America’s inflation problem created the worst scenario. The consumer price index has been surging particularly on food, rent, heating oil, and auto, which can lead Americans to face financial difficulty during holidays such as Thanksgiving and Christmas. These holidays are one of the best shopping seasons in the country. Prices surged 6.2% which is considered the highest since December 1990, the Labor Department reported Wednesday.
On the monthly basis, the CPI has soared 0.9% against the 0.6%. The yearly core inflation rose at a 4.6% pace compared with the highest since August 1991. Fuel oil prices increased 12.3% in the month. Energy prices rose 4.8% in October, which is 30% for the 12 months. Used vehicle prices contributed to the increase of 2.5% for the month, and also contributed 26.4% for the year. New vehicle prices were raised 1.4% and 9.8% for the year. Food prices jumped up 0.9% and 5.3% for the year. In the food category poultry, meat, eggs, and fish collectively increased 1.7% for the month and 11.9% yearly.
The main reasons for the price surge were excessive demand, raw material shortage, and the global supply chains. The price increase affected savings, household wealth, said Rick Rieder, BlackRock’s chief investment officer of global fixed income.“Further employment gains will continue to be a major driver of continued demand strength for goods and services, and higher wages will be a story that will sustain itself for many months to come,” Rick said.
The Biden administration and the Federal Reserve stated that the price hikes are temporary.
Consumer Price Index Summary:
Transmission of material in this release is embargoed until
8:30 a.m. (ET) November 10, 2021 USDL-21-1973
Technical information: (202) 691-7000 • [email protected] • www.bls.gov/cpi
Media Contact: (202) 691-5902 • [email protected]
CONSUMER PRICE INDEX – OCTOBER 2021
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.9 percent
in October on a seasonally adjusted basis after rising 0.4 percent in September,
the U.S. Bureau of Labor Statistics reported today. Over the last 12 months,
the all items index increased 6.2 percent before seasonal adjustment.
The monthly all items seasonally adjusted increase was broad-based, with
increases in the indexes for energy, shelter, food, used cars and trucks, and
new vehicles among the larger contributors. The energy index rose 4.8 percent
over the month, as the gasoline index increased 6.1 percent and the other major
energy component indexes also rose. The food index increased 0.9 percent as the
index for food at home rose 1.0 percent.
The index for all items less food and energy rose 0.6 percent in October after
increasing 0.2 percent in September. Most component indexes increased over the
month. Along with shelter, used cars and trucks, and new vehicles, the indexes
for medical care, for household furnishing and operations, and for recreation
all increased in October. The indexes for airline fares and for alcoholic
beverages were among the few to decline over the month.
The all items index rose 6.2 percent for the 12 months ending October, the large
st 12-month increase since the period ending November 1990. The index for all
items less food and energy rose 4.6 percent over the last 12 months, the largest
12-month increase since the period ending August 1991. The energy index rose
30.0 percent over the last 12 months, and the food index increased 5.3 percent.
Table A. Percent changes in CPI for All Urban Consumers (CPI-U): U.S. city average
Seasonally adjusted changes from
preceding month
Un-
adjusted
12-mos.
Apr. May June July Aug. Sep. Oct. ended
2021 2021 2021 2021 2021 2021 2021 Oct.
