Deceleration – The July CPI Release

From BLS today:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5 percent in July on a seasonally adjusted basis after rising 0.9 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 5.4 percent before seasonal adjustment.

The indexes for shelter, food, energy, and new vehicles all increased in July and contributed to the monthly all items seasonally adjusted increase. The food index increased 0.7 percent in July as five of the major grocery store food group indexes rose, and the food away from home index increased 0.8 percent. The energy index rose 1.6 percent in July, as the gasoline index increased 2.4 percent and other energy component indexes also rose.

Here’s month-on-month CPI, core CPI, and chained CPI, annualized:

Figure 1: Month-on-month annualized inflation rate for CPI for all urban consumers, goods and services (blue), CPI core (green), and chained CPI, seasonally adjusted (tan)%. Chained CPI s.a. adjusted by author. Source: BLS and author’s calculations.

The headline and core CPI numbers came in on Bloomberg consensus.

More to come.

56 thoughts on “Deceleration – The July CPI Release

  1. ltr

    August 10, 2021

    The hard case for soft investment
    By Paul Krugman

    What a difference a few votes in Georgia made! Actually, about $4 trillion worth of difference. Upset victories in the January Senate runoffs gave Democrats narrow control of Congress, and they’re exploiting that narrow control to push a hugely ambitious spending agenda. President Biden might not get all of the public investment and social spending he’s asking for, but it looks likely that he’ll get most of it.

    Part of the spending will come via a bipartisan infrastructure bill that passed the Senate today. The rest will come via a much larger bill, whose outlines were laid out Monday, that Democrats plan to pass on a party-line vote that bypasses the filibuster.

    This two-step legislative process is playacting, and everyone involved knows it — although voters might not. Republicans went along with some infrastructure spending to create the (false) impression that they aren’t implacably opposed to anything Biden might propose. Biden chose to let them play that game to create the equally false impression that he really believes in the possibility of bipartisanship.

    One thing that struck me, however, is the interesting dividing line between what Republicans were willing to vote for and what they won’t even pretend to support. The bipartisan bill is pretty much all about “hard” infrastructure; it’s all steel and concrete. The Democratic resolution has some of that, especially things like clean-energy technologies. But the bulk of the proposed investment spending seems to involve “soft” stuff like child tax credits, child care, universal pre-K and free community college.

    Why this division of playacting — I mean labor? Republicans appear to believe, or at least think their constituents believe, that only tangible, physical investment is real.

    This is, however, an outmoded view. Maybe we once had an economy whose productive capacity depended on visible assets like factories and machinery; these days our most valuable companies derive their value mainly from knowledge rather than physical capacity, and spending on intangible intellectual property accounts for more than a third of business investment:

    The private sector gets less physical.

    Beyond that, it’s a somewhat surprising fact that we have much better evidence for high returns on public spending on people, especially children, than we have for high returns on infrastructure investment.

    Why? Assessing the payoff to infrastructure spending is surprisingly hard, because we don’t get to observe the counterfactuals….

    1. pgl

      A nice discussion. Of course Krugman did not mention transfer pricing abuse or big pharma monopoly power in this particular discussion so JohnH will tell us that Krugman is all for such abuse. That is what JohnH does – all the time.

      1. JohnH

        Funny…Krugman did not mention globalization, either. Nor did he talk about where the funds to pay for soft infrastructure, either. Of course, the government would have a lot more revenue if so much in the way of corporate profits had not been offshores, thanks to globalisation.

        I expect that corporate offshore tax avoidance is something that PK has or will address…without ever making the obvious link to corporate-friendly, managed trade deals, AKA “free” trade deals, that were a necessary condition for rampant tax avoidance. After all, such an admission would only encourage “the barbarians” who might criticise the deals and mitigate their defects.

        1. pgl

          If Krugman were writing a book – then maybe he should mention every issue on the planet. But he has limited space to make a point. Unlike you where you go on and on and on and never makes a coherent and honest argument.

