The consumer price index increased by 0.4% in November, as higher prices for energy were only slightly offset by lower prices for groceries and clothing.  The Consumer Price Index Summary from the Bureau of Labor Statistics indicated that the seasonally adjusted price index rose 0.4% in November after it had risen 0.1% in October, 0.5% in September, 0.4% in August, 0.1% in July, and after it was unchanged in June and had fallen 0.1% in May. The unadjusted CPI-U, which was set with prices of the 1982 to 1984 period equal to 100, inched up from 246.663 in October to 246.669 in November, which left it statistically 2.203% higher than the 241.353 index reading of last November, which is reported as a 2.2% year over year increase. With an increase in energy prices accounting for three-fourths of the CPI increase, seasonally adjusted core prices, which exclude food and energy, rose by just 0.1% for the month, with the unadjusted core index actually falling from 253.638 to 253.492, which put it 1.711% ahead of its year ago reading of 249.227.

The volatile seasonally adjusted energy price index rose by 3.9% in November, after it had fallen by 1.0% in October, risen by 6.1% in September and by 2.8% in August, but after it had fallen by 0.1% in July, 1.6% in June, and 2.7% in May.  Prices for energy commodities were 7.1% higher while the index for energy services rose by 0.6%, after rising by 0.4% in October.  The increase in the energy commodity index included a 7.3% jump in the retail price of gasoline, the largest component, and a 5.0% increase in the price of fuel oil, while prices for other fuels, including propane, kerosene and firewood, rose by an average of 1.4%.  As a result of this month's price hikes, energy commodities are now priced 16.4% above their year ago levels, with gasoline prices averaging 16.5% higher than they were a year ago. Within energy services, the index for utility gas service rose by 0.6% after increasing by 0.3% in October, meaning utility gas is now priced 3.6% higher than it was a year ago, while the electricity price index rose by 0.5%, after rising 0.5% in October.  Hence, the energy services price index is now 2.8% higher than last November, as even electricity prices have increased by 2.5% over that period..

The seasonally adjusted food price index was unchanged for the second month in a row in November, after rising 0.1% in September, 0.1% in August, 0.2% in July, being unchanged in June, rising 0.2% in May, 0.2% in April, 0.3% in March, 0.2% in February, and 0.1% in January, but after being unchanged in each of the prior 6 months, as the index for food purchased for use at home was 0.1% lower in November, while prices for food bought to eat away from home was 0.1% higher, as prices at fast food outlets rose 0.2% and prices at full service restaurants rose 0.1%, while food prices at schools were unchanged.

In the food at home categories, the price index for cereals and bakery products decreased by 0.2%, as prices for bread fell 0.3%, prices for cookies fell 1.4%, and prices for crackers and cracker products fell 1.5%. The price index for the meats, poultry, fish, and eggs group was down 0.3% as egg prices fell 1.9%, ham prices fell 2.3%, and processed fish and seafood prices fell 0.8%, while the index for dairy products was 0.3% higher on a 0.9% increase in the price of fresh whole milk. The fruits and vegetables index was 0.5% lower on a 1.3% decrease in prices for fresh vegetables and a 1.3% decrease in prices for frozen fruits and vegetables.. In addition, the beverages index was 0.6% lower as roast coffee prices fell 1.5% and carbonated drink prices fell 1.3%. Lastly, prices in the ‘other foods at home’ category were 0.4% higher on average, as butter prices rose 2.3% and sauces and gravies were 2.0% higher.  Among food at home line items, only oranges, which are up 12.8% sinc last November, have seen a price changes greater than 10% over the past year. The itemized list for price changes in over 100 separate food items is included at the beginning of Table 2, which gives us a line item breakdown for prices of more than 200 CPI items overall...

Among the seasonally adjusted core components of the CPI, which rose by 0.1% in November after rising by 0.2% in October, 0.1% in September, 0.2% in August and by 0.1% in each of the prior 4 months, the composite of all goods less food and energy goods fell by 0.1%, while the more heavily weighted composite for all services less energy services was 0.2% higher.   Among the goods components, which will be used by the Bureau of Economic Analysis to adjust October retail sales for inflation in national accounts data, the index for household furnishings and supplies was 0.2% lower on a 2.7% decrease in the index for window and floor coverings and a 3.7% decrease in prices for laundry equipment.  The apparel price index was 1.3% lower on a 4.3% decrease in prices for men's furnishings, a 3.2% decrease in prices for women's underwear, nightwear, sportswear and accessories, and a 2.5 decrease in prices for boy's apparel.  On the other hand, prices for transportation commodities other than fuel were up 0.5%, as prices for used cars were up 1.0% while prices for new cars rose 0.4%.  Meanwhile, prices for medical care commodities were 0.6% higher on a 0.6% increase in prescription drug prices, while at the same time, the recreational commodities index was 0.5% lower on another 1.1% drop in TV prices, a 5.6% drop in the index for audio equipment, and a 1.3% decrease in the index for toys.  Meanwhile, the education and communication commodities index was unchanged as a 1.7% increase in prices for college textbooks was offset by a 1.4% decrease in prices for computer software and accessories. Lastly, a separate price index for alcoholic beverages was up 0.2% on 0.6% higher wine prices, while the price index for ‘other goods’ was unchanged as a 1.5% increase in the index for cosmetics, perfume, bath, nail preparations and implements was offset by a 1.1% decrease in the index for stationery, gift wrap and other personal paper supplies..

Within core services, which rose by 0.2%, the price index for shelter rose 0.2% on a 0.2% increase in rents, a 0.2% increase in homeowner's equivalent rent, and a 1.6% decrease in costs for lodging away from home at hotels and motels, while costs for water, sewers and trash collection rose 0.4% and other household operation costs were up 0.3%.  At the same time, the index for medical care services was down 0.1%, as prices for physicians' services fell 0.8% and health insurance policies were priced 0.3% lower.  Meanwhile, the transportation services index was 0.1% higher on a 1.6% increase in car and truck leasing and 0.8% higher motor vehicle insurance.  The recreation services index rose 0.2% as cable and satellite television service rose 0.4% and photographer fees rose 1.8%%, while the index for education and communication services rose 0.3% as elementary and high school tuition and fees and and telephone services both rose 0.4%.  Lastly, the index for other personal services was unchanged as bank services rose 2.8% while haircuts fell 0.1%.  Among core line items, only prices for audio equipment, which are now 11.5% lower than last November, and prices for wireless phone services, which are still 10.2% lower than a year ago, have seen prices drop by more than 10% over the past year, while only the prices of watches, which are 11.2% higher, have seen prices rise by a double digit magnitude in that span.

Note: the above was excerpted from my weekly synopsis at Marketwatch 666