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October's CPI Report

On October 13, the Consumer Price Index report was released. September’s CPI for all goods and services was up 8.2 percent year-over-year.

For electric utility service, prices were up 15.5 percent per year. For gas utility service, prices were up 33.1 percent.

Hey Steve, what does this mean? Well, on the one hand, utility rates are still outpacing overall inflation. Year-over-year.

But let’s dig deeper into the data.

From August to September, the CPI for all goods and services rose four-tenths of a percent, seasonally adjusted. So did the CPI for electric utility service. It also rose four-tenths of a percent.

At the same time, during the last month, the CPI for gas utility service rose twenty-nine tenths of a percent. That sounds like a lot, sure. Though this was a rather moderate rise in gas prices relative to what’s been happening in the months since Russia invaded Ukraine on the twenty-fourth of February.

Just look at the monthly changes in electric utility service prices since the war started.

From February to March, the electricity component of the CPI increased twenty-two tenths of a percent. From March to April, it increased another seven tenths. From April to May, it increased another thirteen tenths. From May to June, it increased another seventeen tenths.

As spring turned to summer, from June to July, it increased another sixteen tenths. From July to August, it increased another fifteen tenths.

And then, from August to September, as we said above, it increased again, by four tenths. That is indeed a considerably lower rate of increase compared to each of the prior six months.

Could this be the beginning of a slowdown in electricity’s inflation?