U.S. Inflation Eases Some as CPI Hits 7.7% in October

The overall pace of inflation stayed steady in October but prices for some key items slowed while others actually declined, according to a U.S. government report released Thursday, Nov. 10.

In the longer haul, annual inflation increased below 8% for the first time since February and it was the lowest since January, although prices remained elevated for items like food, shelter, and energy.

In the headline monthly figure, U.S. consumer prices rose 0.4% for a second straight month in October, 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 eggs to electricity.

Overall food prices for the month rose 0.6% following two straight 0.8% gains. Groceries went up 0.4% against 0.7% previously while the cost of eating at restaurants and the like climbed 0.9% for a third month in a row.

Food inflation advanced 10.9% year-over-year compared to 11.2% previously. In the 12 months ended August, the rate at 11.4% was the highest since April 1979.

Grocery prices rose 12.4% year-over-year against prior gains of 13% and 13.5% — the most since March 1979. Meanwhile, prices for foods consumed outside of the home rose 8.6% from 8.5%.

Prices at the pump rose 4% in October after falling 4.9% in September, bringing their year-on-year increase to 17.5%. This year’s high-water mark happened in the 12 months ending June when gasoline inflation at 59.9% was the highest since March 1980.

The broader index for energy, which combines items like gasoline, electricity, and fuel oil, picked up 1.8% for the month after sliding 2.1% previously. Energy costs rose 17.6% from a year earlier.

Excluding the more volatile food and energy components, the rate of core consumer prices picked up 0.3% in October after increasing 0.6% in September.

Shelter or housing prices moved up 0.8%, after two monthly gains of 0.7%. They surged 6.9% year-over-year for their biggest 12-month increase since hitting the same level in August 1982.

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. This index accounts for about one-third of the entire CPI.

Airline fares fell 1.1% for the month after increasing 0.8% in September. Earlier, they posted monthly increases as high as 12.6% in May and 18.6% in April, which was the largest 1-month gain since the inception of the series in 1963. For a second instance, they are 42.9% higher year-over-year.

Clothing prices fell 0.7% in October after dipping 0.3%, and they increased 4.1% from a year earlier.

New vehicle prices rose 0.4%, for their eighteenth increase in nineteen months, after rising 0.7% previously. They advanced 8.4% from a year ago.

Also, for the month, used car and truck prices dropped 2.4% after falling 1.1%. They register 2% higher than a year earlier.

As for the headline annual figure, inflation rose 7.7% over the past 12 months against 8.2% previously. This year’s high-water mark happened in the 12-months ending July at 9.1%, which was quickest rate of inflation since November 1981. Annual inflation rates have now topped 6% for thirteen straight months, and they have been at or above 7% for eleven months in a row.

Meanwhile, core inflation grew 6.3% over the past year compared to the previous gain of 6.6% — the highest annual core rate since August 1982. 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 guides the central bank when setting its key interest rate.

“Inflation is still too high, but there is evidence that the Fed has turned the corner in its fight and that the pace of future interest rate increases will begin to slow,” Reuters quoted Christopher Rupkey, chief economist at FWDBONDS in New York.

The following table of key inflation figures is for the last seven months through October, as published by the U.S. Labor Department’s Bureau of Labor Statistics (www.bls.gov/cpi) on Nov. 10, 2022. 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.

April 2022 to October 2022 Consumer Prices – Gains & Losses in Percent
(Seasonally Adjusted from Prior Month and Unadjusted 12-Month)

  April 2022 May 2022 June 2022 July 2022 Aug 2022 Sept 2022 Oct 2022 12 Month
All items 0.3 1.0 1.3 .0 0.1 0.4 0.4 7.7
  Food 0.9 1.2 1.0 1.1 0.8 0.8 0.6 10.9
    Food at home 1.0 1.4 1.0 1.3 0.7 0.7 0.4 12.4
    Food away from home 0.6 0.7 0.9 0.7 0.9 0.9 0.9 8.6
  Energy -2.7 3.9 7.5 -4.6 -5.0 -2.1 1.8 17.6
    Energy commodities -5.4 4.5 10.4 -7.6 -10.1 -4.7 4.4 19.3
      Gasoline (all types) -6.1 4.1 11.2 -7.7 -10.6 -4.9 4.0 17.5
      Fuel oil 2.7 16.9 -1.2 -11.0 -5.9 -2.7 19.8 68.5
    Energy services 1.3 3.0 3.5 0.1 2.1 1.1 -1.2 15.6
      Electricity 0.7 1.3 1.7 1.6 1.5 0.4 0.1 14.1
      Utility (piped) gas service 3.1 8.0 8.2 -3.6 3.5 2.9 -4.6 20.0
  All items less food, energy 0.6 0.6 0.7 0.3 0.6 0.6 0.3 6.3
    Commodities less food, energy 0.2 0.7 0.8 0.2 0.5 0.0 -0.4 5.1
      New vehicles 1.1 1.0 0.7 0.6 0.8 0.7 0.4 8.4
      Used cars and trucks -0.4 1.8 1.6 -0.4 -0.1 -1.1 -2.4 2.0
      Apparel -0.8 0.7 0.8 -0.1 0.2 -0.3 -0.7 4.1
      Medical care 0.1 0.3 0.4 0.6 0.2 -0.1 0.0 3.1
    Services less energy 0.7 0.6 0.7 0.4 0.6 0.8 0.5 6.7
      Shelter 0.5 0.6 0.6 0.5 0.7 0.7 0.8 6.9
      Transportation 3.1 1.3 2.1 -0.5 0.5 1.9 0.8 15.2
      Medical care 0.5 0.4 0.7 0.4 0.8 1.0 -0.6 5.4

 

The BLS releases inflation data around the middle of a month for consumer prices surveyed up to the previous month. The Consumer Price Index (CPI) for November and the latest annual period become public on Dec. 13, 2022.

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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