Friday, March 16, 2007

Just What Gas are Those BLS Shoppers Buying?

by Tom Bozzo

So the Fed is looking soft on inflation, not that there's anything wrong with that, but one oddity in the February CPI report is this, via the NYT:
Gas at the pump inched up 0.3 percent after falling 3 percent the month before.
Oh really? I could be forgetting just how much of the current run-up was in the last two weeks, but we're up about 25% here for the year-to-date, and that isn't all within the last three or four weeks. Nor do I understand this to be particularly localized. The national average price reported by AAA shows a substantial increase in February, and no decrease in January. Seasonal adjustment also doesn't explain it (the NSA CPI-U for gasoline was up more, but only 0.8%).

Are we missing out on a special BLS deal, or will energy prices really not help the March headline CPI?

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They have all gasoline going from 2.321 to 2.333 Jan to Feb (after 2.380 in December) and Unleaded Regular from 2.274 to 2.285 (same time period; 2.334 for Dec).

I'm fairly consistent (read: cheap) with my selection of gas stations. I spent $2.099 a gallon in mid-January and $1.989 in early Feb ($2.199 in December; $2.379 yesterday, and I think of that as a bargain).

So I suspect the daily graphic would show a rise through December and early January, a decline beginning in late January, and a rise again in late February.

Averaging is smoothing.
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