Even a year down the line, the record inflation rate continues to assail low and middle-class America. Prices went through the roof when inflation crossed 8$ in the first quarter of this year and has stayed at that level ever since. The complete absence of stimulus checks from the federal government in 2022 further made matters tough for America.
Americans continued to struggle with high rates of hoods and services that covered everything from groceries to gasoline. Even the latest figure has been just as grim for Americans as prices in November 2022 increased by 7.1% year-on-year compared to November 2021 as revealed by the 12-month percentage of change in the consumer price index, which is the monthly inflation rate for services and goods in the United States.
But some economists see a silver lining in the November 2022 figures as US consumer prices rose less than expected for the 2nd straight month this month amid a marginal decrease in the cost of healthcare and gasoline. The minimal slide has also been felt in the price of used cars and trucks. This has led to the smallest annual spurt in inflation in close to a year.
Underlying consumer prices to have advanced by the lowest in 15 months, as reported this Tuesday by the department of labor. This will pave the way for the Federal Reserve to begin scaling back the size of its interest rate hikes this Wednesday.
Though American continue to face high costs for rental housing, financial experts expect a moderation in figures in 2023. The figures were released by the federal government even as an official at the US Federal Reserve, the central bank, gathered for a final 2-day policy meet scheduled for the year.
The Federal Reserve is in the middle of its fastest hike in the rate cycle since the early 1980s. it is expected to lift its benchmark overnight interest rate on Wednesday by 50 basis points. This will lead to a string of 4 straight 75-basis-point increases. Experts still expect the Federal Reserve to maintain its tightening of the monetary policy campaign at least through the first three months of 2023.
Marginal Decrease In Prices For The First Time In Year Raises Hopes In Absence Of Stimulus Checks
Senior economists said the broad improvements rekindle hope that the sustained pressure on prices is easing and the Federal Reserve will not have to tighten rates as much by the spring of 2023. But it is nowhere near the compelling inflation improvement that Federal Reserve chairman Jerome Powell has talked about and he needs more convincing before the Fed can pause soon.
There has been a drop in gasoline prices by 2% while the prices of electricity and natural gas also fell. A marginal increase has been felt in the rice of food (0.5%), but it is the smallest since December 2021, after a rise of 0.6% in October 2022.
The cost of foods consumed at home by Americans also eased marginally by 0.5% and was driven by an increase in the price of vegetables and fruits, non-alcoholic beverages, and cereals. But the prices of eggs, fish, and meat continued to come down.
The decline in the prices of most products has been welcomed by President Biden who said he welcomed the decline in the price of gasoline and moderation in the price of food items days ahead of the festive season.
In a statement, the present said that there is no doubt that prices continued to be way higher than normal though the situation was improving and appeared to be headed in the right direction.
State Stimulus Checks Continue Into Festive Season Amidst Easing In Inflation Rates
California has led the way in the last quarter of 2022 with a generous stimulus check that has covered 60% filers of households in the Golden State. though the state started sending out its Middle-Class Tax Rebate in the first week of October, it is expected to continue mailing out inflation stimulus checks through the middle of January 2023. Though the number of states sending out stimulus checks is low, several of them are sending residents a bonus tax refund or stimulus check and back them to face the onslaught of the ongoing record inflation.
Massachusetts has just begun returning surplus tax revenues of $3 billion in November. The payments are equal to around 14% of the state income tax liability of an individual in 2021. The stimulus checks are expected to continue through the middle of December 2022.
South Carolina has also started issuing multiple forms of stimulus checks that include debit cards, direct deposits, and printed checks that could be as much as $800 in October and will continue through the end of the year. The rebate in income tax for the state was approved by South Caroline lawmakers as part of the annual state budget of $8.4 billion.
You could still be in line for a stimulus check in the form of direct deposits, paper checks, debit cards, or even income tax rebates.
California Stimulus Checks To Continue Into January 2023
The Golden State started sending out the third round of state stimulus checks though the latest one is different than the earlier Golden State stimulus checks I and II. Around 23 million residents, around 60% of the total population, have received the third round of stimulus checks, the Middle-Class Tax Rebate that could go up to $1,050 for a married couple filing jointly and with dependents. The state stimulus checks have been divided into three tiers based on the Adjusted Gross Income of residents in their 2020 income tax returns.
Residents who filed their 2020 income tax returns by October 15, 2021, only are eligible for the stimulus checks. Residents with an AGI of below $75,000 individually will get a $350 stimulus check along with an extra $350 if they declare any dependent in their 2020 state income tax returns.
For married couples filing jointly and with an AGI for 2020 less than $150,000, the stimulus check can reach up to $1,050, with $350 for each filer plus another $350 for any dependents. Residents with an individual AGI of above $250,000 and joint filers with a combined AGI of above $500,000 for 2020 will not receive any stimulus checks.