Jeff Fuentes Gleghorn
Inflation slowed down for the first time since November 2020 based on new data from the Bureau of Economic Analysis. The Personal Consumer Expenditure price index (PCE) showed that prices had increased by 6.3 percent in April compared to a year ago, a decrease from the 40 year high of 6.6 percent we saw in March. The PCE measures how much more people are spending on goods and services including food, gasoline, restaurants, medical services, cars, and even concerts.
Inflation has hit Wisconsin hard. Food banks in the state, like The River Food Bank, report that they are currently serving 20 percent more people than they were before the pandemic. Between the increases in food and gas prices, many Wisconsin residents are struggling to make ends meet each month, and are turning to local food banks for help.
Economists blame the COVID19 pandemic and the Russian invasion of Ukraine for the increase in prices. The pandemic interrupted supply chains for manufacturers, driving up the cost of raw materials and limiting how much of their product they could make. The increased cost of business combined with shortages on store shelves has driven prices up rapidly. The Russian invasion of Ukraine also caused problems in the global supply chain, particularly with gasoline, making the existing troubles worse. The PCE began climbing in November of 2020, and economists are hopeful that the drop in April means that inflation peaked in March and that the worst is behind us.