Inflation Slows but Prices Still Climbing Compared to Pre-Pandemic Levels
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Inflation has fallen from its peak but prices are still rising, just more slowly. The Fed aims for 2% inflation, not deflation.
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Prices have risen 19% since February 2020. Some items like groceries have gone up much more, while others like airfare have fallen.
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The Fed has tools to prevent sustained price decreases. It flooded markets with money during recessions to avoid deflation.
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Americans want deflation to pre-pandemic prices, but the Fed is unlikely to allow that. Officials see falling prices as economically destructive.
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Within the inflation average, necessities have gotten more expensive while some other prices have fallen or been stable.