The consumer price index, the top measure for consumer inflation in the U.S., increased in November to 2.7% in the 12-month period ending last month, according to the Bureau of Labor Statistics, which released the updated consumer price index on Wednesday.
The new data shows that the U.S. has lost some progress in combating inflation in recent months. In September, the 12-month inflation rate was down to 2.4% before increasing to 2.6% in October.
In the last decade, prices generally increase at a rate of 3.2% per year. In the last 20 years, consumer inflation has generally increased by 3% annually. But the Federal Reserve has aimed to keep annual inflation right at 2%.
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The consumer price index weighs the costs of goods based on their importance. Items like food, shelter and energy tend to be weighted more heavily. Overall, the price of goods and services increased 0.3% during November.
After annual inflation reached 9% in the middle of 2022, the Federal Reserve implemented a series of interest rate hikes in 2022 and 2023 to combat high inflation. It has since lowered federal interest rates by 0.75 basis points.
One particularly concerning point in Wednesday's report was an increase in the cost of groceries in November. Food at home prices increased 0.5% during November, making food 1.6% more expensive than a year ago. Driving the increase in food prices was the cost of meat, which increased by 1% in November and 3.8% for the 12-month period ending last month.
According to government data, food prices increased by 9.9% in 2022, faster than in any year since 1979.
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Other items far more expensive this year compared to last include auto insurance (+12.7%), motor vehicle repair (+5.7%), shelter (+4.7%) and medical care services (+3.7%).
Energy, especially fuel oil and gasoline, are actually cheaper this year than last year, helping keep inflation in check.
With wages outpacing the inflation rate, Americans are regaining some of the buying power lost in 2022.
Average hourly wages increased 13 cents in November to $35.61. Workers are making an average of $1.38 an hour more than a year ago. Average weekly wages were $1,221 in November, up from $1,178 a year ago. The 3.7% increase in wages is outpacing inflation.
