While the overall inflation rate affects what consumers pay for goods and services, economists and investors usually pay more attention to the core rate. It strips out the often-volatile food and energy categories and tends to give a better idea of inflationary trends.
Yet the main consumer inflation number has been flashing warning signs for months as food and energy costs, led by gasoline, trek higher.The soaring price of petroleum, as demonstrated by higher costs of fuel at the gas pump, is behind the bulk of the increase in consumer prices. The energy index climbed 3.5 percent in March, and it has soared 23.7 percent over the past nine months.
The average cost of a gallon of gas nationwide has jumped about 75 cents so far in 2011, including a 20-cent increase in just the past two weeks. As a result, the gas index has risen 14.4 percent over the last three months.
Food costs rose 0.8 percent last month as prices increased for a broad range of goods found in the grocery. What's more, the government's "food at home" index shot up 1.1 percent last month for the largest increase in almost three years.
In the past 12 months, food costs have risen 2.9 percent, the fastest pace since April 2009. The increase has been driven by rising prices of key agricultural crops such as corn and wheat. Higher global demand and major crop failures are largely to blame, economists say.
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Talk with you soon. --- Stephen
Talk with you soon. --- Stephen
