The Bureau of Labor Statistics released the April Consumer Price Index this morning. The headline index came in at 332.4 on the 1982 to 1984 base, up 0.64% from March and 3.8% above April of last year. With that figure now in the underlying data, The U.S. Sentiment Signal updates to 27 out of 100 for the May reading, down from 34 in December and the weakest value in the twenty years of history the composite covers, beneath the troughs of the 2008 financial crisis, the 2011 debt-ceiling standoff, and the COVID shock of April 2020.
The CPI print sits inside Economic Health, which lands at 40 for the month. That category is the strongest of the three and is still in distressed territory: three of its five indicators are at risk and two are off track. The cumulative price level has been the central drag for some time. April's print extends rather than breaks that pattern. Another 0.64% on a base that has already moved well past its long-run trajectory continues to compress real spending power in a way the labor market has not yet offset.
The other two categories carry the rest of the weight. Government Trust prints at 10, with all three of its indicators off track. Social Confidence prints at 22, with one indicator at risk and one off track. The headline composite reflects that distribution; a print this low on this composite does not happen when the trust and confidence blocks are in any other configuration.
A composite at 27 is not a forecast. It is a description of what ten well-known series are saying together right now, on the same page and the same scale. The next inflection in the headline composite will come from one of two places: a clean disinflation print that opens up real-income growth, or a measurable rebound in one of the trust series. As of this morning, neither has shown.