Inflation continued to run near a multi-decade high of 8.2 percent last month but a deeper dive into the Consumer Price Index (CPI) data shows that some goods—including everyday essentials like food—saw far sharper price jumps.
The Bureau of Labor Statistics (BLS) reported on Oct. 13 that annual inflation in the United States in September was running at 8.2 percent, down slightly from August’s pace of 8.3 percent.
An alternative measure of CPI inflation that uses the same methodology BLS used back in the 1980s puts the figure at a far higher 16.4 percent year-over-year in September.
While the government’s official inflation data shows that American households got a bit of relief in some categories—like the cost of recorded music and music subscriptions falling 1.2 percent year-over-year and 0.2 percent month-over-month—the cost of basic necessities continued to spike.
Food purchased for consumption at home rose 13 percent year-over-year and 0.7 percent month-over-month. Some food categories saw far sharper jumps in price.
Flour prices advanced 24.2 percent annually and 2 percent monthly in September.
Bread was up 14.7 percent year-over-year and 0.5 percent month-over-month.
Lunchmeats cost 17 percent more in September 2022 than in September 2021, and 0.7 percent more in September than August of this year.
Chicken prices jumped 17.2 percent year-over-year and 0.5 percent month-over-month.
Fresh vegetables cost 9.2 percent more this September than 12 months ago, and 2.4 percent more than in August.
“The latest read of inflation at the retail level delivers a series of upside surprises with the costs of shelter and food leading the way to higher ground,” Bankrate Senior Economic Analyst Mark Hamrick told The Epoch Times in an emailed statement.
“Gasoline prices were down on the month but have since rebounded somewhat. The year-over-year headline gain of 8.2 percent continues to be something that gets our attention, while the core increase over the past year is 6.6 percent, a four-decade high.”
Core inflation, which strips out the volatile categories of food and energy, is seen as a measure of underlying inflationary pressures and is closely tracked by the Federal Reserve when gauging the pace of inflation against its 2 percent target.
At 6.6 percent, core inflation is over three times higher than the Fed’s goal, suggesting the central bank will continue to hike rates aggressively in a bid to relieve price pressures.
The BLS’ hotter-than-expected inflation data, which exceeded market predictions, sparked a sharp upward revision to investor forecasts for how high the Fed will hike rates as it struggles to quell price pressures.
Fed Funds futures contracts are now pricing in a 98-percent chance of a 75-basis point interest rate hike when U.S. central bank policymakers meet in November. A day before the inflation data was released, those odds stood at 85 percent. A month ago, the probability for a three-quarter point rise was about 50 percent.
From The Epoch Times
