How Much Does Inflation Vary by Income? Depends on How It’s Measured

The brief’s key findings are:

Today’s high inflation rates raise the question of how inflation impacts households differently by income.
To explore this issue, the analysis combines data from the Consumer Price Index (CPI) and the Consumer Expenditure Survey.
The results show that low- and high-income households face roughly similar inflation rates for items included in the CPI.
However, the rich can afford to save more, so a sizable share of their income is not exposed to inflation today.
While they will eventually spend their savings, they will have years to rearrange their spending patterns.

Briefs