2012 COLA Watch – Preliminary Information – September Gasoline Price Decrease – A Little Perspective

Repeat from original post:

The national average price for regular gasoline decreased at a more or less continuous rate in September, from $3.647 on September 1st down to $3.433 on September 30. This is a decrease of $0.214 for the month.

Now the perspective. This decrease of 21 cents is 5.9%. And of the 100% of all expenses used to compute the CPI-W, Gasoline (All Grades) was about 6.2% of the total in August, and should be about the same in September. So the 5.9% decrease in price for gasoline will be largely restricted to a relatively small slice of the overall CPI-W pie.

Also, gasoline has been has been very volatile in its pricing over the last several months, and changes in the price of gasoline do not directly correlate to changes in the CPI-W:

May, 2011 to June, 2011: -6.9%. The CPI-W decreased 0.2% during this period.
June, 2011 to July, 2011: 4.9%. The CPI-W increased 0.07% during this period.
July, 2011 to August, 2011: 1.8% The CPI-W increased 0.3% during this period.

The cost of food has been increasing steadily. This will be the topic for my next 2012 COLA Watch – Preliminary Information. And the prices for items other than food and fuel (the so-called “core inflation,”) have also been increasing steadily.

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