While inflation is wreaking havoc on people’s wallets across the country, inhabitants in many areas face rates that are greater than the national average.
Inflation is above 7.5 percent in the Midwest, South, and West, according to Labor Department data. Surprisingly, inflation in the Northeast is running at a significantly lower rate.
In addition, the Labor Department keeps track of inflation in large metro regions. The Tampa Bay region has the highest inflation rate in the country, according to current data.
Where does inflation have the most impact?
SALT LAKE CITY, Utah (AP) Utah and the Mountain West are being struck the worst by recent inflation, according to a new report from a congressional study issued this week.
According to a survey by the Congressional Joint Economic Committee, Utah families are paying $511 more each month on average than they were at the same time last year.
“One of the difficult and annoying aspects of inflation is that it disproportionately affects those with the least,” said Phil Dean, Senior Research Fellow in Public Finance at the Kem C. Gardner Policy Institute.
According to the report, the Mountain West has the highest inflation rate in the country, with an annual rate of 9.0 percent, owing to rising property and rent prices.
He claims that property prices have increased by 30%, while rent has increased by 10% to 15% year over year.
“We have a supply and demand imbalance; we haven’t built enough houses for the number of families we have,” Dean explained.
He believes that right now, individuals must be cautious about how they spend their money.
“Sometimes they’ll have to acquire something that they don’t like as much but is less expensive,” Dean explained.
Jordan Crawforth of Salt Lake City has noticed a price increase in the food she buys for her dog, Rufio.
“I just ordered a new bag for him last night,” Crawforth said, “and I feel like the price of the food he eats has definitely gone up $15 from the last time I bought it.”
That, according to Crawforth, extends to the rest of her family. She claims that the expense of her regular supermarket shopping trip has increased.
“Just the cost of anything is so costly,” Crawforth said. “I feel like we try to eat most of our budget is already designated for our food and it’s just, I feel like it’s practically tripled.”
People in the southeast of the United States, on the other hand, are seeing the slowest rate of inflation. With an average monthly expenditure of $331.
Crawforth claims that having to worry about the impact of inflation as a consumer irritates her.
“Ideally, prices would come down, but it appears that everyone is raising their rates to stay up,” Crawforth added.
Dean noted that once prices have risen, they are unlikely to fall. He anticipates a slowing in the rate of price increases, rather than the recent spikes we’ve seen in some locations.
President Joe Biden promised to battle inflation and rising costs by taking more action to address supply chain challenges during his State of the Union address this week.
Senator Mike Lee of Utah blamed inflation on government spending earlier this month, but he also acknowledged that supply chain concerns had had a significant impact on growing costs.
“Here’s the issue about inflation,” Lee explained. “Not always, but in general, as prices rise, they do not tend to fall as quickly.”
When did the United States’ inflation rate peak?
Between 1914 and 2022, the United States’ inflation rate averaged 3.25 percent, with a high of 23.70 percent in June 1920 and a low of -15.80 percent in June 1921.
Why is Atlanta’s inflation rate higher?
Last month, annual inflation in metro Atlanta reached double digits, greatly exceeding the national average, owing to rising housing, energy, and food costs. Consumer prices are expected to rise even quicker this month, owing to surging oil and gas costs as a result of Russia’s recent invasion of Ukraine.
What is the rate of inflation in Chicago?
Prices in Chicago, Illinois are 2,537.79 percent greater in 2022 than they were in 1914, according to the US Bureau of Labor Statistics (a $507.56 difference in value). Chicago had an average annual inflation rate of 3.08 percent between 1914 and 2022. Significant inflation is indicated by this rate of change.
RELATED: Inflation: Gas prices will get even higher
Inflation is defined as a rise in the price of goods and services in an economy over time. When there is too much money chasing too few products, inflation occurs. After the dot-com bubble burst in the early 2000s, the Federal Reserve kept interest rates low to try to boost the economy. More people borrowed money and spent it on products and services as a result of this. Prices will rise when there is a greater demand for goods and services than what is available, as businesses try to earn a profit. Increases in the cost of manufacturing, such as rising fuel prices or labor, can also produce inflation.
There are various reasons why inflation may occur in 2022. The first reason is that since Russia’s invasion of Ukraine, oil prices have risen dramatically. As a result, petrol and other transportation costs have increased. Furthermore, in order to stimulate the economy, the Fed has kept interest rates low. As a result, more people are borrowing and spending money, contributing to inflation. Finally, wages have been increasing in recent years, putting upward pressure on pricing.
When was the last time the United States experienced high inflation?
SNELL: So, Scott, the last time inflation was this high, Ronald Reagan was in the White House, Olivia Newton-John was everywhere on the radio, and the cool new computer was the Commodore 64, which was named after its 64 kilobytes of capacity. Oh, and a new soft drink was set to hit the market.
(Singing) Introducing Diet Coke, UNIDENTIFIED PERSON. You’ll drink it only for the sake of tasting it.
SNELL: Before Diet Coke, there was a period. And, while it feels like a long time ago, Scott, how close are we to having to go through it all again?
