May 18, 2005
THE LAST KID TO GRADUATE BUSINESS SCHOOL WOULD KNOW BETTER:
Consumer prices up in April, but 'core' inflation flat (JEANNINE AVERSA, May 18, 2005, ASSOCIATED PRESS)
Excluding energy and food prices, which can swing widely from month to month, "core" inflation was flat in April. [...]The flat reading on core inflation, which is closely monitored by the Fed, was the best showing since November 2003.
The inflation report is likely to keep the Federal Reserve on its current path of modestly boosting short-term interest rates to keep prices in check.
And so, the Fed will once again raise rates into the teeth of deflation. Couldn't Andrea tell Al it's 2005, not 1975? Posted by Orrin Judd at May 18, 2005 11:56 AM
This month's CPI is at 5% annualized. The core rate excludes energy and food prices because they're volatile, but they haven't been lately, they've just been going up. Split the difference and you're still looking at 3%.
Posted by: joe shropshire at May 18, 2005 12:19 PMIt's not inflation if other prices don't follow.
Posted by: oj at May 18, 2005 12:25 PMAnd if oil prices continue to decline and push energy costs lower so that there actually deflation will the Fed pay attention. Probably not.
Posted by: AWW at May 18, 2005 12:57 PMI'm sure their pillow talk is a bit more gossipy than that.
Posted by: jim hamlen at May 18, 2005 3:38 PMMonth to month inflation reports are essentially meaningless and year long extrapolations from them are even of less value.
Posted by: bart at May 18, 2005 5:46 PM