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If you feel that you’re still spending more while getting less at virtually every establishment you visit, you’re likely not alone.
“The primary issue is that since January 2020, the average price for everything you and I purchase has risen by 25%,” stated Torsten Sløk, chief economist at Apollo Global Management, during a discussion with Yahoo Finance Executive Editor Brian Sozzi on the Opening Bid podcast (see video above; listen below).
Sløk’s extensive career has centered on understanding the perspectives of investors and consumers. Today, numerous individuals are examining the rising costs of all goods, including groceries. The consensus is that prices still appear to be on the rise.
Recent data from the January Consumer Price Index (CPI) showed a year-over-year increase in inflation of 3%, along with a 0.5% rise from December. This leads to the most significant month-over-month CPI increase since August 2023. Core prices for things like insurance, medical care, and vehicles saw an increase of 3.3% compared to last year.
Egg prices, which continue to be closely monitored in the report, jumped by 15.2% compared to December, marking the highest monthly increase since June 2015.
Read more: From $5 eggs to rising insurance costs, here’s where expenses are climbing
Diving deeper, egg prices rose by 53% year over year, leading some analysts to assert that they are at their highest in 45 years. A significant factor behind the surge in egg prices is the severe bird flu outbreak, which has affected many in the poultry and egg sectors.
At the start of last year, the average cost for a dozen eggs was $2.52. Some bodegas in New York City have even adopted a “loosies” strategy, offering customers the option to purchase single eggs instead of a dozen.
Sløk mentions that while inflation may slow down (currently at about 3%, down from a peak of 9%), “you typically will not see the overall price level decrease. Prices are high now, but historically, it’s rare to see aggregate prices go down.”
“We shouldn’t desire that, because in such a scenario, if we face a severe recession like in the 1930s, where deflation occurred,” he stated, “the unemployment rate back then was 20%. I’d prefer to keep my job and pay a bit more.”
He continued, “It feels costly because housing prices are high, tuition fees are high, and healthcare is expensive. These are some of the areas that have seen the most substantial hikes over the past five years.”