2021
All items……………… .8 .6 .9 .5 .3 .4 .9 6.2
Food…………………. .4 .4 .8 .7 .4 .9 .9 5.3
Food at home…………. .4 .4 .8 .7 .4 1.2 1.0 5.4
Food away from home (1).. .3 .6 .7 .8 .4 .5 .8 5.3
Energy……………….. -.1 .0 1.5 1.6 2.0 1.3 4.8 30.0
Energy commodities……. -1.4 -.6 2.6 2.3 2.7 1.3 6.2 49.5
Gasoline (all types)…. -1.4 -.7 2.5 2.4 2.8 1.2 6.1 49.6
Fuel oil (1)………… -3.2 2.1 2.9 .6 -2.1 3.9 12.3 59.1
Energy services………. 1.5 .7 .2 .8 1.1 1.2 3.0 11.2
Electricity…………. 1.2 .3 -.3 .4 1.0 .8 1.8 6.5
Utility (piped) gas
service………….. 2.4 1.7 1.7 2.2 1.6 2.7 6.6 28.1
All items less food and
energy…………….. .9 .7 .9 .3 .1 .2 .6 4.6
Commodities less food and
energy commodities…. 2.0 1.8 2.2 .5 .3 .2 1.0 8.4
New vehicles………… .5 1.6 2.0 1.7 1.2 1.3 1.4 9.8
Used cars and trucks…. 10.0 7.3 10.5 .2 -1.5 -.7 2.5 26.4
Apparel…………….. .3 1.2 .7 .0 .4 -1.1 .0 4.3
Medical care
commodities (1)…… .6 .0 -.4 .2 -.2 .3 .6 -.4
Services less energy
services………….. .5 .4 .4 .3 .0 .2 .4 3.2
Shelter…………….. .4 .3 .5 .4 .2 .4 .5 3.5
Transportation services 2.9 1.5 1.5 -1.1 -2.3 -.5 .4 4.5
Medical care services… .0 -.1 .0 .3 .3 -.1 .5 1.7
1 Not seasonally adjusted.
Food
The food index increased 0.9 percent in October, the same increase as in September.
The food at home index increased 1.0 percent over the month as all six major grocery
store food group indexes continued to rise. The index for meats, poultry, fish, and
eggs continued to rise sharply, increasing 1.7 percent following a 2.2-percent
increase in September. The index for beef rose 3.1 percent over the month.
The index for other food at home rose 1.2 percent over the month, its largest monthly
increase since April 2020, near the onset of the pandemic. The index for cereals and
bakery products rose 1.0 percent in October following a 1.1-percent increase the prior
month. The index for nonalcoholic beverages rose 0.8 percent in October, the index for
dairy and related products rose 0.2 percent, and the index for fruits and vegetables
advanced 0.1 percent.
The food away from home index rose 0.8 percent in October after increasing 0.5 percent
in September. The index for full service meals rose 0.9 percent and the index for
limited service meals increased 0.8 percent over the month.
The food at home index rose 5.4 percent over the past 12 months as all of the six
major grocery store food group indexes increased over the period. The index for meats,
poultry, fish, and eggs increased 11.9 percent, with the index for beef rising
20.1 percent and the index for pork rising 14.1 percent, its largest 12-month
increase since the period ending December 1990. The other major grocery store food
group indexes also increased over the last 12 months with increases ranging from
1.8 percent (dairy and related products) to 4.5 percent (nonalcoholic beverages).
The index for food away from home rose 5.3 percent over the last year. The index for
limited service meals rose 7.1 percent over the last 12 months, and the index for full
service meals rose 5.9 percent, both the largest 12-month increases in the history of
the respective series. The index for food at employee sites and schools declined
sharply over the past year, falling 45.4 percent.
Energy
The energy index rose 4.8 percent in October after rising 1.3 percent in September.
The gasoline index rose 6.1 percent in October, its fifth consecutive monthly increase.
(Before seasonal adjustment, gasoline prices rose 3.7 percent in October.) The index
for natural gas rose 6.6 percent over the month, its largest monthly increase since
March 2014. The electricity index increased 1.8 percent in October, its largest 1-month
increase since May 2014, while the fuel oil index also rose sharply, increasing
12.3 percent.
The energy index rose 30.0 percent over the past 12 months, its largest 12-month
increase since the period ending September 2005. All the major energy component
indexes increased sharply over the last 12 months. The gasoline index rose
49.6 percent over the last year, and is now at its highest level since September 2014.
The fuel oil index increased sharply over the year, rising 59.1 percent. The index for
natural gas rose 28.1 percent over the last 12 months, and the electricity index rose
6.5 percent.
All items less food and energy
The index for all items less food and energy rose 0.6 percent in October as most major
component indexes increased. The shelter index increased 0.5 percent over the month,
as the indexes for rent and owners’ equivalent rent both rose 0.4 percent and the
index for lodging away from home increased 1.4 percent. Major vehicle indexes also
rose in October. The index for used cars and trucks rose 2.5 percent after declining
in August and September. The index for new vehicles rose 1.4 percent in October, its
seventh consecutive monthly increase.
The medical care index increased in October, rising 0.5 percent, its largest monthly
increase since May 2020. The index for hospital services rose 0.5 percent, and the
index for prescription drugs advanced 0.6 percent; the index for physicians’ services
was unchanged. The household furnishings and operations index rose 0.8 percent, and the
recreation index increased 0.7 percent. Also rising in October were the indexes for
personal care (0.6 percent), tobacco (1.9 percent), education (0.2 percent), and
communication (0.1 percent).
The motor vehicle insurance index and the apparel index were both unchanged in October.
