Your Money Matters: Inflation report shows 3% rise in prices since last year

The latest inflation report shows that overall prices have risen 3% since January 2024. While high egg prices continue to make headlines, other key factors are contributing to rising costs.

Auto insurance premiums have increased by 11.8% over the past year. For example, a six-month premium that was $300 is now more than $335, which could strain budgets for many households.

Housing costs remain a major driver of inflation, increasing by 4.4%.

Consumer spending impacts inflation

One factor influencing inflation is consumer spending. According to the U.S. Census, Christmas spending rose to nearly $1 trillion nationwide this past holiday season.

Wells Fargo economist Sarah House says that if Americans, particularly wealthier ones, continue to spend at high levels, companies have little incentive to lower prices.

Interest rates remain high

The Federal Reserve has signaled that interest rates will not decrease soon, making it more expensive to borrow money for homes and vehicles.