June 2011 CPI

Yesterday’s inflation report suggests at best a deceleration in inflationary pressures (log annual and monthly changes):

Monthly log changes in the overall CPI ran at 0.3%, which is above the historical norm of about 0.2%, as is core inflation at over 0.1%. The main culprit for June was food (log annual and monthly changes):

…which was running at a 4.6% annual pace. Overall CPI for the first half of the year averaged 3.0% higher than last year. Apart from that the good news, if you could say that,  is that the CPI was not under pressure from any of the other components. Absent any further price shocks in either oil or food, we should start seeing inflation (on a month-to-month basis at least) easing off from July onwards. The headline annual number might still be climbing, but we might finally be seeing some light at the end of the tunnel.

Technical Notes:

June 2011 Consumer Price Index Report from the Department of Statistics