Phoenix inflation eases to 2.3% in August, families still face stubborn cost burdens

(The Center Square) – While Arizona is seeing some inflation relief from last month, Arizona families are still struggling. According to inflation measured by the Consumer Price Index, inflation in the Phoenix area for August was 2.3%, a decrease from June’s 2.7%.

“Despite inflation taking another step in the right direction, today’s inflation report reveals that prices are still crushing American families,” Rep. David Schweikert, vice chairman of the Republican Joint Economic Committee, said in a written statement. “Shelter prices are growing even faster than both core and headline inflation - up 5.2 percent since last year. Meanwhile, Americans’ paychecks have not kept pace with inflation by several metrics.”

According to a report by the Common Sense Institute of Arizona analyzing the CPI data, national inflation figures have shown a slow decline from 3% in June to 2.5% in August - marking July and August as the first two months in years where the national inflation rate has fallen below 3%.

“August ended the 4-month streak of year-over-year inflation rate increases; local prices increased +2.3% (down from 2.7% in June),” reads the CSI report. “Of the 23 urban consumer price indices tracked by the BLS, the Phoenix metro area once again had the 5th lowest rate of measured inflation over the past year.”

The report also states that Phoenix households have had to pay almost $40,000 more over the past four years to maintain their lifestyle as it was in 2020.

When breaking it down by types of costs over the past four years, food and beverage costs have increased by $3,978, housing costs have increased by $17,548, transportation costs have increased by $10,237 and all other cost increases have amounted to $7,960.

If Arizona had experienced the 2% Federal Reserve target inflation rate, it would have cost the typical Arizona family almost $10,000 less per year on food, housing and transportation.

“As of September 2024, the average Phoenix area household was spending $1,004/month more than they would have at a 2% inflation rate,” reads the CSI report.“Even if the rate of inflation slows, it would take a sustained period of deflation to restore historical price levels.”

The report also notes that income rates in Arizona have not been able to keep up with inflation. While inflation rose 2.3% over the past year, Arizonans’ incomes only rose 2.1%.

“The Phoenix-Mesa-Scottsdale area now ranks second for the highest cumulative metro inflation,” Schweikert said. “The burden of inflation remains unbearable and ever present.”