Services Inflation Worst Since 1982, Food Inflation Worst Since 1979, Housing CPI Heats Up. Energy Prices Plunge, Some Durable Goods Drop: Inflation Whack a Mole

by Wolf Richter
Wolf Street

Inflation in services is now where the action is, not commodities or durable goods.

Inflation as measured by the Consumer Price Index backed off a tad in July to a still ugly 8.5%, from the super-ugly 9.1% in June, as food prices continued to spike, but gasoline and natural gas prices fell sharply, and prices of durable goods backed off their crazy spike.

But inflation in services rose to 6.25%, the highest since 1982. The CPI for services is still below overall CPI and is still pulling down overall CPI. But it has been getting worse every month for 11 months, and as other price spikes back off, the services CPI pushes to the forefront. That’s how inflation works after it’s entrenched: it cycles from category to category and pops up in different places, while backing off for a while in other places.

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