US Inflation Cools To 7.1% In November, Worsens In Tampa-St. Pete Area

FLORIDA — Inflation slowed again in November, with the prices up 7.1 percent compared to a year ago — down from 7.7 percent in October and from the recent peak of 9.1 percent in June, the government said in a report Tuesday.

Driving the trend was less expensive gasoline — the average price for a gallon of regular gasoline in Florida Tuesday was $3.13, compared to $3.26 at this time last year — and cheaper electricity and used cars.

The Consumer Price Index for all urban consumers in the Tampa-St. Petersburg-Clearwater region rose 1.0 percent from September to November, the U.S. Bureau of Labor Statistics reported Tuesday.

In the Tampa region, a 14 percent increase in the cost of rental housing in the past year has dropped, but the cost still increased 2.2 percent in the past two months.

In St. Pete, the Publix website says the cost of a dozen large eggs is $6.63, while a gallon of 2 percent milk is selling for $4.37. A Boar's Head small sweet slice ham, weighing 5 to 6 pounds, is selling for $49.99 each.

The pain of inflation varies by region.

Regional Commissioner Janet S. Rankin said the index for all items less food and energy increased 1.3 percent over the bi-monthly period. The energy index rose 1.0 percent from September to November, while the food index edged down 0.2 percent.

The all items CPI-U advanced 9.6 percent for the 12 months ending in November in the Tampa metro. The index for all items less food and energy increased 9.7 percent over the past year. The food index and the energy index also increased over the prior 12 months, up 9.5 percent and 8.9 percent, respectively.

Food

The food index declined 0.2 percent from September to November, led by a 1.0-percent decrease in the food at home index. Among the grocery store food groups that dropped in price over the bi-monthly period were cereals and bakery products (-4.4 percent) and other food at home (-1.7 percent).

The food away from home index rose 1.0 percent over the bi-monthly period.

The food index advanced 9.5 percent for the 12 months ending in November. The food at home index rose 10.4 percent over the past year as all six major grocery store food group indexes increased. The food away from home index also increased over the past year, up 8.4 percent.

Energy

The energy index rose 1.0 percent from September to November. The gasoline and electricity indexes contributed to the bi-monthly increase, up 1.1 percent and 0.5 percent, respectively. In contrast, the index for natural gas edged down 0.3 percent from September to November.
The energy index rose 8.9 percent for the 12 months ending in November, led by increases in the electricity (+12.5 percent) and gasoline (+5.1 percent) indexes. The index for natural gas also increased over the past year, up 16.7 percent.

All items less food and energy

The index for all items less food and energy rose 1.3 percent from September to November. The shelter index increased 2.2 percent over the bi-monthly period, primarily reflecting a 3.1-percent increase in the owners’ equivalent rent index; rent of primary residence rose 2.9 percent.

Recreation (+3.5 percent) was also among the indexes to increase from September to November. In contrast, used cars and trucks was among the indexes to decline over the bi-monthly period, down 5.1 percent.

The index for all items less food and energy advanced 9.7 percent for the 12 months ending in November, led by a 14.6-percent increase in the shelter index. Within shelter, owners’ equivalent rent rose 14.7 percent over the past year and rent of primary residence increased 15.8 percent.

Despite the progress, high prices continue to take a bite out of Florida residents’ budgets, and economists warn inflation isn’t expected to return to levels they were accustomed to any time soon.

Prices for food and shelter continued to increase, the government said. Rising housing costs more than offset the 1.6 percent month-over-month decreases in energy costs, and the cost of food increased 0.5 percent from October to November, according to the report.

The cost of meat and eggs fell 0.2 percent over the month after increasing 0.6 percent in October. Beef prices fell 0.8 percent over the month, and pork prices 0.3 percent.

But the costs of fruits and vegetables increased 1.4 percent in November, after falling 0.9 percent in October. The costs of cereal and bakery products increased 1.1 percent, and dairy and related products increased 1.0 percent. Non-alcoholic beverages also cost more, rising 0.7 percent in November after a 0.5 percent rise in October.

November was the fifth straight month the consumer price index has decreased, and it’s at its lowest level since December 2021. The 7.1 percent CPI is down from 7.7 percent in October. On a month-to-month basis, the CPI rose just 0.1 percent in November, a decrease from 0.4 percent in October.

The Federal Reserve is still expected to raise its benchmark interest rate for a seventh time this year when it meets on Wednesday, a move that will further increase borrowing costs for consumers and businesses. Economists warn that by continuing to tighten credit to fight inflation, the Fed is likely to cause a recession next year.

Fed Chair Jerome Powell has said he is tracking price trends in three different categories to best understand the likely path of inflation: Goods, excluding volatile food and energy costs; housing, which includes rents and the cost of homeownership; and services excluding housing, such as auto insurance, pet services and education.

In a speech two weeks ago in Washington, Powell said there had been some progress in easing inflation in goods and housing, but not so in most services. Physical goods like used cars, furniture, clothing and appliances have become steadily less expensive since the summer.

Used car prices, which had skyrocketed 45 percent in June 2021 compared with a year earlier, have fallen for most of this year.

Housing costs, which make up nearly a third of the consumer price index, are still rising. But real-time measures of apartment rents and home prices are starting to drop after having posted sizzling price acceleration at the height of the pandemic. Powell said those declines will likely emerge in government data next year and should help reduce overall inflation.

Still, services costs are likely to stay persistently high, Powell suggested. In part, that’s because sharp increases in wages are becoming a key contributor to inflation. Services companies, like hotels and restaurants, are particularly labor-intensive. And with average wages growing at a brisk 5 percent to 6 percent a year, price pressures keep building in that sector of the economy.

Services businesses tend to pass on some of their higher labor costs to their customers by charging more, thereby perpetuating inflation. Higher pay also fuels more consumer spending, which allows companies to raise prices.

“We want wages to go up strongly,” Powell said, “but they’ve got to go up at a level that is consistent with 2 percent inflation over time.”

The Associated Press contributed reporting.