The CPI for April was flat, but the Fed’s favorite measure, core CPI, was up more than expected. Year over year core increases were 1.9%, the most since Nov ‘08. Considering the deflationary environment we have been in since early 2008, this was surprising.
With vehicle sales down 30-40%, I am at a loss to explain the upside surprise in vehicle prices.
Regardless, perhaps this chart, via Ron Griess of The Chart Store, helps to explain the CPI gains . . .