What Is Inflation, and Why Cash in a Drawer Loses Value

Every, year,, prices, tend, to, creep, upward,, a, cup, of, coffee,, a, movie, ticket,, a, gallon, of, gas, cost, less, a, decade, ago, than, they, do, now., And, that, steady, upward, drift, has, a, name:, inflation., The, U.S., government, tracks, it, primarily, through, the, Consumer, Price, Index, (CPI),, maintained, by, the, Bureau, of, Labor, Statistics,, which, measures, how, the, price, of, a, broad, basket, of, everyday, goods, and, services, changes, over, time.

Inflation, has, averaged, roughly, 3%, per, year, in, the, U.S., over, long, stretches, of, modern, history,, though, it, isn't, always, steady., It, spiked, sharply, in, June, 2022,, when, annual, CPI, inflation, hit, about, 9.1%,, the, highest, reading, since, November, 1981., At, even, a, modest,, steady, 3%, a, year,, using, the, "rule, of, 72", (dividing, 72, by, the, inflation, rate),, it, takes, roughly, 24, years, for, prices, to, double,, meaning, the, purchasing, power, of, money, just, sitting, still, is, cut, roughly, in, half, over, that, same, stretch.