Consumer prices are expected to skyrocket, according to April data released Wednesday. This is primarily due to technical quirks, but investors are watching carefully in determining whether inflation could change the policies of the Federal Reserve.
Economists surveyed by Bloomberg predict that the consumer price index will probably rise 3.6% in the year to April. Price increases from March to April are expected to be further suppressed to 0.2%.Ministry of Labor announces numbers at 8:30 am
The annual surge is the fastest rise since 2011, with inflation rising above very weak readings since 2020 and rising prices as supply chain turmoil begins to bite and demand increases. It’s a sign that you are.
The central bank believes inflation is short-lived and has revealed plans to overlook a temporary rise in policymaking. According to officials, the technical habit of going live in April lasts only a few months and it’s not clear when the shortfall will be resolved, but eventually as companies increase production to meet demand Is expected to go through the system.
But concerns among Wall Street and some economists are the fast-recovering economy, massive stimulus from Washington, and stagnant consumer demand, which are more expensive than the Fed can tolerate. It can mean that the rise in is noticeable or persistent.
An important part of the central bank’s role is to keep curbing price increases. Therefore, a sharp acceleration in prices that is expected to persist may encourage people to keep money cheap and dial back credit-flowing policies. Reducing support can lower stock prices.
The Fed uses another indicator, the Consumer Price Index, to define its inflation target, which relies on data from the CPI and is expected to exceed the central bank’s target. The Federal Reserve Board is aiming for an average annual inflation of 2 percent.
The central bank has made it clear that it will respond to unexpected signs of sustained price increases. However, they also say they want to avoid early withdrawal of economic support. This could lead to a complete recovery in the labor market and the risk of recovery in long-term inflation. Unpleasant low level, Where they have been plagued for most of the last decade.
Federal Reserve Board of Governors Lael Brainard, Said during the speech “Retaining patients over the temporary surge associated with the resumption will help to gain financial momentum to’achieve our goals’,” he said on Tuesday.
Consumer prices rose in April as investors worried about inflation
Source link Consumer prices rose in April as investors worried about inflation