The CPI Rose 0.2 Percent in July

The BLS reports the CPI Rose 0.2 Percent in July, in line with the the Bloomberg Econoday consensus. Good and bad details are very mixed.

The BLS reports to a single decimal place. I calculate two decimal places.

CPI Month-Over-Month Percent Details

All Items: 0.20

All Items Except food and Energy: 0.32

Food and Beverage: 0.05

Food Away from Home: 0.28

Food at Home: -0.12

Shelter: 0.23

Owners' Equivalent Rent (OER): 0.28

Rent of Primary Residence: 0.26

Medical Care Services: 0.79

Medical Care Commodities: 0.05

Energy: -1.07

Gasoline: -2.17

The Fed, when it looks at the CPI, looks at core CPI, all items except food and energy. That was a less than stellar 0.32 percent increase for the month.

But the Fed's preferred ,measure of inflation is the PCE price index, out later this month.

The PCE overweighs medical care whereas the CPI overweighs shelter. Medical Care Services is a very hot 0.79 percent.

On this basis, I doubt the next PCE report will be any good.

I will cover food, in a second post.

For now, please make a mental note that food and beverage up 0.05 percent for July is weighted nonsense even if you believe food at home declined 0.12 percent.