The BLS reported inflation today and it is still red hot at 6 percent year over year. To put this into context, if you earn $100,000 per year, you have effectively lost $6,000 of purchasing power. Over the course of the past two years, anyone earning $100k has lost about $15k in purchasing power which is why things “seem” more expensive than normal. Let’s take a look at the BLS report:
CONSUMER PRICE INDEX - FEBRUARY 2023 The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in February on a seasonally adjusted basis, after increasing 0.5 percent in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.0 percent before seasonal adjustment. The index for shelter was the largest contributor to the monthly all items increase, accounting for over 70 percent of the increase, with the indexes for food, recreation, and household furnishings and operations also contributing. The food index increased 0.4 percent over the month with the food at home index rising 0.3 percent. The energy index decreased 0.6 percent over the month as the natural gas and fuel oil indexes both declined. The index for all items less food and energy rose 0.5 percent in February, after rising 0.4 percent in January. Categories which increased in February include shelter, recreation, household furnishings and operations, and airline fares. The index for used cars and trucks and the index for medical care were among those that decreased over the month.
Food, Energy and Transportation services are all double digit inflationary year over year!
With the banking fiasco bringing hopes that the Fed will stop or reduce interest rates and inflation reports showing inflation is still red hot we have two bi-polar forces exerting pressure on the center.
Next week we’ll update our global inflation index to see how things are progressing in other parts of the world but we’ve taken some sampling and things don’t look good.
Stay tuned, stay profitable and stay solvent…