Old North News

The U.S. Bureau of Labor Statistics (BLS) has released numbers that show the Consumer Price Index has (CPI) increased the most since 1982.

According to a Jan. 12 report, the CPI for urban consumers went up 0.5% in December and over the last year has increased 7%. A Jan. 18 report showed that the real average hourly earnings for employees increased only 0.1% between November and December. Over a year, the average real earnings decreased 2.4%.

According to the U.S. Census Bureau, the average household income in the state of North Carolina is $54,602. A 0.1% increase in wages would move that figure to $55,148.

"Increases in the indexes for shelter and for used cars and trucks were the largest contributors to the seasonally adjusted all items increase," the BLS stated in a press release. "The food index also contributed, although it increased less than in recent months, rising 0.5% in December."

Reuters reported that numbers show the largest annual inflation increase in four decades and the Federal Reserve is expected to start raising interest rates by March.

“The Fed is going to be forced to begin raising rates in March and, depending on the political pressure on them – from both sides of the aisle – they are going to have to raise rates four or more times in this year and potentially more than that next year," Chief Investment Officer Chris Zaccarelli at Independent Advisor Alliance in Charlotte, said in the Reuters report.

According to the BLS, increases in the indexes for shelter and for used cars and trucks were the largest contributors to seasonally adjusted all items increase. The food index also contributed, but it has also increased less than other months, going up 0.5% in December.

According to CNBC, the CPI is a good measure of inflation and has been closely monitored by economists, taking into account dozens of common consumer goods. The inflation comes at a point where there is a short of goods as well as workers. 

Information from the BLS shows that industries with the largest price increases included energy at 29.3%; gasoline at 49.6%; natural gas at 24.1% and electricity at 6.3%.

There is some good news in the report. Over the past month, fuel prices fell 2.4% and gasoline dropped 0.5% after showing an increase of 6.1% in November and October. The BLS report also showed the energy index decreased 0.4% in December following a 3.5% increase in November. This was the first decrease since April 2021.