Inflation slowing as consumer prices rose less than expected in November
TYLER, Texas (KLTV) - Inflation across the United States has slowed in the last month. In November, consumer prices rose 7.1 percent from a year ago. That’s down from 7.7 percent in October, and a peak of 9.1 percent in June.
“I think it’s a good sign,” said economist Ray Perryman. “Inflation is coming down now, and I think it will continue to come down in the first half of next year and get back to more manageable levels.” He said one of the most noticeable places we’re seeing a decline in is gas prices.
“They’re going down very significantly, and that’s been a big reason why inflation has come down so much,” Perryman said.
AAA Texas shows the statewide average for a gallon of regular unleaded gas is $2.65. That’s down 11 cents from a week ago, and down 25 cents compared to the same time last year. As for loans, a year ago Perryman said people could get a loan for less than three percent interest. Now, that loan is going to cost more than seven percent.
“By the same token, housing prices were going up very rapidly. Now they’re leveling off, in some cases even going down,” he said. “I would say that you’re probably going to see mortgage rates remain high for a few more months and then begin to come back down.”
New data from Freddie Mac shows mortgage rates this week fell for the fifth straight week -- with the rate on a 30-year fixed mortgage at 6.3 percent. Grocery prices are going up, and Perryman said this is due to supply issues and how the weather impacted crops and livestock. CEO of the East Texas Food Bank Dennis Cullinane said they are seeing an increase in the need for their services.
“When you think about it, the families’ finances are limited to their income, so it’s really an income problem, but the food budget seems to be the one that can be the most flexible, and when you have to make choices, that one’s the one that gets pinched. And, that’s where we and our partners come in,” Cullinane said.
Perryman said a combination of factors could lead to more declines in inflation in the early parts of 2023.
“The major thing that can bring them down is supplies are beginning to catch up. We’re not having the shortages that we had before,” Perryman said. “A lot of the excess spending that was taking place, the excess demand with all the stimulus money, is coming down some.”
Perryman said he believes long-term inflation is going to be a little higher than it was before because of the pandemic, but he said it should become more manageable within the next year or so.
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