September CPI, October UI Claims

Robert A. Dye, Ph.D.

,

Daniel Sanabria

Data

The Consumer Price Index for September was unchanged. This follows just a small 0.1 percent gain in August.



Consumer Prices Flat in September

* The Consumer Price Index for September was unchanged after just a small increase in August.
* Initial Claims for Unemployment Insurance fell by 10,000 for the week ending October 5, to hit 210,000.

The Consumer Price Index for September was unchanged. This follows just a small 0.1 percent gain in August. Over the year ending in September, headline CPI was up by 1.7 percent, the same year-over-year reading as last month. Consumer price inflation was held at bay in September by falling energy and vehicle prices. The energy price index declined by 1.4 percent as gasoline prices dropped by 2.4 percent for the month. Food prices have been very stable, increasing by just 0.1 percent in September after three months of no change. Core CPI (all items less food and energy) increased by 0.1 percent in September and was up by 2.4 percent over the previous 12 months. This was also the same year-over-year reading as last month. New car prices declined for the third consecutive month in September, down 0.1 percent from August. Used car prices were down by 1.6 percent for the month. Lower interest rates are bringing car financing charges down.

Earlier this week we saw the headline Producer Price Index for final demand for September decline by 0.3 percent for the month. Sedate U.S. inflation readings keep the Federal Reserve's focus on lifting inflation rather than suppressing it. Too little inflation, and outright deflation, has a negative impact on the economy, causing businesses and consumers to delay their purchases. We expect the Federal Reserve to leave the fed funds rate range unchanged at 1.75-2.00 percent at the upcoming Federal Open Market Committee meeting over October 29/30.

Initial claims for unemployment insurance remain very low, signaling that labor markets remain healthy. For the week ending October 5, initial claims for unemployment insurance declined by 10,000, to hit 210,000. Continuing claims increased by 29,000 for the week ending September 28, to 1,684,000, still a very low number.

Market Reaction: U.S. equity markets opened with gains. The 10-Year Treasury bond yield is up to 1.63 percent. NYMEX crude oil is up to $53.23/barrel. Natural gas futures are up to $2.24/mmbtu.
 



CEW_10102019

For a PDF version of this report, please click here: September CPI, October UI Claims

The articles and opinions in this publication are for general information only, are subject to change, and are not intended to provide specific investment, legal, tax or other advice or recommendations. The information contained herein reflects the thoughts and opinions of the noted authors only, and such information does not necessarily reflect the thoughts and opinions of Comerica or its management team. We are not offering or soliciting any transaction based on this information. We suggest that you consult your attorney, accountant or tax or financial advisor with regard to your situation. Although the information has been obtained from sources we believe to be reliable, neither the authors nor Comerica guarantee its accuracy, and such information may be incomplete or condensed. Neither the authors nor Comerica shall be liable for any typographical errors or incorrect data obtained from reliable sources or factual information.

October 10, 2019
Robert A. Dye, Ph.D., Senior Vice President and Chief Economist at Comerica Bank

Robert A. Dye, Ph.D.

Senior Vice President and Chief Economist
Daniel Sanabria, Senior Economist at Comerica Bank

Daniel Sanabria

Senior Economist

Related Content