CPI Increases 0.4% in March, U.S. Annual Inflation Rises to 1.9%

American spent more in March for energy, shelter, food, healthcare and new cars but underlying inflation pressures for the month still remained tame, according to government figures released Wednesday, April 10, 2019.

 

The cost of food climbed for a fifth straight month while prices at the pump went up for a second month in a row. The pair diverged from a year ago.

U.S. consumer prices advanced 0.4% in March, for the biggest increase in 14 months, after rising 0.2% in February, the Labor Department said in its monthly report on the Consumer Price Index. The CPI is a broad measure of what American consumers pay for everything from coffee to cars.

In key pricing categories:

  • Gasoline prices jumped 6.5% after gaining 1.5% in February though they fell 0.7 % from a year ago. The broader index for energy, which combines items like gasoline, electricity and fuel oil, rose 3.5% in March after edging up 0.4% in February. Energy prices declined 0.4% year-over-year.

  • Overall food prices for the month went up 0.3% from 0.4% previously. Food prices increased 2.1% from a year earlier.

Excluding the more volatile food and energy components, so-called core consumer prices rose 0.1% in March, matching their increase in February.

"The indexes for shelter, medical care, new vehicles, recreation, education, and tobacco were among those that increased in March, while the indexes for apparel, used cars and trucks, and airline fares all declined," the Labor Department’s monthly report noted.

Shelter or housing costs moved up 0.4% following fourth straightly monthly 0.3% increases, while their year-over-year level remained at 3.4%. Components of shelter include pricing items like rent for apartments, rental equivalence, lodging away from home such as hotels and motels, and housing at schools. The index accounts for about one-third of the entire CPI.

In the headline figure, U.S. inflation finished 1.9% higher in 12 months ending March, a larger increase than the 1.5% rise in February which represented the lowest inflation rate since September 2016.

Core inflation grew 2.0% from a year earlier from 2.1% previously. The core rate was the slowest since February 2018. This index of "all items less food and energy" is one of the benchmark inflation rates monitored by the Federal Open Market Committee (FOMC) as it helps the central bank decide where to set its key interest rate.

"Looking past the swings in energy prices during recent months, the economy still shows little sign of building inflation pressure despite a low unemployment rate and accelerating worker wages," MarketWatch quoted Ben Ayers, senior economist at Nationwide. "Until inflation readings breakout on the upside, the Fed is unlikely to move on interest rates for some time."

The following table of key inflation figures is for the last nine months through March, as published by the U.S. Labor Department’s Bureau of Labor Statistics (www.bls.gov/cpi) on April 10, 2019. To index the data each month, the BLS monitors the prices of about 80,000 consumer goods and services from around the nation. All monthly and annual pricing changes are in percentages.

September 2018 to March 2019 Consumer Prices – Gains & Losses in Percent

  Sept 2018 Oct 2018 Nov 2018 Dec 2018 Jan 2019 Feb 2019 Mar 2019 12 Month
All items 0.1 0.3 .0 .0 .0 0.2 0.4 1.9
  Food 0.1 .0 0.2 0.3 0.2 0.4 0.3 2.1
    Food at home -0.1 -0.1 0.1 0.3 0.1 0.4 0.4 1.4
    Food away from home 0.2 0.1 0.3 0.4 0.3 0.4 0.2 3.0
  Energy -1.0 2.1 -2.8 -2.6 -3.1 0.4 3.5 -0.4
    Energy commodities -1.1 2.6 -5.0 -5.7 -5.3 1.5 6.2 -0.6
      Gasoline (all types) -1.2 2.7 -5.2 -5.8 -5.5 1.5 6.5 -0.7
      Fuel oil -0.7 3.2 -2.9 -9.4 -1.3 2.6 2.1 -0.4
    Energy services -0.9 1.3 0.2 1.5 -0.5 -0.8 0.3 -0.1
      Electricity -0.7 1.8 0.2 0.4 -0.6 -0.3 0.4 0.3
      Utility (piped) gas service -1.5 -0.5 0.2 5.1 -0.3 -2.4 -0.1 -1.4
  All items less food, energy 0.2 0.2 0.2 0.2 0.2 0.1 0.1 2.0
    Commodities less food, energy -0.1 0.3 0.2 .0 0.4 -0.2 -0.2 .0
      New vehicles .0 -0.2 .0 .0 0.2 -0.2 0.4 0.7
      Used cars and trucks -2.1 2.5 2.5 -0.5 0.1 -0.7 -0.4 0.4
      Apparel 0.9 0.2 -0.6 .0 1.1 0.3 -1.9 -2.2
      Medical care -0.2 -0.1 0.5 -0.4 0.1 -1.0 0.4 -0.6
    Services less energy 0.3 0.2 0.2 0.2 0.2 0.2 0.3 2.7
      Shelter 0.2 0.2 0.3 0.3 0.3 0.3 0.4 3.4
      Transportation 0.5 0.1 .0 -0.1 -0.2 -0.1 .0 1.0
      Medical care 0.3 0.2 0.4 0.4 0.3 .0 0.3 2.3

 

The BLS tends to release inflation data around the middle of a month based on consumer prices surveyed in the previous month. The Consumer Price Index (CPI) for April and the latest annual period become public on May 10, 2019.

CPI data is used in calculating inflation rates and in this site’s U.S. inflation calculator. The US Inflation Calculator shows cumulative inflation and the change in buying power of the U.S. dollar over time.

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