(The Center Square) – A new report from the personal finance website WalletHub finds that the Seattle metro area is currently experiencing the most significant inflationary pressure of all major metro areas in the U.S.
“WalletHub compared 23 major MSAs (Metropolitan Statistical Areas) across two key metrics related to the Consumer Price Index, which measures inflation. We compared the Consumer Price Index for the latest month for which BLS (Bureau of Labor Statistics) data is available to two months prior and one year prior to get a snapshot of how inflation has changed in the short and long term,” according to the report.
Area prices in the Seattle-Bellevue-Tacoma area were up 1.4% over the past two months alone, and up 2.7% from a year ago.
According to WalletHub, the index for all items except food and energy increased 2.4 percent over the year. The food index for the Seattle metro area rose 4.8%, and the energy index advanced by 5%.
“The numbers are pretty startling for Seattle, particularly in the short term,” WalletHub writer and analyst Chip Lupo said in an interview with The Center Square. “They went up 1.4% in just the last two months – and that was the highest jump of any of the 23 metro areas.”
Food and restaurant prices are way up for the Seattle metro area.
“For Seattle, food went up one-and-a-half percent in June. That’s the index for what we call food at home, which are grocery store purchases,” Lupo explained. “The food away from home index includes things like restaurants, cafeterias and vending purchases, and that is up 1.6% in the past two months.”
The Seattle area’s food index rose 4.8% year over year for both food at home and eating out.
“That is pretty staggering,” Lupo said.
Washington has higher grocery prices than most of the nation. Washingtonians pay the fourth-highest grocery bill in America, according to a 2024 report from Help Advisor.
Per the report, only California, Nevada, and Mississippi boast a higher cost for groceries.
For a family of four that spends $1,000 per month on food – a lower-end estimate – a 4.8% increase amounts to spending another $576.00 on food for the year.
It’s unclear how big a factor Seattle’s minimum wage law, or, as reported by The Center Square, DoorDash’s hiking service fees in Seattle, plays into the food inflation equation.
On Jan. 1, Seattle’s minimum wage went up to $20.76 per hour for all employers regardless of size.
The other big hit for Seattle residents is the energy index.
“It increased 4% over the past two months,” Lupo observed. “Gasoline prices are a big component of that, up 2.4%.
He said, “Over the year, the energy index, including gasoline prices, went up less than a percent, so there was something going on there for it to jump almost two and a half percent in the last two months.”
As reported by The Center Square, Washington’s gas tax increased by 6 cents per gallon on July 1, from 49.4 cents to 55.4 cents. Starting July 1, 2026, it will rise each year by 2% to account for inflation.
The state tax on diesel also went up 3 cents per gallon, bringing the total tax to 58.4 cents per gallon. The diesel tax will increase by another 3 cents in 2027. Starting in 2028, the diesel tax will increase by 2% annually to keep pace with inflation.
Meanwhile, with temperatures on Wednesday soaring well into the mid-90s across western Washington, KUOW reported that Puget Sound Energy, Washington’s largest utility, is paying customers to use less electricity.
“Customers who sign up for ‘PSE Flex’ programs get paid to do things like turn up their thermostats a few degrees or charge electric vehicles late at night,” noted the article.
There are other factors driving inflation.
“There are generally two main forces that drive inflation. First, inflation increases when the economy is overheated. This can occur when the government stimulates the economy by increasing spending and/or lowering taxes, or when the Federal Reserve lowers interest rates, which encourages firms and individuals to spend more,” noted Richard Grossman, Andrews Professor of Economics at Wesleyan University in Middletown, Conn. “The recently passed One Big Beautiful Bill Act will both reduce taxes and increase spending, which will be inflationary.”
Lupo told The Center Square, it’s disingenuous to blame President Trump’s tariffs on recent inflationary pressures.
“A lot of experts are saying that the tariffs are playing a factor, which is interesting because the tariffs, for the most part, haven’t been enacted, and when they do take effect, it’s only going to be impacting imported goods,” he said. “Any current inventory is not going to be subject to tariffs. It’s when that inventory runs out and they import more stuff … then the tariff comes.”
The full WalletHub report can be viewed here.
