Topline
Inflation may be more palatable than years past heading into this Memorial Day Weekend, but some of the most essential items for the unofficial kickoff of summer 2024 continue to burn a hole in Americans’ wallets.
This year’s Memorial Day barbecue may be the most expensive one yet.
Key Facts
Inflation is sure to be a topic of discussion at Memorial Day barbecues nationwide later this month, with inflation now running at a hard-to-stomach 6% annualized rate over the last three years after coming in at 3.4% in April.
Though inflation is far better than April 2023’s 4.9% and April 2022’s 8.3%, it’s far above the historical average of about 2%.
Driving this year’s persistent inflation are some summer staples.
Steaks are 7% more expensive than they were a year ago, sports tickets are 15% pricier, car insurance and car repairs are more than 10% costlier and vices are denting wallets more heavily, too, as beer is 10% more expensive and cigarettes are 7% more expensive, according to the federal government’s consumer price index.
In the U.S.’ ongoing bout of inflation, which began in the spring of 2021 and is the most painful stretch of price increases since the Carter Administration, activities associated with summer fun have been among the hardest hit by inflation.
Plane tickets are 24% more expensive heading into summer 2024 than they were three years ago, gasoline is 28% more on average than it was in 2021, while cookout staples like meat (19%), alcohol (11%), and tobacco products (18%) are far more expensive than they were in recent years.
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Surprising Fact
Gas, which typically grows more expensive during the summer as demand increases due to an uptick in road trips, is actually one area where Americans are seeing some relief, as the average cost of a gallon of gas nationwide was less than 2% more expensive Friday than it was the same day in 2023, according to AAA.
Tangent
This may be the year to opt for a more Mediterranean grill session rather than the traditional burger and hot dog setup, as fresh fish and seafood is actually 2.7% cheaper than it was this time last year, according to government data, while raw beef is 6% more expensive.
Key Background
After nearly a decade of sub-3% inflation, prices began to shoot up in 2021, peaking at as high as 9.1% in June 2022. A variety of factors contributed to the painful price increases, including a rapid rise in global energy prices as the U.S. and its allies stopped importing Russian products in response to its Feb. 2022 invasion of Ukraine, increased finished goods prices as the pandemic upended supply chains and an injection of new capital into the economy via stimulus checks. About 41% of Americans believe inflation is the biggest financial issue facing their families, according to a recent Gallup poll. It’s highly unlikely that prices will ever come down to their pre-pandemic levels, as negative inflation is typically associated with painful recessionary periods, with central bankers instead targeting a more comfortable 2% inflation that boosts economic activity while keeping Americans’ wallets’ happy.