September’s Consumer Price Index ended any hope that inflation might be cooling.
Just ponder the CPI’s topline. In Los Angeles and Orange counties, consumer prices are rising at a 7.8% annual rate vs. 7.6% in August and 4.6% a year ago. In the Inland Empire, where the CPI tracks costs every other month, overall inflation was 8.4% vs. 9.2% in July and 6.8% a year ago. And nationwide, inflation ran at 8.2% vs. 8.3% in August vs. 5.4% a year ago.
Blame who you want. The president. Global supply chain headaches. A worker shortage. Corporate greed. Central bankers who missed early signs of surging prices. Russia’s invasion of Ukraine. China. Or perhaps it’s a mix of all these factors.
It adds up to a price-hike era in which a roaring rebound out of pandemic lockdowns created a badly overheated economy. Too many dollars are chasing too few goods.
Strong spending by consumers and corporations alike are defying efforts by the Fed to use serious interest-rate hikes to chill the business climate. However, some signals suggest this spending spree might be slowing
Consider what inflation-fighters might be thinking by eyeing an odd slice of the CPI – the cost of everything, minus more volatile items: food and energy prices.
Nationally, this “core” price benchmark was inflating at a 6.6% rate in September, up from 6.3% in August and 4% a year ago. Locally, L.A.-O.C.’s core rate was up 6.3% vs. 3% a year ago. Inland Empire was 6% vs. 5.2% a year ago.
In theory, central bankers like to see “core inflation” at 2% or less. September reminds us there’s plenty of economic deflating still required to chill the cost of living.
Below, my trusty spreadsheet details the pain your wallet may be suffering, as seen through the CPI lens.
Surging grocery prices are battering household budgets. In L.A.-O.C., prices are up 13% in a year vs. 5.3% a year ago. The Inland Empire prices are up 12.2% vs. 4.3% a year ago.
Restaurant owners are being hit by these same ballooning food costs, not to mention expensive labor. So dining out gets expensive. In L.A.-O.C., the rate is up 5.8% in a year vs. 4.2% a year ago. Inland Empire was 10.7% vs. 4.1% a year ago.
We all thought gasoline’s upswing was over. Then came late summer’s rebound. L.A.-O.C. gas prices are up 25.3% in a year vs. 35% a year ago. Inland Empire gas prices are up 25.1% vs. 36% a year ago.
Brenda Felton, from Rancho Cucamonga, removes a gas nozzle after filling up at a station on Milliken Avenue in Rancho Cucamonga on Tuesday, Oct. 4, 2022. The average price has risen 32 consecutive days, increasing $1.243, including seven-tenths of a cent Monday, according to figures from the AAA and Olil Price Information Service. Monday’s increase was the smallest since a half-cent increase Sept. 19.(Photo by Will Lester, Inland Valley Daily Bulletin/SCNG)
Home. Pricey. Home.
Housing costs continue to escalate. Just look at rents, noting the CPI tracks a wide selection of renters in various living arrangements — not what big landlords seek from new tenants.
In L.A.-O.C., tenants paid 5.3% more this year vs. 1.1% a year ago. Inland Empire’s up 7.9% vs. 4.3% a year ago.
Turning the lights on hurts household finances, too. Electricity prices are up, with fuel costs a key culprit. L.A.-O.C. is up 9.7% in a year vs. 11.6% a year ago. Inland Empire was up to 14.8% vs. 15.5% a year ago.
And if you use natural gas to heat your home or cook, it’s another lesson in the globe’s high energy prices. L.A.-O.C. prices are up 31% in a year vs. 16% a year ago. Inland Empire prices are up 30% vs. 16% a year ago.
Plus, furnishing and operating a home isn’t getting cheaper. L.A.-O.C. prices are up 6.5% in a year vs. 1.9% a year ago. Inland Empire: 11.7% vs. 6.1% a year ago.
Labor is in short supply. So the price of getting somebody to do something is up.
The CPI for all services says L.A.-O.C. is 6.6% pricier vs. 3.1% a year ago. Inland Empire: 7.3% vs. 5.3% a year ago.
Getting sick, too, isn’t good for the health of a household’s finances. L.A.-O.C. is up 6.8% in a year vs. 0.6% a year ago. Inland Empire: 9.1% vs. 1.8% a year ago.
One of the sharpest price turns is apparel.
Folks working in the office and their kids returning to the classroom created a heavy demand for new clothes. So apparel prices skyrocketed. L.A.-O.C. prices are up 12.8% in a year vs. a drop of 1.9% a year ago. Inland Empire was up to 7.8% vs. a dip of 2% a year ago.
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And you know all those big things you need to buy — think appliances or furniture. “Durables” are costlier, too. L.A.-O.C. is up 6.6% in a year vs. 7.4% a year ago. Inland Empire: 3.5% vs. 10.1% a year ago.
Vehicles remain pricey but their inflation rates have dampened. New cars and trucks in L.A.-O.C. cost 6.6% more in a year vs. 7.9% a year ago. Inland Empire’s are actually down 1.2% vs. a gain of 12.5% a year ago.
And the used car lots don’t offer much help. L.A.-O.C. prices are up 8.1% in a year vs. 23% a year ago. Inland Empire prices rose to 8.1% vs. 24% year ago.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at email@example.com