Consumer Prices Up 1.1% in June

There is no more debilitating economic disease than high inflation. It saps the will to save while causing ordinary people to fear the future.

Last month,
consumer prices rose 1.1%. That's the highest monthly increase in three years. Inflation for the last 12 months stands at 5% which is the highest since 1991.

Fuel costs led the way rising more than 6% with the related transportation costs up 3.8% for the month. Food prices rose at 0.8% which, if you've been to a grocery store lately, only tells half the story. Everything we get fresh including meat, veggies, and fruit went up more than that since fresh items are always more sensitive to the price of deisel fuel truckers have to pay to ship it in.

Take out food and fuel and you have what economists term the "core index" of inflation. That index rose a modest 0.3%, up 2.4% for the year. This means that much of the increased cost of fuel has not worked itself through the entire economy yet and that strong exports along with a weak dollar are probably helping to keep the lid on. If fuel prices come down significantly, inflationary pressures should ease considerably.

An interesting sidelight to fuel prices was that after the president's speech from the rose garden where he promised to lift the executive order on drilling offshore, the price of oil tumbled $9 on the open market.

Imagine what would happen if Congress authorized that drilling?

So the inflation news is bad and many are saying it will remain a problem until we can find a way to get those oil prices down. But the good news is that 5% is still historically low for a post World War II economy and that the core index of inflation shows price stability in most areas.

C'mon Congress, get on board. Just drill, baby.


There is no more debilitating economic disease than high inflation. It saps the will to save while causing ordinary people to fear the future.

Last month,
consumer prices rose 1.1%. That's the highest monthly increase in three years. Inflation for the last 12 months stands at 5% which is the highest since 1991.

Fuel costs led the way rising more than 6% with the related transportation costs up 3.8% for the month. Food prices rose at 0.8% which, if you've been to a grocery store lately, only tells half the story. Everything we get fresh including meat, veggies, and fruit went up more than that since fresh items are always more sensitive to the price of deisel fuel truckers have to pay to ship it in.

Take out food and fuel and you have what economists term the "core index" of inflation. That index rose a modest 0.3%, up 2.4% for the year. This means that much of the increased cost of fuel has not worked itself through the entire economy yet and that strong exports along with a weak dollar are probably helping to keep the lid on. If fuel prices come down significantly, inflationary pressures should ease considerably.

An interesting sidelight to fuel prices was that after the president's speech from the rose garden where he promised to lift the executive order on drilling offshore, the price of oil tumbled $9 on the open market.

Imagine what would happen if Congress authorized that drilling?

So the inflation news is bad and many are saying it will remain a problem until we can find a way to get those oil prices down. But the good news is that 5% is still historically low for a post World War II economy and that the core index of inflation shows price stability in most areas.

C'mon Congress, get on board. Just drill, baby.