The Consumer Price Index (CPI) jumped by a seasonally adjusted 0.5 percent in March, according to a April 15 report by the Bureau of Labor Statistics (BLS.)
Rising food and gasoline prices made up for almost two thirds of the increase in inflation. Gasoline alone rose by 5.5 percent in March while food prices increased by 0.8 percent. Gasoline has increased for the ninth consecutive month and has risen 14.4 percent over the last three months.
Energy prices were the largest contributor for the fourth consecutive month. Food indices also continued to rise in March. The increases were not as drastic as those in February, which saw rises in fresh vegetables and meat purchases, contributing to a 0.8 percent increase in the food at home index.
The BLS uses seasonally adjusted prices when determining change. Seasonally adjusted prices are preferred when analyzing general price trends in the economy since they take into account price fluctuations that normally occur, such as changes in crop and natural gas prices.
Although most of the increase in inflation is coming from rising gas prices, part of this increase could be that March also saw an increase in jobs. Although the unemployment rate only slightly changed, U.S. nonfarm payroll employment increased by 216,000, according to a March BLS unemployment report.
“My spending has gone up, but mostly just with gas. I have also gotten tired of this constant fear of the economy, I’ve begun treating myself more often. That my not be the best idea though,” said 34-year-old Falls Church, VA resident Dave Tate.
When economic growth returns and jobs are created, consumer demand for goods and services may pressure the price level to rise. Some will see this as a good sign, as moderate inflation over time is a good sign for the economy.
“I definitely have not been spending more, I haven’t noticed my family spending more either. If anything, around here I’ve seen people trying to spend less because they’re starting to get used to the habit of having to watch their money for the past few years,” said 20-year-old Minneapolis resident Andrew Wolpers.
The consumer price index for the United States has changed very little over the past month and year, despite erratic fluctuations in energy prices. As the U.S. economy slowly recovers and unemployment remains high, there is little pressure for consumers to spend more.