      2. JohnH

        No, what I am saying that when Krugman praises drug companies’ marvellous supply chain without any context behind it, he is telling only part of the story and covering up the abuses fostered by globalisation. It’s a deceptive practice very similar to the media’s unreservedly hyping only the marvel of the “shock and awe” of the Iraq War, leading to the US quagmire there. Krugman’s refusal to talk about corporate abuses of globalisation helps assure that they will not be fixed anytime soon.

        The best time to fix corporate abuse of trade deals would have been before they were approved. Unfortunately, a lot of economists demonstrated a blind herd mentality to extol a deal whose real world implications they barely understood. A few are starting to express buyer’s remorse…a couple decades to late. Krugman has yet to get there in his NYT column, though he has acknowledged some problems…well out of public view.

        1. pgl

          Maybe I have not been clear so let me say this plainly – you are a worthless lying waste of time.

        2. JohnH

          Reading a NY Times piece by Krugman makes me feel like I do when I’m talking to a used car salesman—what is this man not telling me?

          I’m not the only one to note his use of radical simplification to sell his opinion.But it’s shameful for a renowned academic to adopt such a deceptive public persona. But it works well in a ‘gotcha’ culture that focuses mostly on feeling superior to others, particularly to those with whom you disagree…IOW, people like pgl.

          No wonder so many hold experts in such low regard. Dani Rodrik has been warning economists about this for years without much success.

          1. Barkley Rosser

            So, JohnH, what do you think of SecTreas Yellen’s proposal to place a minimum 15% corporate profits tax on that now has the support of the EU and most other major nations? Is this not a start at getting at all these globalized profits? Your big working class hero, Donald J. Trump, certainly never proposed anything like this, only a bunch of mostly stupid tariffs that on net damaged the US economy and certainly did nothing at all to undo any of this globalization of profits that you are so obsessed with.

          2. JohnH

            Yes, Yellen’s proposal is definitely a positive step, although 15% is way too low.

            Trump was a fraud, as everyone should have know years ago. But they don’t. And Republicans advertising of tax cuts masks the fact that the cuts overwhelmingly benefit corporate America and the 1% while giving a few crumbs to the rest of us. It’s more used car salesmanship—what they don’t tell you is probably what’s most important, whether it be Republicans, Democrats, or economists trumpeting trade deals.

    2. ltr

      When it comes to investment in people, by contrast, we often do get to observe the counterfactuals.

      The food stamp program, for example, was rolled out gradually across America, not introduced immediately on a nationwide basis. So was Medicaid, which was also enhanced in a series of discrete steps in the decades after its creation.

      These gradual rollouts provide us with natural experiments….

      — Paul Krugman

  2. pgl

    “The energy index rose 1.6 percent in July, as the gasoline index increased 2.4 percent and other energy component indexes also rose.”

    Something tells me this will moderate as oil prices have not hit the Princeton Steve forecast of $100/barrel. The most recent WTI quote was just shy of $68/barrel.

    Now I’m sure he is going to complain about the high price for his bagels. Keep up posted on the price of lumber!

    1. Moses Herzog

      A famous writer gives his thoughts on the man pgl called America’s leader on Covid-19 policy response:

      Pelosi did help kill off one of this nation’s best friends to labor unions though, and with corporate Democrats’ money even got the auto workers’ union to turn against Nina Turner. But according to some people on this blog Pelosi is “class” through-and-through.

      Do you folks who think Nancy Pelosi is such a sharp-minded and intelligent person think Pelosi didn’t hear talk around the campfire over the years that Andrew Cuomo acted the way he did around women and continually bullied New York State authorities and agencies?? Just remember, you can’t have it both ways, you can’t say Pelosi is sharp-minded and that she was clueless on what a bastard Andrew Cuomo has been over the years. Some people on this blog wanted to pretend they didn’t see how tight Pelosi was with Joe Crowley. Folks, if you make good friends with the children playing waist-deep in sewer water, some of it splashes up on you. Maybe, eventually, some of you who run to Pelosi’s defense like pgl told me I was a trump-lover for attacking Andrew Cuomo will figure that out, though apparently, due to low intelligence, on some kind of time-lag.

