ROANOKE, Va. (WFXR) — Roanoke economics experts say a recent spike in the monthly cost of goods will likely decrease naturally.
Gas prices are starting to inch down already, but the cost of many other goods are still high.
The Consumer Price Index shows over the last 12 months the cost of goods has increased five percent monthly before the seasonal adjustment. This is the largest yearly increase recorded since August of 2008.
Experts say a huge contributing factor to the inflation spike is the increase cost of used cars.
Prices this time last year were much lower. Pandemic shut downs, and restrictions throughout last year, allowed some people to save money. Now they are spending it, but the demand cannot keep up in some cases, which is causing shortages.
In Roanoke, the most recent example is when the Colonial Pipeline was hacked and people rushed to the pump, which in turn caused a shortage all because people were panic-buying.
Economists say lumber prices also sky rocketed.
Roanoke College Economics Professor Dr. Alice Louise Kassens says spending is causing the spike.
“We have this huge surge in post-pandemic demand for all kinds of business services, not just cars and trucks, but entertainment including restaurants and hotels.”
Dr. Kassens believes the inflation will die off shortly.
In the long-term, she hopes government assistance and stimulus efforts will allow people to keep spending.