U.S. Consumer Prices Rise 0.4% in July; Core Rate Rises 0.2%

[swag]

http://www.bloomberg.com/apps/news?pid=20601087&sid=aOrkFF85iASk&refer=home

Aug. 16 (Bloomberg) -- Prices charged for U.S. consumer products excluding food and energy eased last month, adding to evidence of slowing inflation that may let the Federal Reserve keep holding interest rates steady.

The consumer price index rose 0.4 percent in July, following June's 0.2 percent increase, the Labor Department said today in Washington. Excluding food and energy costs, so-called core prices rose 0.2 percent, the smallest increase since February, after a 0.3 percent gain a month earlier.

The lower reading on core prices comes a day after the government reported that inflation remained unexpectedly tame at the wholesale level last month. Together, the reports bear out Fed Chairman Ben S. Bernanke's forecast of slowing inflation and suggest the central bank may again refrain from raising interest rates at its next meeting Sept. 20.

``It buys Bernanke time,'' Chris Low, chief economist at FTN Financial in New York, said before the report. ``If we continue to see weak economic growth data that would make a further case for them to leave rates on hold.''

. . .

[MaineDem]

1. I'm glad someone's food prices have gone down

Mine sure as hell haven't! Nothing has gone down. These numbers infuriate me.

[raccoon]

2. "excluding food and energy "--what the hell do they think

people spend money on? Yachts and brie?

"adding to evidence of slowing inflation "

Take this and believe the opposite,

"adding to evidence of growing inflation."

[WePurrsevere]

16. Yeah silly us like to eat a meal now and then, drive to the market & heat

and light up our homes a bit now and then.

Not sure when they changed the formula but I believe it was fairly "recent". It makes BAD numbers look not as much so on paper but in reality most folks can see that their dollar stretches less and less every month.

[swag]

3. I'm glad I own all those I bonds.

[RUMMYisFROSTED]

4. Not so fast!

Bush portrays Social Security fund as worthless paper

"Far from being 'worthless IOUs,' the investments held by the trust funds are backed by the full faith and credit of the U.S. Government. The government has always repaid Social Security, with interest," the agency says. "The special-issue securities are, therefore, just as safe as U.S. Savings Bonds or other financial instruments of the federal government."

http://www.signonsandiego.com/uniontrib/20050406/news_1n6socsec.html

In Bushworld, bonds may be worthless.

[swag]

11. Point well taken.

[Zynx]

12. If we refuse to pay on the Social Security bonds, ie pay benefits, we

will have defaulted and our credit rating will take a dump.

[marmar]

5. Consumer prices up, factory output down...

... economy sucks. :(

By MARTIN CRUTSINGER, AP Economics Writer
16 minutes ago



WASHINGTON - Consumer inflation accelerated in July, reflecting a big jump in gasoline and other energy prices. In evidence that the economy is slowing, industrial output in July slipped to just half the June pace.

ADVERTISEMENT

The Labor Department reported Wednesday that its closely watched Consumer Price Index rose by 0.4 percent last month, double the 0.2 percent increase in June. While energy costs had fallen in June, they rose by 2.9 percent last month, the biggest increase in three months.

Meanwhile, the Federal Reserve reported that output at the nation's factories, mines and utilities increased by 0.4 percent last month, just half of the 0.8 percent gain in June.

Core inflation, which excludes food and energy, slowed in July, rising by just 0.2 percent after four straight months of 0.3 percent gains. This slowdown, which was helped by a 1.2 percent drop in clothing prices, was likely to encourage officials at the Federal Reserve, who are counting on a slowing economy to reduce inflation pressures.

The rise in industrial production was the slowest since no gain at all in May. Output at manufacturing industries edged up a tiny 0.1 percent, but this weakness was offset by stronger gains in other sectors of the economy.

Output at the nation's utilities shot up by 2 percent in July, reflecting higher production at electric utilities in response to warmer-than-normal temperatures. Output at the nation's mines, a category that also includes oil and gas production, rose 0.8 percent in July, reflecting increased demand for domestic energy supplies.

The complete article is at: http://news.yahoo.com/s/ap/20060816/ap_on_bi_go_ec_fi/economy

[Virginia Dare]

6. The American economy is going through...

the equivalent of chinese water torture right now. It's painful to watch.

[apnu]

8. yeah whats worse is...

... watching that moron Kudlow say everyday how great things are on CNBC as the commodities traders at my job do. Over the last few years I've gone from watching their heads bob in agreement with him to the traders staring at the TV with the most amusing look of confusion as they try to reconcile Kudlow's stupidity with what their own quote boards are telling them. Priceless.

[Virginia Dare]

9. Wall Street is one big psyops campaign...

got to keep the people confident. We are all lemmings.

[Barkley]

7. Higher prices and lower output = "stagflation"

[PsN2Wind]

10. Inflation is in check

for those that do not eat or drive.

[plasticsundance]

13. Okay ... they exclude food & energy

Two of the largest components that consumers must spend on, and they don't include housing prices, but only rent. They also fail to give the annualized rate of inflation. It's like bullshit grew legs and got up to dance.

Buy gold and silver.

[WePurrsevere]

15. "It's like bullshit grew legs and got up to dance." :-D That would be this

whole admin and man oh man does it stink. Time to empty out the tank and let it compost. ;)

[AX10]

14. So as long as we don't eat or drive, inflation won't be a problem then.

:eyes: