Where are high prices still hitting Americans the hardest?

August 14, 2024

Former IMF Chief Economist Kenneth Rogoff discusses the state of the economy following the July CPI report.

Inflation eased again in July, even as rising rent, grocery and auto insurance costs kept prices uncomfortably high for millions of Americans.

The Labor Department said Wednesday that the Consumer Price Index (CPI), a broad measure of the prices of everyday items such as gasoline, groceries and rent, rose 0.2% in July from the previous month, in line with expectations.

Prices were up 2.9% from the same period last year, the lowest inflation rate since March 2021.

Inflation rises to less-than-expected 2.9% in July

“Evidence is mounting that consumers are struggling under the strain of high prices, high interest rates and a sluggish job market,” said Mark Hamrick, senior economic analyst at Bankrate. “Despite the ‘as expected’ numbers, prices broadly continued to rise last month.”

Here’s a breakdown of where Americans are seeing prices rise and fall the fastest.

rent

Housing costs continued to be the main driver of inflation last month, with rents rising 0.3% last month and 5.1% higher than the same period last year.

Rising rents are a concern. Rising housing costs It has the most direct and serious impact on household finances.

A home for sale in the Capitol Hill neighborhood of Washington, DC, on July 30. (Tierney L. Cross/Bloomberg via Getty Images/Getty Images)

Another data point measuring how much homeowners would pay in comparable rent if they hadn’t bought the home also rose 0.4% from the previous month.

Nationwide chief economist Cathy Bosjancic said home price growth was a “blemish” in July’s CPI report.

“These data pour cold water on the idea that rental inflation is finally showing a sustained slowdown after weak data in June,” she added.

US home prices hit record high again

food

Food items, one of the things that many Americans feel most strongly about inflation, rose in price again in July.

Food prices rose 0.2% last month and are 2.2% higher than the same period last year. The eating out index rose 0.2%, while grocery prices rose 0.1%.

Food prices are up 1.1% from last year, and compared to January 2021, before the inflation crisis began, prices are up more than 21%.

Consumers continue to pay more for some basic goods, including cookies (1.5%), beef and veal (1.2%), ham (3.3%), chicken (0.1%), milk (1.9%), carbonated drinks (0.6%), coffee (1.7%), tomatoes (3.6%) and citrus fruit (1.6%).

Customers line up to buy groceries at a supermarket in Foster City, California, on Sunday. (Li Jianguo/Xinhua via Getty Images/Getty Images)

Prices of some commodities, including rice, bread, ice cream and seafood, fell last month.

“While inflation overall has fallen, some of the biggest pain points in consumer prices have worsened,” said Robert Frick, corporate economist at Navy Federal Credit Union.

Energy

Energy prices remained steady in July after declining over the previous two months, easing some of the financial pressures many households are enduring.

Rising interest rates could cost US companies $380 billion in ‘slow-moving crisis’

Gasoline prices also remained steady in July, remaining 2.2% lower than the same period last year.

However, propane, heating oil and firewood prices rose 1.9% in July, while fuel oil costs increased 0.9%.

A customer fills up his car at a Shell gas station in Miami on May 15. (Joe Raedl/Getty Images/Getty Images)

car

There’s good news for Americans looking to buy a car in July.

Auto insurance rates are on the rise again and could rise 22% by the end of the year

Prices for new cars and trucks fell again last month, down 0.2 percent. Prices are 1 percent lower than the same period last year.

of Used car prices Home prices, the main driver of 2022’s inflation surge, also fell in July, plunging 2.3%. Year-on-year they are down 10.9%.

This used car will be available for sale at a dealership in Chicago, IL on July 11, 2023.

The used car will be available for sale at a Chicago dealership on July 11, 2023. (Scott Olson/Getty Images/Getty Images)

But there’s another growing issue for car owners: insurance costs. Auto insurance rates rose 1.2% in July, and are up a staggering 18.6% from the same time last year.

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