The index for airline fares was one of the few to decline, falling 0.7 percent; the
index for alcoholic beverages decreased 0.2 percent.
The index for all items less food and energy rose 4.6 percent over the past 12 months.
Component indexes rising more include used cars and trucks (26.4 percent) and new
vehicles (9.8 percent, the largest 12-month increase since the period ending May 1975).
Indexes rising less than 4.6 percent include shelter (3.5 percent) and medical care
(1.3 percent). Few major component indexes declined over the past year; one exception
is airline fares (-4.6 percent).
Not seasonally adjusted CPI measures
The Consumer Price Index for All Urban Consumers (CPI-U) increased 6.2 percent over
the last 12 months to an index level of 276.589 (1982-84=100). For the month, the
index increased 0.8 percent prior to seasonal adjustment.
The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased
6.9 percent over the last 12 months to an index level of 271.552 (1982-84=100). For
the month, the index rose 0.9 percent prior to seasonal adjustment.
The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased
6.1 percent over the last 12 months. For the month, the index increased 0.8 percent on
a not seasonally adjusted basis. Please note that the indexes for the past 10 to
12 months are subject to revision.
_______________
The Consumer Price Index for November 2021 is scheduled to be released on Friday,
December 10, 2021 at 8:30 a.m. (ET).
————————————————————————————————–
Coronavirus (COVID-19) Pandemic Impact on October 2021 Consumer Price Index Data
Data collection by personal visit for the Consumer Price Index (CPI) program has been suspended
almost entirely since March 16, 2020. When possible, data normally collected by personal visit
were collected either online or by phone. Additionally, data collection in October was affected by
the temporary closing or limited operations of certain types of establishments. These factors
resulted in an increase in the number of prices considered temporarily unavailable and imputed.
While the CPI program attempted to collect as much data as possible, many indexes are based on
smaller amounts of collected prices than usual, and a small number of indexes that are normally
published were not published this month. Additional information is available at
www.bls.gov/covid19/effects-of-covid-19-pandemic-on-consumer-price-index.htm.
—————————————————————————————————-
Technical Note
Brief Explanation of the CPI
The Consumer Price Index (CPI) measures the change in prices paid by consumers
for goods and services. The CPI reflects spending patterns for each of two
population groups: all urban consumers and urban wage earners and clerical
workers. The all urban consumer group represents about 93 percent of the total
U.S. population. It is based on the expenditures of almost all residents of urban
or metropolitan areas, including professionals, the self-employed, the poor,
the unemployed, and retired people, as well as urban wage earners and clerical
workers. Not included in the CPI are the spending patterns of people living in
rural nonmetropolitan areas, farming families, people in the Armed Forces, and
those in institutions, such as prisons and mental hospitals. Consumer inflation
for all urban consumers is measured by two indexes, namely, the Consumer Price
Index for All Urban Consumers (CPI-U) and the Chained Consumer Price Index for
All Urban Consumers (C-CPI-U).
The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W)
is based on the expenditures of households included in the CPI-U definition
that meet two requirements: more than one-half of the household’s income must
come from clerical or wage occupations, and at least one of the household’s
earners must have been employed for at least 37 weeks during the previous
12 months. The CPI-W population represents about 29 percent of the total U.S.
population and is a subset of the CPI-U population.
The CPIs are based on prices of food, clothing, shelter, fuels, transportation,
doctors’ and dentists’ services, drugs, and other goods and services that people
buy for day-to-day living. Prices are collected each month in 75 urban areas
across the country from about 6,000 housing units and approximately 22,000 retail
establishments (department stores, supermarkets, hospitals, filling stations, and
other types of stores and service establishments). All taxes directly associated
with the purchase and use of items are included in the index. Prices of fuels and
a few other items are obtained every month in all 75 locations. Prices of most
other commodities and services are collected every month in the three largest
geographic areas and every other month in other areas. Prices of most goods and
services are obtained by personal visits or telephone calls by the Bureau’s
trained representatives.
In calculating the index, price changes for the various items in each location
are aggregated using weights, which represent their importance in the spending
of the appropriate population group. Local data are then combined to obtain a
U.S. city average. For the CPI-U and CPI-W, separate indexes are also published
by size of city, by region of the country, for cross-classifications of regions
and population-size classes, and for 23 selected local areas. Area indexes do not
measure differences in the level of prices among cities; they only measure the
average change in prices for each area since the base period. For the C-CPI-U,
data are issued only at the national level. The CPI-U and CPI-W are considered
final when released, but the C-CPI-U is issued in preliminary form and subject
to three subsequent quarterly revisions.
