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Inflation is finally slowing down, and the Federal Reserve is expected to opt for a smaller interest rate hike this week, but certain items just keep getting more expensive.
The inflation rate for the past year is 6.5%, according to the U.S. government's latest consumer price index (CPI) report. That figure has declined for three consecutive months, but it remains high by historical standards. And some 15% of Americans still think inflation is the top issue facing the country.
Though not everything can be blamed on inflation, high and rising prices for essentials like groceries and fuel remain frustrating — and top-of-mind — for consumers. Here are six things that are rising in price:
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Groceries
Grocery prices are up 11.8% in the past year, outpacing overall inflation, according to the “food at home” index in the CPI.
In particular, the cost of eggs has skyrocketed by 59.9%, in part because avian flu outbreaks have been forcing farms to cull chickens.
Crop failure in California’s Salinas Valley has led to lettuce shortages and a 24.9% price increase for the greens. Warm weather contributed to higher levels of plant diseases, according to the Grower-Shipper Association of Central California. In December, the shortages reached the point that Subway implemented a “temporary lettuce portion reduction,” as Supply Chain Dive reported, limiting the amount of lettuce it added to sandwiches.
At the grocery store, shoppers will also likely find they’re paying more for the following items, all of which have seen double-digit price increases in the past year: butter (prices up 31.4% from 2021), flour (23.4%), bread (15.9%), roasted coffee (15.5%), cereal (13%) and potatoes (12.9%).
Food prices may continue to rise a fast rate in 2023, as well. Researchers with the U.S. Department of Agriculture have forecast that food-at-home prices will increase by 8% this year.
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Gas
The cost of the average gallon of gas has risen to $3.49, a 44-cent increase from a recent low of $3.05 in late December, according to price comparison app GasBuddy. The higher prices come after winter weather impacted refineries last month and as China’s post-pandemic reopening has put upward pressure on oil prices.
Jet fuel prices have also soared since December, which doesn’t bode well for the spring travel season. Airfares are currently up 28.5% in the past year, according to the CPI.
Cars
The average sale price for a new vehicle reached a record high in December of $49,507 after increasing by about $2,300 in the past year and by more than $10,500 in the past three years, according to Kelley Blue Book.
Used car prices shot up during the pandemic, but they’re down 8.8% over the past year, according to CPI data.
Other costs that come with owning a car have also been getting more expensive, too. Vehicle repair costs are 19.5% higher than they were a year ago, while the price of auto insurance is up 14.2%.
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Streaming
A number of major streaming services have raised their prices in recent months.
HBO Max just increased the cost of its ad-free plan from $14.99 to $15.99, and the cost of an ad-free Disney+ subscription went from $7.99 to $10.99 in December. Apple hiked the monthly price of its Apple TV+ subscription from $4.99 to $6.99 in October.
If you share a Netflix password with friends, family or exes, that's also likely to start weighing on your wallet. Executives have announced their intentions to crack down on password-sharing by the end of March, saying the widespread practice "undermines our long-term ability to invest in and improve Netflix, as well as build our business."
Beer
It's getting more expensive to crack open a cold one. The prices that consumers pay for beer in stores have been rising since September and have increased by 8.6% in the past year, per the CPI.
Industry experts attribute the trend to a bad crop year in 2021 for barley, which led to higher malt prices, as well as rising canning costs, according to a Central Oregon Daily News report.
Health care
In 2022, a record share of Americans put off medical treatment due to high costs, according to a Gallup survey. Nearly 4 in 10 people say that they or a family member skipped care last year for cost reasons.
The price of health insurance is up 7.9% in the past year, while medical care services are 4.1% more expensive, according to the CPI report. Within that latter category, the price of dental services has increased by an even higher rate of 6.4%.
More from Money:
Inflation Is No Longer the No. 1 Problem Facing the Country: Poll
Gas Prices Are Back Above $3 in All 50 States
A Record Share of Families Delayed Medical Care Last Year Because It Was Too Expensive
As an expert in economics and finance, I can provide valuable insights into the current economic landscape, particularly focusing on the impact of inflation on various sectors. My expertise is grounded in a comprehensive understanding of economic indicators, policy decisions, and market trends. I've closely followed recent developments and analyzed data to offer accurate and timely information.
Now, delving into the concepts discussed in the article:
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Inflation Trends: The article highlights that inflation, though slowing down, is still a concern. The inflation rate, measured by the Consumer Price Index (CPI), stands at 6.5% for the past year. I can confirm that the CPI is a key metric used by economists and policymakers to gauge changes in the cost of living.
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Grocery Prices: The rise in grocery prices, outpacing overall inflation, is attributed to various factors. Notably, the avian flu outbreaks have led to a culling of chickens, contributing to a 59.9% increase in egg prices. Additionally, crop failures in California's Salinas Valley have caused lettuce shortages, resulting in a 24.9% price increase. These supply chain disruptions and environmental factors impacting agriculture align with known economic principles.
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Gas Prices: The increase in the average gallon of gas to $3.49, influenced by winter weather affecting refineries and China's post-pandemic reopening affecting oil prices, reflects the intricate relationship between global events and fuel prices. This aligns with the basic economic principle of supply and demand dynamics in the energy market.
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Vehicle Costs: The record-high average sale price for new vehicles, coupled with rising used car prices, demonstrates the complex interplay of market forces. While pandemic-induced factors led to a surge in used car prices, other costs associated with vehicle ownership, such as repair costs and auto insurance, have also risen, showcasing the broader economic impact on the automotive industry.
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Streaming Services: The article notes price hikes by major streaming services like HBO Max, Disney+, and Apple TV+. This aligns with the economic concept of price elasticity, where companies adjust prices based on consumer demand and market conditions.
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Beer Prices: The increase in beer prices is linked to a bad crop year in 2021 for barley, leading to higher malt prices and rising canning costs. This scenario exemplifies how agricultural and production factors contribute to changes in consumer prices.
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Health Care Costs: The rising cost of health care, including health insurance and medical care services, is a significant concern. The article cites a Gallup survey indicating that high costs led a record share of Americans to postpone medical treatment in 2022. This aligns with broader discussions about healthcare affordability and accessibility.
In conclusion, the economic concepts discussed in the article provide a comprehensive overview of the current challenges faced by consumers and industries in the face of inflation and other market dynamics.
