Shelter index up, gasoline prices down
Consumer prices rose in October at their slowest pace since July, the Bureau of Labor Statistics announced Thursday. The 0.1 percent increase in the Consumer Price Index follows two consecutive months of 0.6 increases, an indication that inflation, a primary concern in affluent households, is being held in check.
The cost of shelter, which includes rent, increased 0.3 percent, its largest increase since March 2008, the BLS reported. The index for all items excluding the more volatile food and energy, also known as the core CPI, rose 0.2 percent in October. The rise in the shelter index (including a 0.4 percent increase in the index for rents), coupled with increases in prices for apparel and airline fares offset the declines in the indexes for used cars and trucks, new vehicles and recreation.
Gas prices fell 0.6 percent in October, the first drop in gasoline prices since June. They climbed 7 percent the previous month and has risen 16.6 percent from July to September. Lower gas prices boost consumer spending, which accounts for 70 percent of the economy.
Food costs increased 0.2 percent in October, while the index for food at home rose 0.3 percent, the largest increase since September of last year. Among other indexes, clothing costs increased 0.7 percent, hotel fares rose 0.5 percent and airline fares soared 2.4 percent. Medical expenses remained basically unchanged for the first time in more than two years, while prices for used cars and trucks dipped 0.9 percent, the fourth consecutive decrease.
Overall consumer prices have increased 2.2 percent in the past year. The core CPI has increased 2 percent in the last 12 months, the same as in the 12 months through September.
Affluent households were more concerned about inflation this year than last, according to wealth level studies conducted in the first quarter by Millionaire Corner. In households with a net worth between $100,000 and $1 million (not including primary residence), 71 percent said inflation was their primary national concern, up from 69 percent in 2011. In Millionaire households, the increase is sharper, 64 percent vs. 55 percent.
The monthly CPI report measures the average change in prices over time of goods and services purchased by households. Prices are collected monthly in 87 urban areas across the country from about 4,000 housing units and approximately 26,000 retail establishments.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.