CPI data inflation

Originally Published: November 14, 2023, 8:30 AM ET
Updated: November 14, 2023, 8:46 AM ET

Whether you’re trading large-cap stocks or penny stocks economic data has been a centerpiece in the daily stock market trends. Today’s release of the October Consumer Price Index (CPI) data is crucial for understanding inflation’s current status. As a vital economic measure, the CPI tracks consumer price changes for various goods and services. It’s a principal indicator of inflation, impacting aspects like Social Security benefits and interest rates.

Inflation has been a major economic issue lately. September’s CPI report showed a 3.6% yearly increase. While inflation has decreased over the past year, high prices continue to weaken consumer buying power. This has led to bold actions by the Federal Reserve, including significant interest rate hikes to curb demand and control inflation.

Market watchers eagerly await the October data to see if inflation is stabilizing or persisting. Consumer spending is also fluctuating, influenced by high fuel costs and increasing borrowing expenses. Inflation’s direction will greatly affect the Fed’s rate decisions and economic growth forecasts.

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Analysts predict the October CPI will show a 3.3% year-on-year rise in headline figures. This could indicate a slight decrease from the previous month, suggesting that peak inflation may be behind us. However, core CPI, excluding volatile food and energy prices, might remain unchanged from last month’s 4.1%. This indicates ongoing complex economic conditions. Even with a gradual decline in headline inflation, the struggle continues.

What is CPI Inflation Data?

The CPI, or Consumer Price Index, measures average prices of goods and services consumed by households. It tracks price changes, providing insights into inflation trends. This data helps economists and investors understand consumer purchasing power and make strategic decisions.

what is CPI

The U.S. Bureau of Labor Statistics explains it as“The CPIs are based on prices of food, clothing, shelter, fuels, transportation, doctors’ and dentists’ services, drugs, and other goods and services that people buy for day-to-day living. Prices are collected each month in 75 urban areas across the country from about 6,000 housing units and approximately 22,000 retail establishments (department stores, supermarkets, hospitals, filling stations, and other types of stores and service establishments).”

Think of the CPI as a snapshot of the economy. It reflects supply and demand dynamics, cost fluctuations, and consumer spending habits.

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In 2023, amid global events, the CPI’s link to the stock market is crucial. It raises questions: Will inflation rise, driving interest rates up? Or, will it show signs of returning to normal levels?

Traders are monitoring the CPI to gauge the market’s direction in these volatile times. The CPI offers hints about future economic paths.

When Is the CPI Inflation Report Released?

The October CPI report is set for release at 8:30 am ET, today, November 14th.

CPI Report Today: October Inflation Expectations

CPI Inflation Data Expectations For October 2023:

  • CPI Expectations (month-over-month): 0.1%, Previous read was 0.4%
  • CPI Expectations (year-over-year): 3.3%, Previous read was 3.7%
  • CORE CPI Expectations (month-over-month): 0.3%, Previous read was 0.3%
  • CORE CPI Expectations (year-over-year): 4.1%, Previous read was 4.1%

The Consumer Price Index Report For October 2023 & CPI Numbers

The Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in October on a seasonally adjusted basis, after increasing 0.4 percent in September, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.2 percent before seasonal adjustment.

The index for shelter continued to rise in October, offsetting a decline in the gasoline index and resulting in the seasonally adjusted index being unchanged over the month. The energy index fell 2.5 percent over the month as a 5.0-percent decline in the gasoline index more than offset increases in other energy component indexes. The food index increased 0.3 percent in October, after rising 0.2 percent in September. The index for food at home increased 0.3 percent over the month while the index for food away from home rose 0.4 percent. 

The index for all items less food and energy rose 0.2 percent in October, after rising 0.3 percent in September. Indexes which increased in October include rent, owners’ equivalent rent, motor vehicle insurance, medical care, recreation, and personal care. The indexes for lodging away from home, used cars and trucks, communication, and airline fares were among those that decreased over the month.

The all items index rose 3.2 percent for the 12 months ending October, a smaller increase than the 3.7-percent increase for the 12 months ending September. The all items less food and energy index rose 4.0 percent over the last 12 months, its smallest 12-month change since the period ending in September 2021. The energy index decreased 4.5 percent for the 12 months ending October, and the food index increased 3.3 percent over the last year. 

CPI inflation data for October

CPI Report Summary:

CPI Expectations (month-over-month): 0.1%
Actual CPI (month-over-month): 0.0% BELOW EXPECTATIONS

CPI Expectations (year-over-year): 3.3%
Actual CPI (year-over-year): 3.2% BELOW EXPECTATIONS

CORE CPI Expectations (month-over-month): 0.3%
Actual CORE CPI (month-over-month): 0.2% BELOW EXPECTATIONS

CORE CPI Expectations (year-over-year): 4.1%
Actual CORE CPI Expectations (year-over-year): 4.0% BELOW EXPECTATIONS

October CPI Inflation Data By The Numbers

October CPI For Food

The food index rose 0.3 percent in October, after rising 0.2 percent in each of the last 3 months. The index for food at home increased 0.3 percent over the month, after rising 0.1 percent in September. Four of the six major grocery store food group indexes increased over the month. The index for meats, poultry, fish, and eggs rose 0.7 percent in October as the index for beef increased 1.2 percent and the index for pork rose 1.3 percent. The other food at home index increased 0.3 percent over the month, as did the dairy and related products index. The index for cereals and bakery products rose 0.2 percent in October, after falling 0.4 percent in September.

October CPI For Energy

The energy index fell 2.5 percent in October after increasing 1.5 percent in September. The gasoline index decreased 5.0 percent in October, following a 2.1-percent increase in the previous month. (Before seasonal adjustment, gasoline prices fell 5.3 percent in October.)

The index for fuel oil fell in October, decreasing 0.8 percent. The natural gas index rose 1.2 percent over the month after falling 1.9 percent the previous month. The index for electricity rose 0.3 percent in October, after increasing 1.3 percent in September.

The energy index fell 4.5 percent over the past 12 months, as its components were mixed over the year. The gasoline index decreased 5.3 percent, the natural gas index declined 15.8 percent, and the fuel oil index fell 21.4 percent over the span. In contrast, the index for electricity rose 2.4 percent over the last year.

October CORE CPI Breakdown

The index for all items less food and energy rose 4.0 percent over the past 12 months. The shelter index increased 6.7 percent over the last year, accounting for over 70 percent of the total increase in the all items less food and energy index. Other indexes with notable increases over the last year include motor vehicle insurance (+19.2 percent), recreation (+3.2 percent), personal care (+6.0 percent), and household furnishings and operations (+1.7 percent).

Reaction In The Stock Market Today

Following the CPI inflation report for October, the overall markets exploded to the upside. The S&P 500 ETF (SPY) surged above $446 while the NASDAQ ETF (QQQ) jumped above $383. Major tech stocks including Splunk (SPLK) and Qualcomm (QCOM) also surged higher after already gapping up during the premarket session.

Splunk stock news helped propel shares even before Consumer Price Index data came out. The cybersecurity company announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. This is in connection with the previously announced agreement for Splunk to be acquired by Cisco (CSCO) for $157 per share in cash. At the same time, other stocks, including airlines stocks like American Airlines (AAL) are flying higher on speculation due to the upcoming Thanksgiving holiday week. Projections are pointing at record numbers.

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