Random Walk at Night: Price Check is Not Bad

Inflation is directionally cooling, but there's still one price that continues to irk

Inflation printed again! Random Walk got a little carried away and turned a short post into a longer one. Generally, the data’s not bad, but not as good as some people seem to think.

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Everything reads better in your browser or in the app. The footnotes especially, and Random Walk is really leaning into the footnotes. Plus, if you have the app, you can set delivery to “app only” and then my daily barrage will feel less like a barrage. Unfortunately, substack does not yet have a “Weekly Digest” option, but I’m hectoring them aplenty.

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Random Walk at Night

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Price Check

We have a new price check, and it’s basically good news (or at least not bad news).

The stuff that’s expected to not get expensive isn’t, while the stuff that’s expected to get expensive is, but not too badly.

If 2% annualized is the number you’re shooting for, then you’re looking for ~0.16% on monthly basis.¹

Big Picture

Scoreboard says:

• Overall, inflation was up just 0.04% MoM. Good.

• “Core” inflation (i.e. sans gas and food) was ~0.20% MoM. Less good, but better than last month.

On an annualized basis, it looks like this:

Obviously, YoY inflation is still too high, but the current rate and pace of change is much closer to getting us where we need to be (for now).

Another interesting way to look at the data is the distribution of price increases (and the publisher has graciously made the tool publicly available to play around with):

The dispersed peaks and valleys in 21-22 reflect the extreme category-wide inflation, whereas the more recent blobs are reminiscent of the more predictable and manageable past.

Blobs are good.

Anyways, let’s dig in to the prices behind the prices . . .