Inflation in the U.S. continues to work its way slowly into the U.S. economy. The U.S. Bureau of Labor Statistics (BLS) reported this week that inflation on all consumer goods and services inched up +0.3 percent in June. While this may seem low to most people, the data point to an increasing trend in inflation over time.
In the chart below, the 12-month moving average for the Consumer Price Index (CPI) for all goods and services was +1.5 percent in June. However, as we focus more on 2014 data, the six-month year-to-date trend is running +1.7 percent and the June 2014 vs. June 2013 is now over +2.0 percent.
There is some good news for beer consumers here, as the CPI for beer purchased for home consumption is actually showing the opposite trend to the general inflation level. The 12-month moving average is now running +1.8 percent, with improving trends to +1.5 percent for the six months year-to-date and 0.8 percent for June 2014 vs. June 2013.
The competitive position against wine and liquor is another story. According to the BLS data, wine consumers have seen a decreasing inflationary environment in 2014, with inflation for both year-to-date and June 2014 vs. June 2013 actually falling into negative territory. Liquor consumers, on the other hand, are experiencing trends similar to beer, but at a slightly lower rate of overall inflation.
All in all, we are seeing a good environment for the two-thirds of consumers (according to Gallup) that consume alcohol.
To receive additional information on the CPI for alcohol beverages, please contact NBWA Chief Economist Lester Jones at email@example.com.