The price of goods and services in the U.S went up by 5% more in May of this year. We are now now in the midst of the highest inflation rate spike since 2008.
"If this continues over the next 6 months, we could be looking at an inflation rate of 7 or 8 percent. Which you would have to go back to the early 1980's to get that high of an inflation rate," said Professor Benjamin Keen.
Professor Keen said one of the driving forces behind the spike is the rise in car prices. A computer chip shortage has made producing new cars more expensive, and that has led to the prices of used cars going up as well.
Keen says it’s a sellers' market for cars right now. But if you’re looking to buy, it may be a good idea to hold off.
In the food industry, the labor shortage is causing prices to go up, according to Keen.
"The labor shortage is causing the wages to go up in those more limited-service restaurants you know your McDonalds and that is causing higher prices," said Keen.
Prices are also going up at the grocery store. Unilever, the maker of products like Dove soap said they have raised prices this year.
Keen said this inflation increase could have an impact on social security as well.
"So usually, they are used to 1.5 to 2% [Increase] they could see anywhere from 5 to 8% in their social security," said Keen.
Keen believes the price jump could be temporary, as the pandemic begins to wind down. But some high prices may be here to stay.
"When corporations are out seeing if they can pass along price increases and that isn't really going to impact demand that can be an indication that we've got some more permanent long run inflation," said Keen. "Those things have seen price increases of 4 or 5% we would expect that, that would be more representative of permanent inflation."