Inflation Update: Food, Rent, Electricity See Biggest Price Increases in Decades
Inflation is still sky-high, and everyday essentials like groceries, paper products and utilities are seeing their largest yearly price increases in decades. Rent and health insurance costs are soaring too.
New data released Tuesday by the Bureau of Labor Statistics (BLS) shows that consumer prices rose 8.3% year-over-year in August. That’s a slight improvement over July’s 8.5% annual inflation rate, but it’s still extremely elevated by historical standards. Many experts expected price growth to have slowed down in August, but instead prices rose 0.1% from July.
High inflation is persisting despite the Federal Reserve’s attempts to slow it down by raising interest rates, and the stock market plunged Tuesday morning on renewed fears of an impending recession. The S&P 500, an index often used as a proxy for the stock market overall, was down 3% early in the day.
Inflation pushes prices higher and higher
While Tuesday’s headline number of 8.3% is already large, some consumer staples have seen even more dramatic spikes.
Grocery prices were up 13.5% on a yearly basis in August, according to the BLS — that’s the highest annual jump since 1979. The grocery category includes rapidly rising prices for essentials like flour, which spiked 23% on an annual basis, the largest jump ever in that category. Dairy prices spiked 16.2%, the biggest annual increase since 1974.
Prices for household paper products like paper towels and toilet paper, rose 14.1% year-over-year, also the largest ever increase. Electricity prices were up nearly 16%, which is the largest annual increase since 1981.
Meanwhile, health insurance prices rose 24.3% — the biggest annual increase ever in that category. Rent prices are up 6.7%, the biggest spike since 1986.
Thankfully, Tuesday’s report also brought some good news. While used car prices are still up nearly 8% on an annual basis, they actually dropped 0.1% between July and August. Gas prices fell more than 10% on a monthly basis after soaring earlier this year.
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