This morning the Bureau of Labor Statistics released October’s CPI metrics. Core CPI increased 6.3% year-over-year, down .35% from 6.65% growth in September. Back in mid-October, researchers at CloudQuant predicted a 0.45% decline based on a model built from alternative data on its platform. Consensus estimates for Core CPI were around 6.5% or a 0.15% decline month-over-month. The slowing of growth was largely influenced by falling used vehicle prices, medical costs, and commodities (excluding food and energy). The cost of shelter showed a slight increase this month, even as the price of homes and home sales decreased due to increasing interest rates. Private sector data sources show a monthly decline in rent prices, however, due to the way housing cost is calculated as an input to CPI, economists don’t expect to see a housing cost-influenced-decline in CPI until the spring.
Stay tuned next week for CloudQuant’s prediction of November’s Core CPI numbers, which will be released by the BLS on December 13th.