The U.S. Bureau of Labor Statistics released the November Consumer Price Index (“CPI”) results Tuesday morning and, relatively speaking, the news isn’t bad…
The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1% in November on a seasonally adjusted basis after increasing 0.4% in October. This was the smallest 12-month increase since the period ending December 2021.
The energy index decreased by 1.6% over the month, and the gasoline index, the natural gas index, and the electricity index all declined. Indexes that increased generally did so at a lower rate than the period ending in October.
Did we reach peak inflation? Maybe.
Peak inflation is the point at which inflation has reached its highest rate over a given period. We’ve now seen a five-month falling trend as measured by the CPI, and that is certainly some evidence. Trends can reverse, however, and the CPI is just one measure of inflation (and it is not even the Federal Reserve’s main way to measure it). The Brookings Institution’s article, How does the government measure inflation?, is a good read if you want to learn more about both the CPI and the Fed’s favored measure, the PCE).
Regardless, we think you can expect the financial pinch you’ve undoubtedly felt at the gas pump and grocery store to continue easing.
But it’s not exactly time yet to go out and start spending like it’s 1999 or 2019, especially if you have a house you will need to sell or refinance in the next year or two.
So, maybe pass around the bagels and cream cheese but go light on the lox. And keep a tight watch on your egg and butter use because between the bird flu and extreme weather events, prices for those two consumer categories remain sky-high (with the price of eggs still up about 50% over last year’s prices and butter and margarine up about 35%).
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