The consumer price index rose 0.1 percent in October, according to the Bureau of Labor Statistics. This is a slower pace than what was observed in August and September (with 0.6 percent higher inflation in both months) when energy prices were up sharply. In October, energy prices were down 0.2 percent, with gasoline prices off 0.6 percent. Food prices increased 0.2 percent, with higher dairy, meat, and fruits and vegetables pushing costs up.

Core inflation – which excludes food and energy costs – were up 0.2 percent. This was largely due to higher costs for services (up 0.3 percent). The average price of core goods has fallen for three consecutive months and was down 0.1 percent in October. Year-to-date core inflation is currently 2.0 percent, which is in-line with the goal set by the Federal Reserve Board and suggests modest price increases overall. Indeed, the minutes from the October Federal Open Market Committee meeting, which were released yesterday, read:

Participants saw recent price developments as consistent with inflation remaining at or below the Committee’s 2 percent objective over the medium run. Although energy prices had risen sharply in recent months, reflecting earlier increases in crude oil costs and supply disruptions, gasoline prices were anticipated to move back down in coming months as those pressures eased. Similarly, effects of the drought were expected to show through to retail food prices over the next few quarters but then subside. By various estimates, underlying inflation trends remained subdued, and indicators of longer-term inflation expectations were generally viewed as stable.

With inflation in-check (at least for now), the FOMC has been free to pursue more accommodative actions, helping to push interest rates to historic lows and attempting to stimulate economic growth. These policies are expected to continue moving into 2013.

Chad Moutray is chief economist, National Association of Manufacturers.

The consumer price index rose 0.6 percent in September, according to the Bureau of Labor Statistics. This matched the increase in August. Higher energy costs were the main contributor to the gains, with consumer energy prices up 5.6 percent and 4.5 percent for the past two months. Gasoline prices in September rose 7 percent, as we have seen a pickup in petroleum costs recently from the easing experienced earlier in the year.

Food prices rose 0.1 percent for the month. Higher nonalcoholic beverages prices (up 0.9 percent) were offset by declines in meat, poultry, fish and eggs (down 0.6 percent) and fruits and vegetables (down 0.4 percent). The food categories that were down represent some easing from prior months. Year-over-year food prices were up a modest 1.6 percent.

Excluding food and energy prices, core inflation from September 2011 to September 2012 was 2.0 percent. This is in-line with Federal Reserve Board targets, suggesting that pricing pressures are currently under control.

Note that the producer price index for September noted some higher food and energy costs at the intermediate and crude levels that will be forthcoming in future months. Even with these expected increases, inflation is expected to remain modest. If not, I would anticipate that the Federal Reserve Board might need to readjust. For the time being, though, they are more worried about slowing global and U.S. economic growth than they are about inflationary pressures.

Chad Moutray is chief economist, National Association of Manufacturers.

The Bureau of Labor Statistics reported that consumer prices rose 0.6 percent in August. This follows flat inflation for three of the past four months, as lower energy costs helped to ease inflationary concerns. As we saw with yesterday’s announcement on producer prices, August’s increase in pricing pressures was led by rebounding energy costs, particularly for gasoline, fuel oil, and natural gas. Overall energy prices were 5.6 percent higher last month for the consumer, with gasoline up 9 percent.

Food was another driver of growth at the producer level. This has not yet translated to higher consumer costs, with some notable exceptions (e.g., pork, eggs, whole milk, fresh fruit, and processed vegetables). Total food costs increased 0.2 percent, with food purchased at restaurants up 0.3 percent.

Core inflation, which excludes food and energy costs, increased 0.1 percent, the same as last month. On an annual basis, overall and core inflation were 1.7 percent and 1.9 percent, respectively. This suggests that inflation remains modest, and more specifically, it is under the 2 percent target stated from the Federal Reserve. With current inflation “in control,” this frees the Fed to do what it did yesterday by undertaking another round of quantitative easing to help stimulate the economy.

Chad Moutray is chief economist, National Association of Manufacturers.

The Bureau of Labor Statistics said that consumer prices were unchanged in July for the second straight month. Lower energy prices helped drag overall costs lower, including reduced prices for electricity and fuel oil. Gasoline prices, though, rose 0.3 percent. Food prices were also higher, up 0.1 percent.

Core inflation, which excludes food and energy costs, rose 0.1 percent in July. On an annual basis, overall and core inflation were 1.4 percent and 2.1 percent, respectively. This suggests a significant easing in inflationary pressures over the past few months, particularly for goods. Prices for goods have risen just 1.2 percent over the past year, down from 2.2 percent in January. A weaker economic environment is clearly restricting price increases for finished goods.

These number mirror yesterday’s producer price data, which also found energy prices easing inflationary concerns. This suggests that core price increases are currently around the Federal Reserve’s stated goal of 2 percent of less. This frees the Fed to continue to promote “exceptionally low” interest rates, as is its current policy, but it might also help ease concerns for those pondering additional monetary policy steps. The Federal Open Market Committee will meet on September 18-19, where it is expected that they will debate the need for another round of quantitative easing.

Chad Moutray is chief economist, National Association of Manufacturers.

The Bureau of Labor Statistics reported that consumer prices rose 0.4 percent in February, faster than the 0.2 percent increase in January. As we saw with yesterday’s producer prices release, higher energy costs led this acceleration, up 3.2 percent. Gasoline prices alone went up 6 percent. On an annual basis, consumer prices are up 2.9 percent.

This increase is a prime example of the need for an “all of the above” energy strategy to take advantage of our domestic resources to lower energy prices.

Food prices were unchanged overall. The prices of fats and oils, for instance, were offset by falling prices for meats, daily, fruits and vegetables. When food and energy costs are excluded, core inflation is running at 2.2 percent, essentially unchanged from the 2.3 percent reading last month.

Outside of food and energy prices, other consumer cost changes were mostly modest. Apparel was one of the exceptions, with prices down 0.9 percent. This reverses the 0.9 percent gain last month.

Overall, consumer inflation remains modest, but with the recent run-up in energy costs, prices have accelerated. This will squeeze Americans’ pocketbooks, and depending on how sustained it is, it could also zap consumer confidence in upcoming surveys.

Chad Moutray is chief economist, National Association of Manufacturers.