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The Greater Houston Partnership has issued the following press release:
Inflation Nationwide
Consumer prices rose 7% nationwide from December ’20 to December ’21, according to the U.S. Bureau of Labor Statistics. This rise in inflation is the highest since June 1982. Energy costs rose 29.3% from the previous December, largely due to a 49.5% surge in the cost of motor fuel. The cost of natural gas grew 24.1%, while electricity increased 6.3%. The shelter index rose 4.1% from December of last year. In that same period, overall food prices increased 6.3%, grocery prices 6.5%, and the cost of dining out 6%. Core inflation (all items less the volatile food and energy categories) increased 5.5% since December ’20.
The consumer price index for December ’21 once again showed gains in every major category as supply chain disruptions continue to collide with high consumer demand. It was the seventh straight month in which inflation topped 5%. This rise in inflation “comes amid a shortage of goods and workers and on the heels of unprecedented cash flowing through the U.S. economy from Congress and the Federal Reserve,” reports CNBC.
The Federal Reserve meets at the end of January. After last month’s meeting, the Federal Open Market Committee (FOMC) issued a statement indicating that it will “[seek] to achieve maximum employment and inflation at the rate of 2% over the longer run.”
Inflation Houston
The cost of consumer goods and services as measured by the Consumer Price Index for All Urban Consumers (CPI-U) rose 6.6% in the Houston-The Woodlands-Sugar Land metro area from December ’20 to December ’21. This rise in inflation is the highest since July 1976. In Houston, core inflation (all items less food and energy) increased 4.9%, suggesting that the surge in inflation is largely due to non-core items. The energy index jumped 30.5% since December ’20, boosted by a 58.9% surge in motor fuel prices. Gulf Coast gasoline prices averaged $2.91 per gallon the week of Dec. 27, a $0.90 increase from a year ago, according to the U.S. Energy Information Administration. Local natural gas prices rose 16.4%, while electricity costs increased 7.9% over the same period.
Local food prices climbed 5.2% over the past 12 months. The cost of dining out increased 4.2%, while grocery prices rose 6.3%. The shelter index grew 1.9%.
Note: CPI data in this commentary are not seasonally adjusted. Counties include: Austin, Brazoria, Chambers, Fort Bend, Galveston, Harris, Liberty, Montgomery and Waller Counties.