{"id":8813,"date":"2023-05-15T07:05:10","date_gmt":"2023-05-15T11:05:10","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/if-inflation-is-slowing-why-is-everything-so-expensive-four-facts-to-help-you-understand-inflation-right-now\/"},"modified":"2023-05-15T07:05:11","modified_gmt":"2023-05-15T11:05:11","slug":"if-inflation-is-slowing-why-is-everything-so-expensive-four-facts-to-help-you-understand-inflation-right-now","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=8813","title":{"rendered":"If inflation is slowing, why is everything so expensive? Four facts to help you understand inflation right now."},"content":{"rendered":"
\n

This article is reprinted by permission from <\/em>NerdWallet<\/em>.\u00a0<\/em><\/p>\n

Inflation in April continued its steady cooldown, but its slow pace shows it\u2019s still resilient, too, according to the Bureau of Labor Statistics\u2019 latest consumer price index report released last week. Here\u2019s what else you need to know.<\/p>\n

\n

1. Inflation has slowed for 10 months straight<\/strong><\/h2>\n

April marked the 10th month in a row of overall inflation decreases.<\/p>\n

The\u00a0consumer price index\u00a0for all items rose 4.9% for the past 12 months throughout April, down from 5% in March. It\u2019s a small decline, but it makes April the lowest annual increase since April 2021. That includes the peak for overall CPI at 9.1% in June 2022.<\/p>\n

The month-to-month increase was up slightly: 0.4% for April compared with 0.1% in March.<\/p>\n

More<\/strong>: Rate hikes haven\u2019t brought inflation down to the Fed\u2019s 2% target. Here\u2019s what the central bank could do next.<\/p>\n

2. Core inflation is now higher than overall inflation<\/strong><\/h2>\n

Annual core CPI, which excludes food and energy, decreased from 5.6% in March to 5.5% in April. But for the second time in nine months, the core CPI is higher than the overall CPI rate, on an annual basis.<\/p>\n

Why would core inflation overpower overall inflation? When you remove food and energy, services remain elevated. The index for services is still up 6.8% over the last 12 months, including shelter, transportation and medical care.<\/p>\n

3. Blame the increase on gas, rent and used cars<\/strong><\/h2>\n

Energy was showing signs of slowing with a 3.5% decline from February to March, but it\u2019s now up 0.6% in April. The increase was primarily due to gasoline, which rose 3% in April after a 4.6% decline in March.<\/p>\n

But when you zoom out, over the past 12 months, both have seen declines: energy is down 5.1% and gas, specifically, is down 12.2%. Other energy markers have also decreased since April 2022, like natural gas (down 2.1%) and fuel oil (down 20.2%). But the index for electricity is still high: up 8.4% on an annual basis.<\/p>\n

The other most volatile price index is\u00a0food, which remained unchanged from March, but is still up 7.7% over the last 12 months. Prices for food-at-home \u2014 groceries \u2014 have fallen for the second straight month, but remain elevated annually at 7.1%.<\/p>\n

When you remove food and energy from the equation, the April increase was primarily caused by shelter, which increased 0.4% from March to April. That\u2019s down from the 0.6% increase from February to March, but the big picture is the 12-month increase. On an annual basis, shelter is up 8.1%.<\/p>\n

Another primary contributor to\u00a0inflation\u00a0right now is used cars and trucks, which were once a persistent contributor to inflation. This index declined 0.9% from February to March. But this month is a little different: In April, used cars were up 4.4% from March. And the 12-month decline is now 6.6%, significantly less than in the previous month when it was down 11.2%.<\/p>\n

Related<\/strong>: Car prices are still rising. But some economists insist they have peaked. Here\u2019s why.<\/p>\n

4. Inflation is slowing, but not as fast as the Fed would like<\/strong><\/h2>\n

The new data should be a welcome sign to the Federal Reserve that inflation continues to decline. The central bank has been the primary challenger for inflation, hiking the federal funds rate 10 times since March 2022. The most recent increase May 10 puts the rate at a range of 5% to 5.25% \u2014 the highest since 2007.<\/p>\n

These hikes are meant to drop inflation to the Fed\u2019s long-run inflation target of 2%. Current inflation is 4.2%, per the Fed\u2019s preferred metric, the\u00a0personal consumption expenditures\u00a0index. The PCE rate for April will be released May 26.<\/p>\n

See<\/strong>: The Fed is trying to get inflation back down to 2%, but is that too low for the good of the economy?<\/strong><\/p>\n

More From NerdWallet<\/strong><\/p>\n

Anna Helhoski writes for NerdWallet. Email: anna@nerdwallet.com. Twitter: @AnnaHelhoski.<\/em><\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

This article is reprinted by permission from NerdWallet.\u00a0 Inflation in April continued its steady cooldown, but its slow pace shows it\u2019s still resilient, too, according to the Bureau of Labor Statistics\u2019 latest consumer price index report released last week. Here\u2019s what else you need to know. 1. Inflation has slowed for 10 months straight April […]<\/p>\n","protected":false},"author":1,"featured_media":8814,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[236],"tags":[83],"class_list":["post-8813","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-news","tag-featured","post_format-post-format-gallery"],"yoast_head":"\nIf inflation is slowing, why is everything so expensive? 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