The pace of inflation in the United States picked up in July, quickened by broad-based gains in consumer goods and services to include higher prices for shelter, healthcare, airline fares, clothing and energy, the government said Tuesday, August 13, 2019.
In the longer haul as highlighted in the above graphic, two key consumer pricing categories diverged with food prices higher and energy costs lower.
U.S. consumer prices increased 0.3% in July after climbing 0.1% for two consecutive months, the Labor Department said in its monthly report on the Consumer Price Index (CPI). The CPI is a broad measure of what American consumers pay for everything from ground beef to gasoline.
In key pricing categories:
Prices at the pump rose 2.5% after falling 3.6% in June. Gasoline prices declined 3.3% from a year ago. The broader index for energy, which combines items like gasoline, electricity and fuel oil, climbed 1.3% in July after dropping 2.3% previously. Energy prices registered 2% lower year-over-year.
Overall prices for food were flat for a second month in a row. That said, food prices rose 1.8% from a year earlier.
Excluding the more volatile food and energy components, so-called core consumer prices advanced 0.3% in July, matching their previous increase. June’s advance was the largest since January 2018.
"The July rise was broad-based, with increases in the indexes for shelter, medical care, airline fares, household furnishings and operations, apparel, and personal care all contributing to the increase," the Labor Department’s monthly report noted. "The index for new vehicles was one of the few to decline in July."
Shelter or housing costs grew 0.3% for a second straight month, while their year-over-year level increased to 3.5% — also for a second consecutive time. 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.
Used car and truck prices rose 0.9% from June’s 1.6% increase and clothing prices rose 0.4% from 1.1%. New vehicle prices, meanwhile, fell 0.2% after advancing 0.1% in each of the three prior months.
In the headline annual figure, U.S. inflation over the past 12 months picked up 1.8% from 1.6%. Going back three months, April’s level at 2% was the highest in 2019 so far. Conversely, annual inflation through February at 1.5% was as the lowest since September 2016.
In the 12 months ending July, core inflation rose 2.2%, the largest gain in six months, after rising 2.1% June. This "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.
"The recent pickup in inflation won’t deter the Federal Reserve from cutting interest rates in September as the downside risks to the outlook from trade have become more threatening," Reuters quoted Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania.
The following table of key inflation figures is for the last seven months through July, as published by the U.S. Labor Department’s Bureau of Labor Statistics (www.bls.gov/cpi) on Aug. 13, 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.
January to July 2019 Consumer Prices – Gains & Losses in Percent
|Jan 2019||Feb 2019||Mar 2019||Apr 2019||May 2019||June 2019||July 2019||12 Month|
|Food at home||0.1||0.4||0.4||-0.5||0.3||-0.2||-0.1||0.6|
|Food away from home||0.3||0.4||0.2||0.3||0.2||0.3||0.2||3.2|
|Gasoline (all types)||-5.5||1.5||6.5||5.7||-0.5||-3.6||2.5||-3.3|
|Utility (piped) gas service||-0.3||-2.4||-0.1||-0.8||-1.0||-0.3||-1.8||-2.9|
|All items less food, energy||0.2||0.1||0.1||0.1||0.1||0.3||0.3||2.2|
|Commodities less food, energy||0.4||-0.2||-0.2||-0.3||-0.1||0.4||0.2||0.4|
|Used cars and trucks||0.1||-0.7||-0.4||-1.3||-1.4||1.6||0.9||1.5|
|Services less energy||0.2||0.2||0.3||0.3||0.2||0.3||0.3||2.8|
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 August and the latest annual period become public on September 12, 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.