SAN DIEGO — A 1, 2, 3 punch to consumers this week in the battle between you and high prices: Gas, grocery, and housing prices are all up. And the feds are again concerned with inflation.
CBS 8 spoke with an economics professor at University of San Diego’s Knauss School of Business who says prices are high because the economy is booming.
But when we spoke with local San Diegans outside a grocery store, they weren’t so sure.
The Labor Department’s latest Consumer Price Index report shows an increase of 3.5% in March compared to last year. That’s the biggest spike in 6 months.
Alan Gin with the Knauss School of Business says despite what it may feel like, the economy is doing well.
“Prices are up 3.5% year over year nationally, but wages up 4.2%, year over year, nationally," he says. "The economy is strong in the sense that if you look at growth, and you look at the labor market, it's doing well. We get a negative consequence of that in the sense that prices are high."
And they are.
A trip to the supermarket in 2019 that would cost $100 now has shoppers shelling out around $133. Gas prices are also up. In San Diego County they’ve gone up every day for 25 days. The average price of a gallon of regular unleaded is now $5.35.
Not only are everyday essentials more, but the cost of borrowing money is expected to stay expensive. Because this week’s inflation report came back higher than hoped, an interest rate cut any time soon is off the table.
“I do expect the federal reserve to cut interest rates," Gin says. "Maybe not as fast and not as many times as people anticipated.”
He says the trade off is between inflation and a strong economy.
But he does point out some bright spots where costs are lower for people in San Diego than this time last year. The price of fruits and vegetables are lower.
Apparel prices are down. As are furniture and appliance prices.
WATCH RELATED: Gas prices on the rise in San Diego County