AIER’s Everyday Price Index fell 0.1 percent in September, the third decline in the past four months. Over the past 12 months, the index has fallen 0.2 percent. The Everyday Price Index measures price changes people see in everyday purchases such as groceries, restaurant meals, gasoline, and utilities. It excludes prices of infrequently purchased, big-ticket items (such as cars, appliances, and furniture) and prices contractually fixed for prolonged periods (such as housing).
The Everyday Price Index including apparel, a broader measure that includes clothing and shoes, increased 0.1 percent in September after a 0.3 percent decline in August. Apparel prices rose 2.7 percent on a not-seasonally-adjusted basis in September but are down 0.3 percent over the past year. Apparel prices tend to be volatile, registering sporadic large gains or declines in between stretches of relatively steady prices. Over the past year, the Everyday Price Index including apparel is down 0.2 percent.
The Consumer Price Index, which includes everyday purchases as well as infrequently purchased, big-ticket items and contractually fixed items, rose 0.1 percent in September. The Everyday Price Index is not seasonally adjusted, so we compare it with the unadjusted Consumer Price Index. Over the past year, the Consumer Price Index is up 1.7 percent.
Within the apparel category, children’s apparel led the increase with boy’s apparel up 7.0 percent and girl’s apparel up 5.6 percent. Men’s and women’s apparel posted gains of 3.3 percent and 3.2 percent, respectively. Footwear prices rose 1.2 percent for the month. Over the past year, both men’s and boy’s apparel had gains (1.9 percent and 5.4 percent, respectively) while women’s and girl’s apparel had declines (-3.2 percent and -1.1 percent, respectively). Footwear prices are up 1.8 percent from a year ago.
Among other key contributors to the month change include gains for food at home or grocery prices (up 0.2 percent for the month and 0.6 percent for the year) and food away from home or restaurant prices (up 0.3 percent and 3.2 percent for the year) offset by motor fuel (down 0.9 percent in September and down 8.2 percent over 12 months), household fuels (down 0.4 percent for the month but up 0.3 percent for the year), and prescription drugs (down 0.8 percent and 1.1 percent for the year).
Overall, price pressures remain very weak despite rising tariffs due to on going trade wars. Longer-term disruptions to production and distribution (especially retailing) from the rapid development and deployment of new technologies are restraining prices. Furthermore, recent softening in demand, likely a result of declining confidence and rising uncertainty in the economic outlook add to the restraint. Price pressures are likely to continue to be restrained in coming months and quarters.