Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Stocks

Lead Prices Foretell CPI Changes

by April 21, 2023
April 21, 2023
Lead Prices Foretell CPI Changes

Inflation rates have been coming back down from their big post-COVID spike to above 8%. But they are likely to see a brief upturn, if this week’s guest fortune-teller is correct.

The movements of the price of lead tend to get repeated about 4 months later in the Consumer Price Index (CPI). That is the message in this week’s chart. Lead is an industrial metal which most of us do not think about, now that it has been taken out of gasoline, but it still finds uses in lead-acid car batteries, car radiators, and in some electronics components. Its price goes up and down with demand, like lots of other industrial metals, and it does a pretty good job of foretelling the movements of other prices.

This is relevant right now because lead prices bottomed on September 27, 2022 and spiked up to a top on December 30, 2022. We have not yet seen the CPI reflect that upswing in lead prices, and we ought to see some echo of it over the next 1-2 months. That up move in lead prices in late 2022 did not go very far nor for very long, but it was still a noticeable up move that ought to see its echo get felt in consumer prices. Note that, in the chart above, I have shifted forward the plot of lead prices in order to allow us to better see how the CPI data echo lead’s movements after that amount of lag time.

This is not a new phenomenon; it has been going on for years. Here is a longer-term chart going back to 2008, again with the 4-month offset employed.

The movements of the CPI rate of change do not perfectly echo all of lead’s price movements. And this is daily pricing for spot lead versus monthly data for the CPI, and so the lead price plot understandably has more noise.

Why this particular lag time is 4 months is a fascinating question, but not a very useful one. A person does not need to have an answer for that question in order to take advantage of the insights that this comparison offers us. If a phenomenon has been going on consistently for long enough, we do not have to be able to perfectly explain it in order to notice it and use it. It is also worth noting that the magnitudes of lead’s price movements do not always get perfectly replicated in the CPI data. I am not bothered by that, because I find that if I get the direction and the timing of the turns correct, the magnitudes can take care of themselves.

Look for the CPI to make a bit of an inflationary resurgence over the next 1-3 months, and for the Fed and others to get a bit excited about that. But also know that it should just be a temporary resurgence.

0
FacebookTwitterGoogle +Pinterest
previous post
Check Out This Economic Indicator
next post
Friday Feature: Gather Forest School

You may also like

Oops, I Did It Again!

December 31, 2023

Pullbacks within Uptrends Create Opportunities

February 12, 2023

4 Crucial Dividend Features Every Investor Needs to...

November 19, 2022

The Bottom is Here or Rapidly Approaching

April 13, 2025

Microsoft (MSFT) Stock On the Verge of a...

October 25, 2023

Fresh Look at Long Bonds

September 14, 2023

Precarious Action in the Bonds and Stock Market

October 15, 2022

Grayson’s Top 5 Most Valuable New Features &...

December 10, 2022

Next Week’s Sector and Industry Group to Watch

September 17, 2022

Sector Spotlight: Money Rotating Out of Large-Cap Growth...

August 14, 2023

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Trump’s ‘big, beautiful bill’ faces Republican family feud as Senate reveals its final text

      June 28, 2025
    • Senate shuts down Kaine’s attempt to check Trump’s war powers

      June 28, 2025
    • 3 Stock Setups for the Second Half of 2025

      June 28, 2025
    • Trump touts administration’s progress on peace deals, says world leaders ‘respect our country again’

      June 27, 2025
    • Venezuelan opposition member details harrowing 400-day captivity at UN

      June 27, 2025
    • Anxious Republicans turn to Trump amid divisions over ‘big, beautiful bill’

      June 27, 2025

    Categories

    • Business (8,329)
    • Investing (2,081)
    • Politics (15,843)
    • Stocks (3,176)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved