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Broader CPI Dispersion Measures Show Notable Weakening

US DATA
  • Belying the strength in supercore CPI inflation (0.44% M/M, 3-month annualized with a 5 handle), dispersion measures suggested less inflationary pressure across the entire CPI basket.
  • By our calculation across 57 items, just 33% were growing faster than 3% annualized in November vs 42% in Oct for its lowest since Apr’20 and below the 41% averaged in 2019.
  • However, nearly all of this share is still growing very strongly, with 28% of the basket growing in excess of 5% annualized. It’s down from 30% in Oct and is its lowest since Oct’20 but remains above the 25% averaged in 2019.
  • The share in outright deflation is particularly of note, jumping from 40% to 54% for its highest since at least 2010 and vs the 2019 average of 38%.

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