U.S. Consumer Prices Unchanged, Matching Forecasts

[Beet]

By Timothy R. Homan

Aug. 14 (Bloomberg) -- The cost of living in the U.S. was unchanged in July, and dropped by the most since 1950 from a year ago, as the recession sapped companies’ pricing power.

The flat reading matched the median forecast of economists surveyed by Bloomberg News and followed a 0.7 percent increase in June, data from the Labor Department showed today in Washington. Excluding food and energy costs, the so-called core index rose 0.1 percent, also as anticipated.

Today’s figures indicate no sign that the Federal Reserve’s record $1 trillion of injections into the banking system have passed through to faster inflation. Retailers including Nordstrom Inc., Abercrombie & Fitch Co. and American Eagle Outfitters Inc. have used discounts to lure consumers on tight budgets in the aftermath of job losses and home-price declines.

Treasuries headed higher after the report, sending benchmark 10-year note yields down to 3.57 percent at 9:21 a.m. in New York from 3.60 percent late yesterday. Futures on the Standard & Poor’s 500 Stock Index were little changed at 1,013.20.

http://www.bloomberg.com/apps/news?pid=20601068&sid=akb72dWFWOzs

Similar data in Europe; consumer prices fell by more than expected, 0.7%. Consumers still aren't spending. We still have deflationary dynamics and it's far too early to declare victory, as some pundits (particularly some on the left, which is disappointing) have done.

[Sam Spade]

Consumer sentiment was also terrible - 63.2 vs. 69 expected.  That variable usually tracks the stock market but has diverged over the past couple of months, which is a reason why I continue to not play long despite the technicals looking good.  (there are countless other fundamental reasons too of course - like almost every one of them)

It's also a major reason why the stock market is getting killed today so far.  We were right up against a very important technical level too, oh well...

Btw, both this and your article fits with the anecdotals I have too.

[Swing low, sweet chariot. Comin' for to carry me home.]

Consumer sentiment was also terrible - 63.2 vs. 69 expected.

granted, but the survey only included 250 people.

[Marokai Backbeat]

By Timothy R. Homan

Aug. 14 (Bloomberg) -- The cost of living in the U.S. was unchanged in July, and dropped by the most since 1950 from a year ago, as the recession sapped companies’ pricing power.

The flat reading matched the median forecast of economists surveyed by Bloomberg News and followed a 0.7 percent increase in June, data from the Labor Department showed today in Washington. Excluding food and energy costs, the so-called core index rose 0.1 percent, also as anticipated.

Today’s figures indicate no sign that the Federal Reserve’s record $1 trillion of injections into the banking system have passed through to faster inflation. Retailers including Nordstrom Inc., Abercrombie & Fitch Co. and American Eagle Outfitters Inc. have used discounts to lure consumers on tight budgets in the aftermath of job losses and home-price declines.

Treasuries headed higher after the report, sending benchmark 10-year note yields down to 3.57 percent at 9:21 a.m. in New York from 3.60 percent late yesterday. Futures on the Standard & Poor’s 500 Stock Index were little changed at 1,013.20.

http://www.bloomberg.com/apps/news?pid=20601068&sid=akb72dWFWOzs

Similar data in Europe; consumer prices fell by more than expected, 0.7%. Consumers still aren't spending. We still have deflationary dynamics and it's far too early to declare victory, as some pundits (particularly some on the left, which is disappointing) have done.

Duh.

As if I needed to be told that the hysterical "hyperinflation on the way!" people were paranoid.

[Swing low, sweet chariot. Comin' for to carry me home.]

Consumer sentiment was also terrible - 63.2 vs. 69 expected.

granted, but the survey only included 250 people.

yep!!! this survey is much less reliable than The Conference Board's survey, which conducts a monthly survey of 5000 households and showed a HUGE jump in consumer confidence.

[○∙◄☻¥tπ[╪AV┼cVê└]

If consumers aren't spending much, there's not going to be much inflation.