It's been three months since the elevated May consumer prices report led the Federal Reserve to adopt a "whatever it takes" mentality to fight inflation. Markets are now bracing for an expected third straight 0.75% increase in the Federal Funds rate at the Fed's next policy meeting. But a funny thing has happened as markets and the economy adapted to the new policy environment: Much of the pain that Main Street was feeling has shifted to Wall Street.
The two most significant changes unfolding in the real economy over the past three months are in energy markets and the housing market. Retail gasoline prices peaked at $5 a gallon in mid-June, and have since fallen by more than $1.25 a gallon. According to Patrick De Haan of GasBuddy, American drivers are about to be saving $500 million a day on gasoline compared with what they were paying three months ago. And with gasoline futures prices continuing to fall, those savings should increase for at least the next couple of weeks.