US consumer prices are rising at the fastest pace since 2008

In May, US consumer prices accelerated the most in almost 13 years as closed demand, coupled with high commodity prices, raised concerns about inflationary pressures.

Consumer prices rose 5 percent last month from a year earlier, the Bureau of Labor Statistics said on Thursday. This is the largest increase since the 5.4% acceleration in August 2008 and 4.2% in April.

Excluding volatile items such as food and energy, the so-called core CPI rose 3.8% year on year in May and 3% in April.

Although the recent rise in prices can be partly attributed to the low level of inflation at the beginning of the coronavirus epidemic, it is also due to rising commodity prices, demand for rental cars, hotels and flights as the US economy has reopened. ,

The used car-truck index rose 7.3 percent in May to about a third of inflation. Prices of used cars jumped against the background of a semiconductor shortage that is hitting car production.

Federal Reserve policymakers are more tolerant of inflation, in part because consumer prices have been under pressure for so long despite loose monetary policy.

The Fed has repeatedly said that the recent rise in inflation is likely to be transient rather than stable. Minutes: The April session of the Central Bank’s monetary policy showed that officials maintain a relatively subtle approach to inflation.

But Gregory Dako, chief US economist at Oxford Economics, says that while some of the factors driving up inflation, such as base effects and high energy prices, will dissipate, some growth will be “sticky”.

Some, including Republican lawmakers, say the Fed underestimated the risk of high inflation.

“Inflationary fears are a bit like phantom pain in the limbs, because they actually cut the problem, but it still hurts, և it hurts because the fear is remembered, even if the limb disappears,” said Ames Swinn, Credit Suisse. the chief economist.

He said there were signs that demand was responding well to high prices, citing a drop in mortgage applications. “It shows that we are not in a serious rise in inflation as a result of expectations,” he said.

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