      1. pgl

        You persist in your petty little lies? Guess what old drunk troll. The governor of my state is about to be a woman and we are celebrating. But yea – an old pig like you will find some way to call her a bit$$. It is your style. After all Randy Andy’s disdain for ladies pales in comparison to yours.

        Maybe you should start your own blog which we can all ignore – and not pollute this one with your stupid, pointless, and dishonest rages.

        1. Moses Herzog

          In the above permalink commenter pgl states: “Cuomo hosted a conference call with the governors of the Northeast Region which expressed some smart ideas including the need for testing. Cuomo is basically our national leader given we still have a pack of clowns occupying the White House.”

          Then later, in the above permalink, pgl also goes on to say: “A little good news from NYC on the restaurant situation. A lot of the Park Slope (Brooklyn) ones were serving food that people enjoyed sitting at tables outside. I’m just hoping our very careful governor does not freak out at what is happening in other states. We are pulling through and slowly reopening. Maybe the restaurant owners should demand proof that their customers are New Yorkers as we don’t need the damn mistakes being made in other states.”

          So who is lying here??~~sadly for both pgl and Barkley Junior, we can go back to these permalinks ANY TIME they call people liars. Or even when they call other commenters “trump-lovers” when they call out Andrew Cuomo’s true record:

      2. pgl

        “Today, House of Representatives Democratic Leader Nancy Pelosi endorsed Governor Cuomo’s Enough is Enough campaign to combat sexual assault on college campuses while at the Fashion Institute of Technology in New York City. Democratic Leader Pelosi’s support reflects the increasing pressure felt across the country to end this growing epidemic and highlights the leadership role New York is taking in this fight.”

        Oh I see why you are upset. You are the kind of guy who would applaud sexual assault. Yea – Randy Andy is a pig for his sexual harassment but this pales in comparison to rape. But old Uncle Moses has sweet dreams of Pelosi getting raped.

        BTW retard – a friend of mine was raped by Weinstein and I’m sure she would be highly offended that someone like you abuse this garbage for raw partisan garbage. Enough is enough is right but never for a lying pig like old horny Uncle Moses.

      3. pgl

        Greenwald claims everyone knew for a long time that Randy Andy was a sexual predator? WOW – he is even more dishonest than old drunk Uncle Moses. Please find us a post from Greenwald from a couple of years ago where he disclosed this information. If he did not – he is nothing but a liar who abuses the suffering for his own partisan agenda. Yes Glenn Greenwald could care less about woman’s right – just tooting his own little horn. Pathetic.

        1. JohnH

          Poor Cuomo. First, they came for the NY Senate Republicans who worked with him to block progressive legislation.

          Then they came for the Independent Democratic Conference who took Republicans’ place in working with Cuomo to block progressive legislation.

          Then they came for Cuomo.

          pgl must be devastated. A conservative Democratic icon has been toppled! Makes my day.

          “Before Trump’s election, Cuomo had built a unique political system in New York in which power flowed upward to him. Republicans controlled the state Senate, significantly thanks to Cuomo, who helped create a renegade band of Democrats known as the Independent Democratic Conference. The IDC allied itself in the state Capitol in Albany with Republicans, while Cuomo fended off insurgent Democrats’ efforts to unseat Republican senators and reclaim the chamber. The GOP’s control of the upper chamber marginalized the progressive wing of the Democratic Party, creating an obstacle that could be cited for the failure to enact the party’s agenda…

          In a feat that would have been inconceivable in the previous cycle, progressive Democrats smashed the IDC out of existence and reclaimed the Senate, giving Democrats unified control and stripping Cuomo of excuses. That made Andrea Stewart-Cousins the Democratic Senate leader, taking power after Cuomo spent years thwarting her rise.“

          1. pgl

            Almost as dumb as old Uncle Moses. I’m a De Blasio Democrat. But of course you and old Uncles Moses could care less about the rights of these 11 women who you get to play political football instead.

      4. pgl

        Gee this Greenwald claim that Democrats knew all along that Randy Andy has been a scum is getting TONS of attention from the usual right wing hit jobs such as Faux News. Of course Greenwald is always a welcome guest on these shows as he makes all sorts of allegations about sexual assault by prominent Democrats.

