Retail prices in the Baltimore region continued their upward trend in July, rising 1.7 percent from May to July, after a 1.1 percent increase in the previous two-month period.
The region’s Consumer Price Index for All Urban Consumers stood at 142.065 in July, up 5.7 percent from this time last year — the largest year-over-year increase since publication of the index began in November 1996. According to the index, it now costs $142.07 to buy goods and services that cost $100 in November 1996.
The May-to-July increase was due to spikes in the housing and transportation indexes, said Sheila Watkins, Bureau of Labor Statistics regional commissioner. Lower prices for other goods, services and apparel nearly offset higher prices for food, beverages, education, communication and recreation.
The Federal Reserve expects inflationary pressure to ease by the end of the year, a forecast that will hinge on oil prices, said Peter Morici, a University of Maryland economics professor.
“Oil prices have been receding in recent weeks, and demand pressures on available supplies of other commodities should ease as growth slows in the U.S. and globally over the balance of 2008 and 2009,” Morici said.
Across the country, consumer prices rose 0.8 percent last month, the third straight month of oversized inflation increases following jumps of 0.6 percent in May and 1.1 percent in June. The costs increased even as department store chains Boscov’s, of Reading, Pa., and Mervyns, of Hayward, Calif., filed for bankruptcy and announced store closings in recent weeks.
Some economists worried the July report could be a signal that inflation is not going to moderate as quickly as had been expected because the surge in energy prices is starting to spread to other sectors of the economy.
“The battering of consumers continues as prices are rising for just about everything,” said Joel Naroff, chief economist at Naroff Economic Advisors. “If you think things are going to get a lot better with the drop in petroleum prices, think again. The increases [in July] were broad based.”
The Associated Press contributed to this article.
