The Bureau of Labor Statistics keeps track of an inflationary indicator called the Consumer Price Index (CPI). The CPI tracks the prices of goods and services by sampling a large portion of consumer products. The latest CPI release was yesterday, July 13, 2021, and the inflation data was higher than many expected. The unadjusted 12-months ended June 2021 change for all items was 5.4%. This unadjusted data could be particularly interesting for clients as it is the tangible increase seen in day-to-day life for all items. Even when excluding food and energy (as their prices can be very volatile), the change for all items was 4.5%. This is the largest 12-month period change since November of 1991. There was also a rather substantial seasonally adjusted .9% jump in inflation from May-June. This is to be somewhat expected however, as prices were depressed during the pandemic, supply and demand factors have been shaken up, and stimulus has increased money supply. All in all, the high inflation spike is somewhat worrisome but expected. The real question is what will happen with inflation long-term? Only time will tell.
Thanks for joining in to another Economic Track with Zac. Tune in next Wednesday for more updates.
Bureau of Labor Statistics. Consumer Price Index Summary. 13 July 2021. https://www.bls.gov/news.release/cpi.nr0.htm. USDL-21-1313. Accessed 14 July 2021.