Inflation is on everyone’s minds these days and with good reason. Prices have risen 6.2% over the last year and are likely to continue to rise well above the Federal Reserve’s 2% target at least into the middle of next year.
Why it matters: Food prices are a major concern for consumers:
- The Farm Bureau estimates the cost of Thanksgiving dinner is up 14% from last year.
- Turkey has risen over 9% since last year alone. It could cost more than $1.50 a pound next year, meaning a 16-pound turkey would be $22.80.
Looking ahead: It’s likely we’ll be paying more for necessities next year. Assuming 4% inflation on top of the past year’s 6.2% and assuming the composition of future inflation remains the same, next year:
- Bacon could be $8.27 a pound.
- Gas could rise to $4.47 a gallon.
- Milk to $3.76 a gallon.
- A washing machine could be almost $658.
Bottom line: Taming inflation is important for many reasons, but the squeeze it is putting–and will continue to put–on family budgets is at the top of the list. The last thing we need is Congress passing the multi-trillion-dollar, tax-and-spend reconciliation bill.
—Curtis Dubay, Senior Economist, U.S. Chamber of Commerce