Consumer prices declined in June 2011 for the first time in a year as energy costs dropped by the biggest amount since 2008, the latest US inflation figures from the government revealed Friday.
All was not rosy, however, as core US inflation climbed faster than expected due to higher prices in other goods and services. Americans continue to pay more for rent, cloths, used cars and trunks and medical care.
Consumer prices declined 0.2 percent in June, a level that was in line with most forecasts.
"The gasoline index declined sharply in June, falling 6.8 percent. While this decrease was the major factor in the seasonally adjusted decline in the all items index, the index for household energy declined as well. In contrast, the index for all items less food and energy increased 0.3 percent for the second consecutive month. The indexes for shelter, apparel, new vehicles, used cars and trucks, and medical care all continued to rise in June," the US Labor Department reported in its monthly Consumer Price Index (CPI) report. The CPI data is used as the main gauge for tracking US inflation.
"The food index increased as well, although the 0.2 percent rise was the smallest of the year. The index for food at home increased 0.2 percent, with major grocery store food groups mixed. The indexes for fruits and vegetables and for meats, poultry, fish, and eggs both declined, and while the other major grocery store food group indexes all increased, none rose more than 0.6 percent."
Consumer prices advanced 0.2 percent in May.
The so-called core inflation rate, which strips out volatile food and energy prices, rose 0.3 percent in June — the same rate as in May when it had marked the biggest one-month pick-up since July 2008.
"Core inflation… is moving higher at both the retail and wholesale level and the back-to-back readings of 0.3 per cent on the monthly change in core CPI should be particularly troubling for the Fed," Conrad DeQuadros and John Ryding of RDQ Economics said, according to the Financial Times. "The only thing that looks transitory in this inflation report is the drop in energy prices with July’s gasoline prices on track to add 0.2 percentage points to inflation in the month."
US inflation rose 3.6 percent in the 12 months ending June, which was the same year-over-year pace as reported in May. The annual core CPI climbed 1.6 percent as compared to the 1.5 percent increase in May.
US Labor Department inflation data on a 12-month basis and between December 2011 and June 2011 follows:
May 2011 Consumer Prices – Gains (%)
|Food at home||0.1||0.7||0.8||1.1||0.5||0.5||0.2||4.7|
|Food away from home||0.1||0.2||0.2||0.3||0.3||0.2||0.3||2.3|
|Gasoline (all types)||8.5||3.5||4.7||5.6||3.3||-2.0||-6.8||35.6|
|Utility (piped) gas service||1.4||-1.2||3.4||-1.4||1.9||-0.3||0.4||-0.8|
|All items less food, energy||0.1||0.2||0.2||0.1||0.2||0.3||0.3||1.6|
|Comm. less food, energy||.0||0.2||0.2||0.1||0.4||0.5||0.5||1.6|
|Used cars and trucks||-0.1||-0.3||0.1||0.8||1.2||1.1||1.6||5.1|
|Services less energy||0.1||0.1||0.2||0.2||0.1||0.2||0.1||1.6|
The Labor Department will release the next round of Consumer Price Index statistics for July 2011 on August 18, 2011 at 8:30 AM Eastern Time. The CPI data is used as the core engine for the Inflation Calculator.