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We spoke with the chair of the economics department at the University of North Florida to get his take on how inflation will change the cost of living.
JACKSONVILLE, Fla. — Inflation has increased, according to the latest numbers from September. Not by much (only 0.4%), but every little move hurts as inflation is the worst we’ve seen in 40 years.
Rent, food, and medical care cost more than they did a month ago. The Labor Department shows they’re on the rise.
We are hoping the old saying “what comes up must come down” will be true with inflation.
The economist we spoke to says the saying is true for some items, but other goods and services are forever changed in price.
“So inflation is a measure of the change in the average prices,” explains Dr. Russell Triplett. He is the chair of the economics department at the University of North Florida.
“What you’re saying may well hold true for some prices of some things, especially let’s say commodities – coffee prices, lumber prices, even gasoline prices – are the kinds of things that we know go up and down for a variety of reasons and we’ve experienced that regularly,” Triplett says. “What we are seeing with the inflation rate right now is that across a board array of prices on average they all tend to be or lots tend to be going up at a fairly remarkable rate.”
He says policy makers are trying to lower inflation from 8 percent to 2 percent. Even if successful, some prices won’t go back down. Triplett says that includes restaurants, hotels, travel, healthcare, and basically any service dependent industries.
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“What can they pass along to their customers? How much and in what ways?” Triplett says businesses are trying to answer those questions.
“Because those services are often very labor intensive, those price increases at least in large part are at least reflecting increases in wages and the tightness of the labor market,” he explains.
The big news is there is not necessarily an end in sight. We are stuck on a wait and see basis while we watch the actions from the Federal Reserve play out over time.
He says we may be seeing the impact of the rising interest rates come Spring.
In the meantime, he suggests continue budgeting with your family as usual, and do not make any drastic changes without talking to a financial planner first.
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