Rajkotupdates.news : US inflation jumped 7.5% in in 40 years

Rajkotupdates.news : US inflation jumped 7.5% in in 40 years – Inflation soared over the last year at its highest rate in four decades, hammering American consumers, wiping out pay raises and reinforcing the Federal Reserve’s decision to begin raising borrowing rates.

The Labor Department said Thursday that consumer prices jumped 7.5% last month from a year earlier, the steepest year-over-year increase since February 1982. The acceleration of prices ranged across the economy, from food and furniture to apartment rents, airline fares and electricity.

Rajkotupdates.news : US inflation jumped 7.5% in in 40 years – Inflation soared over the past year at its highest rate in four decades, hammering America’s consumers, wiping out pay raises and reinforcing the Federal Reserve’s decision to begin raising borrowing rates across the economy.

The Labor Department said Thursday that consumer prices jumped 7.5% last month compared with a year earlier, the steepest year-over-year increase since February 1982. The acceleration of prices ranged across the economy, from food and furniture to apartment rents, airline fares and electricity. When measured from December to January, inflation was 0.6%, the same as the previous month and more than economists had expected. Prices had risen 0.7% from October to November and 0.9% from September to October.

Rajkotupdates.news : US inflation jumped 7.5 in in 40 years

The Labor Department said Thursday that consumer prices jumped 7.5% last month compared with 12 months earlier, the steepest year-over-year increase since February 1982. Shortages of supplies and workers, heavy doses of federal aid, ultra-low interest rates and robust consumer spending combined to send inflation accelerating in the past year.

When measured from December to January, inflation was 0.6%, the same as the previous month and more than economists had expected. Prices had risen 0.7% from October to November and 0.9% from September to October.

There are few signs that inflation will slow significantly anytime soon. Most of the factors that have forced up prices since last spring remain in place: Wages are rising at the fastest pace in at least 20 years. Ports and warehouses are overwhelmed, with hundreds of workers at the ports of Los Angeles and Long Beach, the nation’s busiest, out sick last month. Many products and parts remain in short supply as a result.

The steady surge in prices has left many Americans less able to afford food, gas, rent, child care and other necessities. More broadly, inflation has emerged as the biggest risk factor for the economy and as a serious threat to President Joe Biden and congressional Democrats as midterm elections loom later this year. The Fed and its chair, Jerome Powell, have pivoted sharply away from the ultra-low-interest rate policies that the Fed pursued since the pandemic devastated the economy in March 2020.

Powell signaled two weeks ago that the central bank would likely raise its benchmark short-term rate multiple times this year, with the first hike almost surely coming in March. Investors have priced in at least five rate increases for 2022.

Among the Americans who are struggling with pricier food and gas is Courtney Luckey, who has changed her shopping habits and taken on additional work shifts at a grocery store in Charlotte, N.C., where she lives.

Luckey, 33, used to be able to fill up a grocery cart for $100. Now, she said, $100 barely fills half the cart. Tomatoes have reached nearly $5 a pound, “which I think is ridiculous.” Luckey has switched to canned tomatoes and has begun using coupons for Family Dollar and Food Lion.

To help pay bills, she’s also picked up more hours at a Harris Teeter grocery store. But the store is 30 minutes from her house, so she’s had to spend more on gas.

All her forced additional spending has caused Luckey to pull back on family activities, such as bowling, with her daughter, her brother and his two sons. Those outings now typically happen once a month, rather than every week or two.

Even excluding volatile food and energy prices, so-called core prices jumped 0.6% from December to January and 6% from a year earlier.

In the last year, sharp increases in the costs of gas, food, autos and furniture have upended many Americans’ budgets. In December, economists at the University of Pennsylvania’s Wharton School estimated that the average household had to spend $3,500 more than in 2020 to buy an identical basket of goods and services.

Thursday’s report will intensify pressure on the Fed and its chair, Jerome H. Powell, to tighten credit to try to slow the economy enough to cool inflation. Powell signaled two weeks ago that the central bank would probably raise its benchmark short-term rate multiple times this year, with the first increase almost surely coming at its next meeting in March.

With the latest inflation data, some economists expect the Fed to raise its key rate in March by half a percentage point, rather than its typical quarter-point hike.

Over time, those higher rates will raise the costs for a wide range of borrowing, such as mortgages, credit cards and auto and business loans. That could cool spending and inflation, but for the Fed, the risk is that in steadily tightening credit, it could trigger another recession.

Last week, the average rate on a 30-year fixed mortgage jumped to 3.69%, the highest level in more than two years, according to mortgage buyer Freddie Mac. Higher loan rates will elbow some would-be home buyers out of the market.

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Many large corporations, in conference calls with investors, have said they expect supply shortages to persist until at least the second half of this year. Companies including Chipotle and Levi Strauss & Co. have also warned that they will probably raise prices again this year, after having done so in 2021.

Rajkotupdates.news : US inflation jumped 7.5 in in 40 years. Consumer prices jumped 7.5% last month compared with a year earlier, the steepest year-over-year increase since February 1982.

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