The current inflation spike now appears to be on track to persist deep into 2022.
Gas prices nearing $5 per gallon are displayed at Valero and Chevron stations on Oct. 12, 2021 in Mill Valley, Calif. | Justin Sullivan/Getty Images
By MEGAN CASSELLA
10/15/2021 04:30 AM EDT
Americans are likely to face higher prices on everything from gasoline to groceries well into next year — threatening to turn a simmering economic issue into a major political one.
The rapid reopening of the economy this summer led to massive price hikes for travel services, used cars and other goods that were initially dismissed as fleeting phenomena. But the inflation spike now appears to be on track to persist deep into 2022, when midterm elections will determine who controls Congress, as clogged supply chains, labor shortages and unabated consumer demand push costs even higher.
“Higher inflation is reasonably likely through at least next year,” said Jason Furman, a top economic adviser to former President Barack Obama who is close to the Biden administration. “And once you’ve had two years in a row of higher inflation, it may take on some momentum of its own.”