Inflation is everywhere now — and almost no part of the economy has been left untouched.
When inflation began to surge a year ago, most of the price increases were concentrated in a handful of categories such as gasoline and used vehicles.
Now price pressures have broadened out to include most goods and services.
Rents are a big one because the cost of shelter is a large part of most household budgets. They have risen by 4.8% over the past year to mark the fastest pace since 1987. Home prices have also soared.
Americans are also paying appreciably more for common purchases such as clothes, furniture, pet food, tools, appliances, dry cleaning and haircuts.
Plan to travel soon or take a vacation? The cost of car rentals, hotel rooms and airfares are way up. A plane ticket costs 33% more than a year ago.
increases in the cost of these goods drove up the core rate of inflation in April by 0.6% — the largest gain since January. The core rate of inflation has jumped 6.2% in the past year.
“Just as key goods categories such as used vehicles that pushed up inflation last year start to drop, inflation in key services categories such as airfares has risen dramatically,” said Robert Frick, corporate economist at Navy Federal Credit Union.
The core rate of inflation is a favorite of economists on Wall Street and at the Federal Reserve because it strips out food and energy prices.
The cost of food and especially fuel have often swung up and down over time and have not been a good barometer of underlying inflationary trends.
Yet it’s not just food and energy these days. The cost of everything is going up.
The sharp increase in the core CPI disappointed Wall Street on Wednesday and signaled that inflation is not going to fall as fast or much as the Fed has been hoping.
“The report should be of concern for the Fed given price gains in the core segment appear to be spreading, and not only contained within the shelter category,” economists at TD Securities told clients in a note.
For consumers, there is little relief in sight.