Inflation Drops From Peak but Still Double Target Rate

( – Americans continue to be burdened by high and ever-increasing prices. A 2% rate of inflation, long touted as the Federal Reserve’s target number, missed its mark by doubling, according to reports released for the month of May. A yearly basis analysis showed that prices rose by 4%. While this was lower than what some economists had forecast, it was only fractionally so, with their estimate being off by only 0.1%.

The consumer price index, the Labor Department’s monthly measure of commonly used goods like food, fuel, and rent, showed a slower rate of increase in May than that in April, but an increase nonetheless of 0.1% month over month. Peak inflation reached 9.1% in June of 2022 and although this month’s lower numbers are likely welcome to consumers, economic circumstances more than halfway through a Biden Presidency are forcing large amounts of the population from all demographics to take second and third jobs.

Whereas side hustles were once a convenient way to earn discretionary income, many working adults now both rely on and expect to continue to have to rely on their additional jobs to handle routine monthly obligations and living expenses. According to a recent survey, 39% of working adults now have a side gig they consider essential. Of that number, 28% believe they will always need the extra job to pay their bills.

Investors are expecting Federal Reserve Chairman Jerome Powell to announce a pause on interest rate hikes in June, but regardless of a pause or further hikes, the central bank’s actions would not negate the fact that they have already raised rates 10 times in succession in an effort to tame rising inflation.

Economist Robert Fick says that while May’s numbers fell, “the report contains plenty of pain.” He went on to then say that because of the nature of goods and services affected by inflation, lower-income adults are especially affected.

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