Rising energy and food costs continued to keep upward pressure on consumer prices in metro Denver, with overall inflation rising at an 8.2% annual rate in July, down slightly from the 8.3% pace in May and below the U.S. rate of 8.5%, according to the Consumer Price Index for All Urban Consumers for Denver-Aurora-Lakewood, from the U.S. Bureau of Labor Statistics.
The local CPI report, which covers a basket of commonly purchased goods and services, comes out every two months. After showing signs of slowing in May, the two-month rate of change started accelerating again, going from a 1.33% pace in May to a 1.77% pace in July.
“Much of the two-month increase in inflation may have occurred in June, which is not reported separately in Colorado, as national inflation was flat in July,” said Chris Brown, a vice president of policy and research with the Common Sense Institute, in emailed comments on the CPI report.
The average Colorado household spent $1,642 more because of inflation in June and July than it did in the same period a year ago, Brown said. And since 2020, inflation has eroded about $7,522 from household buying power in the state.
Although wages are rising, average hourly earnings are up 4.6% nationally the past year, which covers about 54% of the price gains, Brown said.
Gasoline prices were up 33.9% year-over-year in July, not too far off the 33.7% gain seen in May. The two-month change was large at 15%, but prices at the pump have started to come down rapidly and that will likely show up in the next CPI report two months from now.
Foods purchased for home consumption are up 13.6% year-over-year in July, an acceleration from the 10.6% rate in May and the 10.2% pace in March. Baked goods and cereals had the biggest gain among food items, up 15%, surpassing the gain in the meat and poultry category, which was up 14.3%. The cost of non-alcoholic beverages rose 14.7%, while the cost of alcohol was up 7.6%. The cost of eating out was up 9.8%.
The cost of rent was up 7.8%, household utilities were up 10.6%, and the cost of medical care was up 11.2%. One of the most noticeable changes in the report involved used cars. Prices there rose 8.9% annually in July, down from 18.9% in May and 38% in March.
A consumer panel conducted by retail research firm GlobalData found that 60.4% of consumers are buying fewer non-food products, 51.7% are driving less to save on gasoline, 49.6% are doing more bargain hunting, 42.5% are trading down to cheaper brands in the grocery store and 39.9% are shopping around more to find better prices.
