Just like that, 1/2 of 2023 is over. Despite inflation having dropped over that timeframe, mortgage interest rates are 1/2% higher than they were in January.
The Personal Consumption Expenditures Index published today was up 0.3% from last month and 4.6% from last June. Though higher than regulators want it to be, it’s only 1/2 of the 9.1% we saw last summer. To be clear, the average price of everything is 4.6% higher now than it was a year ago, but the rate at which the prices are rising has slowed 50% from that torrid pace.
Here’s a win though, Personal Income rose 0.4% last month and Personal Spending only 0.1%. So we’re saving the difference. Go us; we’re so practical. Should that trend continue though, inflation may return with a vengeance. Remember that it was the abundance of cash savings and lack of spending for so long during the early months of Covid that opened the spending floodgates in 2021 which brought on higher prices for everything. So be judicious in your own personal expenditures and it’s less likely that you will overpay for everything you need for the future.