The index measures price change from a designed reference date. For most of the
CPI-U and the CPI-W, the reference base is 1982-84 equals 100. The reference
base for the C-CPI-U is December 1999 equals 100. An increase of 7 percent from
the reference base, for example, is shown as 107.000. Alternatively, that
relationship can also be expressed as the price of a base period market basket
of goods and services rising from $100 to $107.
Sampling Error in the CPI
The CPI is a statistical estimate that is subject to sampling error because it
is based upon a sample of retail prices and not the complete universe of all
prices. BLS calculates and publishes estimates of the 1-month, 2-month, 6-month,
and 12-month percent change standard errors annually for the CPI-U. These standard
error estimates can be used to construct confidence intervals for hypothesis
testing. For example, the estimated standard error of the 1-month percent change
is 0.03 percent for the U.S. all items CPI. This means that if we repeatedly sample
from the universe of all retail prices using the same methodology, and estimate a
percentage change for each sample, then 95 percent of these estimates will be within
0.06 percent of the 1-month percentage change based on all retail prices. For
example, for a 1-month change of 0.2 percent in the all items CPI-U, we are
95 percent confident that the actual percent change based on all retail prices would
fall between 0.14 and 0.26 percent. For the latest data, including information on
how to use the estimates of standard error, see
https://www.bls.gov/cpi/tables/variance-estimates/home.htm.
Calculating Index Changes
Movements of the indexes from 1 month to another are usually expressed as percent
changes rather than changes in index points, because index point changes are
affected by the level of the index in relation to its base period, while percent
changes are not. The following table shows an example of using index values to
calculate percent changes:
Item A Item B Item C
Year I 112.500 225.000 110.000
Year II 121.500 243.000 128.000
Change in index points 9.000 18.000 18.000
Percent change 9.0/112.500 x 100 = 8.0 18.0/225.000 x 100 = 8.0 18.0/110.000 x 100 = 16.4
Use of Seasonally Adjusted and Unadjusted Data
The Consumer Price Index (CPI) produces both unadjusted and seasonally adjusted data.
Seasonally adjusted data are computed using seasonal factors derived by the X-13ARIMA-
SEATS seasonal adjustment method. These factors are updated each February, and the new
factors are used to revise the previous 5 years of seasonally adjusted data. The
factors are available at
www.bls.gov/cpi/tables/seasonal-adjustment/seasonal-factors-2021.xlsx. For more
information on data revision scheduling, please see the Factsheet on Seasonal
Adjustment at www.bls.gov/cpi/seasonal-adjustment/questions-and-answers.htm and
the Timeline of Seasonal Adjustment Methodological Changes at
www.bls.gov/cpi/seasonal-adjustment/timeline-seasonal-adjustment-methodology-changes.htm.
For analyzing short-term price trends in the economy, seasonally adjusted changes are
usually preferred since they eliminate the effect of changes that normally occur at
the same time and in about the same magnitude every year—such as price movements
resulting from weather events, production cycles, model changeovers, holidays, and
sales. This allows data users to focus on changes that are not typical for the time
of year. The unadjusted data are of primary interest to consumers concerned about
the prices they actually pay. Unadjusted data are also used extensively for escalation
purposes. Many collective bargaining contract agreements and pension plans, for example,
tie compensation changes to the Consumer Price Index before adjustment for seasonal
variation. BLS advises against the use of seasonally adjusted data in escalation
agreements because seasonally adjusted series are revised annually.
Intervention Analysis
The Bureau of Labor Statistics uses intervention analysis seasonal adjustment for some
CPI series. Sometimes extreme values or sharp movements can distort the underlying
seasonal pattern of price change. Intervention analysis seasonal adjustment is a process
by which the distortions caused by such unusual events are estimated and removed from
the data prior to calculation of seasonal factors. The resulting seasonal factors, which
more accurately represent the seasonal pattern, are then applied to the unadjusted data.
For example, this procedure was used for the motor fuel series to offset the effects of
the 2009 return to normal pricing after the worldwide economic downturn in 2008.
Retaining this outlier data during seasonal factor calculation would distort the
computation of the seasonal portion of the time series data for motor fuel, so it was
estimated and removed from the data prior to seasonal adjustment. Following that,
seasonal factors were calculated based on this “prior adjusted” data. These seasonal
factors represent a clearer picture of the seasonal pattern in the data. The last step
is for motor fuel seasonal factors to be applied to the unadjusted data.
