If this plays out, with a slowdown in wage increases that should occur because of tighter monetary policy, this should help continue to moderate food inflation over the next few years. Finally, let’s turn to energy inflation.
Households spend less than 5 percent of their PCE basket on gasoline, electricity, and heating but, as seen in the left panel of  - 10 figure 8, the energy price index skyrocketed over the past couple of years, reflecting a surge in crude oil prices after the pandemic recession which was exacerbated by Russia’s invasion of Ukraine.