August 17, 2022 Reading Time: 4 minutes

On Wednesday, August 10th, the Bureau of Labor Statistics release of the July 2022 Consumer Price Index data showed a year-over-year change of 8.5 percent. That’s down from June’s 9.1 percent year-over-year number, but still at 40-year highs. The Biden administration, predictably, chose to seize upon the 0.0 percent month-over-month change between June and July. As the New York Post reported,

“I just want to say a number: zero,” Biden said in the White House East Room…”Today, we received news that our economy had 0 percent inflation in the month of July — 0 percent,” Biden said. “Here’s what that means: While the price of some things go up — went up last month, the price of other things went down by the same amount. The result? Zero inflation last month.”

It first bears mentioning that a view that this 0 percent number simply isn’t plausible has been voiced (loudly). My own investigation shows that since September 1971 there have been 205 month-over-month CPI releases. Fourteen of those, and four since 2010, have been flat: a 0 percent change from one month to the next. More than half of the largest monthly CPI changes – 14 of the top 25 – occurred in the troubled, highly inflationary period between 1971 and 1982. Two of the largest monthly changes occurred this year, one in 2021.

With hundreds of price index constituents and plunging poll numbers, manipulation seems eminently likely to critics. With no prejudice against those views, I do not make that charge here. Rather, the nature of the artifice is gloss. Yes, it is true that gasoline prices have fallen significantly. In July 2022 the average price of a gallon of gasoline in the United States fell from $5.34 to $4.80. Yet even after that decline the price of gasoline is up 87 percent since the start of 2021. 

To consider the actual contours of the trumpeted “zero percent” change, below are the largest June to July 2022 decreases in price among CPI constituents according to the Bureau of Labor Statistics. (Because certain goods and services are broken into subcategories, some categorical redundancies may be present.) 

