The producer price data captures inflation at an earlier stage of production and can sometimes signal where consumer prices are headed. It also feeds into the Federal Reserve’s preferred measure of inflation, the personal consumption expenditures price index.
There is little evidence that gasoline prices, which hit a record national average of $5 a gallon on Saturday, will drop anytime soon.
As high prices leave less income for discretionary purchases, the risk to the economy is a more pronounced slowdown in consumer spending.
Some evidence in recent weeks had suggested that inflation might be moderating, particularly for long-lasting goods that were caught up in supply chain snarls and shortages last year. But that trend appeared to reverse itself in May.
The incessant run-up in prices has motorists testing the limits of their fuel gauges: AAA fielded 50,787 out-of-gas calls in April, a 32% jump from the same month last year.
Stagflation is the bitterest of pills: High inflation mixes with a weak job market to cause a toxic brew that punishes consumers and befuddles economists.
The Federal Reserve and Treasury Department have been increasingly blamed by legislators and the public for allowing inflation to reach record highs—notably an 8.3% leap in consumer prices over the past year.
The job growth in May was high enough to keep the Federal Reserve on track to pursue what’s likely to be the fastest series of rate hikes in more than 30 years.
The White House launched a push Tuesday to contain the political damage caused by inflation after President Joe Biden complained for weeks to aides that his administration was not doing enough to publicly explain the fastest price increases in roughly four decades.
President Joe Biden will meet with Federal Reserve Chairman Jerome Powell on Tuesday as soaring inflation continues to carve up Americans’ earnings.
Prices for just about everything Americans buy have spiked in the past two years. Inflation, which had been scarcely noticeable for decades, is suddenly the top concern most people have about the economy. And it all seemed to catch Washington, D.C., by surprise.
High inflation appears to be forcing consumers, on average, to save less. The savings rate fell to 4.4% last month, the lowest level since 2008.
Indiana Gov. Eric Holcomb said Wednesday he was preparing a plan to potentially tap into the growing state budget surplus to help residents with the national inflation jump.
The nonpartisan agency expects the consumer price index to rise 6.1% this year and 3.1% in 2023, above a long-term baseline of 2.3%.
Federal Reserve officials agreed when they met earlier this month that they may have to raise interest rates to levels that would weaken the economy as part of their drive to curb inflation, which is near a four-decade high.
Target Corp. is on pace for its worst stock drop since 1987’s Black Monday crash after becoming the second big retailer in two days to trim its profit forecast. Other retailers suffered steep drops in their stock prices Wednesday.
Chairman Jerome Powell on Tuesday underscored the Federal Reserve’s determination to keep raising interest rates until there is clear evidence inflation is steadily falling—a high-stakes effort that carries the risk of causing an eventual recession.
Consumers are providing critical support to the economy even after a year of seeing prices spiral higher for gas, food, rent, and other necessities.
The White House responded by pointing out that Jeff Bezos’ attacks emerged days after Biden met in the Oval Office with the labor leaders behind Amazon’s unionization drive, which the company has vehemently opposed.
Feeling a bit cheated when you look down at your plate? It’s not just a figment of your imagination—portions at some U.S. restaurants are indeed getting smaller.
