For now, don’t blame food for last month’s increase in US retail inflation. It was higher energy prices that mainly fueled the biggest monthly increase in consumer prices since June and a sharp rise in the annual rate, the government reported Wednesday (October 18).
The Consumer Price Index for All Urban Consumers, the leading retail inflation gauge, rose 0.5 percent seasonally adjusted in September after a 0.1-percent decline in August, the US Bureau of Labor Statistics (BLS) said in Washington.
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The May-June increase was also 0.5 percent.
For the 12 months through September, consumer prices were up 3.5 percent, compared to 2.7 percent for all of 1999. If the rate continues at its nine-month 2000 pace, inflation will hit 3.8 percent for the calendar year.
The seasonally adjusted energy price index rose 3.8 percent in September after a 2.9-percent decline in August, the BLS said. By contrast, however, the food price index rose only 0.2 percent last month, with grocery store food prices up only 0.1 percent after advancing 0.3 percent in August.
Excluding energy and food prices, the inflation rate from September to September was 2.6 percent, compared to 1.9 percent for all of 1999.
“We’re starting to move up,” said Jerome Watters, a Dallas-based economist for the Labor Department agency. “You can assume the Fed will still be quite worried about inflation.”
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By GlobalDataBut despite the rising rates, Watters said, inflation remains moderate in the 3.5-3.8 percent annualized range when compared to historical data. Since the late 1970s, the U.S. inflation rate has leaped as high as 12 to 14.8 percent during a few 12-month spans, but more typically has ranged between 4 and 6 percent, he said.
“Below 4 percent and it’s definitely a number we can live with,” Watters said. “Still, it is higher than it has been in the past few years.”
CPI FOOD DATA
Here is a breakdown of the food and beverage sectors of the Consumer Price Index, comparing August-September, July-August and September 1999-September 2000 changes in retail prices:
- Food and beverages _ up 0.1 percent from August to September; up 0.2 percent from July to August; up 2.6 percent for the 12 months ending with September.
- Food _ up 0.2 percent; up 0.2 percent; up 2.6 percent. Food at Home (grocery store-level prices) _ up 0.1 percent; up 0.3 percent; up 2.7 percent.
(NOTE: The following food categories are breakouts from Food at Home Index.)
- Cereals and bakery products _ down 0.3 percent; up 0.3 percent; up 1.8 percent.
- Meats, poultry, fish and eggs _ down 0.1 percent; up 0.2 percent; up 5.2 percent.
- Dairy and related products _ up 0.4 percent; up 0.3 percent; up 1.8 percent. Fruits and vegetables _ up 0.8 percent; up 1.2 percent; up 1 percent.
- Nonalcoholic beverages and related goods _ down 0.2 percent; down 0.3 percent; up 2.8 percent.
- Other foods at home _ up 0.1 percent; up 0.1 percent; up 1.8 percent.
(NOTE: The following is a further breakout of other foods at home)
- Sugars and sweets _ down 0.3 percent; up 0.4 percent; up 0.7 percent.
- Fats and oils _ down 0.1 percent; up 0.6 percent; up 0.1 percent.
- Other foods _ up 0.2 percent; down 0.1 percent; up 2.5 percent.
- Other miscellaneous foods _ down 1.6 percent; up 0.6 percent; up 2.3 percent.
NOTE: The following refers to prices at restaurants and other eateries.)
- Food away from home _ up 0.3 percent; up 0.2 percent; up 2.5 percent.
- Other foods away from home _ up 0.6 percent; up 0.6 percent; up 3.4 percent.
(NOTE: The following is a separate category.)
- Alcoholic beverages _ down 0.2 percent; up 0.2 percent; up 2.8 percent.
By WORTH WREN JR.
StoreAlliance.com
