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Inflation expected to increase as Biden bans Russian oil

Published: Mar. 8, 2022 at 4:43 PM CST
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NEW ORLEANS (WVUE) - New Orleanians were already feeling the squeeze from spiraling inflation and Tuesday’s announcement of a Russian oil embargo is not expected to ease things.

Americans are paying hundreds of dollars more each month to make ends meet but some say there is a bright side.

“Gas has been especially hard, groceries have gone up exponentially, and it’s definitely a financial drain,” said shopper Caroline Schenker.

A typical US household is spending an extra $276 a month on goods and services due to rising inflation, and that was before President Joe Biden’s announcement of a Russian oil embargo, which is getting mixed reactions.

“I don’t mind paying more for gas if it helps the Ukrainians,” said Michael Matassa.

“I think it’s a poor decision. When you’re creating financial hardship for the large majority of your people, you’re making a bad choice,” said Schenker.

An economist at the University of New Orleans says the current inflationary spiral is about more than oil.

“Most recent numbers are 7% inflation. It’s on food, it’s on everything else, but it’s related to the supply chain problems we’ve had post-pandemic. There’s a lot of issues going on there,” said Dr. Walter Lane.

Inflation, on top of the pandemic, is also putting a strain on stopgap relief organizations like Second Harvest Food Bank.

“Prior to the pandemic, we were serving about 210,000 people. Now we are serving 300,000 people on an annual basis,” said Natalie Jayroe.

Second Harvest calls the current economy a “perfect storm” because most of their donations come from grocery stores and in many cases, grocery store shelves are empty.

“We are continuing to get requests for assistance from tens of thousand people and as you know we are still recovering from Ida,” said Jayroe.

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Though inflation is up, so are wages and employment, benefiting some people.

Kesala Wheeler owns two hair salons in New Orleans and says her business is in the green.

“When inflation went up, I went up as well,” she said.

For others, not so much.

“Definitely cutting back on the fun stuff. No more date nights. Simpler meals for sure,” said Schenker.

“I think some of that will be going down, but I’m worried about next year. The huge deficit will cause demand-side inflation, I don’t think it’s going away anytime soon, but the nature of it will be changing,” said Dr. Lane.

Dr. Lane believes inflation will get back under control eventually.

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