Americans are increasingly worried that red-hot inflation will erode their purchasing power this year with the cost of living soon outpacing their income.
Moody's Analytics Chief Economist Mark Zandi explains what he believes is contributing to rising inflation and what could tame it.will erode their purchasing power this year, with the cost of living soon outpacing their income.
Traffic passes a downtown Los Angeles gas station where a gallon of gas costs more than $6, Dec. 10, 2021. Families are increasingly worried about the cost of everyday necessities like food, with 19% of survey respondents saying they are anxious about being able to pay for food and groceries. Almost all the respondents – 92% – agreed that the cost of groceries has increased recently.
By that measure, the typical U.S. worker is actually worse off today than he was a year ago, even though nominal wages are rising at the fastest pace in years. That's because inflation is also surging. The government reported Friday that the consumer price index rose 7% in December from a year ago, marking the fastest increase since June 1982, when inflation hit 7.1%.
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