CPI came in cooler than expected again today — the fifth consecutive month where monthly inflation has surprised to the downside.
That’s undoubtedly welcome news for consumers and markets alike.
But it’s important to keep perspective: inflation is cumulative. Month-over-month figures only compare today’s prices to last month’s — not to where we were a few years ago.
When you zoom out, the story changes.
Since May 2020, prices have risen 25.3% — the highest five-year inflation rate we’ve seen in over 40 years, rivaling the double-digit inflation era of the 1980s.
Wondering why everything still feels so expensive? Why it feels harder to get ahead?
Look at your paycheck from five years ago. If your current income hasn’t increased by at least 25%, you’ve lost purchasing power. In real terms, you’re earning less than you did in 2020.
So yes, we can welcome cooler CPI prints. But let’s not forget: the inflation shock of 2021–2022 left a deep mark — and it will take time for households, wages, and the broader economy to fully recover.
