Tuesday, January 18, 2022

US consumer prices jump 7%, highest in 40 years

US consumer prices rose 7% in December from a year earlier, the highest inflation rate in 40 years, the government’s Labor Department reported Wednesday.

Higher prices flowed throughout the US economy in 2021, with the biggest increase since 1982. The annual jump in December was up from the 6.8% figure in November and a gain of half a percentage point during the month.

Analysts say strong consumer demand was hit by a coronavirus-related supply crunch, pushing up prices over the year for big-ticket items like cars and furniture, but more importantly, food and gasoline for motorists. Like for everyday shopping.

Rapidly rising costs for consumers have drawn the attention of the White House and policymakers at the country’s central bank, the Federal Reserve, even as they say they expect inflation to remain high through 2022.

President Joe Biden has called on the Federal Trade Commission to investigate “increasing evidence of anti-consumer behavior by oil and gas companies.” The Fed is signaling new efforts in March to rein in inflation by ending its direct financial support of the economy, earlier than originally planned, and raising its benchmark interest rate that lends to businesses and consumers. Affects the cost of taking.

Federal Reserve Chairman Jerome Powell told a congressional committee on Tuesday that reducing prices to more stable levels was key to ensuring a sustainable recovery from the pandemic.

“If inflation becomes too stable, if these high levels of inflation get too caught up in the economy or people’s thinking, that will lead us to a very tight monetary policy, and that can lead to a recession and that will be bad for workers. , Powell told lawmakers.

For consumers, inflation is often more of a daily fact than other aspects of the US economy, which has smartly recovered since the coronavirus pandemic broke out in the US for the first time in March 2020.

The US economy added a record-setting 6.4 million jobs last year, the unemployment rate fell from 6.3% in January to 3.9% in December, and hourly wages for rank-and-file workers rose 5.8%. Government aid checks were sent to everyone except the wealthiest American families, helping many families.

But the prices paid by consumers increased significantly.

Government data shows the price of gasoline paid by motorists at service stations rose 58% last year, while the price of used cars and trucks rose by 31% and that of new vehicles by 11%. Was.

The prices of meat, poultry and fish increased by 13%, the prices of furniture and bedding by about 12%. Fast-food and casual dining locations increased their prices by about 8%.


This article is republished from – Voa News – Read the – original article.

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