The Consumer Price Index (CPI-U) report for the New York-Newark-Jersey City area in July reported prices dropping slightly, likely due to lower energy prices.
The CPI-U – a measure of how the prices of goods and services change over a period of time – in the New York area has shown an overall increase by 6.5%, with energy prices rising to 30.6% due to the 45.9% increase in gasoline prices.
For the month of July, energy prices were slightly lower – falling 5.8% over the month with the price of gas falling 6.5% and household energy decreasing 5.2%.
Despite the drop in prices for energy, food prices still continue to soar with prices rising 1.8% and prices for food at home increasing 2.5%.
The overall report released on Aug 10 revealed that while inflation has decelerated in recent weeks, it still remains abnormally high.
There is still hope that inflation and price hikes will slow down in the coming months – with supply chain pressures showing some signs of easing – however, other factors like the wage growth rate and rapidly increasing pay growth make it difficult for price increases to slow.
Other contributing factors like volatile gas prices, make it difficult to predict when the rate of inflation will slow.
“It can’t just be one month,” said Loretta Mester, president of the Federal Reserve Bank of Cleveland in a recent statement. Oil prices went down in July; that’ll feed through to the July inflation report, but there’s a lot of risk that oil prices will go up in the fall. It would be a mistake to cry victory too early.”