U.S. Consumer Prices Climb the Most Since 2005 as Fuel, Food Costs Surge

[marmar]

from Bloomberg:



U.S. Consumer Prices Climb by the Most Since 2005 (Correct)

By Shobhana Chandra

July 16 (Bloomberg) -- Prices paid by U.S. consumers jumped in June by the most since 2005 on spiraling costs for fuel and food, intensifying the pressure on households struggling with falling home prices and the credit crunch.

The cost of living soared 1.1 percent, more than forecast, after a 0.6 percent gain the prior month, the Labor Department said today in Washington. Excluding food and energy, so-called core prices climbed 0.3 percent, also more than anticipated.

The figures underscore why Federal Reserve Chairman Ben S. Bernanke yesterday said inflation risks had ``intensified.'' The surge in energy costs has also trimmed consumer and business spending, hurting growth and making it less likely policy makers will boost interest rates to stem even bigger price increases.

``Inflation has galloped,'' Michael Feroli, an economist at JPMorgan Chase & Co. in New York, said before the report. ``It puts the Fed in a really tricky position. I don't see how they can change rates this year.''

Treasuries dropped after the report, with yields on benchmark 10-year notes rising to 3.87 percent at 8:37 a.m. in New York, from 3.82 percent late yesterday.

Consumer prices were forecast to rise 0.7 percent, according to the median forecast of 79 economists in a Bloomberg News survey. Estimates ranged from gains of 0.2 percent to 1.1 percent. Costs excluding food and energy were forecast to rise 0.2 percent, the survey showed. .....(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=awi7vRLYDAY4&refer=home

[liberal N proud]

1. I wonder what the real inflation numbers are

They always pad these numbers to look more favorable. I know the pain of the cost of living is more than I have ever experienced.

[dysfunctional press]

2. it boggles my mind that fuel and food aren't counted in the 'cost-of-living' index...

those are the two MOST important items in many if not most people's budgets.

but- we wouldn't want people's cost-of-living adjustments to actually keep up with the cost of living, now would we?