Consumer prices rose 5% for the 12 months ending in March, down from 6% in February, as inflation continues to cooling, federal officials said Wednesday. March marked the ninth month in a row that the pace of inflation has slowed following last summer’s record-setting levels.
Viewed on a monthly basis, The Consumer Price Index for March rose 0.1% compared to February’s monthly increase of 0.4%, according to the U.S. Bureau of Labor Statistics. The index for shelter (+0.6%) was the largest contributor to the monthly all-items increase.
Even though the pace of inflation is moderating, the 5% annual inflation rate remains above the 2% target rate set by the Federal Reserve, which meets again next month to consider another increase in the benchmark interest rate. The Fed has raised interest rates nine times in the past year as part of an ongoing effort to slow down the economy and curb inflation.
Among the other price indexes that rose in March were the monthly index for motor vehicle insurance (+1.2%) and the index for airline fares (+4%). The indexes for household furnishings and operations, new vehicles, education, and apparel also increased on a monthly basis in March.
Used car and truck prices fell 0.9% in March on a monthly basis, continuing a downward trend for used vehicles, which cost 11.2% less in March 2023 than they did in March 2022. New vehicles costs increased 0.4% for the month of March and remain 6.1% higher than they were in March 2022.
Energy costs declined 3.5%, compared to February’s monthly decline of 0.6%. Viewed on an annual basis, the energy index has fallen 6.4%, compared to a year ago. The gasoline index has decreased 17.4% compared to March 2022. The electricity index has risen 10.2% over the same 12-month period, and the natural gas index has increased 5.5%.
The overall food index was unchanged for March. The food-at-home index fell 0.3% on a monthly basis, the first decline in that index since September 2020. Three of the six major grocery store food group indexes decreased over the month. The index for meats, poultry, fish, and eggs decreased 1.4 % in March and the index for eggs fell 10.9%. The fruits and vegetables index declined 1.3% over the month, and the dairy and related products index decreased 0.1%. The cost of food eaten away from home, however, rose 0.6% on a monthly basis in March, just as it had in the two previous months.
Despite the good news that the overall food index was unchanged for the month of March, food prices are still 8.5% higher than they were in March of 2022, the report said.
