Consumer inflation continues its gradual descent in metro Denver, but it isn’t falling as fast as elsewhere in the country, according to a bi-monthly update from the U.S. Bureau of Labor Statistics.
The Consumer Price Index for All Urban Consumers for the Denver-Aurora-Lakewood area advanced 1.3% between January and March and is running at an annual pace of 5.7%, which is down from the 6.4% annual rate measured in January. Nationally, consumer inflation increased at a 5% annual rate in March, which was down from a 6% annual pace in February.
Annual gains of 10% in both rents and food prices helped keep inflation elevated in the region. Metro Denver was also hit with a 12.3% spike in gasoline prices between January and March, which resulted from the closure of the Suncor Refinery in Commerce City to repair equipment damaged by cold temperatures late last year.
Gasoline prices were down about 2% in metro Denver compared to March 2022, but nationally, they were down 17.3%.
Michael Hirniak, the BLS assistant commissioner for regional operations, which oversees the metro Denver CPI report, noted in the report that core inflation, which is all items less food and energy, advanced 1.0% in February and March, due primarily to an increase in the index for owners’ equivalent rent of residences, a proxy for home ownership costs. The energy index was up 6.4%, while the food index increased 1.3% over the past two months.
Among food items, the biggest annual gains were in nonalcoholic beverages, up 16%; fruits and vegetables, up 14.1%; and dairy and related products, up 12.5%. The cost of dining out is up 9.5% over the past year, while alcoholic beverages are up 5.7%.
Deflation has emerged in used car prices, which are down 11.3% over the year. While good for buyers, the sharp decrease in car values could harm those who purchased used vehicles at inflated prices, as well as the financial institutions that provided those buyers loans.
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