Inflation went from 8.6% to 2.4%. What happened to prices?
Commit to an answer. This is the single most misread number in financial news.
Two numbers, three years apart.
The biggest one-year price rise in four decades.
The calmest year since 2020. Headlines called it cooling.
Over those three years, what happened to a $100 grocery run?
The rate came down. The bill did not.
The rate fell by nearly three quarters. The bill has still never been back to $100.
Inflation is a speed, not a position.
A falling inflation rate means prices are climbing more slowly. It does not mean they are climbing back down. Prices actually coming down has a different name — deflation — and it is not what “inflation is cooling” describes.
What would it take for prices to return to their May 2022 level?
The CPI went from 292.3 in May 2022 to 335.1 in May 2026.
A headline says “inflation cooled to 2.4%.” What does that tell you about next year’s grocery bill?
One idea, in under a minute.
A falling inflation rate is a slower climb, not a reversal. That is why a gap that opens during a high-inflation year does not close when the rate comes down — and why waiting for prices to go back to normal is waiting for something that almost never happens.