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Inflation rises 0.5% in January, with medical prices dipping month to month

Article

National figures show food, gas, shelter all cost more than a year ago.

Inflation rose 0.5% in January, with medical care prices declining slightly among a mix of rising and falling costs.

Prices for all items were up 0.5% from December 2022 to January 2023, and were up 6.4% for the 12 months ending in January 2023, according to seasonally adjusted figures of the Consumer Price Index Summary published Feb. 14 by the U.S. Bureau of Labor Statistics (BLS). Not counting food and energy, prices generally were up 5.6% for the 12 months ending in January.

The medical care index decreased 0.4% for the month as the physicians’ service index dipped 0.1%, while the hospital services index ticked up 0.5%, and the prescription drug index rose 2.1%. Over the last year, medical care prices grew by 3.1%, joining indexes with “notable increases” for the past 12 months.

Shelter costs rose 0.7% in January and were up 7.9% for the 12 months ending last month, accounting for nearly 60% of the total increase in prices for all items without food and energy. Transportation services rose by 0.9% and were up 14.6% in the last year, according to the BLS report.

The food index increased 0.5% last month, with food at home prices rising by 0.4% and food away from home costs going up by 0.4%. Overall food prices were up 10.1% for the 12-month period ending January 2023.

For food at home, cereals and bakery product prices were up 15.6%, fruits and vegetables up 7.2%, and dairy products were up 14%, for the 12 months ending in January 2023. For dining out, food away from home prices have risen 8.2% in the last year.

For energy, gas prices nudged upward by 2.4% in January, while fuel oil prices decreased by 1.2%. Respectively, they were up 1.5% and 27.7% for the 12 months ending in January, with fuel oil prices showing the single largest 12-month cost increase on the January 2023 index.

For all items without food and energy, prices rose 0.4% for the month, and were up 5.6% during the 12-month period ending in January 2023. Used cars and trucks posted the largest changes, with prices dropping 1.9% for the month and 11.6% for the year ending last month.

Political reactions

In his statement on the economic figures, President Joe Biden said real wages are up over the last seven months as “job growth remains resilient” and unemployment is at the lowest level since 1969.

The president touted the Inflation Reduction Act of 2022 with measures for lowering prices of prescription drugs, health care, and home energy for people. Congressional Republicans want to take the country in the opposite direction, Biden said, pledging to fight cuts to Medicare and Social Security, and “economic chaos” if the United States were to default on its credit.

“I will stand firmly against any effort to make inflation worse and increase costs for families,” Biden said. “Today’s data reinforces that we have made historic progress and are on the right track, and now we need to finish the job.”

The Republican National Committee (RNC) said the 6.4% yearly increase exceeded economists’ expectations and was “excessively high.”

“As a direct result of Biden’s failed policies, paychecks are worth less and the cost of feeding a family continues to skyrocket. Inflation is up, wages are down, and it’s no wonder a record number of Americans say they are worse off under Joe Biden,” RNC Chairwoman Ronna McDaniel said in a statement.

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Mike Bannon - ©CSG Partners