US inflation fell for the second consecutive month, dropping to 4.9 percent in September from a year ago, the Bureau of Labor Statistics reported Thursday. Consumer prices remained flat, although energy prices plunged and food prices increased.
Lower inflation generally makes inflationary-hedge investments in commodities like gold less attractive. And at least during Thursday early afternoon trading, the latest government report did not help with spot gold falling more than $45 as it neared a few quarters shy of $800 per ounce.
The CoinNews Inflation Calculator and rate charts with their updated figures show inflation’s drop using the government’s latest Consumer Price Index (CPI) data. By entering any two dates from 1913-2008 and then a dollar amount, the calculator measures the change in the buying power of the dollar over time.
Inflation, rates and price figures in September…
On a monthly basis, consumer prices remained flat in September. That compares to a drop of 0.1 percent in August followed by an increase of 0.8 percent in July when inflation was at its fastest growing rate in 17 years
"Food prices continue to trend strongly upwards, with a 0.6 percent September gain. But with global food prices having dropped sharply in recent weeks, there should be some relief over the next few months," said Ian Shepherdson, chief US economist at High Frequency Economics.
The core Consumer Price Index, which excludes volatile food and energy costs, increased by 0.1 percent, which was 0.1 percent lower than market expectations. The figure compares to a 0.2 percent rise in August.
Also according to Thursday’s report, energy prices tumbled 1.9 percent last month, the second-straight decline. Gasoline prices slipped 0.6 percent, and natural gas prices plunged 8.3 percent.
Food and beverage prices rose 0.6 percent while clothing dropped 0.1 percent.
New-car prices declined for the second straight month, falling 0.7 percent after a 0.6 percent decrease in August. Used-cars and trucks fell sharply in September as well, declining 1.8 percent after a 0.3 percent fall in August.
What’s the real world meaning of these figures? The CoinNews Inflation Calculator can provide further historical insights.
Inflation Calculator examples
Using the calculator, anyone can determine the purchasing power of the dollar over time. A few examples after adjusting for inflation:
- An item purchased in 1913 for $1 would now cost $22.10 (down 3 cents from August figures)
- An item purchased in 1950 for $10 would now cost $90.78 (down 13 cents from August figures)
- An item purchased for $20 in 1985 would now cost $40.67 (down 5 cents from August figures)
Mixed dates may also be used with the Inflation Calculator. As examples:
- An item purchased today for $500 would have cost $122.95 in 1975
- An item purchased for $1000 in 1980 would have cost $1,586.17 in 1990
Of course, not all "goods and services" rise or fall in tandem with inflation rates. For example, many computers when adjusted for inflation are actually less expensive today (and do more) compared to years ago.
Latest Charts on Inflation Rates
The CoinNews inflation page also includes two updated charts indicating the:
- Annual Averages for Rate of Inflation
- Annual Percent Changes for Rate of Inflation or Inflation Rates