What a pot of gumbo can teach us about disinflation

The Indicator from Planet Money

NPR

Business

4.7 • 9.5K Ratings

🗓️ 3 January 2024

⏱️ 9 minutes

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Summary

News about inflation made a lot of noise in the past two years, but the national CPI reports seem to indicate that inflation is starting to normalize within the Federal Reserve's target range. However, the national CPI basket of goods can have trouble representing inflation at a local level.

Today, we're joined by Drew Hawkins of the Gulf States Newsroom as he goes to the supermarket in New Orleans where the national CPI may not be the best measure of inflation for folks living in the South.

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Transcript

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0:00.0	NPR. Okay class break out your pencils pull up a new word doc as you know here on the
0:16.5	indicator we love an econ vocab lesson and today's lesson is about the many
0:22.3	versions of inflation.
0:24.0	As we've all been painfully aware for years now, inflation means prices going up-up-up.
0:30.0	Simple, right?
0:31.0	And deflation means down-down. Welcome, Professor Drew Hawkins from the Gulf
0:35.8	States Newsroom. I am absolutely not at all a professor, but I can help us out with some
0:41.8	inflation vocab.
0:43.0	Okay, so if inflation means prices going up,
0:46.0	and deflation means prices going down.
0:48.0	Then disinflation is a bit more complicated.
0:52.0	Right, so basically disinflation means prices are going up, just not as fast as they were a year ago.
0:58.7	So instead of up up up up, up, it's more like up.
1:02.2	And that's what we have right now, disinflation.
1:04.7	And you know, this makes the Fed happy. It means they are getting closer to their
1:08.3	target of 2% inflation.
1:10.8	Right, but if you're a consumer shopping in the grocery aisle, this inflation means you're still
1:16.0	seeing the prices of things going up.
1:19.0	And to make things more complicated, how much those prices are going up or down can depend on where you live or what
1:25.8	you're cooking. This is the indicator from Planet Money I'm Whelan Wong and I'm
1:30.9	Drew Hawkins with the Gulf States Newsroom, a family of public radio stations in Mississippi, Alabama, and Louisiana.
1:37.0	On today's show, a look at what disinflation feels like in 2024 as we go on a shopping trip in my hometown of New Orleans.
	...

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