There is likely little doubt the cost of going to the gas station or the grocery is impacting your life and your wallet. The latest report from the Bureau of Labor and Statistics reports a 9.1% inflation rate, the highest since 1981.
That means goods and services are on average 9.1% more expensive today than they were 12 months ago. Groceries and gas prices continue to be the main contributors to such a high rate.
The data means that if your boss hasn’t given you a 9.1% raise recently, your paycheck is not going as far.
But how does our inflation compare with the rest of the world? If you’ve listened to reports out of the White House recently, you have heard a lot about how the U.S. inflation rate is bad, but it’s not as bad as in other places.
During a meeting with Mexico’s President Andres Manuel Lopez Obrador last week, President Biden said, “We are suffering from inflation imposed as a consequence of what’s going on in Ukraine, but we have the lowest rate of almost every major nation in the world.”
However, when you look at the latest numbers by the Organization for Economic Cooperation and Development, there are plenty of other countries with better rates than the U.S.
In Canada and Mexico, the rate of inflation is 7.7% and 8%, respectively. In Europe, Germany’s inflation is 7.6%, while France’s is 5.2%.
In Korea, inflation is at 6.0%, while in China, inflation was reported at just 2.2% in April.
In short, inflation is happening around the world and is not a uniquely American problem. However, there may be good news on the horizon.
Gas prices have fallen in the last 30 days in the U.S., and the country is now on pace for a national average of $3.99/gallon of gasoline by Aug. 14, according to analysts at Gas Buddy, a tech company that finds real-time gas prices.
$3.99/gal update… the national average edged a bit lower than our forecast, we're a bit ahead of the game so far… will keep our forecast line so you can see if we're ahead or behind of our projection. August 14 could be the date we fall back under $4! #gasprices pic.twitter.com/7zYUpnQayu
— Patrick De Haan ⛽️📊 (@GasBuddyGuy) July 14, 2022
If that holds, inflation will go down since gas prices are contributing so much to the number.
Additionally, Congress is negotiating a deal to possibly help with the cost of prescription drug prices. One proposal would allow Medicare to negotiate with drug companies for the very first time. That, possibly, could impact your wallet positively as well.
By Joe St. George, Scripps National.