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US Department of Labor reports largest 1-year consumer price index increase since 2008

One economist says the impacts of COVID on supply chains have led to the rise in prices of various goods.

JACKSONVILLE, Fla. — From groceries to gas, prices are on the rise for many goods.

The US Labor Department reports the consumer price index increased five percent since last May.

They call that the largest price increase over a year’s time since august of 2008.

Doctor Rody Borg, professor of economics and public policy at Jacksonville University says a lot of the world supply chains have been disrupted.

Companies moved toward keeping less stock on goods.

“A lot of the world’s production and supply chain mechanisms in the last 20 to 30 years have gravitated to a just in time mentality. Goods are produced, shipped just in time for delivery,” Dr. Borg says under normal circumstances that works because it keeps costs of storing goods down.

He says effects have been felt in the production of food, lumber and more recently, automobiles.

Dr. Borg says historically, inflation rates were higher in the 1970s and 1980s.

While the recent jump may be concerning, Dr. Borg says be smart about your money.

“Can you figure out ways to stretch your food budget? Can you minimize how much travel you have to do…Try to limit trips so you spend less money on gas, try to hold off on major purchases that could be impacted right now, and exercise some patience,” Dr. Borg said.

Dr. Borg estimates another few months before prices could go back down.

“I know the Federal Reserve System, they’re not panicked about inflation being in the 1 to 2.5 percent range…I think it’ll take at least six months to a year to get all these supply chain issues resolved,” Dr. Borg said.