With the rising costs of groceries, many Americans have taken to growing food at home. 43% of Americans are now growing food at their homes, up from 33% of Americans in 2019, according to the National Gardening Association.
“According to the U.S. Department of Agriculture, at-home food prices increased by 11.4% in 2022. In 2023, it increased by another 5.8%,” Spectrum News noted.
This week, Federal Reserve Chair Jerome Powell acknowledged that the Fed’s goal of diminishing inflation to 2% is proving more difficult to reach than heretofore projected.
In March, for the third consecutive month, the core consumer price increased. It advanced 0.4% from February and 3.8% from the year before.
“The recent data have clearly not given us greater confidence and instead indicate that is likely to take longer than expected to achieve that confidence,” Powell said. “Given the strength of the labor market and progress on inflation so far, it is appropriate to allow restrictive policy further time to work and let the data and the evolving outlook guide us.”
Powell has been blamed for saying interest-rate cuts would be forthcoming, thus catalyzing economic activity.
“They just got the inflation picture wrong,” Stephen Stanley, chief US economist at Santander US Capital Markets LLC, told Bloomberg. “The mistake they made was they got really enamored with the combination of really strong growth and benign inflation that we saw in the second half of last year.”
Another cause of stubborn inflation has been the lack of available housing. Some homeowners grabbed inexpensive mortgage rates during the pandemic and now are reluctant to move.
A third possible cause: insurance costs. “Tenants’ and household insurance is rising at the fastest rate in nine years, while auto insurance skyrocketed 22.2% in the year through March, the most since 1976,” Bloomberg noted.
Powell “is entertaining the possibility that disinflation has indeed stalled, and that the bar for cutting rates may have increased,” Anna Wong, chief US economist at Bloomberg Economics, commented. “That raises the risk that there won’t be a rate cut this year, if the unemployment rate is little changed from today.”
