Consumer Price Index
CPI rose 0.4% in April, the largest monthly gain since 2013, with energy rising 3.4% and food prices rising 0.2%. Excluding food and energy, the CPI rose 0.2%. This moves the rate closer to the target set by the Federal Reserve, which is watching inflation closely as it decides whether to raise interest rates.
Productivity & Costs
The economy's productivity slowdown continued in the first quarter of 2016, in line with expectations. Nonfarm business productivity fell 1% during the quarter. Employee hours worked increased 1.5%, and output increased 0.4%. Compensation per hour rose 3%, implying an increase in unit labor costs of 4.1%. Compensation growth, coupled with productivity decline, has increased unit labor costs significantly.
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