The headline Consumer Price Index (CPI) increased 2.7% from a year ago. The reading is lower than the 3.0% in September and below the 3.0% expected by analysts today. The 10% decrease is welcome and reflects softer inflation pressures, though still 7/10% higher than the Fed’s target rate. The Core CPI, reflecting all purchased goods and services except food and energy, rose only 2.6% over the same period. This defied all expectations and was the lowest YOY rate since April 2021. We can expect that the recent decline in oil prices will help next month’s number to settle even lower.
The shelter (housing) component of CPI, which accounts for 44% of the indexes weight, rose only 0.9%. This is the fourth month in a row that housing costs have decelerated. Even those of us who make a living on a fractional percentage of home values agree that more affordable roofs over our heads are good for everyone.
