Higher grocery and gas bills — how long will they last?

Consumer Report

SAVANNAH, Ga. (WSAV) – If you’ve been to the gas station or grocery store lately, you’re probably feeling the shock of higher prices, mostly blamed on rising inflation.

“So inflation is a general rise in price levels, and consumers notice this as they go along in their daily lives,” said Richard McGrath, Professor of Economics at Georgia Southern University.

The Consumer Price Index (CPI) is up 6 percent in the last year, which can provide the big picture on prices for most goods and services.

“But there are a few big categories that really matter to us,” said McGrath, “one is food and another is energy.”

He says food and energy inflation tend to bounce around on their own pattern, but core inflation is “really the trend for all others goods” — and now all three are up at the same time.

“The big surprise we’ve had in the past year is that even though food, energy and core goods generally have inflation rates that aren’t connected to one another is if they’re all going up at the same time, it really has a visible effect,” said McGrath.

He also says one thing plays on another.

“Food has gotten more expensive, in part, because energy’s gotten more expensive and transportation of food’s gotten more expensive,” he explained.

McGrath says this is mostly pandemic and supply chain-related.

“This isn’t a long-term thing; this isn’t multiple years of inflation we’re expecting. This is a short-term effect,” he said, “and as we return to some previous consumption patterns, we shouldn’t expect this to continue so much.”

McGrath says that doesn’t mean prices will drop anytime soon for groceries or gas. Cutting down on some food items and food waste can help you save some money, he says, but gas is a different story.

“The difficulty with gas is that it is one of the things we spend a lot of money on that is really least in our control,” said McGrath. “But as we return to whatever the new normal will be, that’s really going to reduce the inflation.”

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