        Look I have done my best to dissuade sexual harassment in the work place and even a few times been lucky enough to be in the right place to shut down an attempted rape. I would never use this stuff as a political weapon as it too important for partisan garbage. But of course I’m neither Glenn Greenwald nor old Uncles Moses – thank God!

        1. Moses Herzog

          The four comments by pgl just above, speak for themselves. And if you look at both the general tone, and also at certain individual sentences, I’m happy to let the chords of pgl’s four comments above resonate to all who choose to read them.

          I just have to point out two sentences. I encourage all, after you’re done belly-laughing at the above, to focus on two sentences and ask yourself where you fit that on a believability scale.

          “I would never use this stuff as a political weapon as it [sic] too important for partisan garbage.” No, no one would accuse you of using legit sexual harassment claims or multiple molestations by a state Governor of his staff and a New York state trooper as a partisan weapon pgl. You would never do that to a New York politician anyway……. Perish the thought. But, pgl, you’ve “busted” me alright, as my record as a staunch Republican is well known on this site, so I couldn’t resist using this “partisan weapon”.

          “Look I have done my best to dissuade sexual harassment in the work place and even a few times been lucky enough to be in the right place to shut down an attempted rape.” Wow, that’s an impressive claim. Almost enough to push credulity. “A few times ‘lucky enough’ to shut down an attempted rape”. [interesting phrasing, “lucky enough”?? I would think the potential rape victim would prefer the entire event never occurred]

          pgl, I’d say you missed a career in law enforcement. “A few times been lucky enough to be in the right place shut down a rape”. Fascinating. Tell us the places you hang out where you on your own “shut down” these things “a few times”, so women know where to avoid. I’m wondering out of say 10,000 readers on this blog, how many could say they themselves “shut down” a rape from occurring “a few times”. Honest to God, i’d like to see the numbers of those blog readers, excluding those who work in law enforcement or similar type work. You are a special person pgl, I feel you surely deserve some public service award. Who could doubt you deserve an award based on that claim???

          1. pgl

            Another long winded pointless rant. I would never accuse you of lifting a finger to help out a lady. No – you hunker down alone in your safe basement looking for some new place to score political points as the actual rights of women have never been your style.

          2. pgl

            ” I would think the potential rape victim would prefer the entire event never occurred”

            Of course she would prefer not to be attacked but I said I was the lucky one to be there to stop some jerk from screwing with a fellow runner. Now your reading skills generally suck but in this case you knew what I meant. But a little liar like you twists and turns everything.

            “pgl, I’d say you missed a career in law enforcement.”

            Oh – only cops can deter rapes? 40 years ago when I live in New Haven, the cops had a problem with rapists attacking women runners. They did something smart – they enlisted the aid of running clubs and the guys were all too happy to work with them. It was the right thing to do.

            But of course old Uncles Moses cannot phantom this. First of all he is too lazy to go runner preferring to mock those of us who do. But just imagine Moses coming up on a potential rape scene. He would do nothing to stop it as he could care less preferring to flee the scene like the little chicken he is.

      5. JohnH

        Moses: as the old adage goes, politics makes for strange bedfellows!!!!

        I’m always amazed at the accolades for Pelosi, which I assume are mere plants by her publicists. The main reason Pelosi is where she is is because she is a fund raising dynamo. Of course, the flip side of that is that she is very solicitous of her donors and very much less so to the Democratic base…pgl’s kind of gal.

      6. Barkley Rosser


        The person who led the charge against Turner was Jim Clyburn, not Pelosi. Hr went to this predomiantly Black district in Cleveland to campaign for her opponent. She dissed him during the campaign for the nomination for supposedly providing Dems with Biden, which she said was like voting for “s–t,” a statement that is what probably did her in, given that now Biden is quite popular among Blacks around the country.

        You have again gone bonkers about Pelosi. It really is embarrassing. I suggest you go get yourself some good premium ice cream and enjoy it.

        Oh, and Greenwald has done nothing worthwhile since his public service on the Snowden revelations. But that was some time ago. As pgl accurately notes, he has turned into a total Fox News ahill, simply worthless.