Goods/servicesJuly 2022June 2022June-July chg
1Unleaded Regular Gasoline-8.0%10.1%-18.1%
2Gasoline, Unleaded Midgrade-6.5%9.6%-16.1%
3Gasoline, Unleaded Premium-5.5%8.7%-14.2%
5Airline Fare-9.6%-0.2%-9.4%
7Shelf Stable Fish and Seafood-3.3%1.8%-5.1%
8Women’s Outerwear-3.2%1.6%-4.8%
9Newspapers And Magazines-0.5%4.2%-4.7%
10Audio Equipment-1.4%3.2%-4.6%
11Ham Excluding Canned-0.8%3.6%-4.4%
12Computer Software and Accessories-1.9%2.3%-4.2%
14Frozen Non Carbonated Juices & Drinks-1.1%2.4%-3.5%
15Other Linens-1.8%1.6%-3.4%
16Girls apparel-3.8%-0.4%-3.4%
17Recreational Books-1.7%1.6%-3.3%
19Men’s furnishings-2.4%0.8%-3.2%
20Peripheral Computer Equipment-1.8%1.3%-3.1%
21Men’s Footwear-1.4%1.7%-3.1%
22Other Furniture-4.3%-1.5%-2.8%
23Processed Fish and Seafood-1.3%1.4%-2.7%
24Prepared Salads0.7%3.1%-2.4%
26Fresh Biscuits, Rolls, Muffins1.2%3.4%-2.2%
27Boys’ Apparel-2.0%0.2%-2.2%
28Frozen & Refrigerated Bakery Products0.7%2.9%-2.2%
29Butter and Margarine1.6%3.7%-2.1%
30Dental Services-0.1%2.0%-2.1%
31Frozen Fish & Seafood-0.1%2.0%-2.1%
32Stationery, Stationery Supplies, Gift Wrap-2.6%-0.6%-2.0%
33Men’s suits, sport coats, and outerwear-1.6%0.4%-2.0%
34Indoor Plants and Flowers-1.2%0.7%-1.9%
35Non Electric Cookware and Tableware-0.7%1.2%-1.9%
36Major Appliances-1.8%0.0%-1.8%
37Other Condiments0.2%2.0%-1.8%
38Motor Oil, Coolant, and Fluids0.8%2.6%-1.8%
39Boys & Girls Footwear-0.9%0.8%-1.7%
40Fresh Cakes & Cupcakes1.2%2.9%-1.7%
41Other Appliances-0.8%0.8%-1.6%
42Lodging Incl Hotels & Motels-2.4%-0.8%-1.6%
43Flour and Prepared Flour Mixes4.0%5.5%-1.5%
44Sewing Machines, Fabric and Supplies0.4%1.9%-1.5%
45Eyeglasses & Eye Care-0.8%0.7%-1.5%
46Motor Vehicle Body Work0.3%1.8%-1.5%
47Parking and Other Fees-0.4%1.1%-1.5%
48Lodging Away from Home-2.0%-0.7%-1.3%
49Motor Vehicle Maintenance & Servicing0.7%2.0%-1.3%
52Sports equipment-1.1%0.1%-1.2%
53Nursing Home & Adult Day Service0.1%1.3%-1.2%
54Sweet Rolls, Coffeecakes, Doughnuts0.5%1.7%-1.2%
55Fish and Seafood-0.6%0.5%-1.1%
56Frozen & Freeze Dried Prepared Foods1.9%2.9%-1.0%
57Child Care and Nursery School-0.2%0.8%-1.0%
58Women’s dresses-3.3%-2.3%-1.0%
59Parking Fees and Tolls0.2%1.2%-1.0%
60Floor coverings0.1%1.0%-0.9%
61Pets, Pet Supplies, Accessories0.0%0.9%-0.9%
62Uncooked Beef Steaks-1.0%-0.1%-0.9%
63Canned Vegetables1.1%2.0%-0.9%
64Clocks, Lamps, and Decorator Items-0.3%0.5%-0.8%
65Fresh Whole Milk-0.7%0.0%-0.7%
66Women’s Suits and Separates-1.2%-0.5%-0.7%
67Frozen Vegetables0.7%1.3%-0.6%
69Cable, Satellite Television, Radio Service-0.6%0.0%-0.6%
70Pork Roasts Steaks and Ribs-0.5%0.1%-0.6%
71Other Miscellaneous Foods1.8%2.4%-0.6%
72Men’s apparel-1.4%-0.8%-0.6%
73Fresh & Frozen Chicken Parts1.1%1.7%-0.6%
74Breakfast Cereals2.0%2.5%-0.5%
75Frozen Fruits and Vegetables0.5%1.0%-0.5%
76Tools, Hardware and Supplies-0.1%0.4%-0.5%
77Beer, Ale, and Malt Beverages at Home0.3%0.8%-0.5%
78Other Meats0.5%1.0%-0.5%
79Oranges, including Tangerines0.2%0.7%-0.5%
80Motor Vehicle Repair1.7%2.1%-0.4%
81Fresh Milk Other than Whole0.5%0.9%-0.4%
82Wine At Home0.1%0.5%-0.4%
83Services By Other Medical Professionals-0.3%0.1%-0.4%
84Intracity Transportation0.4%0.8%-0.4%
85Other Uncooked Poultry including Turkey0.6%1.0%-0.4%
86Miscellaneous Household Products1.0%1.4%-0.4%
90Wine away from Home0.0%0.3%-0.3%
92Distilled Spirits Away From Home-0.1%0.1%-0.2%
93Landline Telephone Services-0.1%0.1%-0.2%
94Intracity Mass Transit-0.2%0.0%-0.2%
95Cakes, Cupcakes and Cookies1.7%1.8%-0.1%
96Pet Food1.2%1.3%-0.1%
97Rent of Primary Residence0.7%0.8%-0.1%
98Women’s Footwear0.3%0.4%-0.1%
99Fresh Vegetables0.6%0.7%-0.1%
100Owners Equivalent Rent of Residences0.6%0.7%-0.1%
101College Tuition and Fees0.2%0.3%-0.1%
102Haircuts and Other Personal Care Services0.2%0.3%-0.1%
103New Trucks0.6%0.7%-0.1%
104Owner Equivalent Rent Primary Residence0.6%0.7%-0.1%

The following CPI constituents saw price increases from June to July 2022, starting with the largest month-to-month percentage change.

