markemark
Über Member
Can someone please help me out. I keep reading the same line:
When the rate of inflation falls, it does not mean prices are coming down - it means they are rising less quickly.
Now my maths tells me this may not be true so am I wrong? Inflation is measuring prices against the same month last year. I know that today prices are 6.8% higher than last year, but surely that doesn't necessarily mean prices are still rising (although they could' be)? Prices can be falling and less than last month, but still higher than last year giving us the published inflation figures. To know whether prices are rising or falling we need to compare the change of rates of inflation for now and last year, or simply look at the prices of this month compared to last month.
Eg:
Pint of milk: Jul '22 £1, Aug '22 £1.05, Jul '23 £1.10, Aug '23 £1.08
July inflation is 10%, August inflation is 2.9%. Price of milk is falling
What am I missing here?
When the rate of inflation falls, it does not mean prices are coming down - it means they are rising less quickly.
Now my maths tells me this may not be true so am I wrong? Inflation is measuring prices against the same month last year. I know that today prices are 6.8% higher than last year, but surely that doesn't necessarily mean prices are still rising (although they could' be)? Prices can be falling and less than last month, but still higher than last year giving us the published inflation figures. To know whether prices are rising or falling we need to compare the change of rates of inflation for now and last year, or simply look at the prices of this month compared to last month.
Eg:
Pint of milk: Jul '22 £1, Aug '22 £1.05, Jul '23 £1.10, Aug '23 £1.08
July inflation is 10%, August inflation is 2.9%. Price of milk is falling
What am I missing here?
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