The U.S. Department of Labor said Wednesday (May 12) that the Consumer Price Index rose 4.2 percent in April from a year earlier, the largest annual increase since September 2008. The picture shows a commissioner putting 100-dollar U.S. bills into the counting machine to count them.
The U.S. Consumer Price Index (CPI) rose sharply again in April and pushed inflation to its highest level in nearly 13 years, suggesting that as demand grows rapidly, businesses are raising the cost of many goods and services under pressure from supply shortages, labor shortages and other issues, driving up inflation.
According to a Labor Department report Wednesday (May 12), the U.S. consumer price index jumped 4.2 percent in April from a year earlier, up 0.8 percent month-over-month, after rising 2.6 percent in March as fiscal stimulus and booming demand drove supply shortages. It exceeded economists’ forecasts and posted the largest annual increase since September 2008. Excluding volatile food and energy items, the index rose 3% annually and 0.9% monthly in April.
Financial media “MarketWatch” analysis, the rate of inflation in the United States from years of low levels, jumped to a 13-year high, mainly due to the rapid reopening of the economy, business supply can not catch up with demand, and the global trading system during the epidemic continued to encounter bottlenecks and exacerbate the problem. It may exacerbate market concerns about long-term hyperinflation.
The report shows that almost all items of inflation indicators rose in April, including: transportation services rose 2.9%, piped gas rose 2.5%, and goods net of food and energy rose 2%. Other notable factors contributing to price increases include: housing, airfare, entertainment, and the cost of home furnishings.
Americans’ eagerness to dine out, travel or go on vacations to faraway places drove up the prices of popular vacation destinations, gathering places and airline tickets.
Used cars and trucks also saw record high prices, with their prices soaring 10 percent in April and up 21 percent year-over-year. The cost of used cars and trucks has now exceeded $25,000 for the first time. This is due to a shortage of used vehicles as automakers cut production and leasing agencies scaled back fleet purchases in the early days of the epidemic.
Food costs are rising twice as fast as they did before the epidemic.
On the other hand, gasoline prices fell for the first time in nearly a year. However, as states lift restrictions, more people will travel in the summer and prices may rise as a result.
But Federal Reserve Vice Chairman Richard Clarida downplayed concerns about rising inflation in a speech to the National Association for Business Economics on Wednesday, saying the increase is temporary and that once the epidemic subsides and most people return to Once the epidemic subsides, most people return to work and the global economy largely recovers, inflation is expected to subside next year.
Clarinda’s speech reads, “Annual figures for inflation have risen recently and may rise further before moderating later this year. I expect inflation to recover in 2022 and 2023, or perhaps slightly above our long-term target of 2 percent.”
The Fed has repeatedly said before that they will not raise interest rates or reduce their monthly bond-buying program until inflation reaches about 2 percent.