The U.S. Bureau of Labor Statistics released its November Inflation report on Wednesday December 11th showing Annual Inflation was up from 2.6% in October to 2.7% in November.
(But since we calculate it to two digits, it was actually 2.60% in October and 2.75% in November but for some reason they rounded down rather than rounding up.) On a non-seasonally adjusted basis, monthly inflation was -0.05% in November but annual inflation rose because November 2023 was a negative -0.20%.
Inflation Prediction:
For a change, the “experts” were right this month with their prediction of 2.7% Inflation for November maybe that is because they agreed with our Mip “Most Likely” prediction for a change. Of course, if we take the calculation to two decimal places that number was a bit low. We warned that with a negative number falling out of the calculation inflation could be up. And the same is true for December.
See this month’s MIP prediction
November 2024 Inflation Summary:
- Annual Inflation rose from 2.60% to 2.75%
- CPI Index fell slightly from 315.664 to 315.493
- Monthly Inflation for November was -0.05%
- Next release January 15th 2025
| Jan | Feb | Mar | Apr | May | June | July | Aug | Sep | Oct | Nov | Dec | |
| 2022 | 7.48% | 7.87% | 8.54% | 8.26% | 8.58% | 9.06% | 8.52% | 8.26% | 8.20% | 7.75% | 7.11% | 6.45% |
| 2023 | 6.41% | 6.04% | 4.98% | 4.93% | 4.05% | 2.97% | 3.18% | 3.67% | 3.70% | 3.24% | 3.14% | 3.35% |
| 2024 | 3.09% | 3.15% | 3.48% | 3.36% | 3.27% | 2.97% | 2.89% | 2.53% | 2.44% | 2.60% | 2.75% |
BLS Commentary:
The BLS Commissioner reported:
“The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent on a seasonally adjusted basis in November, after rising 0.2 percent in each of the previous 4 months, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all-items index increased 2.7 percent before seasonal adjustment.
The index for shelter rose 0.3 percent in November, accounting for nearly forty percent of the monthly all-items increase. The food index also increased over the month, rising 0.4 percent as the food at home index increased 0.5 percent and the food away from home index rose 0.3 percent. The energy index rose 0.2 percent over the month, after being unchanged in October.”
Looking at table A below we can see that on an annual basis energy and commodities are pulling inflation down and both Energy Services and Other Services are pulling it up.
Once again, the biggest gainers on an annual basis were Food away from home, shelter, transportation, and Medical services
Although these “Seasonally Adjusted” numbers are slightly different than those usually presented by the BLS, the following chart from the Federal Reserve shows the gap between inflation with and without Food and Energy. Comparing the two we can see how much food and energy contribute toward overall inflation.
If the blue line is above the red line, food and energy, add to the overall inflation rate. But if blue is below the red line, food and/or energy are actually mitigating overall inflation. With Energy price increases negative they are currently pulling down overall inflation. Without the lower energy prices, overall inflation would be 3.3% instead of 2.75%.
Source: St. Louis FED
FED Monetary Policy
November 2024 Summary:
- FED Assets are Falling
- M2 Money supply is rising
- FED Funds Rates Fell to 4.64%
M2 Money Supply
Looking at the M2 money supply we see a steady growth of the money supply from 2009 through 2020, then a sharp spike as we saw with FED assets, and then a slightly less sharp incline (but longer duration for QE 5) taking M2 to 22 Trillion dollars in 2022. From 2022 to 2023 we see the decline we would expect due to the reduction of FED assets…
More info about FED Monetary Policy and Inflation
Inflation Chart
Monthly Inflation Compared to Previous Years:
The monthly inflation rate for November 2024 was -0.05%.
In the chart below, we can see how the UNADJUSTED monthly inflation compares between 2018 (light green), 2019 (light blue), 2020 (pink), 2021 (purple), 2022 (orange), 2023 (dark), 2024 (teal). Interestingly, January 2018 and January 2024 are identical. In 2024 monthly inflation started a bit higher than average at 0.54%, 0.62%, 0.65%, but April, May, and June 2024 came in significantly lower than 2023, which brought annual inflation down. November 2024 was -0.05% compared to -0.20% in November 2023 so annual inflation rose.
Not Seasonally Adjusted Monthly Inflation Rates
Note: January 2022’s 0.84% was the highest January since 1990. June was the highest June since 1941 (although the first quarter of 1980 had some higher rates). Typically, the first quarter has the highest monthly inflation and the 4th quarter is the lowest (even negative).
| Jan | Feb | Mar | Apr | May | Jun | Jul | Aug | Sep | Oct | Nov | Dec | |
| 2016 | 0.17% | 0.08% | 0.43% | 0.47% | 0.41% | 0.33% | (0.16%) | 0.09% | 0.24% | 0.12% | (0.16%) | 0.03% |
| 2017 | 0.58% | 0.31% | 0.08% | 0.30% | 0.09% | 0.09% | (0.07%) | 0.30% | 0.53% | (0.06%) | 0.002% | (0.06%) |
| 2018 | 0.54% | 0.45% | 0.23% | 0.40% | 0.42% | 0.16% | 0.01% | 0.06% | 0.12% | 0.18% | (0.33%) | (0.32%) |
| 2019 | 0.19% | 0.42% | 0.56% | 0.53% | 0.21% | 0.02% | 0.17% | (0.01%) | 0.08% | 0.23% | (0.05%) | (0.09%) |
| 2020 | 0.39% | 0.27% | (0.22%) | (0.67%) | 0.002% | 0.55% | 0.51% | 0.32% | 0.14% | 0.04% | (0.06%) | 0.09% |
| 2021 | 0.43% | 0.55% | 0.71% | 0.82% | 0.80% | 0.93% | 0.48% | 0.21% | 0.27% | 0.83% | 0.49% | 0.31% |
| 2022 | 0.84% | 0.91% | 1.34% | 0.56% | 1.10% | 1.37% | (0.01%) | (0.04%) | 0.22% | 0.41% | (0.10%) | (0.34%) |
| 2023 | 0.80% | 0.56% | 0.33% | 0.51% | 0.25% | 0.32% | 0.19% | 0.44% | 0.25% | (0.04%) | (0.20%) | (0.10%) |
| 2024 | 0.54% | 0.62% | 0.65% | 0.39% | 0.17% | 0.03% | 0.12% | 0.08% | 0.16% | 0.12% | (0.05%) |
See: Monthly Inflation Rate for more information and a complete table of Unadjusted Monthly Rates.
Misery Index
Current Misery Index:
Unemployment 4.20% + Inflation 2.75% = 6.95%
Unemployment and inflation were up so the misery index rose. The Average Misery index under Trump was 6.9% including COVID or 6.1% excluding COVID and so far under Biden the average Misery index is 9.2%.
[Read More on the Misery Index…]
Rate of Change (ROC) Charts
The NYSE ROC chart as of today remains well into buy territory.
The NASDAQ ROC issued a tentative Sell signal but it was cancelled last month, but now it is threatening to fall again.
Bitcoin generated a buy signal in November.
For more information, see NYSE Rate of Change (ROC) , NASDAQ ROC Chart, and Crypto ROC .
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