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Written by AIER Research Staff
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Sunday, 09 March 2008 14:21 |
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The Consumer Price Index for all urban consumers increased 4.1 percent in 2007, up from the 2.5 percent increase in 2006. The rate of price inflation accelerated in 2007. However, as the table below shows the overall inflation rate masked widely different trends in the underlying prices.
View 2007 CPI Table
If you mostly bought TVs, computers, and electronic gadgets, your cost of living went down. During the 12 months ended in December, the price of televisions decreased sharply (down 18.3 percent), as did the prices of computers and related equipment (down 13.2 percent), computer software and accessories (-6.4 percent), audio equipment (-4.8 percent), and cameras (down 6.9 percent). Clothing prices also fell.
On the other hand, if you ate, drove, heated your home, or received medical care, your out-of-pocket expenses increased substantially. Gasoline prices soared by 29.6 percent, fuel oil prices by 32.5 percent. The prices of eggs, milk, cheese, and bread all increased at double-digit rates. The price of medical care increased by 5.9 percent, led by higher prices for outpatient hospital services (up 9.9 percent).
On a December-to-December basis, last year’s 4.1 percent increase in the CPI was the largest since a 6.1 percent increase in 1990. At this rate, the purchasing power of the dollar would be cut in half in 17 years.
To see how the overall cost of living has changed over time, use our cost of living calculator.
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