The INCREDIBLE SHRINKING DOLLAR

Inflation up 5.4%, worst in 13 years Milk, gas, wine, eggs all cost more

Inflation continued to surge in June, with consumer prices accelerating at the fastest pace in almost 13 years as the economy emerges from the pandemic, the feds said Tuesday.

The Labor Department’s Consumer Price Index, which measures a basket of goods and services, as well as energy and food costs, jumped 5.4 percent in June from a year earlier.

That’s higher than May’s 5 percent year-over-year rise in prices, and the biggest 12month rise since August 2008, just before the financial crisis plunged the United States into the worst recession it had seen since the Great Depression.

Economists surveyed by Dow Jones expected a 5 percent spike in June. Compared with two years ago, the overall consumer price index was 3 percent higher in June.

Consumer prices rose 0.9 percent from the month prior, the Labor Department said.

The core Consumer Price Index, which excludes volatile food and energy costs, rose 4.5 percent from a year ago, the fastest acceleration since 1991.

Much of the price increases this spring came from sectors that were hit particularly hard by the pandemic and subsequent shutdowns, including used-car prices, airfares and fuel costs.

That trend held last month, as used-car and -truck prices jumped a striking 10.5 percent from May, accounting for more than one-third of the price index’s gains.

From a year ago, used-car and -truck prices have now spiked 45.2 percent, the data show. Airline fares rose 2.7 percent from May and are now up 24.6 percent from last summer, when the pandemic had largely shuttered air travel.

Energy prices rose substantially, too, up 1.5 percent from a month prior and now 24.5 percent higher than a year ago. Gasoline, specifically, rose 2.5 percent from May and is now up more than 45 percent from a year ago.

Food prices were also up, 0.8 percent higher than the month prior, according to the data, and 2.4 percent higher than a year ago.

All six major grocery-store food categories witnessed price increases — with meat, fresh fruit and vegetables having the sharpest hikes. Meats led the way, with beefsteaks and pork chops up 6 percent and 5 percent, respectively, from a month prior. The price of eggs also surged 3 percent from the month prior.

The price of eating out rose 0.7 percent last month — a whopping pace not seen since 1981, according to Axios. A major reason was eateries paying more to hire staff for an economic rebound and then passing along the costs.

Even snack vending machines also saw their biggest singlemonth cost jump on record.

One driver of the annual gain in prices is very low inflation this time last year, when consumers were staying indoors and spending less.

Year-over-year comparisons aside, prices are spiking for a variety of reasons, including supply-chain bottlenecks as the economy rapidly reopens, as well as a labor shortage.