Following an unprecedented three-consecutive-month decline in core CPI. the BLS reports the CPI jumped 0.6% in June with the core CPI up 0.2%.

Key Points Month-Over Month

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.6% in June on a seasonally adjusted basis after falling 0.1% in May. 
The gasoline index rose sharply in June after recent declines and accounted for over half of the monthly increase in the seasonally adjusted all items index. 
The energy index increased 5.1% in June as the gasoline index rose 12.3%. 
The food index also rose in June, increasing 0.6% as the index for food at home continued to rise. 
The index for all items less food and energy rose 0.2% in June, its first monthly increase since February. 
The index for motor vehicle insurance increased sharply in June after recent declines.
The indexes for apparel, shelter and medical care also increased in June, while the indexes for used cars and trucks, recreation and communication all declined. 

Key Points Year-Over Year

The all items index increased 0.6% for the 12 months ending June; this compares to a 0.1% increase for the 12 months ending May.
The index for all items less food and energy increased 1.2% over the last 12 months. 
The food index increased 4.5% over the last 12 months, with the index for food at home rising 5.6%.
Despite increasing in June, the energy index fell 12.6% over the last 12 months. 

CPI Distortions

Anyone buying their own medical insurance, those in college and those looking to buy a home, and those in areas with high rent will dispute the stated CPI.

The BLS does not directly factor in the price of homes into the CPI. Rather, the BLS goes through a ridiculous process in which it asks people how much they would rent their their own house from themselves and uses that number as Owners’ Equivalent Rent (OER).

Nor does the BLS factor in soaring equity prices. And that is the primary place inflation has turned up now.

CPI Jump Won’t Last 

Inflationistas will point to the 0.6% rise ,and once again say “here we go.”

But those expecting a big jump in the CPI as calculated will be wrong again.

COVID accelerated trends toward more work at home, less driving, less eating out, and fewer business meetings in person.

These factors will easily outweigh government stimulus and Fed manipulations.

State Claims Decline But All Unemployment Claims Are on the Rise


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