U.S. Consumer Prices Jump Most Since 2008, Topping All Estimates
Comment of the Day

July 13 2021

Commentary by Eoin Treacy

U.S. Consumer Prices Jump Most Since 2008, Topping All Estimates

This article from Bloomberg may be of interest to subscribers. Here is a section:

Shelter costs, which are seen as a more structural component of the CPI and make up a third of the overall index, rose 0.5% last month, the most since October 2005. The gain was driven by a 7.9% jump in hotel stays.

Wage growth rose steadily through the second quarter, but higher consumer prices are taking a toll. Inflation-adjusted average hourly earnings fell 1.7% in June after slumping 2.9% a month earlier, separate data showed Thursday.

Figures out Tuesday from the National Federation of Independent Business showed 47% of small-business owners, the largest share since 1981, reported higher selling prices in June.

Eoin Treacy's view

The jump in used car prices is a direct result of the semi-conductor shortage. The kinds of chips required by the automotive sector could be in short supply until the end of the year, so that supply inelasticity is likely to last a while longer. It is also having a knock-on effect for the rental car market and even into the U-Haul sector.

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