RBC Chief Economist Francis Donald explains how inflation affects the average household's income.
Inflation increased In December, it reached its highest level since July, with most of the increase due to higher energy and food prices.
Ministry of Labor published Consumer Price Index (CPI) – a broad measure of the cost of everyday goods such as gas, groceries and rent – for December, which showed prices were 2.9% higher than a year earlier The increase was 0.4% from the previous month, which was larger than LSEG economists had estimated. .
Most of the increase in prices was due to higher energy and food costs, which put pressure on household budgets.
More than 40 percent of the monthly increase in the CPI was attributed to rising energy prices, as the Bureau of Labor Statistics' energy index rose 2.6 percent in December, after energy prices were little changed in previous months and previously fell 0.5 percent on an annual basis. found the moon
Inflation rose 2.9 percent in December, in line with expectations
Energy prices increased significantly in December, and gas prices also contributed significantly. (Louis Cinco/Los Angeles Times via Getty Images/File)
Energy price They were flat in July, then fell by 0.8% and 1.9% in August and September, respectively, before leveling off in October. They rose 0.2% in November, before rising 2.6% in December.
gas price They contributed significantly to the increase in the energy index, as they rose 4.4 percent in December. Similar to the overall energy index, gas prices fell 0.6% in August, 4.1% in September and 0.9% in October, before ending the year with a 0.6% gain in November, before rising further last month. .
price from Municipal gas service It also rose in December, up 2.4 percent month-on-month and 4.9 percent year-on-year.
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Food prices It also recorded a significant increase in December, rising 0.3 percent on the month. Contrary to energy price trends, food costs have increased relatively little in recent months.
The lowest monthly increase in food prices was 0.1% in June, July and 0.2% in October. Larger gains of 0.4 percent were recorded in September and November leading up to the December CPI report.
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The outbreak of bird flu has reduced the supply of eggs and contributed to the increase in prices. (Reuters/Dado Rovic/File)
In the BLS Food Price Index, the cost of eating out has increased twice as much as food at home in the past year, with the former rising 3.6 percent over the past 12 months compared to 1.8 percent for the latter.
Eggs continued to be the most volatile among food items tracked by the BLS, rising 3.2 percent in December for a 12-month gain of 36.8 percent. The supply of eggs was disrupted last year due to the outbreak of bird flu.
particle for direct object US Department of Agriculture “Supply remains the biggest challenge in the market as HPAI continues to affect commercial egg flocks in the new year,” noted a report this month.
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The price of beef also witnessed a faster increase than the total food price in December on an annual and monthly basis. Beef and veal prices increased by 0.5% in December compared to the previous month and increased by 4.9% compared to the previous year.