Goods/servicesJuly 2022June 2022June-July chg
1Window Coverings4.0%-3.9%7.9%
2Photographic Equipment5.6%-0.7%6.3%
3Peanut Butter3.5%-2.0%5.5%
4Uncooked Other Beef and Veal1.8%-1.9%3.7%
5Pork Chops2.3%-1.4%3.7%
6Crackers Bread & Cracker Products3.8%0.5%3.3%
7Fats and Oils including Peanut Butter4.0%0.8%3.2%
8Other Fresh Fruits0.0%-3.1%3.1%
9Women’s Underwear, Nightwear0.0%-2.9%2.9%
10Dried Beans Peas & Lentils1.7%-1.0%2.7%
11Bacon, Breakfast Sausage, & Related1.9%-0.8%2.7%
12Laundry Equipment1.7%-0.9%2.6%
13Video Discs and Other Media2.9%0.3%2.6%
15Bacon & Related Products1.4%-1.1%2.5%
17Carbonated Drinks2.3%-0.1%2.4%
18Breakfast Sausage & Related Products2.6%0.2%2.4%
19Bread Other than White3.5%1.3%2.2%
20Olives, Pickles, Relishes3.0%0.9%2.1%
21Sauces and Gravies3.2%1.1%2.1%
22Ship Fare0.0%-2.1%2.1%
23Admission to Sporting Events4.9%2.9%2.0%
24Telephone Hardware, Calculators, Etc.0.9%-1.1%2.0%
25Salt and Other Seasonings and Spices2.0%0.1%1.9%
27Men’s pants and shorts0.1%-1.7%1.8%
28Toys, Games, Hobbies, Playground Equip.1.1%-0.6%1.7%
29Citrus Fruits-1.3%-3.0%1.7%
30Men’s Shirts and Sweaters-1.3%-3.0%1.7%
31Fresh Fruit-0.3%-1.9%1.6%
32Delivery Services0.7%-0.8%1.5%
33Roasted coffee2.6%1.2%1.4%
34Other Beverage Materials Including Tea2.4%1.0%1.4%
35Spices, Seasonings, Condiments, Sauces2.3%0.9%1.4%
36Care of Invalids and Elderly at Home1.5%0.1%1.4%
37State Motor Vehicle Registration, License1.4%0.0%1.4%
38Candy and Chewing Gum2.0%0.7%1.3%
40Canned Fruits1.1%-0.2%1.3%
41Instant & Freeze Dried Coffee2.3%1.0%1.3%
44Vehicle Parts and Equipment0.4%-0.7%1.1%
46Baby Food2.1%1.1%1.0%
47Sports Vehicles Including Bicycles0.4%-0.6%1.0%
48Pet Services0.3%-0.7%1.0%
49Processed Fruits and Vegetables2.2%1.3%0.9%
50Uncooked Ground Beef0.8%-0.1%0.9%
51Household Paper Products3.1%2.2%0.9%
52Other Intercity Transportation0.7%-0.2%0.9%
53Other Bakery Products2.0%1.2%0.8%
54Financial Services0.3%-0.5%0.8%
57Distilled Spirits0.8%0.1%0.7%
58Housing at School, excluding Board0.8%0.1%0.7%
59Vehicle Accessories Other Than Tires0.7%0.0%0.7%
60Beer, Ale, Etc. (Away From Home)0.9%0.2%0.7%
61Video Discs and Other Media1.7%1.0%0.7%
62Club Dues & Fees for Sports and Exercise0.4%-0.3%0.7%
63Whiskey at Home0.6%-0.1%0.7%
64Inpatient Hospital Services0.6%-0.1%0.7%
65Uncooked Beef Roasts-1.3%-2.0%0.7%
66Fresh Whole Chicken1.9%1.2%0.7%
67Sugar and Artificial Sweeteners2.2%1.6%0.6%
68Living Room, Kitchen, Etc. Furniture2.7%2.1%0.6%
69Cosmetics, Perfume, Bath, Nail Prep0.8%0.2%0.6%
70Veterinarian Services0.8%0.2%0.6%
71Distilled Spirits at Home0.7%0.1%0.6%
72Hospital Services0.6%0.0%0.6%
73Admission to Movies & Concerts1.5%0.9%0.6%
74Lunch Meats1.1%0.6%0.5%
75Outdoor Equipment and Supplies0.3%-0.2%0.5%
76Apparel Services1.5%1.0%0.5%
77Beef And Veal-0.1%-0.6%0.5%
78Fresh Fish and Seafood0.1%-0.4%0.5%
79Outpatient Hospital Services0.5%0.0%0.5%
82Funeral Expenses0.5%0.1%0.4%
84Salad Dressing2.4%2.0%0.4%
86Audio Discs, Tapes and Other Media0.6%0.3%0.3%
87Other Video Equipment-2.0%-2.3%0.3%
88New Cars0.8%0.6%0.2%
89Other Fresh Vegetables0.5%0.3%0.2%
90Rental Of Video, Audio Discs0.0%-0.2%0.2%
91Prescription Drugs0.3%0.1%0.2%
92Physicians Services0.3%0.1%0.2%
93Womens Apparel-1.2%-1.4%0.2%
94White Bread2.0%1.8%0.2%
95Nonfrozen Noncarbonated Drinks1.5%1.4%0.1%
96Nonprescription Drugs1.3%1.2%0.1%
97Hair, Dental, Shaving, Care Products1.3%1.2%0.1%
98Music Instruments and Accessories0.0%-0.1%0.1%
99Wireless telephone services0.0%-0.1%0.1%
100Elementary & High School Tuition & Fees0.6%0.5%0.1%
101Bedroom Furniture1.2%1.1%0.1%

