A 4.2% inflation rate is not a good number.
But it also does not fully explain why so many people still feel squeezed.
The reason is simple:
Inflation slowing does not mean prices go back.
It only means prices are rising slower.
The latest CPI shows inflation running at 4.2% over the last 12 months through May 2026.
But the cost shock happened over several years.
Since 2019, cumulative inflation is around 26%.
That means the average price level is roughly one quarter higher than it was before.
Housing is where people feel it the most.
Shelter costs rose 0.3% in May and are up 3.4% year over year.
And shelter makes up roughly 35% of CPI.
The biggest problem is not just that homes are expensive.
It is how far prices have moved away from incomes.
The median home price is now above $400,000.
A home that once cost around 3 times median family income is now closer to 7 times.
Yes, homes are bigger today.
Yes, more households have two incomes.
But for many younger buyers, the math still feels completely different.
This is why people argue about inflation numbers.
CPI is measuring an average.
It is not saying every person experiences the same price changes.
Someone who already owns a home has a very different experience from someone trying to buy one today.
The inflation rate can improve.
The economy can look better on paper.
But the higher prices remain.
And that is the part many people are still struggling with.
BLS official May 2026 CPI report 4.2% inflation and 3.4% shelter: https://www.bls.gov/news.release/cpi.nr0.htm
FRED data on shelter CPI index May 2026 at 427.998: https://fred.stlouisfed.org/series/CUSR0000SAH1
CNBC summary on 4.2% CPI rise with shelter details: https://www.cnbc.com/2026/06/10/cpi-inflation-report-may-2026.html