Ouch! New Study Reveals the Top 10 Cities Where Residents Are Hardest Hit by Inflation

You don’t need us to tell you that things are getting more expensive. You likely notice that everything from your grocery bill to your electricity bill has gone up, up, up, with no signs of stopping. You’re not wrong. Inflation in the United States climbed to 2.7% in June 2025, the highest level it’s been since February. While inflation is lower than its recent peak of 3% in January 2025, prices are rising across the board, mostly because of supply chain issues, strong consumer demand and higher energy costs. In the wake of recent government tariffs and ongoing uncertainty surrounding them, businesses, including Amazon, are starting to pass higher costs on to shoppers in order to offset their own rising bottom lines.

This mix of factors makes everything, from groceries to used cars, more expensive. Some cities, however, are experiencing higher inflation than others, according to a new WalletHub study, making the cost of living higher for those who live there. Read on to see if your city made the list.

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How were the cities hardest hit by inflation determined?

To determine the cities that are struggling most with inflation, WalletHub compared 23 major Metropolitan Statistical Areas across two key metrics within the Consumer Price Index (CPI), which measures inflation. Using the most current available data from the Bureau of Labor Statistics, it compared the Consumer Price Index Change from the latest month that data is available versus two months before, as well as last month versus one year ago.

Which city is hardest hit by inflation?

Topping the list of the cities hardest hit by inflation is Seattle. Seattle has been the hardest-hit city by inflation in the U.S. because of a combination of short- and long-term price pressures, some of which have been felt at a state-wide level throughout Washington.

Why is Seattle the hardest hit by inflation?

Seattle saw the largest CPI increase over May and June (1.40%) and ranks among the highest for annual inflation (2.70%). “While the state boasts strong economic activity and potential for innovation, these benefits haven’t shielded Seattle residents from feeling the sting of persistent inflation,” explains Chip Lupo, WalletHub writer and analyst. A combination of reasons has caused Seattle to experience a high level of inflation, he says, including the following four factors:

Supply and demand for housing

Washington state has high housing costs, Lupo says. It ranks fifth in the nation for homeowners’ housing burden and 18th for renters, plus it ranks ninth in mortgage debt growth. This, in turn, can drive up other local costs. “That strong demand, paired with limited housing supply and elevated costs for essentials like health care, pushes prices even higher,” he explains.

Job market challenges

Although the state of Washington has a strong economy overall, its job market ranks just 44th, which points to a mismatch between the jobs available and the workers looking to fill them, Lupo says. “Combined with high housing costs and labor shortages, this imbalance contributes to Seattle’s recent CPI increase,” he adds. “The state has a strong economy and ranks 2nd for innovation potential, meaning many jobs require specialized skills. But unemployment claims remain high, and housing costs are steep, as Washington ranks fifth for homeowner expenses, which makes it harder to attract workers for lower-paying positions.” So while there are jobs, the labor market is out of sync with employee skills and affordability.

Trade-heavy economy

Washington state, in general, is especially vulnerable to tariffs because of its trade-heavy economy. “The state ranks third in economic activity with major ports like Seattle and Tacoma, which handle a large volume of international imports and exports,” Lupo says. “Tariffs can raise costs for both consumers and businesses, feeding into the inflation numbers.”

In 2024, Washington state exported $57.8 billion worth of goods worldwide and was the ninth-largest state exporter, according to the U.S. Census Bureau.

State tax structure

Finally, Washington’s overall tax structure—no state income tax but high sales taxes—can magnify the current rate of inflation’s effect on everyday purchases. When prices on everyday goods go up, that 6.5% to 10.4% sales tax, which varies locally, can push costs even higher.

What other cities ranked in the top 10?

Cities all across the country made the top 10 of those that have been the hardest hit by inflation, showing that rising costs aren’t just affecting one particular region. (However, the Southeast area of the U.S. did manage to escape the top 10.) Here are the places that ranked in the top 10:

1. Seattle, Tacoma and Bellevue, Washington

2. Boston and Cambridge, Massachusetts / Newton, New Hampshire

3. Chicago and Naperville, Illinois / Elgin, Wisconsin

4. St. Louis, Missouri

5. San Diego and Carlsbad, California

6. New York City / Newark and Jersey City, New Jersey

7. Denver, Aurora and Lakewood, Colorado

8. Philadelphia / Camden, New Jersey / Wilmington, Delaware

9. Honolulu, Hawaii

10. Riverside, San Bernardino and Ontario, California

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Sources:

• WalletHub: “Changes in Inflation by City”
• Chip Lupo, writer and analyst for WalletHub
• Trading Economics: “U.S. Inflation Rate”
• Washington State Department of Transportation: “Washington state imports and exports decrease roughly 5.7% from 2022 to 2023”
• Office of the United States Trade Representative: “Washington Exports and Foreign Investment”
• Washington Council on International Trade: “How the Proposed Trump Administration Tariffs Likely Will Impact Washington State’s Economy”

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