December 9, 2022

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US June CPI +% y/y +5.4% vs +4.9% expected

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Highlights of the June 2021 US CPI report

Highlights of the June 2021 US CPI report
  • Highest since 2008
  • Prior was +5.0% y/y
  • Ex food and energy +4.5% vs +4.0% y/y expected
  • Prior ex food and energy +3.8%
  • CPI m/m +0.9% vs +0.5% expected — highest since June 2008
  • Prior m/m reading was +0.6%
  • CPI ex-food and energy +0.9% vs +0.4% m/m expected
  • Prior ex food and energy +0.7 m/m

Wage data:

  • Real avg hourly earnings % vs -2.8% y/y prior
  • Real avg weekly earnings -0.9% m/m vs -0.1% m/m prior

The US dollar has jumped around 50 pips across the board on the headlines and US equity futures fell. I’m watching bonds closely. The long end has sold off, pushing yields up to 1.38% from 1.36%. That’s not a huge move but last time around, yields moved up and then later crashed lower.

In terms of details, used cars alone represented more than one-third of the increase in the y/y CPI as they rose 10.5% m/m. The shelter component rose 0.5% m/m compared to 0.3% prior.

  • Energy +24.5% y/y
  • Gasoline +45.1% y/y
  • New vehicles +5.3% y/y
  • Used cars +45.2% y/y
  • Shelter +2.6% y/y
  • Transportation services +10.4% y/y
  • Medical care services +1.0% y/y
  • Apparel +4.9% y/y

I don’t understand how it’s even possible that the price of a used car has risen 45.2% y/y. You’re telling me a used car from last June that was selling for $20,000 is now getting nearly $30,000!?

Used car meme

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