U.S. consumer prices surged in April and inflation over the past 12 months marched at the quickest pace in nearly 12 years, according to a government report released Wednesday, May 12.
American consumers paid more for a broad range of goods and services last month, highlighted by used car and truck prices which soared 10%. In a bit of a relief, the cost of energy retreated. Compared to a year ago when parts of the U.S. economy were in the earlier stages of pandemic-caused shutdowns, pricing hikes look more striking. Gasoline prices jumped nearly 50% year-over-year.
In the headline monthly figure, U.S. consumer prices advanced 0.8% in April, the largest monthly gain since June 2009, after rising 0.6% in March, the Labor Department said in its monthly report on the Consumer Price Index (CPI). The CPI is a broad measure of what Americans pay for everyday items ranging from cereals to cars.
In major consumer pricing categories:
Prices at the pump declined 1.4% last month, ending a streak of ten consecutive monthly increases, compared to their previous gain of 9.1%. Gasoline prices soared 49.6% year-over-year, for their the largest 12-month rise since January 2010.
The broader index for energy, which combines items like gasoline, electricity and fuel oil, dipped 0.1% from an increase of 5% in March. Energy prices increased 25.1% in the past 12 months.
- Prices for food rose 0.4% last month after rising 0.1% previously. Food prices increased 2.4% year-over-year.
Excluding the more volatile food and energy components, core consumer prices jumped 0.9% in April, the biggest monthly gain since April 1982 and up from 0.3% in March.
"A 10.0-percent increase in the index for used cars and trucks was the largest contributor, but many indexes increased substantially… The indexes for owners’ equivalent rent and for rent both increased 0.2 percent, while the index for lodging away from home rose sharply, increasing 7.6 percent. The index for airline fares also rose sharply in April, increasing 10.2 percent," the Labor Department’s monthly report said.
Shelter or housing costs for the month rose 0.4% from 0.3%. They increased 2.1% from a year ago. 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.
The cost of health care rose 0.1% for a second month in a row. Health care prices increased 1.5% year-over-year.
In the headline annual figure, inflation in the United States soared 4.2% in the 12 months ended April, the largest increase since the annual period ending September 2008 and compared to 2.6% previously.
Core inflation increased 3.0% over the past 12 months, the biggest 12-month gain since January 1996 and against 1.6% previously. The core, "all items less food and energy" index 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.
"Put together with potentially higher wage inflation, higher inflation may be stickier than the Fed expects," Reuters quoted David Kelly, chief global strategist at JPMorgan Asset Management in New York.
The following table of key inflation figures is for the last seven months through April, as published by the U.S. Labor Department’s Bureau of Labor Statistics (www.bls.gov/cpi) on May 12, 2021. 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.
October 2020 to April 2021 Consumer Prices – Gains & Losses in Percent
|October 2020||November 2020||December 2020||January 2021||February 2021||March 2021||April 2021||12 Month|
|Food at home||0.1||-0.2||0.3||-0.1||0.3||0.1||0.4||1.2|
|Food away from home||0.3||0.1||0.4||0.3||0.1||0.1||0.3||3.8|
|Gasoline (all types)||0.7||0.5||5.2||7.4||6.4||9.1||-1.4||49.6|
|Utility (piped) gas service||0.4||3.0||-0.4||-0.4||1.6||2.5||2.4||12.1|
|All items less food, energy||0.1||0.2||.0||.0||0.1||0.3||0.9||3.0|
|Commodities less food, energy||.0||.0||0.1||0.1||-0.2||0.1||2.0||4.4|
|Used cars and trucks||0.9||-1.4||-0.9||-0.9||-0.9||0.5||10.0||21.0|
|Services less energy||0.1||0.2||.0||.0||0.2||0.4||0.5||2.5|
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 May and the latest annual period become public on June 10, 2021.
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.