2012 Economic Calendar
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Consumer Price Index  
Released On 2/17/2012 8:30:00 AM For Jan, 2012
PriorConsensusConsensus RangeActual
CPI - M/M change0.0 %0.3 %0.1 % to 0.4 %0.2 %
CPI - Y/Y change3.0 %2.9 %
CPI less food & energy- M/M change0.1 %0.2 %0.1 % to 0.3 %0.2 %
CPI less food & energy - Y/Y change2.2 %2.3 %
CPI - level226.747 index level
Core CPI - level227.166 index level

In January, CPI inflation picked up at both the headline and core levels. The consumer price index rose 0.2 percent, following no change in each of the prior two months. January's pace, however, was lower than consensus expectations for a 0.3 percent boost. Excluding food and energy, the CPI firmed to a 0.2 percent increase from December's 0.1 percent increase. Analysts called for a 0.2 percent rise.

Turning to major components, energy rose only 0.2 percent, following a 1.3 percent decrease in December. Gasoline rebounded 0.9 percent in January after falling 2.1 percent the month before. But household energy fell 0.6 percent (largely natural gas) for the latest month. Food price inflation held steady at 0.2 percent.

Within the core, upward pressure came from apparel (up 0.9 percent), recreation (up 0.6 percent), tobacco (up 0.5 percent), and medical care (up 0.3 percent). In contrast to these increases, the index for used cars and trucks declined for the fifth month in a row, falling 1.0 percent, and the index for airline fares fell 0.9 percent. The new vehicles index was unchanged in January after declining in each of the prior four months.

Year-on-year, overall CPI inflation came in at 2.9 percent, compared to 3.0 percent in December (seasonally adjusted). The core rate firmed to 2.3 percent from 2.2 percent on a year-ago basis. On an unadjusted year-ago basis, the headline number was up 2.9 percent in January, compared to 3.0 percent in December. The core was up 2.3 percent versus 2.2 percent in December.

The January CPI report overall came in marginally better than expected-but only marginally. The bottom line is that there is no sign of deflation. Today's report gives no ammunition to those hoping for QE3 from the Fed. For Fed officials, the numbers overall fall in between the worries of the inflation hawks and the hoped for numbers of the doves. The January CPI report leaves Fed policy on hold.

Consensus Outlook
This report includes annual revisions to seasonal adjustment factors.

The consumer price index in December was unchanged for the second month in a row with lower energy costs playing a key role. Excluding food and energy, the CPI decelerated to a modest 0.1 percent increase after gaining 0.2 percent in November. By major components, energy dipped 1.3 percent after declining 1.6 percent in November. Gasoline fell 2.0 percent, following a 2.4 percent decline in November. Food price inflation firmed to 0.2 percent after rising 0.1 percent the prior month. Within the core, upward pressure was seen in medical care, recreation, and rent. Declines were seen in used cars & trucks, new vehicles, and apparel.

The Consumer Price Index is a measure of the change in the average price level of a fixed basket of goods and services purchased by consumers. Monthly changes in the CPI represent the rate of inflation for the consumer. Annual inflation is also closely watched.

The consumer price index is available nationally by expenditure category and by commodity and service group for all urban consumers (CPI-U) and wage earners (CPI-W). All urban consumers are a more inclusive group, representing about 87 percent of the population. The CPI-U is the more widely quoted of the two, although cost-of-living contracts for unions and Social Security benefits are usually tied to the CPI-W, because it has a longer history. Monthly variations between the two are slight.

The CPI is also available by size of city, by region of the country, for cross-classifications of regions and population-size classes, and for many metropolitan areas. The regional and city CPIs are often used in local contracts.

The Bureau of Labor Statistics also produces a chain-weighted index called the Chained CPI. This measures a variable basket of goods and services whereas the regular CPI-U and CPI-W measure a fixed basket of goods and services. The Chained CPI is similar to the personal consumption expenditure price index that is closely monitored by the Federal Reserve Board.  Why Investors Care
It is always a good idea to look at more than a few months of data to get a sense of changes in established trends. Monthly changes in the CPI are mainly volatile because of sharp fluctuations in food and energy prices. The core CPI eliminates the sharper fluctuations.
Data Source: Haver Analytics
Yearly changes tend to smooth out more severe monthly fluctuations and give a better idea of the underlying rate of inflation. Even with the smoother trend, note that the core CPI does not fluctuate as much as the total CPI.
Data Source: Haver Analytics

2012 Release Schedule
Released On: 1/192/173/164/135/156/147/178/159/1410/1611/1512/14
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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