CPI sinks 0.1% on falling energy prices

[swag]

http://www.marketwatch.com/news/story.asp?guid=%7B619D2167%2D7AFD%2D49B9%2D989F%2DD19B017AD531%7D&siteid=google&dist=

WASHINGTON (MarketWatch) - U.S. consumer prices fell a surprising 0.1% in December as energy prices continued to drop off from the spike in September, the Labor Department reported Wednesday.

It was the second straight decline in the consumer price index, which fell 0.6% in November.

Core prices - which exclude food and energy prices - rose 0.2%, as expected, for the third month in a row.

Economists were expecting the CPI to rise 0.2% in December, according to a survey conducted by MarketWatch.

For all of 2005, the CPI increased 3.4%, not much different than the 3.3% increase in 2004. It was the largest yearly gain since the 3.4% increase in 2000.

. . .

[swag]

1. Couple things

Here's the bls link for the parsers:

http://www.bls.gov/news.release/cpi.nr0.htm

Also note the reversal of fortunes for "core" and "top-line" CPI. Excluding food and energy prices actually made core CPI higher than top-line inflation. That, of course, is mainly because energy prices fell in December.

That will likely be reversed again when January's CPI comes out next month, given the rapid return of energy inflation this month.

[One_Life_To_Give]

2. Must be some type of Energy Prices I never heard of. n/t

[swag]

4. Gasoline prices plunged in December from their November levels,

for starters. Of course January gas prices, which aren't factored in until next month's CPI report, are rocketing higher daily.

[McLuhan]

3. Yes, energy prices are falling

like a helium-filled balloon! By summer the price of a gallon of gas will be over 3 bucks.

[swag]

5. Gasoline prices plunged in December from their November levels,

for starters. Of course January gas prices, which aren't factored in until next month's CPI report, are rocketing higher daily.

[Inland]

8. Gasoline prices in a twenty cent swing pattern here, ti's crazy

I can't figure it out, and nobody in the media remarks on it, but gas prices have been going from 2.11 to 2.35 and back like a yo yo since about October in chicago burbs.

The volatility in prices at the pump have to be a sign of something. Maybe a super nervous market ready to find a new plateau at generally higher prices.

[papau]

6. For all of 2005, the CPI increased 3.4%,about same as 2004's 3.3%

Seems the larger picture needs telling - followed by why the current CPI calc is in error - the "improvements" that are used to reduce the CPI are much less - and should decrease the CPI MUCH LESS -than what is used.

[swag]

7. Feel free.

[papau]

9. Oh I scream this monthly-and like election fraud, the media does not care!

:-)

[papau]

10. year-over-year core inflation numbers climbed 2.2 percent - DJI down

year-over-year core inflation numbers climbed 2.2 percent.

Seems investors feel it is above the Federal Reserve's comfort range for price increases.