Spring, Texas Inflation rates in the United States recently hit their highest levels in 40 years. Arkhat Zhumadilov recently discussed why this inflation occurs and what consumers should expect.
Why Is Inflation Occurring?
Arkhat
Zhumadilov explained that this
rapid inflation is occurring due to the COVID-19 pandemic, which disrupted
supply chains around the globe. This disruption created a demand increase that
could not be met during the pandemic. However, as the pandemic subsides,
inflation is expected to stay high.
Zhumadilov added that inflation was low for many years, but
the economy reopening quickly, and high energy prices are also causing prices
to rise. Oil, electricity, and gas are now more expensive around the globe,
increasing the cost of moving goods from one location to another, and in turn,
increasing the cost of the goods themselves.
He explained that lifting restrictions on entering stores and
restaurants has led to consumers spending more money. Many businesses now
believe they can raise prices without losing their customers. The higher prices
aren't as much of a bother to people who couldn't go out and spend money during
the heart of the pandemic.
Is Inflation Here to Stay?
Arkhat
Zhumadilov explained that consumers should be prepared
for this inflation to stick around. The Bureau of Labor and Statistics stated
that high inflation rates are due to increases in the price of shelter, food,
and gasoline. Energy prices will continue rising, which will continue to
increase inflation.
Zhumadilov stated that the Russian invasion of Ukraine caused
a quick and substantial surge in oil prices. Gas is now at all-time highs, and
the price of gas will continue to affect the cost of other goods.
"Financial experts don't know how long this inflation
will last, but they see it sticking around for months to come," Zhumadilov said.
In the past 12 months, shelter costs rose 5 percent, overall
food costs rose nearly 9 percent, and grocery prices rose 10 percent. These are
increases that affect all Americans.
Financial Advisor Arkhat Zhumadilov
Zhumadilov
of The Woodlands, Texas in Montgomery County is a
financial advisor with decades of experience in the industry. He stated that
history has proven inflation will subside, and he anticipates energy prices to
decrease within the year. Lower energy prices will result in lower prices for
food and other items. The COVID-19 pandemic was unprecedented, and the
following invasion of Ukraine resulted in even more unique financial
circumstances. He stated that Americans may not see a decrease in prices in the
coming months, but they can expect a return to "normal" within
roughly a year or two.
read more: Roy Y. Gagaza