Thursday, August 16, 2001

Isle consumer
prices rise

By Russ Lynch

Pushed up by higher gasoline prices, Honolulu consumer prices were up 1.3 percent in the first half of this year from the first half of 2000.

However, that was a slower rate of inflation than the year-ago 1.9 percent, reflecting a slowing local economy.

"I'm not surprised that it has come down some," said Honolulu economist Leroy Laney. "That would be in agreement with some slowdown in the state economy. We've certainly seen that in tourism," said Laney, a Hawaii Pacific University economics professor.

"We've seen some slowdown in the (local) economy, a little bit more than most forecasters around here thought it would, and most of that is due to a slowdown in the mainland economy," he said.

A 12.7 percent year-over-year rise in consumer gasoline prices lifted prices in the overall transportation segment by 4.9 percent compared to the first half of last year, according to the half-yearly report issued today by the U.S. Department of Labor's Bureau of Labor Statistics. Medical care, an inflation leader in many recent years, again had a bigger rise than most of the broad categories that make up the Honolulu Consumer Price Index, an increase of 4.3 percent in a year.

Price chart

The food-and-beverages category was up 1.7 percent year-over-year, driven by a 2.6 percent increase in the cost of food consumed at home. Eating out also cost more than a year ago, up 1.3 percent from the first half of 2000.

Balancing those increases were some changes in favor of consumers. Clothing costs, for example, were down 4.6 percent. The education and communication category showed a 3.5 percent year-over-year drop in prices and the bureau said the group provided the strongest downward pressure on the overall index.

Recreation costs were down 1 percent. Prices in the important housing category rose only 0.8 percent year-over-year.

The bureau produces a Consumer Price Index study for Honolulu every six months, in February and August. It conducts surveys, such as supermarket visits by price-checkers, throughout the year.

The overall Honolulu Consumer Price Index for the first half of 2001 stood at 178.1, compared to the 1982-84 standard of 100.

That means that a market basket of goods and services that cost $100 in 1982-84 would have cost $178.10 in the first six months of this year.

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