        1. Moses Herzog

          It was more than just Jim Clyburn doing Pelosi’s work for her, and following Pelosi’s worn-out playbook destroying real Democrats,, while Pelosi sat on the couch eating salon ice cream.

          And it’s not surprising seeing the two fake Democrats on this blog “taking the bait” every single time.

          You and pgl, Hillary and Pelosi always love the window dressing candidates. Because it does nothing to help people disenfranchised and goes on paying the bills of the people you and pgl feel your real fraternity with:

        2. pgl

          BTW – this Huff Post account never mentions Pelosi but it did mention Wayne Blanchard:

          “Shontel Brown has stood with us on picket lines. She listens and brings people together, and that makes her a compassionate and effective leader,” Wayne Blanchard, director of UAW Region 2B, said in a statement. “We are confident Shontel will work with President [Joe] Biden and with her constituents to Build Back Better ― and ensure the recovery lifts up Northeast Ohio.”

          Hey – Turner got the support of the tobacco workers. Given I hate tobacco, I am not impressed.

      7. JohnH

        “Nancy and Paul Pelosi Making Millions in Stock Trades in Companies She Actively Regulates“

        Folks, if you make good friends with the children playing waist-deep in sewer water, some of it splashes up on you. [Moses]

        Greenwald is a national treasure…doing just what journalists are supposed to do, exposing corruption and abuse of power. Of course, this makes partisan hacks like pgl very uncomfortable.

        1. noneconomist

          You just discovered that the Pelosi”s are wealthy? That she has a base that has re-elected her handily multiple times? A base centered in that supposed most socialist of cities, San Francisco?
          Here’s another shocker. Her fellow San Franciscan, Sen.Feinstein, is also quite wealthy. Since you’re supposedly up on these doings, you might remember that Feinstein handily whipped the progressive pick, lightweight Kevin DeLeon. That she carried the progressive strongholds of San Francisco, Oakland-Berkeley, Marin (the entire Bay Area really) and was +17 (or so) in Los Angeles. That base.
          And speaking of the base you supposedly know so much about, the California progressive base did not not produce a combined majority for Sanders and Warren in the 2020 primary.
          Pardon me for repeating the above since you know all that needs knowing where the base is concerned.

          1. pgl

            I used to live in Pacific Heights just a few blocks from where the Pelosis live. Nice place but not exactly cheap rents. So yea – her and her husband are indeed comfortably well off. I bet JohnH is jealous as he could not afford even the Tenderloins.

        2. pgl

          They own Apple stock? Communists! I guess JohnH only invests in companies who have gone bankrupt. He is that STOOOPID.

        3. Barkley Rosser


          Sorry, JohnH, Greenwald WAS a national treasure when he was the person getting the Snowden stuff out into the public. But since then he has become a totally reactionary shill, indeed a fave for various Fox News shows where he regularly shows up.

          Just exactly what has he done since the Snowden stuff that is deserving of great praise, much less any praise? He seems to have become utterly worthless. I am sorry about this, as he was once an excellent reporter. But not for a long time. Mostly just repeats right wing lies these days.

  3. pgl

    “Chart 1. One-month percent change in CPI for All Urban Consumers (CPI-U), seasonally adjusted, July 2020 – July 2021
    Percent change”

    I have reproduced the title of the first chart in this BLS report to show folks how it should be done – a very clear presentation of the data. Now everyone here gets the importance of doing this – everyone except Econned who has been known to present data from FRED with absolutely no labeling. Whether this is a 1-month percent increase v. an annualized increase is something that should be made clear.

    Of course when I asked Econned to please do this – he first got all angry and later he blamed the folks at FRED for his laziness. Yes – he is the kind of guy!

    1. EConned

      To anyone who is marginally accustomed to data analytics or even merely reading graphs, it’s all there in the graph itself. Only the illiterate or innumerate can’t see that themselves.
      Again, thanks for the free rent! Honk! Honk! Honk!

      1. pgl

        You posted a graph with absolutely no labeling at all. Only a complete moron would not have gotten my simple point – and of course you still have not gotten it. Figures!

