Braking Down The News

Short-Lasting Inflation Depends on Long-Lasting Goods

The Fed blames rising inflation on an unusual jump in the price of durable products like cars and electronics, which it says won’t last

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For decades, Americans have enjoyed falling prices for cars, electronics and furniture.

Until the Covid-19 pandemic, that is. For the past year, prices for durable goods have been rising—and not just by a little. Whether those prices come back down is a key part of the puzzle facing the Federal Reserve as it plots how to handle an unexpectedly strong burst of inflation.

 

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