CPI for Sept Moderates As Oil Drops To $69, Jobless Claims 461k, Credit Crisis Overshadows Inflation

The US Consumer Price Index, which measures inflation at the consumer level of the economy, was 0.0% in September and +4.9% year-over-year through September. Excluding volatile oil and food costs from the readings, “Core” CPI for September was +0.1% and +2.5% YOY through September. Below are the numbers for the third quarter.

Overall CPI Third Quarter:
Sept-Mo= 0.0%, Aug-Mo= +0.1%, July-Mo=+0.8%
Sept-Yr= +4.9%, Aug-Yr= +5.4%, July-Yr=+5.6%

Core CPI Third Quarter
Sept-Mo= +0.1%, Aug-Mo= +0.2%, July-Mo=+0.3%
Sept-Yr= +2.5%, Aug-Yr= +2.5%, July-Yr=+2.5%

The yearly overall numbers that include oil and food clearly show the effect of dropping oil prices since summer, especially from August to September as oil prices really plummeted–today oil is trading at $69. The core numbers are slightly down for the monthly figures and flat for the YOY numbers. So given that the credit crisis is taking center stage on how markets react and the fact that these numbers are tame and will probably moderate even more in a weak economy, recession looks to be trumping inflation as the main concern.

Also today we saw jobless claims go to 461,000, and now there’s about 3.7 million workers collecting unemployment benefits. For those who won’t admit there’s a recession until we meet the official definition of two consecutive quarters of negative GDP growth, the jobs situation should be proof enough.