There are encouraging and concerning signals in the latest batch of economic data released by the government this week.
First the good news: despite an uptick on a month-to-month basis in April, annual inflation at the wholesale level fell to its lowest since January 2021. The producer price index (PPI) for final demand increased 2.3 percent on a year-over-year basis (y/y), according to the Bureau of Labor Statistics (BLS). That was down from a 2.7 percent y/y increase in March, a 6.4 percent increase in December 2022, and well below the pandemic-era peak of 11.7 percent in March 2022.
Although inflation in business-to-business transactions captured by the PPI has calmed as supply chain snarls have eased and the cumulative impact of Federal Reserve interest rate increases has taken hold, inflation at the consumer level is proving more persistent. Consumer inflation did cool last month according to BLS data, though you’d almost need a magnifying glass to spot the improvement.
Year-over-year increases in both the overall CPI and the core CPI, which excludes food and energy, decreased a scant 0.1 percentage points in April. The overall CPI increased 4.9 percent y/y in April compared to 5 percent y/y in March, while core CPI growth slowed to 5.5 percent y/y in April from 5.6 percent y/y in March. Both indices were up 0.4 percent on a monthly basis in April. These data take the inflation narrative of much of the last year—moving slowly in the right direction—to an extreme. The slow-motion improvement is particularly apparent and concerning when looking at the core CPI, the closer of the two to the Federal Reserve’s targeted price gauge. Indeed, the core index sits only 0.2 percentage points below its year-end 2022 level.
Separately, results from the Federal Reserve Bank of New York’s latest Survey of Consumer Expectations, released on May 8, show a tempering of near-term inflation expectations among respondents but a small increase in longer-term expectations. The Fed panel’s median one-year-ahead inflation expectation fell to 4.4 percent in April from 4.7 percent in March. The median three-year-ahead expectation in April was for 2.9 percent inflation, up from 2.8 percent the in previous month, while the median five-year-ahead expectation in April was for 2.6 percent inflation, up from 2.5 percent previously.
There are encouraging and concerning signals in the latest batch of economic data released by the government this week.
First the good news: despite an uptick on a month-to-month basis in April, annual inflation at the wholesale level fell… Read the rest
The AFSA Extra Credit Podcast Industry Icon series continues, featuring outstanding female leaders in the consumer credit industry. This episode features Lisa Verdun, Senior Fraud Consultant with Point Predictive. She chats with Danielle… Read the rest
This past week, AFSA’s state government affairs team sent a letter to the Texas House of Representatives expressing support on HB 3389. The bill would amend state law that would improve efficiency in the vehicle finance industry. Under the… Read the rest
AFSA’s Senior Vice President Danielle Fagre Arlowe recently testified before the Oregon House Committee on Rules on HB 2008. The bill would make changes to state law related to debt collection. In her testimony, Arlowe expressed concern … Read the rest
AFSA signed a joint trade urging the Senate Banking Committee to introduce legislation to limit the threat credit repair scams pose to consumers and credit markets.
As several state and federal regulators have warned, credit repair organizations… Read the rest
Today, AFSA commented on the CFPB’s proposal to radically reduce the safe harbor dollar amount for late fees. AFSA asked the CFPB not to proceed with rulemaking, as the proposal fundamentally misunderstands the role of late fees, would negatively… Read the rest
AFSA’s State Government Affairs team published it’s May white paper focusing on algorithms, artificial intelligence, and automated decisionmaking.
Artificial intelligence (AI) and algorithms have transformed numerous… Read the rest
The featured Premier Business Partner for May is RSM.
RSM US LLP is the leading provider of audit, tax and consulting services focused on the middle market, with 9,000 people in 90 offices nationwide. Our full range of services help specialty… Read the rest
Economic growth slowed sharply in first quarter of 2023; consumer spending held solid, but for how much longer?
The Bureau of Economic Analysis’ advance estimate of real GDP for the first quarter of 2023 showed an increase of 1.1 percent compared… Read the rest
In this edition of the AFSA Extra Credit Podcast, Dan chats with Melinda Zabritski, Senior Director for Experian’s automotive financial services team. She swings by to give listeners a look into what we can glean from Experian’s… Read the rest
