Inflation: decline of a currency’s purchasing power. Derived using the change in the consumer price index (CPI), created 1919. Changes in CPI determine inflation rate.
Economies form households and fuel apartment supply and rents.
Inflation outpaces wage growth. Average hourly and weekly earnings of employees on private nonfarm payrolls; consumer price index.
The pandemic caused inflation and inflation won’t normalize until 2022 Q3, said Treasury Secretary Janet Yellen. President Biden’s $1.9 trillion spending bill is only a small factor in inflation she added.
As the Federal Reserve prints money, prices rise because there’s an artificial stimulus for demand. Inflation is caused by too much government spending and too much debt, said Sen. Rand Paul.
Inflation is not equal opportunity
Inflation rose more in some areas of the country than in others. Midwesterners saw relatively higher housing costs in October, with rent, natural gas and home furnishings rising faster than in other regions. Rental prices in Northeastern states, by contrast, grew slower than elsewhere last month.
CPI by category, y/y change
- 6% gas (all types)
- 2% home energy
- 1% new vehicles
- 6% fast food
- 4% groceries
- 5% furniture
- 5% apparel
- 8% rent
- 7% medical
- 9% alcohol
Household income growth was slower that official metrics suggested. Percent change in real household income growth by quintile, after adjusting for inflation.