(NEW YORK) — Price hikes have battered the U.S. economy for months, straining household budgets and prompting an aggressive series of rate hikes from the Federal Reserve.
Inflation has sent prices sky high for just about everything: groceries, gas and rent, among other essentials. But some goods are getting hit harder by cost increases than others, and the cost increases are impacting some groups of people more than others.
In fact, Black and Latino people have been disproportionately affected by the set of goods hit hardest by inflation, in light of which goods those groups consume compared with their counterparts, according to a study released in June by the New York Federal Reserve.
Here’s a breakdown of which goods are getting hammered by inflation, and which purchases are escaping the worst of it:
Which products are getting hit hardest by inflation?
Those who have gone grocery shopping lately know that the prices for store-bought foods have jumped in recent months. The latest government data shows that food prices have outpaced the overall inflation rate, rising nearly 11% year-over-year in July. Costs have risen even faster for food meant to be consumed at home, which has seen a roughly 13% hike.
Bakers, beware. As of July, the price of flour and prepared flour mixes — when purchased in a U.S. city — has risen 22% over the last year, according to data from the Bureau of Labor Statistics. The cost of breakfast cereal has also gone up dramatically, rising 16.4% year-over-year. But those price hikes are preferable to what’s transpired with a common breakfast alternative, eggs, which have undergone a 38% price increase over the past year.
To get to the grocery store, many Americans hop in the car. If they bought a new car last month, it cost them over 10% more than it would have a year ago, outpacing overall inflation, government data showed.
Meanwhile, it takes one cruise past a roadside sign to know that gas prices have jumped significantly over the past year. While prices at the pump have fallen for nearly two months, they remain highly elevated. Gas prices have risen 26% over the past year, according to AAA data.
Which products are avoiding the worst of inflation?
As mentioned, overall food prices have increased sharply. But one silver lining has emerged in that category: food eaten away from home. As of July, when dining out, Americans encountered prices 7.6% higher than a year ago — a slower pace of inflation than the 8.5% year-over-year rate for goods as a whole.
Health care, meanwhile, has managed to escape nearly all of the steep price hikes. The medical care commodities index, a measure of the price of goods and services in health care, rose 3.7% year-over-year in July — that’s well below overall inflation and relatively close to the Federal Reserve’s target inflation rate of 2%.
Insurers and providers often negotiate health care prices well in advance, leaving them less sensitive to short-term pricing pressures.
Taken together, the overall price of goods has shown signs of moderating. In July, the consumer price index rose 8.5% compared with the same month a year prior. While still high, the year-over-year inflation rate eased from its breakneck pace in June, according to data from the Bureau of Labor Statistics.
On a monthly basis, the consumer price index rose 1.3% in July, remaining flat from the rise seen in June, according to the bureau.
The data offers hope to policymakers and consumers that inflation has peaked. But, as with rising inflation, a cooling off of price hikes will likely play out in uneven ways across the host of products that Americans buy each day.
Copyright © 2022, ABC Audio. All rights reserved.
