January 12, 2022 – This morning’s consumer price index printed at an astonishing 7.0% YoY rate. As an indicator of how persistent (not transitory) inflation is, 7 of the last 9 releases have come in above consensus. Today’s 7% print is its highest since June 1982.
Checking the Consumer Price Index, this is the 19th straight monthly rise in headline CPI. Core CPI also surged to its highest since Feb 1991, printing hotter than expected at +5.5% YoY.
Driving prices higher, commodities, shelter, and new-and-used cars and trucks saw prices jump the most. Housing costs accelerated once again. Inflation in shelter rose to 4.13% YoY from 3.84%, the highest since Feb 2007. In services, inflation rose to +3.7%, its highest since Jan 2007 and Goods inflation soared 10.7% YoY, its highest since May 1975.
Most importantly for Main Street and folks in the real world, real average hourly earnings fell 2.4% YoY. This is the 9th straight month whereby real average hourly earnings declined.