Inflation Not Bad

Today’s news was OK.  I usually look at the CPI in 12-month percent change format:

I see that high energy inflation (included in "All Items") has not bled through to the core inflation rate ("Ex Food & Energy").  Still, whenever I look at a 12-month percent change, I worry that maybe I’m missing a trend that is only a couple of months old.  So I look at the month-month change:


If you think the data are bogus, take a look at the Wall Street Journal article on that subject (subscription required) here.

Business implication: aside from energy and a few other hot sectors, it won’t be easy to push cost increases onto your customers.