The Fed’s preferred gauge of consumer price growth in the US matched estimates in hotly-anticipated BEA data released Thursday.

The 0.4% MoM gain on the core measure counted as the quickest in a year. That’s bad. Or not good, anyway. But it could’ve been worse.

Headed into the release, the BLS created a circus with an email to so-called “super users” who were told earlier this week that the hot read on rental inflation in the January CPI release was attributable in part to how the figure was calculated. That, as opposed to, you know, actual inflation. Here’s the mail:

Super Users,

Good afternoon.

The weights for single family detached homes increased materially from December 2023 to January 2024. All of you searching for the source of the divergence have found it.

No additional information related to this question will be disseminated. We do not do diagnostic analysis of microdata.

That almost seems fake. If it turns out someone went rogue, I wouldn’t be surprised. Nor would I be surprised if it’s just an example of incompetence.

Sensing, perhaps, the potential for a PR debacle, the BLS tried to take it back, telling recipients to ignore the mail. Suffice to say it was a little late for that. “We sent a follow-up email to the BLS,” Nomura’s econ team wrote, of the confusion. “We have not heard back from them but some of our clients seem to have received a response saying the original email should be ignored and they were looking into this.”

The BLS told Bloomberg the same thing, adding that “additional communication regarding the rent and OER data” could be coming “soon.” The government gave Matthew Boesler the runaround. Or actually, it was more like a map to a brick wall: “A spokesperson for the Labor Department referred inquiries to the BLS, whose official press contacts didn’t respond to messages seeking comment,” he wrote, noting bravely that the minor melee “rais[es] questions about the validity of the figures.” (The NBS is chuckling in Beijing.)

I hope readers will excuse my momentary lapse into an unrefined cadence: This (the BLS’s bullshit) is why I continually insist that everyone’s better off just ignoring everything. These figures are malleable to the point of being meaningless. Some of you have suggested in private correspondence that I’m too nihilistic about markets and macro. I beg to differ. And whatever the BLS’s informal, internal investigation into the super user email reveals, this week’s mini-farce is a testament to the utility of my nihilism which, unlike the imitation nihilism you might find on display elsewhere, is 100% authentic.

Also, I’d be doing myself a disservice not to point out that I did flag this for readers. Here’s what I said, on February 13, of the disparity the BLS tried to explain away this week:

I assume there’s some statistical nuance behind the big jump. The OER print was warm but the rent of primary residence gauge posted its smallest MoM gain since August of 2021. There are surely some distinctions and niceties that need expounding.

“Distinctions.” “Niceties.” I guess that was too damn subtle. My mistake. Next time I’ll just call bullshit “bullshit” as soon as I see it instead of waiting around for confirmation from an errant government email sent to a privileged group of analysts. (Did you get that mail?)

Remember, folks: The Fed’s loudly and avowedly “data dependent” when it comes to setting the price of money. If the data’s bad, what does that suggest about decisions based on it? That’s a rhetorical question.

Now, turning back to Thursday’s PCE figures (which I can assure you are every bit as reliable as the CPI data), the YoY core print, like the MoM reading, was in-line with estimates, at 2.8%. December’s month-to-month increase was revised lower.

The headline gauge rose 0.3% MoM and 2.4% YoY. Those readings were as-expected.

The six-month annualized pace for core is now 2.5% with January’s release. Jerome Powell indicated at last month’s press conference that although the Fed’s obviously happy with recent progress, “success” (“victory,” so to speak) is measured against the 12-month readings, not any shorter windows. The six-month measure spent two months below 2% prior to January’s jump.

Ex-energy and housing, services inflation rose 0.6% last month from December. That’s the “sticky” inflation and it was the briskest since March of 2022, which is to say since Fed liftoff.

On the consumption front, real personal spending fell 0.1% in January, Thursday’s release showed. That was the first decline in five months. Nominal spending rose an as-expected 0.2%. The Fed’ll take those figures. Recall the retail sales print for January suggested spending receded sharply. You don’t want that necessarily, but you don’t want too much spending either because supercore inflation just notched the hottest sequential print in 22 months. And too much spending is a good way to drive additional unwanted price gains in the services sector. So, 0.2% nominal and -0.1% real (i.e., Thursday’s prints) is probably a good balance.

What does all of this mean for investors? Well, the in-line core inflation readings might offer something in the way of relief just in the sense that the event risk is now in the rearview. And don’t underestimate the potential for cleared event risk to serve as a bullish catalyst on its own. However, the MoM readings both on core and supercore inflation are way too warm, where that means bordering on outright hot.

Of course, it’s just one month’s data. And who knows, maybe the increases were down to methodological changes. Statistical innovations. New, improved calculations. The government will let you know. If you’re a “super user.” The rest of you can draw your own conclusions by comparing this month’s grocery receipts to last month’s.