September CPI: Basic costs bite
|Summary
September's 0.4% rise in the Consumer Price Index underscores that inflation is not about to quietly fade away. Rising costs for basic items such as food, energy and housing were behind September's gain, making the increase particularly painful for consumers.
Not all inflation is created equal
Inflation perked back up in September, with the Consumer Price Index advancing 0.4%. Theyear-over-year rate of inflation ticked back up to 5.4% in a sign that inflation is not about to quietly fade away, even if the sharpest monthly price hikes of the post-pandemic period are behind us.
Rising costs for basic items were behind September's gain, making the increase particularly painful for consumers. Energy prices rose 1.3% and remain up 25% over the past year.Higher agricultural and livestock prices, along with steep wage hikes at grocery stores and restaurants, continue to hit food prices. Prices for food at home jumped 1.2%, the most since the lock downs made home cooks of us all in April of 2020, while prices for food away from home advanced another 0.5%.
The rising cost of housing over the past year is also being refiected more forcefully in the inflation data. Owners' equivalent rent rose 0.4%, while rent of primary residences leapt0.5%. Where consumers did get a break this month was for travel-related services like airfares, hotels and car rentals, as COVID concerns surrounding the Delta surge extended into September. The highly discretionary nature of those purchases, however, may be cold comfort for households seeing steeper cost increases for necessities at a time when income support has faded.
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