The Bureau of Labor Statistics (BLS) released the inflation data from April today [DATA HERE] showing 0.3% increased inflation in April and a continued 8.3% ‘sticky’ inflation year-over-year.
CTH is going to say something slightly unusual, this data is actually worse than expected. The hidden canary in the mine is within this BLS sentence which shows in the statistics, “the index for gasoline fell 6.1 percent over the month, offsetting increases in the indexes for natural gas and electricity.” Remember, these are backwards reflections of price captured in early/mid-April.
The actual price of gasoline dropped 1% in April during the timeframe captured. Yes, there was an actual 18 days in April when gasoline prices moderated and slightly ticked down; however, those prices immediately jumped again late April through today.
Because the BLS puts a 5x weight on the importance of gas [Table A], the 1% temporary drop in gasoline led to 6.1% downward “seasonally adjusted” price pressure.
All of that said, and with the heavy weighting of the gasoline prices considered, the net inflation results barely moved from March (8.5%) to April (8.3%). I modified Table-A to take out the noise. You can see the downward pressure from gasoline and simultaneously the upward price pressure from food, specifically food at home.
This outcome is a reflection of what we have been seeing in the supermarkets and grocery stores.


