The July consumer price index numbers offered a glimmer of hope that inflation in the U.S. had started to slow. In June, consumer prices had been up 9.1% year over year. July’s CPI increased at a slower pace, 8.5.% year over year. The new August figures, released on Sept. 13, looked even better at first blush, up by an even smaller 8.3%. Numbers can mislead, however. Most of the improvement in August, same as in July, came from the sharply dropping cost of oil, gas, and heating oil. Otherwise, raging inflation remained.
Oil prices have been the saving grace for Americans trapped in the vice of rising prices. The cost of a gallon of regular gas nationwide three months ago hit $5. That has decreased to $3 per gallon. Still, compared to last year, the price of fuel oil is soaring.
As the drop compared to previous months steepened, a false sense of what Americans pay for their daily lives set in, but only briefly.
A look at the August CPI report from the Bureau of Labor Statistics shows dozens of items the prices of which rose by above 15% year over year. Oil and gas remained at the top because they were so inexpensive in August 2021, but the story last month revolves around food prices. As an example, the cost of butter rose 25%. The cost of eggs jumped 40% year over year. (Inflation can be a greater for those with lower income. These are America’s poorest towns.)
What happens next? The Federal Reserve has raised interest rates at a brisk pace. These rate hikes included a 0.75% increase in March and another in May. This next rate jump will be the same, almost certainly. This will put to the test the theory that rising rates cools inflation.
Perhaps the only antidote to inflation comes with higher unemployment, and thus, a slackening of consumer demand. Prominent economist and former Treasury Secretary Larry Summers believes the jobless rate will need to rise to over 5% for five years (explaining this could mean five years of 6% unemployment or two years of 7.5% unemployment or one year of 10% unemployment) to contain the rampant surge in the prices of so many goods and services. (Over the long term, here are cities where wages will rise the most by 2060.)
To determine the 40 household items that are soaring in price, 24/7 Wall St. reviewed the BLS’ Consumer Price Index Summary August report. Prices are compared to August 2021.
Click here to see the price of this household item is soaring.
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40. Rice, pasta, cornmeal
> Price increase, August 2021 to August 2022: +15.7%
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39. Electricity
> Price increase, August 2021 to August 2022: +15.8%
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38. Sugar and sugar substitutes
> Price increase, August 2021 to August 2022: +15.9%
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37. Bakery products
> Price increase, August 2021 to August 2022: +16.0%
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36. Canned vegetables
> Price increase, August 2021 to August 2022: +16.1%
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35. Fresh whole milk
> Price increase, August 2021 to August 2022: +16.1%
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34. Bread other than white
> Price increase, August 2021 to August 2022: +16.1%
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33. White bread
> Price increase, August 2021 to August 2022: +16.4%
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32. Breakfast cereal
> Price increase, August 2021 to August 2022: +16.4%
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31. Cereals and bakery products
> Price increase, August 2021 to August 2022: +16.4%
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30. Canned fruits
> Price increase, August 2021 to August 2022: +16.6%
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29. Fresh biscuits, rolls, muffins
> Price increase, August 2021 to August 2022: +17.1%
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28. Prepared salads
> Price increase, August 2021 to August 2022: +17.3%
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27. Sauces and gravies
> Price increase, August 2021 to August 2022: +17.6%
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26. Coffee
> Price increase, August 2021 to August 2022: +17.6%
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25. Living room, kitchen, and dining room furniture
> Price increase, August 2021 to August 2022: +17.7%
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24. Fresh milk other than whole
> Price increase, August 2021 to August 2022: +17.7%
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23. Crackers, bread, and cracker products
> Price increase, August 2021 to August 2022: +17.7%
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22. Fresh and frozen chicken parts
> Price increase, August 2021 to August 2022: +17.8%
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21. Frozen and refrigerated bakery products, pies, tarts, turnovers
> Price increase, August 2021 to August 2022: +18.1%
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20. Lunchmeats
> Price increase, August 2021 to August 2022: +18.2%
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19. Frankfurters
> Price increase, August 2021 to August 2022: +18.3%
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18. Soups
> Price increase, August 2021 to August 2022: +18.5%
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17. Roasted coffee
> Price increase, August 2021 to August 2022: +18.7%
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16. Propane, kerosene, and firewood
> Price increase, August 2021 to August 2022: +18.8%
15. Olives, pickles, relishes
> Price increase, August 2021 to August 2022: +19.4%
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14. Public transportation
> Price increase, August 2021 to August 2022: +21.1%
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13. Fats and oils
> Price increase, August 2021 to August 2022: +21.5%
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12. Flour and prepared flour mixes
> Price increase, August 2021 to August 2022: +23.3%
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11. Food at employee sites and schools
> Price increase, August 2021 to August 2022: +23.7%
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10. Health insurance
> Price increase, August 2021 to August 2022: +24.3%
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9. Butter
> Price increase, August 2021 to August 2022: +24.6%
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8. Gasoline, unleaded premium
> Price increase, August 2021 to August 2022: +24.7%
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7. Gasoline, unleaded midgrade
> Price increase, August 2021 to August 2022: +25.5%
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6. Gasoline, unleaded regular
> Price increase, August 2021 to August 2022: +25.8%
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5. Utility (piped) gas service
> Price increase, August 2021 to August 2022: +33.0%
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4. Airline fares
> Price increase, August 2021 to August 2022: +33.4%
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3. Margarine
> Price increase, August 2021 to August 2022: +38.3%
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2. Eggs
> Price increase, August 2021 to August 2022: +39.8%
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1. Fuel oil
> Price increase, August 2021 to August 2022: +68.8%
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