Inflation Rate at Almost a 40-Year High

The steady drumbeat about inflation continues, as the latest data from the U.S. Bureau of Labor Statistics (BLS) shows that the Consumer Price Index (CPI) inflation rate has reached a 39-year high.

Even on the heels of an inflation-centric late summer and fall, the hikes were more than economists had predicted. December’s CPI rose 0.5% over November, above the 0.4% anticipated by business analysts. On an annualized basis, the CPI jumped 7% in 2021, making it the steepest climb since 1982.

The food index contributed to the overall CPI spike, but food prices increased less in December than they have during other months in 2021. The CPI for food at home was up 0.4% in December, lower than the 0.8% in November, 1.0% in October and 1.2% in September. For the year, the index for food at home edged up 6.5%.

According to BLS, five of six major grocery store food group indexes jumped in December. Fruit and vegetable prices changed the most, at 0.9% over the previous month. The index for dairy and related products notched a 0.7% increase, while cereals and bakery products and non-alcoholic beverages were up as well.

It was somewhat of a different story in the protein sector. Although CPI for meat, poultry, fish and eggs had been on an upward trajectory for much of 2021, it dipped by 0.4% in December.  Declines included prices for beef and pork, which had been continually rising.

The full BLS report is available online.