Energy costs prices pushed prices up, but the money supply is probably increasing as fast as it ought to.
by Alexander W. Salter
The Daily Economy
After slight deflation in March, prices rose again in April. The Bureau of Labor Statistics (BLS) reports that the Consumer Price Index (CPI) increased 0.2 percent last month. Over the past year, it rose 2.3 percent. “The April change was the smallest 12-month increase in the all items index since February 2021,” BLS notes. This is welcome news for those of us hoping for continued disinflation.
Shelter prices increased 0.3 percent last month, “accounting for more than half of the all items monthly increase.” That’s because shelter makes up a large part of the CPI—nearly a third of the index, approximating its share in the average household’s budget. Also, energy prices increased sharply. They’re up 0.7 percent on the month, driven primarily by natural gas and electricity. There’s likely a significant seasonality component here.