Inflation in the US Continues to Soar, CPI Rises 7.5%Inflation in America
continues to rise as last month. Prices of consumer goods experienced their
biggest annual spike in 40 years, as prices of various goods rose.
The US Department of Labor said Thursday, the consumer price index (CPI)
rose 7.5 percent in the 12 months to January, the biggest increase since
February 1982. Compared to last December, goods prices rose more than
analysts' forecasts of 0.6 percent. .
The data ran counter to President Joe Biden's administration's hopes that
rising prices for these goods undermined public assessments of its
performance, which is showing signs of an economic slowdown in the first
month of 2022.
That indicates there is a possibility the US Central Bank will soon raise
interest rates.
In a statement, Biden acknowledged that inflation was "spiking" but
"economic forecasters continue to expect inflation to fall substantially by
the end of 2022."
A number of factors are considered to be driving prices up, ranging from the
US Federal Reserve's policy of facilitating financial assistance aimed at
supporting the economy during the pandemic, to supply chain disruptions,
shortages of components and labor, and strong American consumer demand.
Meanwhile, with inflation soaring, stocks on Wall Street fell Thursday
(10/2), as hopes grew that the US Federal Reserve would become more
aggressive in stopping the extraordinary aid it provided to the economy.
Shortages of supply and labor, huge spending on federal aid, very low
interest rates and strong consumer spending all contributed to last year's
inflation.
The highest inflation since 1982 sent shares in the S&P 500 down 0.2
percent in Thursday morning trade.
Meanwhile, the Dow Jones Industrial Average fell 46 points, or 0.1 percent,
to 35,722 after previously dropping 288 points. The Nasdaq Composite fell
0.2 percent, in the morning US East coast time, after losing 1.9 percent.