Consumer Price Index: Inflation Won’t Let Up – Food and Gas Prices Rise Again in September
The Consumer Price Index rose again, this month .4% in September adding to the .3% increase from August the Bureau of Labor Statistics reported this morning. This represents a 5.4% increase overall over the last 12 months.
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Consumer prices rose slightly more than expected, beating the 5.3% 12-month estimate from analysts, CNBC reports.
The indexes for food and shelter contributed to the majority of the monthly increase, as together they accounted for more than half of the monthly all items seasonally adjusted increase. Food prices rose once again .9%, with the index for food at home increasing 1.2% the BLS reported.
Prices for gasoline rose 1.2% in September, adding to the already unprecedented gains experienced throughout the year. OPEC’s recent decision to keep supply stagnant and enduring issues in the international supply chain have kept the upward pressure on gas prices. The overall energy index increased 1.3%.
Food
Food prices continue to be an area of concern, as the food at home index rose 1.2% over the month as all six major grocery store food groups increased in price. Beef prices added another 4.8% in price last month, while the index for meats, poultry, fish, and eggs rose 2.2% over the same period. The index for other food at home increased 1.1% in September, adding to the .6% increase from August.
Fruits and vegetables even increased, adding .6% in September, significantly larger than the .2% increase reported in August, according to the BLS.
Food away from home rose .5%, after rising .4% in August. The goods at home index rose 4.5% over the past 12 months with the largest increase being beef which is up a whopping 17.6% over the year. Prices for meats, poultry, fish and eggs overall increased 10.5%.
Gasoline and Energy
Gasoline prices added to a fourth consecutive monthly increase in the overall energy index, which is up a whopping 24.8% over the past 12 months as all major energy component indexes increased. Gas prices are up an unprecedented 42.1% for the past 12 months. Electricity prices rose .8% in September adding to a 1% increase in August. Natural gas prices also increased, rising 2.7% and adding to an eighth consecutive month of increases in the sector. Natural gas prices are up 20.6% for the year.
The Fed has largely maintained its opinion that these effects are transitory and, as the aftermath of the pandemic continues to ease, so will prices. Prices might have reached such a level though that the Fed’s hand might be forced to avoid a recession.
See: US Considers Releasing Oil Reserves to Combat Inflationary Pricing
Find: Fed Downplaying Inflation? Economists Warn It Could ‘Accelerate Taper Process’
In their most recent global economic outlook report released yesterday, the International Monetary Fund urged that the Fed might need to consider raising interest rates sooner than expected to rein in out-of-control prices.
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