The U.S. economy has been dogged by inflation for two years. That situation has improved some. At the beginning of the period, the consumer price index rose over 8% per month, year over the previous year. Some items, like food and fuel, rose by double digits, based on the same yardstick.

As the Federal Reserve tried to bring down inflation rates, it jacked interest rates so high that mortgage rates topped 7%. Loans for new and used cars were even higher. While many components of the cost of living dropped, people with debt were burdened by higher monthly payments.

The cost of living, which was not a major issue for many Americans in the decade before the Fed started to raise rates, is now at the center of a debate about what the Fed and the federal government can do to make financial lives more tolerable.

The Research

The rate of the cost of living is not even across the nation. The Council for Community and Economic Research’s Cost of Living Index comes out quarterly and covers 269 U.S. metros.

As expected, the cost of living is highest in America’s big cities. The national index has a value of 100. New York City’s figure is 227.8. Honolulu, often at the top of the cost of living measures, ranked second at 179.2. San Jose, home to many people who made their fortunes in tech, ranked third with a score of 171.3, followed by neighbor San Francisco at 169.5

At the far end of the spectrum are several poor cities. Decatur, Illinois, at 77.0, topped this part of the list. Harlingen and McCallen, Texas, followed, each with a score near 80.

Decatur has a population of 69,097, according to the Census Bureau. Median household income is $45,111, well below the national number. The poverty rate is 19.7%, almost double the national figure.

Many economists argue that the poorer the city, the lower the cost of living. If so, it is easy to see why Decatur is on the list. (See every state’s poorest town.)

Cities With the Lowest Cost of Living

These 10 cities have the lowest cost of living in America:

• Decatur, Ill. (77.0)
• Harlingen, Texas (79.7)
• McAllen, Texas (80.2)
• Ponca City, Okla. (80.4)
• Augusta, Ga. (82.8)
• Anniston, Ala. (83.0)
• Florence, Ala (83.0)
• Ashland, Ohio (83.0)
• Conway, Ark. (83.1)
• Tupelo, Miss. (83.1)

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