Because the Bureau of Labor Statistics does not publish official state-level CPI data, the Council of Economic Advisers relied on regional inflation figures and adjusted them based on state population.
The disparity was more pronounced at the metropolitan level.
Metro areas in conservative-led states recorded 1.9% year-over-year inflation, while metro areas in liberal-led states posted 3%, a difference most evident in day-to-day expenses such as commuting and utility bills.
Energy costs accounted for much of the gap. In major liberal-run metro areas, including Baltimore, Chicago, Los Angeles, and New York, energy prices increased at a faster pace than in cities located in conservative-led states. Combined energy and transportation costs explained a significant share of the inflation difference between metro areas.
Rising costs for electricity, gasoline, and commuting tend to be felt quickly by households, even when overall price increases are relatively modest.
Housing inflation remained elevated nationwide, though prices continued to rise slightly faster in liberal-led states than in conservative-led states. Continue reading…