Consumer Price Index Shows Overall Drop in Energy Costs as Gas Prices Continue to Steadily Decline
The U.S. Bureau of Statistics released the Consumer Price Index for July on Aug. 10, with the all items index increasing 8.5%, not seasonally adjusted. The Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in July on a seasonally adjusted basis after rising 1.3% in June.
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The energy index dropped by 4.6% over the month of July as the indexes for gasoline and natural gas fell. The gasoline index declined by 7.7% in July after an 11.2% increase the previous month. The gasoline index surged 44% over the last 12 months and the fuel oil index rose 75.6%. Over the last 12 months ending in July, the energy index increased 32.9%, down from a 41.6% increase for the period ending June.
U.S. gas prices have fallen for 57 consecutive days after reaching a high of more than $5 per gallon in June, The New York Times reported. According to AAA, the national average for a gallon of unleaded gasoline was $4.01 as of Aug. 10, which is down 67 cents from a month ago — but up 82 cents from the same time last year.
The New York Times reported that lower demand, a decline in global oil prices and some states suspending taxes on gasoline have contributed to recent price drops. While lower prices at the pump are raising expectations that inflation will continue to ease, The Washington Post noted that policymakers within the Biden administration and the Federal Reserve are not pinning their hopes on one month of data.
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“It’s no ‘mission accomplished,’ but some much-needed breathing room,” Jared Bernstein, a member of the White House’s Council of Economic Advisers, told The Washington Post.
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