Minuk's Musings and Mission Accomplished?

Yes, it seems as though inflation is finally back under control.

 

After jumping to 9.1% (USA) and 8.1% (CAD) in July of 2022, inflation is now at 2.5% (USA) and 2% (CAD) as of August 2024.

 

Mission accomplished by central banks?

 

 

 

Some say yes, but allow me to be a little more cynical.

 

One problem with celebrating is that slowing inflation doesn’t mean prices are going down. It just means they are going up less quickly. Furthermore, the damage from inflation over the past 4 years is already done.

 

Today in the US, “stuff” costs about 21% more than it did in 2020 and that number is similar here in Canada.

 

Here’s a breakdown from eggs (+61%) to energy (+43%) to television sets (-22%).

 

 

Lastly, the chart below shows us the wild inflation ride we’ve been on over the past 5 years.

 

Canadian Inflation Rate (tradingeconomics.com)

 

 

Hope you have a nice weekend.

 

Rich

Investment Advisor