Posted by Joseph Y. Calhoun, III

Consumer prices rose a modest 0.4% in November:

On a seasonally adjusted basis, the Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months the index increased 1.8 percent before seasonal adjustment, the first positive
12-month change since February 2009.

The seasonally adjusted increase in the all items index was due to a 4.1 percent increase in the energy index. The index for gasoline rose sharply and the indexes for electricity, fuel oil, and natural gas also increased, creating the fourth consecutive rise in the energy index and the largest increase since August. In contrast, the index for all items less food and energy was unchanged in November, after ten consecutive monthly increases. Declines in shelter indexes offset increases in the indexes for new and used motor vehicles, medical care, airline fares, and tobacco.

The food index rose slightly in November. As in October, the food away from home index rose modestly while the index for food at home was unchanged. Within the latter, three grocery store food groups posted increases while three declined.

Like the PPI yesterday, the CPI is showing year over year inflation now that the comparisons are to the period last year whan prices collapsed.

Fears of deflation are vastly overblown now just as they were earlier in the decade. Bernanke isn’t even clever enought to make different mistakes - he’s making the same one all over again.