Once Highest, now near Lowest in the Nation. Phoenix Inflation Rate fell in 2023. Here’s why

Article originally posted on AZ Central on January 11, 2024

Metro Phoenix ended 2023 with one of the nation’s lowest urban inflation rates, in sharp contrast to the situation one year earlier.

The Phoenix-Mesa-Scottsdale area logged a 2.7% inflation rate for the 12 months through December, the federal Bureau of Labor Statistics reported on Jan. 11.

That was lower than all but three of the 14 U.S. cities for which the agency tracked numbers through year-end. The Miami area ended 2023 with the highest inflation rate at 5.7%.

Phoenix-area inflation cooled considerably from a 9.5% rate for all of 2022. At one point during that year, metro Phoenix had the nation’s highest inflation rate at 13%. Stabilizing housing prices have helped, though prior price increases have led to a situation where homes and rents remain unaffordable to many people.

In metro Phoenix, food and beverage prices rose 3% on average in 2023, housing was up 3.8% and medical care surged 13.4%, but clothing was down 1% and transportation dipped 3.9%.

Nationally, inflation rose 3.4% in 2023 following an increase of 6.5% in 2022.

Housing prices, a key inflationary driver, increased 6.2% for the year across the U.S. and electricity rose 3.3%, restaurant food became 5.2% more expensive, beef jumped 8.7%, veterinary services spiked 10.8%, car repairs gained 10.3% and auto insurance soared 20.3%.

On the other hand, gasoline prices eased 1.9% for the year, major appliances were down 10.3%, airline fares fell 9.4%, smartphones became 14.4% less expensive and egg prices tumbled 23.8%, the agency reported.