Higher fuel prices after Hurricane Katrina caused the biggest rise in prices paid by local consumers in memory.
Prices for all urban consumers in the Washington-Baltimore area rose 4.9 percent in the 12 months ended in September, the Labor Department said. That is higher than in any 12-month period since 1997, and that is as far back as the local inflation data go in the department's online database. Local prices rose 4 percent in the year ended in July.
It takes no great insight to figure out what happened. Because of the Gulf Coast hurricane and the shutdown of various refineries and pipelines, local consumers paid 11.9 percent more for natural gas service in September than in August, and they paid 17.6 percent more for gasoline. Those numbers, however, are not adjusted for regular seasonal variations.
Excluding energy, local consumer prices rose by only 2.6 percent in the 12 months ended in September. That was down from a 3.3 percent rise in non-energy prices in the 12 months ended in July.
Although energy prices have eased in recent weeks, the unresolved question is whether higher energy prices will start percolating through the national and local economies, leading companies to raise the prices of other goods.
That will determine whether inflation is back as a real threat or September was simply one bad month.
-- Neil Irwin