A recent study from Moody's Analytics demonstrated that inflation is causing the average U.S. household an extra $296.45 in expenses a month, Fox News reported on Friday.
Senior economist Ryan Sweet compared the average spending of U.S. households in February to what would have been spent in 2018 and 2019 when inflation was around 2.1%.
"There is no doubt that the Federal Reserve will increase the target range for the fed funds rate later this month as higher energy prices are making the central bank's problems even worse," Sweet wrote in the study. "The Fed will respond."
The analysis follows the release of new Labor Department data showing that consumer prices spiked 7.9% last month, a Thursday news release revealed.
Inflation hit a 40-year high in February, not taking into account data following the Russian invasion of Ukraine towards the end of the month, which has substantially disrupted the oil and gas supply chain, according to Bloomberg.
"Inflation is not likely to roll over and begin to come down for several more months," Michael Gapen, chief economist at Barclays Plc, told the network. "This sets the stage for where we are now. And we need to see how long this conflict plays out and how disruptive the sanctions regime actually is."
Almost every category of goods and services grew more expensive from January to February. Gas jumped 6.6%, accounting for nearly a third of price hikes, with the cost of fruits and vegetables rising 2.3% — the most significant monthly increase since 2010, the Thursday report revealed.
In addition, inflation is now outpacing the rate of pay raises for most Americans.
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