Inflation statistics for September: still high, but could be slowing down

Regional inflation is still above the national average and is higher than many other metro areas

Year-over-year overall price growth in the region was 8.4% in September, down slightly from the 9.2% reading we had for July. Other metro areas are seeing even higher inflation, but we are still close to the top. Component-wise, the decline happened mainly because of a slowdown in energy prices, which actually dropped about 3% year-over-year. Rental price growth also cooled slightly, contributing to the lower reading (down from 8.4% to 7.8%). Nevertheless, food and beverage inflation remained in the double digits, at 11.1% year-over-year, higher than the previous reading. See the table below.

As identified in a recent PPIC poll (also discussed in this newsletter here), inflation remains a significant concern for area residents and is no longer simply about playing “catch-up” from the pandemic. Price growth has been significantly “higher than trend”.

It is important to keep things in perspective: in March 2020, the two-year inflation rate (i.e., the inflation rate from March 2018 to March 2020) was 5.17%, or about 2.6% per year. But between March 2020 and March 2022, the two-year inflation rate was 13.96%, or about 7% per year, with most of it actually happening in an 18-month period. Gas prices are not the only thing to blame. Housing has also gotten more expensive: the same analysis shows an +8.5% two-year growth in housing/rental prices between March 2018 and March 2020, compared to an +11.0% increase between March 2020 and March 2022.