Official US inflation data, reported by the government this week, shows a level of 8.6%. This is the fastest growth when considering the year-to-year period in more than 40 years.
The number is frightening, considering that economists and market analysts believed that inflation had peaked in March at 8.5% and would begin to decline in April and May.
Price increases over last year (CPI report)...— Charlie Bilello (@charliebilello) June 10, 2022
Fuel Oil: +106.7%
Gas Utilities: +30.2%
Used Cars: +16.1%
New Cars: +12.6%
Food at home: +11.9%
Overall CPI: +8.6%
Food away from home: +7.4%
We saw 8.3% in the April report, but May's numbers surprised experts' expectations to the upside. Not only does it not seem to have peaked yet, but it continues to accelerate further.
The ones who suffer the most are middle-class American families, who have seen their purchasing power decimated. The cost of food at home soared 11.9% in the last 12 months. Gasoline rose almost 50% over the same period.
Rents are up more than 15% nationally and home sales prices are up more than 20%.
To make matters worse for the middle class, the wages of American workers have not been able to keep up with historical levels of inflation. In fact, the inflation-adjusted average hourly wage of American workers has been negative for more than a year.
So on the one hand we have the cost of goods and services increasing dramatically, and on the other hand wages not being able to keep up. A disastrous scenario for millions of families.
Without the right education, the poorest 45% of Americans are financially disadvantaged during these high-inflation times. They have no assets to invest and live with 100% of their savings in US dollars.