The U.S. inflation rate hit a 40-year high last year, but has since slowed down significantly due to factors like the Federal Reserve rate hikes. The year-over-year inflation rate was still 3.7% in August 2023, though. This relatively high inflation is driven by a variety of factors, such as the war in Ukraine and labor shortages. The government may continue its interest rate hikes in the hope of reining in inflation further.
Inflation rates differ across the U.S, though. In order to determine how inflation is impacting people in different parts of the country, WalletHub compared 23 major MSAs (Metropolitan Statistical Areas) across two key metrics related to the Consumer Price Index, which measures inflation. We compared the Consumer Price Index for the latest month for which BLS data is available to two months prior and one year prior to get a snapshot of how inflation has changed in the short and long term.
Main Findings
Cities With the Biggest Inflation Problems
| Overall Rank | MSA | Total Score | Consumer Price Index Change (Latest month vs 2 months before) |
Consumer Price Index Change (Latest month vs 1 year ago) |
|---|---|---|---|---|
| 1 | Miami-Fort Lauderdale-West Palm Beach, FL | 96.43 | 1.20% | 7.80% |
| 2 | Denver-Aurora-Lakewood, CO | 77.21 | 1.30% | 4.70% |
| 3 | Atlanta-Sandy Springs-Roswell, GA | 67.86 | 1.10% | 4.40% |
| 4 | Seattle-Tacoma-Bellevue, WA | 64.50 | 0.80% | 5.40% |
| 5 | Detroit-Warren-Dearborn, MI | 61.03 | 0.60% | 5.90% |
| 6 | New York-Newark-Jersey City, NY-NJ-PA | 57.67 | 1.00% | 3.50% |
| 7 | Anchorage, AK | 57.35 | 1.30% | 2.00% |
| 8 | Philadelphia-Camden-Wilmington, PA-NJ-DE-MD | 53.47 | 0.80% | 3.90% |
| 9 | Houston-The Woodlands-Sugar Land, TX | 51.79 | 1.00% | 2.70% |
| 10 | Riverside-San Bernardino-Ontario, CA | 42.65 | 0.60% | 3.40% |
| 11 | Los Angeles-Long Beach-Anaheim, CA | 41.91 | 0.60% | 3.30% |
| 12 | San Diego-Carlsbad, CA | 38.55 | 0.30% | 4.30% |
| 13 | Baltimore-Columbia-Towson, MD | 36.87 | 0.50% | 3.10% |
| 14 | Urban Honolulu, HI | 36.66 | 0.70% | 2.10% |
| 15 | Dallas-Fort Worth-Arlington, TX | 36.35 | 0.30% | 4.00% |
| 16 | Tampa-St. Petersburg-Clearwater, FL | 36.03 | -0.10% | 5.90% |
| 17 | Phoenix-Mesa-Scottsdale, AZ | 27.00 | 0.10% | 3.70% |
| 18 | St. Louis, MO-IL | 26.16 | 0.20% | 3.10% |
| 19 | San Francisco-Oakland-Hayward, CA | 21.22 | 0.00% | 3.40% |
| 20 | Minneapolis-St.Paul-Bloomington, MN-WI | 17.86 | 0.40% | 1.00% |
| 21 | Chicago-Naperville-Elgin, IL-IN-WI | 16.70 | 0.10% | 2.30% |
| 22 | Boston-Cambridge-Newton, MA-NH | 13.24 | -0.10% | 2.80% |
| 23 | Washington-Arlington-Alexandria, DC-VA-MD-WV | 5.88 | -0.10% | 1.80% |
- Highest
- T-1. Denver, CO
- T-1. Anchorage, AK
- 3. Miami, FL
- 4. Atlanta, GA
- T-5. New York, NY
- T-5. Houston, TX
- Lowest
- T-18. Chicago, IL
- T-18. Phoenix, AZ
- 20. San Francisco, CA
- T-21. Boston, MA
- T-21. Tampa, FL
- T-21. Washington, DC
- Highest
- 1. Miami, FL
- T-2. Tampa, FL
- T-2. Detroit, MI
- 4. Seattle, WA
- 5. Denver, CO
- Lowest
- 19. Chicago, IL
- 20. Honolulu, HI
- 21. Anchorage, AK
- 22. Washington, DC
- 23. Minneapolis, MN
Ask the Experts
In order to shed more light on inflation and what it means for our economy, WalletHub turned to a panel of experts. Click on the pictures of the experts below to read their bios and responses to the following key questions:
- What are the main factors currently driving inflation?
- What can be done to continue to slow down inflation?
- Is raising interest rates a good or bad solution to control inflation?
- What does the current inflation rate tell us about the future of the economy?
Ask the Experts
Assistant Professor of Economics and Assistant Director of the Free Market Institute, Department of Accounting, Economics, and Finance, Norris-Vincent College of Business – Angelo State University
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Assistant Professor of Global Economics & Management – UCLA Anderson School of Management
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Senior Fellow, Schwartz Center for Economic Policy Analysis and Senior Fellow, Institute on Race, Power, and Political Economy – The New School
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Ph.D. – Interim Associate Dean, Professor of Economics, Gordon Ford College of Business – Western Kentucky University
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Professor in the Department of Finance and Economics, Eberly College of Business – Indiana University of Pennsylvania
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MBA, Ph.D. – Adjunct Associate Professor of Business and Management – Hope International University
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Methodology
In order to determine how inflation is impacting people in different cities, WalletHub compared 23 MSAs (Metropolitan Statistical Areas) across two key metrics involving the Consumer Price Index, which measures inflation. The metrics are listed below, along with their corresponding weights. We then determined each MSA’s weighted average across the metrics and used the resulting scores to rank-order our sample.
For each MSA in the sample, we used the latest data available from the Bureau of Labor Statistics. For some MSAs, there is a one-month lag on the data available.
- Consumer Price Index Change (Latest month vs 2 months before): Full Weight (~50.00 Points)
- Consumer Price Index Change (Latest month vs 1 year ago): Full Weight (~50.00 Points)
Sources: Data used to create this ranking were obtained from the U.S. Bureau of Labor Statistics.