Two particularly noteworthy features should be clear. First, that the changes in the general price level remain extraordinarily broad. We see not just increases in food and energy, but in services, clothing, events, consumer non-durables, and beyond. Additionally, the complementary nature of many goods likely mitigates the benefit of certain declines in price. Labor Day BBQers will note that rolls and frankfurters have declined in price, but pickles, noncarbonated beverages, and household paper products (plates, cups, etc.) have risen in price. Gasoline prices, still high, have declined. But the cost to access destinations, such as sporting events, movies, and gym memberships, have continued ascending. The decline in gasoline prices is a welcome development for individuals who drive, but doesn’t help the working poor when within the same index are increases in the cost of intercity transportation.

American consumers don’t purchase or eat the CPI. Households consume preferred items in specific quantities to meet their needs within the confines of budget and income restrictions. If there happens to be an individual or family subsisting exclusively on snacks, college textbooks, household cleaning supplies, and postage – some of the very few goods that actually saw a 0 percent change in price from June to July – they are at least treading water. Even for an administration desperate for good news, touting a meaningless statistical aberration as an achievement is a pitiful turn.

Peter C. Earle

Peter C. Earle

Peter C. Earle, Ph.D, is a Senior Research Fellow who joined AIER in 2018. He holds a Ph.D in Economics from l’Universite d’Angers, an MA in Applied Economics from American University, an MBA (Finance), and a BS in Engineering from the United States Military Academy at West Point.

Prior to joining AIER, Dr. Earle spent over 20 years as a trader and analyst at a number of securities firms and hedge funds in the New York metropolitan area as well as engaging in extensive consulting within the cryptocurrency and gaming sectors. His research focuses on financial markets, monetary policy, macroeconomic forecasting, and problems in economic measurement. He has been quoted by the Wall Street Journal, the Financial Times, Barron’s, Bloomberg, Reuters, CNBC, Grant’s Interest Rate Observer, NPR, and in numerous other media outlets and publications.

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