US consumer prices accelerated most in May in almost 13 years, combined with stagnant demand and rising commodity prices to arouse concerns about inflationary pressures.
Consumer prices rose 5% last month compared to a year ago, according to the Bureau of Labor Statistics. This represents the sharpest increase since the 5.4% acceleration in August 2008, compared to the 4.2% increase in April.
Removing volatile items such as food and energy, the so-called core CPI rose 3% in April and then 3.8% annually in May.
The recent rise in prices may be partly due to low inflation when the coronavirus pandemic began, but as the U.S. economy resumed, rising prices for goods and rental cars, hotels, etc. Flight demand is also a factor. ..
The used car and truck index rose 7.3% in May, accounting for about one-third of rising inflation. Used car price It soared amid a shortage of semiconductors that would hurt automobile production.
Federal Reserve policymakers were more tolerant of inflation, partly because consumer prices had been restrained for a long time, despite loose monetary policy.
The Federal Reserve Board has reiterated that recent rises in inflation are likely to be temporary rather than persistent. Minutes The results of the central bank’s April monetary policy meeting showed that authorities maintain a relatively optimistic approach to inflation.
However, Gregory Dako, chief US economist at Oxford Economics, said some of the factors driving inflation (such as basic effects and rising energy prices) would disappear, but some would be “persistent.”
Some, including Republicans, claim that the Fed underestimates the risk of rising inflation.
Credit Suisse Chief Economist James Sweeney said:
He said there were signs that demand was reacting to rising prices in the usual way, noting a decline in mortgage applications as an example. “It’s proof that we’re not in a serious expectation-driven rise in inflation,” he said.
US consumer prices are rising at the fastest pace since 2008
Source link US consumer prices are rising at the fastest pace since 2008