•Press Release
June 13, 2008 (Prices Byte)
Prices Byte by Dean Baker
For Immediate Release: June 13, 2008
Contact: Alan Barber, (202) 293-5380 x115
"Medical care inflation is down from 5.2 percent in 2007 to 1.8 percent in the last quarter."
The overall CPI rose by 0.6 percent in May, driven by a 4.4 percent jump in energy prices. This brings the annual rate of increase in the CPI for the last quarter to 4.9 percent, up from 4.2 percent over the last year. Inflation in the core CPI is still relatively contained, coming in at 0.2 percent. The annual rate of increase in the core has been just 1.8 percent over the last three months, down from 2.3 percent for the last year.
The low inflation rate in the core index is striking given the price pressures at earlier stages of production. The May producer price index will not be released until next week, but the April data showed inflationary pressures at all levels, in both the core and overall indices.
The core component of the finished goods index rose by 0.4 percent in April. It has now risen at a 5.0 percent annual rate over the last quarter, compared to a 3.0 percent rate over the year. The core finished consumer goods index has risen even more rapidly, increasing at a 5.4 percent annual rate over the quarter, compared to a 3.6 percent rate over the last year.
