ARLINGTON, Va.—On a seasonally-adjusted basis, overall consumer prices rose 0.8% in April, with the Bureau of Labor Statistics reporting the overall consumer price index (CPI) grew 4.2% over the 12-month period.
NAFCU Chief Economist and Vice President of Research Curt Long noted that the year-over-year rise is the "fastest pace of price gains since the summer 2008."
"Year-over-year measures will be distorted by base effects for the next several months; as compared to February 2020, the price index was up by a more modest 3.1%," said Long. "Furthermore, a large share of the monthly gains were tied to supply chain issues or areas expected to see lots of demand as the economy reopens."
Energy prices declined 0.1% during the month, following a 5% increase in March. From a year ago, energy prices were up 25%. Additionally, food prices climbed 0.4% in April and are up 2.4% compared to this time last year.
‘Only Time Will Tell’
Core prices (excluding food and energy costs) rose 0.9% compared to March. Year-over-year core CPI growth was 3%.
"The Federal Reserve has clearly communicated that it expects these price increases to prove temporary," concluded Long. "Only time will tell, but that outlook is consistent with the specific components driving inflation at the moment. NAFCU still anticipates that the Fed will refrain from tapering asset purchases this year and that a rate hike will not appear prior to 2023."