US CPI Review: June 2023 (w/flash July estimates)
US CPI Review: June 2023 (w/flash July estimates)
As expected, inflation saw a sharp decline in June, with even core services prices now showing clear disinflation.
Executive summary
For June, the US came in as follows:
Headline CPI: 3.0% vs my 3.0% forecast vs 3.1% consensus
Core CPI: 4.8% vs my 4.9% forecast vs 5.0% consensus
CPI adjusted for spot market rent: 0.5% vs my 0.5% forecast
Core CPI adjusted for spot market rent: 1.6% vs my 1.7% forecast
While the CPI continued to decline in June, it wasn’t a result of used car prices, which while decelerating, nevertheless saw another month of strong growth (+1.2%). The lead from the Manheim Index points to negative MoM growth for CPI used car & truck prices in July and August.
As expected, CPI food at home price growth continued to moderate (+4.7% YoY), food away from home prices also saw a 3rd consecutive month of relatively lower MoM growth than was seen in Q1 2023.
CPI energy commodities fell 26.8% YoY as expected. With high prior comparables now almost all cycled, the rate of decline is expected to moderate in 2H23 — I currently expect CPI energy commodities to turn YoY positive in December.
The CPI’s l…