However, the worst may be over. The price of energy and gasoline is already beginning to come down around the country. OPEC's recently announced production increases will take up to three months to reach U.S. shores, but the good news is that they will arrive just as the summer vacation season is hitting full stride. However, oil prices haven't been high enough for long enough to seriously impact inflation, most analysts say. In fact, the inflationary effect seems to be going the other way.
Consumers paying more for gas have less to spend elsewhere, helping keep inflation down.
Inflation is an increase in the overall price level of goods and services over a certain period. The economy, meanwhile, has continued to grow, and that, combined with low inflation, has kept the Federal Reserve on the sideline. Most experts agree that's key because the Fed increased the money supply in the '70s in part to compensate for the oil price shocks of those years. All rights reserved. Inc. The Lane Report is a trademark of Lane Communications Group.