The 2025 Inflation Numbers Are Finally In. Here’s the Good and Bad News.

Gasoline prices are down, but rising grocery costs continue to weigh on consumers

By Rachel Wolfe and Drew An-Pham of The WSJ. 

I have done several posts on how people have been dealing with the inflation of the last few years as well as how they have been affected. Those are listed after some excerpts from the article.  Many of the things consumers are doing involve more time and effort doing things they would not normally do. This is one of the costs of inflation, what we have to do to avoid it or mitigate it.

If you click on the link to the article you can read about some of the particular changes in supply and demand that caused these price changes. 

Excerpts:

"Overall inflation decelerated over the course of 2025, from 2.9% year-over-year in December 2024 to 2.7% last month. Core inflation, a measure that excludes the more volatile food and energy prices, fell even more steeply, from 3.2% to 2.6%."

"food-at-home prices up 2.4% from a year earlier in December, an acceleration from 2024’s increase of 1.8%."

"egg prices down by 21% in 2025."

"Coffee prices were up nearly 20% last year"

"beef and veal prices up by more than 16%."

"Subscription streaming services and videogame rentals rose 29% over the year"

"Tariffs helped drive inflation on categories in which prices increased last year: furniture and bedding, car parts and audio equipment, Barclay’s economist Pooja Sriram said."

"Apparel, for example, rose only 0.6%. Toys were up 0.8%. And new cars increased 0.5%.

Inflation in rental housing has been slowing"

Related posts:

The Middle Class Is Buckling Under Almost Five Years of Persistent Inflation: Workers growing tired of economy in which everything seems to get more expensive (2025) 

The Lengths Americans Are Willing to Go to Make Every Penny Count: From buying half a cow to watering down soap, people are experimenting with frugality—and it is affecting sales at consumer companies (2025) 

Are you hurting the economy if you bring your lunch to work? (2025)

More people are bringing their lunch to work because restaurant meals have been going up in price. Again, more tasks that people are performing to avoid inflation 

Inflation Has Cooled, but Americans Are Still Seething Over Prices: Many people—though not all—saw wage increases that kept pace with the pandemic’s rapid price hikes, but the psychological toll remains (2024)

Child Care, Rent, Insurance: Where Inflation Hits Hardest Now (2024)

Why do workers dislike inflation? (2024) 

"workers must take costly actions (“conflict”) to have nominal wages catch up with inflation" They have to bargain with or fight their employers to get a wage increase to match inflation.

Inflation Usually Hits Harder for Poor Families. For a Couple of Years, It Didn’t. New research on how inflation varies between the poor, middle class and rich paints a different picture of poverty and inequality (2024)

The Haves and Have-Nots at the Center of America’s Inflation Fight: There’s a growing gap between Americans who are battered by high inflation and interest rates and those who are actually benefiting (2024)

An Increase in Uninsured Drivers Is Pushing Up Costs for Everyone Else (2024) 

Inflation has caused consumers to choose what they need to cut back on (insurance)

Costco and Sam’s Club Aisles Are Full of Gen Z Shoppers (2024)

Consumers are buying in bulk to save money by getting a lower per unit price

Inflation is mentally taxing (2024)

Inflation is mentally taxing. Dealing with a straitened budget exacts a psychological toll as well as a financial one

Store Brands Are Filling Up More of Your Shopping Cart (2024) 

People are on the look out for cheaper alternatives due to inflation

Consumers Fed Up With Food Costs Are Ditching Big Brands (2024) 

After years of price increases, food companies say more consumers pull back; fast-food chains and snack makers plan new deals and flavors

Are Americans Worrying Too Much About Inflation? Two opposing views (2024)

The Era of One-Stop Grocery Shopping Is Over (2024)

One thing that I always talked about with inflation was that one of its costs was all the things we had to do to avoid it. Consumers are making 8% more trips to different retailers as inflation continues to upend household budgets. They are going to more stores to find lower prices. But it costs time to do that and probably more money on gas.

When workers were paid twice a day and given half-hour shopping breaks (Germany, 1923) 

By mid-1923 workers were being paid as often as three times a day. Their wives would meet them, take the money and rush to the shops to exchange it for goods. However, by this time, more and more often, shops were empty. Storekeepers could not obtain goods or could not do business fast enough to protect their cash receipts. Farmers refused to bring produce into the city in return for worthless paper. The requirements to calculate and recalculate commercial transactions in the billions and trillions made it practically impossible to do business in paper Marks.