Consumer Price Index report: Inflation up 3.7%

Well, inflation rising once again this month as the consumer price index rose 3.7% in September compared to this time last year. Now, this morning, we are joined by Washington State economist Dave Reich. Good morning, Dave. Thank you so much for being here. Now, essentials like gas and clothing are up as well as airfares and electronics. And now the Social Security Administration announcing recipients will receive a $75 boost to offset these soaring prices. Can you put this into perspective for us? How serious is this 3.7% inflation? Well, it's definitely elevated. The Federal Reserve, our central bank, tries to shoot for around a 2% inflation rate, and we haven't achieved that in five or six years. So it's kind of a longer-term story for us. And of course, with the Iran war and the recent an increase in fuel prices that's been pushing up the numbers that you quoted and that 3.7% that we just received this morning is elevated and actually a little bit higher than most of us expected for September. So it's obviously a tough time for consumers with the elevated prices. Yeah, not what they want to hear. Will consumers notice? They're going to notice this. We're already talking about it and having this conversation, but where will they notice it the most at the pump, buying airline tickets. I know I've been putting off buying tickets to go all the way to the East Coast from Seattle because the ticket prices, I just keep hoping they'll come down, but they keep going up. Yeah, we're all hoping for that. But yes, obviously, probably the biggest place we're all going to notice is at the pump and already have noticed that. I'm sure fuel prices now are up around 34% year over year. That's gas prices and diesel prices, of course, are up very, very much. And so that's the part that's probably going to be most experienced by folks. Otherwise, food prices in the local area have been running a little higher than national numbers. Back in August, they were up over 5%. So that's a significant increase. And it's also something that we purchase, you know, pretty often. And so we get to experience those elevated prices directly. Yeah, and it is a topic of conversation, it seems like, anywhere we go. who's going to be most impacted by this inflation well everybody's impacted of course but the the folks who uh you know probably struggle the most are the folks who are living on lower incomes who maybe have to spend their entire paycheck every couple weeks to uh to buy basics uh and so that you know that then it necessitates hard choices around what do you give up or what do you change out you know buy some buy a cheaper brand or something like that uh so all those kinds of behaviors that you have to do when you don't have enough money so that's where those are the people that will most affect and how do companies keep up with this inflation did they give a bump in income and raises can they do it well that's that's a tough one yeah i think you know there's there's a certain amount of um feeling that this is somewhat temporary because of the um you know the Iran war but but i think you know that's proved to be going on longer than most of us expected. And so I think firms will have to start looking now at what they can do. But they're obviously constrained on the other side by consumers who can't buy their products if they're too expensive. So today's numbers reflect the whole country. What did the last breakout for Washington and the Seattle area say? And how do our numbers compare to the national inflation numbers over the last year? That's a great question. Yeah, so we only get Seattle area. There's only one measure of inflation for Washington state, and that's the Seattle CPI, which is really the three counties King, Pierce and Snohomish County and the most recent data we have is from August and it was up overall inflation was up 4.4 percent compared with 3.4 percent for the U.S. as a whole so that's you know one percentage point higher here typically Seattle inflation runs a little higher than the nation so that's not that unusual it's just a little bit larger than normal again the big drivers in august were food prices were quite a bit higher had gone know quite a bit more here locally than they had in the nation and then transportation costs so likely fuel prices showing up a little a little more than they were for the nation okay dave we're gonna have to keep an eye on this because we have another uh situation coming up on october 27th so we'll see if inflation rates go up again as well dave reich with the washington economic and revenue forecast council thanks for stepping in today thank you