**MNI DATA IMPACT: US April CPI Below-Expected +0.3%>

--Core CPI +0.1% Vs +0.2% Expected, Owners Equivalent Rent +0.3%

--Apparel Prices -0.8% After -1.9% In March

By Kevin Kastner and Harrison Clarke

     WASHINGTON (MNI) - The April CPI data were below expectations, 

allowing year/year inflation to tick up only slightly.

     Overall CPI rose by 0.3%, compared with the 0.4% gain expected in 

both the Bloomberg and MNI surveys, while core prices were up 0.1%, 

just below the 0.2% gain expected. 

     Here are some of the key takeaways from the data released 

Friday: 

     - One factor in the softer than expected core reading was a 0.8% 

decline in apparel prices after a 70-year low in March. The core CPI 

reading rose 0.138% unrounded, so it was closer to 0.1% than the 0.2% 

gain expected. 

     - As a result of the 0.3% rise in overall CPI, the year/year rate 

moved up to +2.0% from +1.9% in March. Excluding only energy, the 

year/year rate held steady at +2.0% and the year/year rate for core 

prices rose to +2.1% from +2.0% in March, so the core measures are very 

close to target. 

     - The major core components showed generally positive readings. The 

large owners' equivalent rents category rose 0.3% and medical care was 

up 0.3%. However, new vehicle prices rose 0.1%, and used vehicle prices 

were down 1.3%. 

     - Energy prices rose by 2.9% in April after a 3.5% gain in March, 

with gasoline prices up 5.7%. Electricity prices were flat and gas 

utilities prices fell 0.8%. CPI excluding only energy was up 0.1%, 

while food prices were down 0.1% on foods at home. 

     - MNI analysis showed analysts tend to slightly overestimate April 

core CPI, so today's data were in line with that trend. 

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

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