MNI DATA ANALYSIS: US April CPI Only Up 0.2%, Core Up 0.1%>

--Overall CPI Ticks Up To 2.5% Y/Y, Core Holds At +2.1% Y/Y

--Initial Claims Unchanged At 211,000 In May 5 Week, Still Very Low

By Kevin Kastner, Sara Haire and Holly Stokes 

     WASHINGTON (MNI) - The April CPI data suggested that consumer 

inflation rebounded, but more modestly than expected, with only a modest 

upward movement in the headline year/year rate, data released Thursday 

morning showed. 

--CPI BELOW EXPECTATIONS

     Overall CPI posted a 0.2% increase, below the 0.3% gain expected, 

while core CPI rose 0.1%, less than the 0.2% gain expected. 

     The whisper number for overall CPI was for a 0.2% gain, so today's 

headline result should not disturb market participants, who were less 

optimistic about inflation growth this month. 

     Unrounded, the month/month rise for overall CPI was +0.221%, on the 

high side of the 0.2% gain, but not even close to being rounded up to 

+0.3%. The unrounded increase for core CPI was +0.098%. 

     Forecasts tend to be fairly accurate for core CPI, so today's data 

were close to that trend, though analysts will need to adjust their 

assessments of current inflation. 

--YEAR/YEAR PRICES LITTLE CHANGED

     Overall, the data point to contained core consumer inflation, as 

the year/year rates were little changed. 

     The year/year rate for overall CPI ticked up to 2.5% from 2.4% in 

March, while the year/year rate for core CPI stayed at 2.1%. 

--HOUSING PRICE UP, VEHICLES DOWN

     The large owners' equivalent rents category was up 0.3%, lodging 

away from home prices were up 0.7%, medical care prices rose 0.1% and 

apparel prices rebounded by 0.3% after a 0.6% decline in the previous 

month. Providing some offset, new vehicle prices fell 0.5%, continuing 

their soft trend, while used car and truck prices fell 1.6%, the largest 

decline since March 2009. 

     Energy prices rose by 1.4% in the month after a 2.8% plunge in 

March. Gasoline prices rose 3.0% and fuel oil prices rose by 2.7%, but 

electricity prices were down 0.6% and natural gas prices fell 0.4%. 

Excluding only energy prices, the April CPI would have been up 0.1%. 

     Food prices were up 0.3% in April, with food at home up 0.3% and 

food away from home up 0.2% in the month. 

--INITIAL CLAIMS UNCHANGED AT 211,000

     In other data released on Thursday, the level of initial claims 

held steady at 211,000 in the May 5 week, compared with a 215,000 level 

expected, keeping the level only marginally ahead of the decades-low 

209,000 level in the April 21 week. The four-week moving average fell 

5,500 to 216,000 as a result, hitting the lowest level since the 

December 20, 1969 week, when it was 214,500. 

     The four-week moving average for claims could fall again next week, 

as a 233,000 level in the April 14 week rolls out of the calculation. 

     The Labor Department said that claims were estimated again in 

Colorado and Maine, and have still not resumed normal operations in 

Puerto Rico and the Virgin Islands. 

     The level of continuing claims rose by 30,000 to 1.790 million in 

the April 28 week after dipping in the previous week. The four-week 

moving average for continuing claims fell by 22,000 to 1.813 million, 

the lowest level since the December 29, 1973 week, when it was 1.784 

million. 

     ** MNI Washington Bureau: 202-371-2121 ** 

[TOPICS: MAUDS$,MT$$$$,M$U$$$,MAUDR$]