Americans are feeling the strain as the cost of groceries, gasoline, and utilities continues to rise. Economists say a one-two punch of new US tariffs and a war-driven spike in global energy prices
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LOS ANGELES — Americans are feeling the strain as the cost of groceries, gasoline, and utilities continues to rise. Economists say a one-two punch of new US tariffs and a war-driven spike in global energy prices are pushing up everyday expenses and threatening to slow growth just as households had begun to regain some breathing room.
"I feel betrayed," Katie Peyrey, a 66-year-old struggling grandmother and caregiver from Burbank, California, told Xinhua news agency.
She is a minimum wage janitorial worker at a rehab facility who supports herself and her autistic grandson on minimum wage. "I voted for (Donald) Trump because he promised to make things better for us," she said.
She said her household expenses, including rent, utilities, groceries, gas, clothing, taxes and healthcare for her grandson had totaled around $2,300 per month before Trump came into office, which she was barely able to cover with her meager income of $2,400 dollars per month.
"But now," despite careful budgeting, she feels increasing financial pressure. "My expenses have shot up to over $2,500 a month and I can't make ends meet anymore," she told Xinhua.
She explained that she had borrowed as much as she could from family and friends, who were going through similar hard times. She feels her future looks bleak.
Peyrey is not alone in her concerns about the future. Christian Devito, a 34-year-old health and safety worker at a large-chain grocery store in Los Angeles, told Xinhua his monthly bills have jumped by at least 15 per cent in the last three months.
"LA is all spread out, so commuting to work jumped from $50 a week to over $70. And my food and utility bills shot up, too. That's killing me," he complained. "First, I just cut down on going to movies and getting haircuts, but now I have to cut back on food."
He enjoys his job in health and safety, but is concerned about the future if prices keep spiraling as the war in the Middle East drags on and tariffs drive inflation up.
The latest US government data support his worries, showing overall consumer prices are still rising, with energy costs doing much of the damage. In March, energy prices jumped 10.9 per cent month over month, led by a 21.2 per cent surge in gasoline, according to the US Bureau of Labor Statistics.
That matters for consumer spending, which powers about two-thirds of the US economy, and for the Federal Reserve (Fed), which has signaled it will keep interest rates higher for longer if price pressures broaden.
For many families, the mix is especially painful: gasoline spikes hit commuters immediately, higher utility bills arrive with a lag, and food inflation -- even when modest overall -- tends to concentrate in staples. Higher borrowing costs, from credit cards to auto loans, add another layer of strain as the Fed keeps rates elevated to keep inflation in check.
"I used to feel like 200 dollars at Costco could fill up your entire shopping cart, but now it doesn't even cover the bottom. Everything is getting more expensive," Allen Wang told Xinhua at a Costco store in Azusa, California, adding: "Even a box of cat litter has gone up by $2 to $3 over the last 12 months."
Tariffs are a key part of the renewed inflation debate. A Fed analysis published in April estimated that tariffs implemented through November 2025 lifted core goods prices in the personal consumption expenditures index -- the Fed's preferred inflation gauge -- by 3.1 per cent through February 2026, while researchers also found a "dollar-for-dollar" pass-through: When tariffs raised retailers' costs, consumer prices rose by roughly the same amount over time.
Economists at the Peterson Institute for International Economics have warned that broad tariffs can function like a tax increase on households. In a February 2025 analysis, they estimated that tariffs announced on imports from Canada, Mexico and China would cost the typical US household more than $1,200 a year, even before accounting for potential knock-on effects such as higher prices from domestic producers competing with imports.
At the same time, energy cost spikes from the ongoing war with Iran can ripple through the economy well beyond the pump, raising shipping and production expenses for everything from groceries to manufactured goods.
For now, economists say the trajectory will hinge on how long energy markets stay disrupted and whether tariffs expand further or begin to ease. The next CPI report, due May 12, will offer an early read on whether April brought broader price increases beyond energy -- and whether Americans should brace for a longer stretch of sticker shock heading into the next year.
"I hope there is good news soon," Peyrey told Xinhua. "We can't survive another year like this one."