For the seasonal factors introduced for January 2021, BLS adjusted 72 series using
intervention analysis seasonal adjustment, including selected food and beverage items,
motor fuels, electricity, and vehicles.
Revision of Seasonally Adjusted Indexes
Seasonally adjusted data, including the U.S. city average all items index levels, are
subject to revision for up to 5 years after their original release. Every year, economists
in the CPI calculate new seasonal factors for seasonally adjusted series and apply them to
the last 5 years of data. Seasonally adjusted indexes beyond the last 5 years of data are
considered to be final and not subject to revision. For January 2021, revised seasonal
factors and seasonally adjusted indexes for 2016 to 2020 were calculated and published.
For series which are directly adjusted using the Census X-13ARIMA-SEATS seasonal adjustment
software, the seasonal factors for 2020 will be applied to data for 2021 to produce the
seasonally adjusted 2021 indexes. Series which are indirectly seasonally adjusted by
summing seasonally adjusted component series have seasonal factors which are derived and
are therefore not available in advance.
Determining Seasonal Status
Each year the seasonal status of every series is reevaluated based upon certain statistical
criteria. Using these criteria, BLS economists determine whether a series should change its
status from “not seasonally adjusted” to “seasonally adjusted”, or vice versa. If any of
the 81 components of the U.S. city average all items index change their seasonal adjustment
status from seasonally adjusted to not seasonally adjusted, not seasonally adjusted data
will be used in the aggregation of the dependent series for the last 5 years, but the
seasonally adjusted indexes before that period will not be changed. Thirty-four of the
81 components of the U.S. city average all items index are not seasonally adjusted for 2021.
US adds 916000 Jobs in the midst of Vaccine Rollout!
Apr 3, 2021
In the midst of coronavirus vaccine rollout happening at a rapid pace, the US labor market added close to 916000 jobs in the month of March edging down the unemployment rate by 6%. Experts claim the opening up of businesses across the country after the pandemic happens to be the core factor for the increase in jobs.
The Bureau of Labor and Statistics (BLS) reported that the continued resumption of economic activity had been curtailed due to the coronavirus pandemic.
According to statistics, nearly 30% of the population in the US received COVID vaccination successfully and the healthcare department is keen on fastening the vaccine rollout to cover the entire population. The gain in employment and confidence follows the Biden administration’s passage of a $1.9tn stimulus package that will hand $1,400 checks to the majority of Americans.
The positive hike on the job market is much needed for the nation’s economy as the pandemic burned a big hole in the job market leaving the unemployment rate high. There were also strong gains in construction, which added 100,000 jobs, and public and private education, which added 190,000 positions in total after months of heavy losses.
$2 Trillion to Cover the Economic Fallout – U.S Government!
Mar 26, 2020
Post days of wrangle the senate democrats and the White House came to terms to allocate a sum of $2 trillion to balance the economic downfall due to the deadly Corona Virus. The fund included direct payments to citizens and half a trillion to struggling firms.
The bill called “Stimulus” is the biggest fund ever passed and it is equal to 9% to the country’s domestic products and it will cater straight financial aids to people, healthcare and businesses as per negotiations.
The bill was finalized by Treasury Secretary Steven T. Mnuchin and Senate Minority Leader Charles E. Schumer (D-N.Y.) on Monday and on Tuesday to solve the pending issues.
The agreement will be voted by the Senate on Wednesday and the remaining will be followed later. Further Senate Majority Leader Mitch McConnell stated that: “At last we have a deal,” and it will rush new resources onto the front lines of our nation’s healthcare fight. And it will inject trillions of dollars in cash into the economy as fast as possible to help American workers, families, small businesses, and industries make it through this disruption and emerge on the other side ready to soar.”
$200 fine to be slammed on pedestrians crossing street while using cell phones
The Pedestrian Council of Australia is pushing for a bill that punishes pedestrians who stare at their phones while crossing the streets. The bill, if passed by the parliament could end up pedestrians paying a hefty fine of $200.
The PDA thinks that implementing this fine would stop pedestrians from putting themselves at risk of getting hit and ensure safety.
Despite the PDA’s sensible argument, the Police think that the proposed penalties are too harsh and need more consideration. Road safety experts say looking down at your phone while walking is a form of inattentive blindness.
The problem of pedestrians meeting with an accident in a split-second is rampant in Australia. In 2017 alone, the national road toll summed 1226 with another 36,000 people hospitalized.
