- Advertisement -spot_img
Monday, December 6, 2021

A major inflation indicator shows that prices are rising at the fastest pace since 1990

Inflation hit an already hot pace in October, and the Commerce Department today reported that the overall personal consumer spending (PCE) index rose 5.0 percent year over year, reaching levels unseen since 1990, and heightening concerns about persisting inflationary pressures. …

Meanwhile, the core PCE inflation index, which excludes volatile food and energy categories and is the preferred inflation indicator for the Federal Reserve’s monetary policy adjustment, rose 4.1 percent in the year to October, the fastest pace since 1991. …

On a monthly basis, PCE increased 0.6 percent, up from 0.4 percent in each of the previous three months. Underlying PCE also jumped, with October’s month-on-month 0.4 percent, double September’s, both showing that inflation is picking up steam and suggesting stronger price pressures are more entrenched than administration officials Biden and Fed policy. expected.

Rising prices have become a key theme amid the economic recovery and a pain point for President Joe Biden, whose approval rating has plummeted. A new NPR / Marist poll found Biden’s approval rating of 42 percent, the lowest since taking office, with inflation being the top concern among respondents.

“Regardless of the number of jobs or the skyrocketing stock market, Americans are worried about the economy, and the reason for this is inflation,” said Lee Meiringhoff, director of the Marist Institute of Public Opinion. said NPR

The survey found inflation to be the top concern (39 percent), followed by wages (18 percent) and labor shortages (11 percent). The poll found that concerns about housing costs, unemployment and gas price increases were linked at 9 percent each.

The PCE inflation data is likely to raise policy concerns, as Fed officials are likely to contemplate accelerating the pace of phasing out the massive $ 120 billion a month central bank asset purchase program. At a policy meeting in early November, Fed officials decided to start cutting monthly bond purchases at the rate of $ 15 billion a month, although they left the door open for a faster schedule.

Read Also:  Biden's visit highlights technical colleges, key to building infrastructure

A number of economists, including several Obama-era advisers, have targeted the Biden administration and the Fed in the wake of the inflationary surge.

Stephen Rattner, head of the Automotive Working Group under former President Barack Obama, recently became Obama’s latest economic aide to sound the inflation alarm, asking in an article how the Biden administration could tackle “this critical issue in a wrong way” and warns that his Build Back Better program could exacerbate inflationary pressures.

Prior to that, former Treasury Secretary Larry Summers, who sounded the alarm early on the current price rises, told CNN in an interview that he believed the labor market was tight and monetary policy was too loose.

“We have to admit that our problem is not that not enough people have jobs,” Summers told the publication. “The current problem is that we are pushing demand into the economy faster than supply can grow, and that we will get more and more inflation until we stop doing it,” he said.

“This is a real problem,” he added.

To follow

Tom Ozimek has extensive experience in journalism, deposit insurance, marketing and communications, and adult education. The best writing advice he has ever heard is from Roy Peter Clarke: “Hit your target” and “leave the best for last.”

World Nation News Deskhttps://www.worldnationnews.com
World Nation News is a digital news portal website. Which provides important and latest breaking news updates to our audience in an effective and efficient ways, like world’s top stories, entertainment, sports, technology and much more news.
Latest news
Related news
- Advertisement -

Leave a Reply