HORSLEY: Kelsey, you have to keep in mind that inflation was really decreasing in 1982. It had been significantly higher, nearly twice as high as it was in 1980, when annual inflation reached 14.6 percent…
HORSLEY:…Nearly twice as much as it is now. And inflation had been high for the greater part of a decade at the time. High inflation plagued Richard Nixon, Gerald Ford, and Jimmy Carter. And by the time Reagan took office, Americans had grown accustomed to price increases that seemed to go on forever.
REAGAN, RONALD: Now we’ve had two years of double-digit inflation in a row: 13.3% in 1979 and 12.4 percent last year. This happened only once before, during World War I.
HORSLEY: So, in comparison to the inflation rates of the 1970s and early 1980s, today’s inflation rate doesn’t appear to be all that severe.
SO IT WAS COMING DOWN. SNELL: How did policymakers keep inflation under control back then?
HORSLEY: Well, the Federal Reserve provided some fairly unpleasant medication. Paul Volcker, then-Federal Reserve Chairman, was determined to break the back of inflation, and he was willing to raise interest rates to absurdly high levels to do it. To give you an example, mortgage rates reached 18 percent in 1981. As you may expect, that did not go down well. On the backs of wooden planks, enraged homebuilders wrote protest notes to Volcker. The Fed chairman, on the other hand, stuck to his guns. Volcker was interviewed on “The MacNeil/Lehrer NewsHour.”
PAUL VOLCKER: This dam is going to burst at some point, and the mentality is going to shift.
HORSLEY: Now, some people may believe we’re in for a rerun when they hear the Fed is prepared to hike interest rates once more to keep inflation in check.
HORSLEY: The rate rises we’re talking about now, though, are nothing like Volcker’s severe actions. Keep in mind that interest rates were near zero throughout the pandemic. Even if the Fed raised rates seven times this year, to 2% or something, as some experts currently predict, credit would still be extremely inexpensive by historical standards. The Fed isn’t talking about taking away the punchbowl, just substituting some of the extremely sugary punch with something closer to Diet Coke. The cheap money party has been going on for a long time, and the Fed isn’t talking about stopping it.
SNELL: (laughter) OK, so there are certainly some significant distinctions between today’s inflation and the inflation experienced by the United States in 1982. Is there, however, anything we can learn from that era?
HORSLEY: One thing to remember is that inflation is still a terrible experience. Rising prices have a significant impact on people’s perceptions of the economy, and politicians ignore this at their peril. The growing cost of rent, energy, and groceries – you know, the stuff that most of us can’t live without – were some of the major drivers of inflation last month. Abdul Ture, who works at a store outside of Washington, says his money doesn’t stretch as far as it used to, so he has to shop in smaller, more frequent increments.
ABDUL TURE: Oh no, the costs have increased. Everything has gone to hell on the inside. I now just buy a couple of items that I can utilize for two or three days. I used to be able to buy for a week. But no longer.
HORSLEY: This has an impact on people’s attitudes. Price gains are expected to ease throughout the course of the year, but inflation has already shown to be larger and more persistent than many analysts anticipated.
SNELL: However, a great deal has changed in the last 40 years. Take, for example, my cell phone. It has 100,000 times the memory of the Commodore computer we discussed earlier. Is this to say that inflation isn’t as dangerous as it once was?
HORSLEY: For the most part, it appeared as if the inflation dragon had been slain for the last few decades. Workers, for example, were assumed to have less negotiating leverage in a global economy, limiting their ability to demand greater compensation. Because the economy is no longer as reliant on oil as it was in the 1970s, oil shocks do not have the same impact. However, additional types of supply shocks occurred throughout the pandemic. And when you combine shortages of computer chips, truck drivers, and other personnel with extremely high demand, you’ve got a recipe for price increases.
SNELL: You should know that both Congress and the Federal Reserve injected trillions of dollars into the economy during the pandemic. It was an attempt to defuse the situation. So, how much of that contributed to the current level of inflation?
HORSLEY: That’s something economists will be debating for a long time. Those trillions of dollars did contribute to a fairly quick recovery. Unemployment has dropped from over 15% at the start of the pandemic to 4% presently. Could we have had a faster recovery without the huge inflationary consequences? Jason Furman, a former Obama administration economic adviser, believes that the $1.9 trillion stimulus package passed by Congress this spring went too far, even if it helped to speed up the recovery and put more people back to work.
FURMAN, JASON: I’d rather have high unemployment and low inflation than the other way around. I believe there were probably better options than either of those. I believe that if the stimulus package had been half as large, we would today have nearly the same amount of jobs and much lower inflation. Who knows, though.
HORSLEY: Federal Reserve Chairman Jerome Powell was also questioned about whether the Fed went too far. He claims that historians will have to decide on the wisdom of the central bank’s policies in years to come. In retrospect, his cigar-chomping predecessor, Paul Volcker, looks a lot better. Look out if Powell shows up to his next press appearance with a cigar in his mouth.
OLIVIA NEWTON-JOHN: Let’s get physical, let’s get physical, let’s get physical, let’s get physical, let’s get physical, let’s get physical, let’s get physical, let’ I’d like to engage in some physical activity. Let’s get down to business. Allow me to hear your body language, body language.
Why is Atlanta’s cost of living so high?
“Wage growth is high in a tight labor market, which implies people have more money and their purchasing power increases,” Hsu explained. “This will also raise the price level.” Housing costs have a significant impact on inflation. Atlanta’s housing demand is high, and so are prices.