It’s hard to know whether the divergence in the rates of inflation between different income groups will continue. Real estate developers are
racing to build apartments in many cities, but rents are likely to keep rising until supply catches up with demand. On the other hand, there are signs that the long rise in college tuitions
may at last be slowing. Health care inflation
has slowed too, but no one is sure how long that trend will continue.
The overall rate of inflation, however, is likely to rise as the economy improves. The Federal Reserve
expects prices to rise faster over the next two years, gradually returning to the Fed’s long-term target rate of 2 percent annually. Few consumers will welcome faster price growth, but if that inflation is the result of faster economic growth, it might also bring a more welcome development: faster wage gains.