mostly on point. As you likely know, inflation rates have recently come down a bit. That may represent a period of calm, as the economy finds its footing after two years of wild swings.