        1. EConned

          Your claim that I “posted a graph with absolutely no labeling at all” is 100% false. As anyone with the slightest experience with FRED data is aware, their default graphs are clearly labeled and extremely functional and clear. Unless you can prove otherwise with a direct link that I “posted a graph with absolutely no labeling at all” I will not respond to any of your follow-up comments in this thread. Also note that you just tacitly acknowledged you’re innumerate and/or illiterate. I think your clown car is out of fuel. Honk! Honk! Honk!

          1. pgl

            You did post a graph with very inadequate labeling. Maybe FRED has great labeling which you decided to erase – that would be like you. Take a little responsibility troll.

          2. EConned

            Responsibility? How about you post the link to support your erroneous claim. Else… give it up, go take a basic stats course, and put away your clown nose.

  4. macroduck

    “The Atlanta Fed’s sticky-price consumer price index (CPI)—a weighted basket of items that change price relatively slowly—increased 3.3 percent (on an annualized basis) in July, following a 3.5 percent increase in June. On a year-over-year basis, the series is up 2.5 percent.

    “On a core basis (excluding food and energy), the sticky-price index increased 2.7 percent (annualized) in July, and its 12-month percent change was 2.4 percent.

    “The flexible cut of the CPI—a weighted basket of items that change price relatively frequently—increased 14.6 percent (annualized) in July and is up 14.1 percent on a year-over-year basis.”

    Arguably, the sticky price series, especially the core series, mean the Fed is still on track, running inflation moderately above 2% to make up for a prolonged period of below-target inflation.

    1. macroduck

      In fact, the good news from the core sticky price series is that the inflation under-shoot from this recession was smaller than for the last one. Perhaps the combined effect of bottlenecks and shorter duration.

      1. Moses Herzog

        You’ve indirectly reminded me to catch up on Brainard’s recent comments, who from my view, often strikes me as more cerebral than most on the FOMC.

    1. JohnH

      Remember all secrecy surrounding every trade deal? But corporate America was quietly informed about the deals to make sure they got theirs, which they certainly did!

      It would have been a good thing for economists to criticise: make the deals truly about free trade, less about protecting corporate interests…not that pgl ever cared to notice.

      1. pgl

        Lord – you are one dumb pest. I guess they should be shamed for not writing on sexual harassment too. Oh wait – you have never mentioned this topic. By your stupid “standard” – you are endorsing sexual harassment.

        1. JohnH

          pgl never mentioned that he worked hard to discourage lying, cheating and stealing at his workplace.

          Therefore he must have condoned lying, cheating and stealing…particularly lying.

          1. pgl

            And she eats quality ice cream. Gee JohnH – we have found someone even more pathetically dishnonest than you. Try harder.

          2. pgl

            Yea I did rat out a few corporate slime balls like you. Of course this kind of corporate dishonesty is more prevalent than it should be but then it sometimes allow inept executives like you to draw ill begotten salaries. What was the name of that former Fortune 200 company that you led to bankruptcy?

  5. Moses Herzog

    Well, very obviously it’s not the quality you might get in NYC, but just as an interesting “price point” for Stevie Kopits, where I live you can get a bag of “mini bagels” cinnamon raisin or plain, 18 ounces for $2.49.

    8 ounces off-brand cream cheese for $1.39.

    Now to me this doesn’t spell out inflation. But Johnny Cuckrant of “Grumpy Economist blog” fame, may be here any moment to tell us the world is coming to an end for “savers” like him. Who knows, maybe Johnny Cuckrant is a “job creator” also!!!! Wow, that would be exciting,

    I guess if you refuse to talk about economic growth after a Republican President worked overtime at telling people not to wear masks which in turn caused shutdowns, then you see if you can make transitory inflation into 1970s inflations. Thank God Johnny Cuckrant is not the type to carry a political agenda or he might spend 30 years running predicting inflation.


    Still pretty high inflation. 4% looking likely in 2021. At the edge of my comfort level.

    1. pgl

      Well since you are clearly living off the government dole – maybe you should check whether your handouts are indexed to the price level. Oh wait – you would not know how. Never mind.

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