Egg and bread prices have always been early indicators of economic inflation. Inflation is a decrease in the purchasing power of money, usually caused by an increase in the quantity of money and a decrease in the value of money.
lagging sense of trust
At the height of the most recent inflation period, which lasted from April 2021 to the present, inflation rose to 9.1% before things cool down. Confidence in the American economy began to wane as wages stagnated or declined while the prices of gasoline, food, and other goods rose.company Mass layoffs shuffled workersand everything looked pretty bleak.
Turnaround
Thankfully, inflation has started to decline, falling to 3.7% as of September 2023, much closer to the Federal Reserve’s level. Allowed annual inflation rate 2%.
Over the past year, Americans have weathered inflation with the same wallet-tightening strategies we use when money is scarce. However, although Japan’s economic situation has remained largely unchanged since mid-2023, the atmosphere is different.
good vibration
Although some indicators support greater confidence in markets, Americans’ attitudes toward the economy are changing.
Six months ago, the job market was strong, consumer spending was solid, and GDP growth was stable. Today, all of these indicators remain true. So what does that give?
The stock market is soaring, gas prices are falling, and the price of eggs always reflects how people feel about the economy.
Stocks, gasoline, and eggs – oh my!
The Dow and S&P 500 hit record highs this month, boosting confidence even among non-investors. Semaphore’s Jordan Wiseman notes media coverage of the San Francisco Fed Index, which tracks sentiment around economic news, and says positive economic sentiment began to build around the same time as the stock market last year.
According to AAA, gas prices have fallen to a national average of $3.096. It was $3.446 a year ago, down from its all-time high of more than $5 in 2022. Generally, people who spend less money feel better about the economy.
Last but not least is the egg price marker. People are notoriously sensitive to egg prices when going to the market. Since it is a familiar product that is purchased regularly, most people know the price, and when the price increases significantly, it attracts attention.
The national egg price in December last year was $2.51. At the same time, in 2022 he averaged $4.25. People pay particular attention to these prices, so when they start to drop, they notice that they can pay less for these everyday items and keep more of their money, which makes them feel good.
overconfidence
Feeling that the economy is doing well does not necessarily correlate with the fact that the economy is on a recovery trend. The economy can feel like it’s doing well even when it’s not, and vice versa. While the average American may feel secure about economic stability, they know that things are still getting better.of Purchasing power of the dollar remains lower than in 2019 For most Americans, it doesn’t matter how they feel about the economy.
The US government may want to push a positive tone narrative, but there is a long way to go before people feel the US economy has truly recovered from this last round of inflation.
