How much everyday prices have risen since 2020
Despite Thursday’s lower-than-expected inflation reading, the cost of everyday goods and services remains much higher than at the beginning of the decade.
Prices increased by 2.7 percent last year consumer price indexTracking changes in the cost of daily needs such as groceries, housing, clothing, healthcare and transportation.
While this marks a sharper-than-expected slowdown from the 3% pace in October and brings inflation closer to the Federal Reserve’s 2% target, inflation has remained above the Fed’s target since then. March 2021.
The cumulative impact of these increases continues to strain household budgets, says Scott Anderson, chief U.S. economist at BMO Harris Bank.
“We all compare our grocery bills to what our money could buy in 2019 and we don’t walk away with a warm and fuzzy feeling,” Anderson told CNBC Make It.
Overall prices have increased by nearly 25% since January 2020, according to CPI data; This is more than double the roughly 10% cumulative inflation seen in the previous five years.
feeling the squeeze
By most measures of federal income, wages have largely kept pace with inflation since 2020, according to a July 2025 report Report from Brookings. Still, not every employee sees these gains, Anderson says.
“Wage increases tend to be higher for high-skilled workers than for low-skilled workers and in sectors such as financial services, information services and manufacturing,” he says.
This uneven pattern may help explain why confidence remains weak despite relatively low unemployment and steady overall wage growth.
Consumer sentiment, a closely watched measure of household confidence near historic lowsBased on monthly University of Michigan survey. The survey asks households how their financial situation is compared to a year ago, whether they expect their financial situation to improve next year and whether now is a good time to make major purchases.
latest index reading It dropped to 51 in November; This level was last seen during the inflation surge in 2022, when the annual inflation rate peaked at 9.1%.
Similarly, a recent Bank rate survey It found that 32 percent of Americans expect their financial situation to worsen in 2026; This is the highest level of pessimism since the annual survey began in 2018. Almost two-thirds of survey respondents say inflation is their biggest concern, much more often than income, debt or interest rates.
“The cost of living still appears to be rising, with households paying more for food, electricity and housing than they did in the few years before inflation soared,” says Atsi Sheth, chief credit officer at Moody’s Ratings.
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