The American cost of living jumped in July 2011 by the most in four months, according to the latest US inflation data released by the government.
Consumer prices rose 0.5 percent in July, led by higher food and energy prices. The US Labor Department on Thursday reported the higher-than-expected level, which was more than twice the rate some economists’ expected and markedly higher than June’s 0.2 percent decline when energy costs had retreated.
"The gasoline index rebounded from previous declines and rose sharply in July, accounting for about half of the seasonally adjusted increase in the all items index. The food at home index accelerated in July and also contributed to the increase, as dairy and fruit indexes posted notable increases and five of the six major grocery store food groups rose," the US Labor Department said Thursday in its monthly Consumer Price Index (CPI) report.
Energy prices increased 2.8 percent in July after a 4.4 percent drop in June and a 1.0 percent drop in May. Food prices rose 0.4 percent after a 0.2 percent gain in the prior month and a matching 0.4 percent increase in May.
The so-called core US inflation rate, which excludes volatile food and energy prices, was up 0.2 percent in July after two straight months of 0.3 percent increases. Core price advances included 1.2 percent for clothes, 0.7 percent for used cars, and 0.3 percent for both shelter and medical care.
The CPI report is "showing some continued firmness in prices," Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York, was quoted on Bloomberg. "There’s not a lot of improvement in the labor market, and given what’s going on with economic growth, pricing power should weaken further. Ultimately, inflation will moderate, but in the meantime, it remains frustratingly high."
US inflation rose 3.6 percent in the 12 months ending July, matching the year-over-year gain in June and in May. The 12-month core CPI climbed 1.8 percent in July as compared to the 1.6 percent increase in June and the 1.5 percent increase in May.
US Labor Department inflation data on a 12-month basis and between January and July follows:
July 2011 Consumer Prices – Gains (percent )
|Food at home||0.7||0.8||1.1||0.5||0.5||0.2||0.6||5.4|
|Food away from home||0.2||0.2||0.3||0.3||0.2||0.3||0.2||2.6|
|Gasoline (all types)||3.5||4.7||5.6||3.3||-2.0||-6.8||4.7||33.6|
|Utility (piped) gas service||-1.2||3.4||-1.4||1.9||-0.3||0.4||-1.2||-2.8|
|All items less food, energy||0.2||0.2||0.1||0.2||0.3||0.3||0.2||1.8|
|Comm. less food, energy||0.2||0.2||0.1||0.4||0.5||0.5||0.3||1.8|
|Used cars and trucks||-0.3||0.1||0.8||1.2||1.1||1.6||0.7||5.3|
|Services less energy||0.1||0.2||0.2||0.1||0.2||0.1||0.2||1.7|
The Labor Department will release the next round of Consumer Price Index statistics for August 2011 on September 15, 2011 at 8:30 AM Eastern Time. The CPI data is used as the core engine for the Inflation Calculator.