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The price of a BLT : Slicing the layers of the CPI

Summary:
Over the summer, FRED added 1,479 new series on average prices for a wide range of consumer items. Almost half of the new data are prices of foodstuffs, more than enough for a seven-course dinner. But to keep it simple, let’s make a traditional BLT sandwich: bacon, lettuce, and tomato on white bread. (Today, we’ll hold the mayo.) Like most things, the price of a BLT has risen over time, which you may have noticed at the local diner or in the supermarket. Let’s “go figure with FRED” what’s been driving up the price of this lunch staple. The FRED graph immediately below plots the prices of all four ingredients over time. The prices of three of the ingredients rise at a fairly constant rate, which is a sign of low and stable consumer price inflation. But the fourth price (in red) is not

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Over the summer, FRED added 1,479 new series on average prices for a wide range of consumer items. Almost half of the new data are prices of foodstuffs, more than enough for a seven-course dinner.

But to keep it simple, let’s make a traditional BLT sandwich: bacon, lettuce, and tomato on white bread. (Today, we’ll hold the mayo.) Like most things, the price of a BLT has risen over time, which you may have noticed at the local diner or in the supermarket. Let’s “go figure with FRED” what’s been driving up the price of this lunch staple.

The FRED graph immediately below plots the prices of all four ingredients over time. The prices of three of the ingredients rise at a fairly constant rate, which is a sign of low and stable consumer price inflation. But the fourth price (in red) is not only noticeably higher than the rest but rises at a much steeper rate. So, this ingredient has been experiencing a higher rate of price inflation.

Have you looked at the graph’s labels to figure out the culprit? It’s the bacon!

Now, if you’d like to follow our recipe and portion sizes for each ingredient, you can track the price of an actual BLT in the graph below: As of August 2019, it’s $1.53!

How these graphs were created: On the FRED homepage, under the search bar, click on “Release” (in the “Browse by…” line). Then scroll down and select “Average Price Data” then “Food.” From the table, select “Tomatoes, Field Grown, Per Lb. (453.6 Gm) in U.S. City Average,” “Bacon, Sliced, Per Lb. (453.6 Gm) in U.S. City Average,” “Lettuce, Iceberg, Per Lb. (453.6 Gm) in U.S. City Average,” and “Bread, White, Pan, Per Lb. (453.6 Gm) in U.S. City Average.” Click on “Add to Graph.” For the second graph, start with the first and use the “Edit Graph” menu to apply a formula to adjust for the weight of the items in your sandwich. (The prices are all given in pounds, so we divide by 16 to get ounces and then multiply by the number of ounces we prefer: 2 oz. of tomatoes, 3 oz. of bacon, 1.3 oz. of lettuce, and 2 oz. of bread.) To stack all the individual prices, use the “Format” tab to select graph type “Area and Stacking: Normal.”

Suggested by Diego Mendez-Carbajo and Maria Arias.

About FRED Blog
FRED Blog
The Federal Reserve Bank of St. Louis is the center of the Eighth District of the Federal Reserve System. This District includes Arkansas, eastern Missouri, southern Illinois and Indiana, western Kentucky and Tennessee, and northern Mississippi.

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