In the United States, it’s at an over 40-year high according to a government report released on Wednesday (13-07-2022). Inflation that’s the rate at which prices rise hitting 9.1 percent annually in June.
This has been blamed on the prices of Patrol and food remaining high in recent months. Inflation will now be a top concern for many Americans and is likely to influence many voters in the coming midterm elections the November as well.
U.S Petrol prices hit record highs last month averaging above five dollars per gallon. The latest data has led to predictions that the U.S Federal Reserve Bank will hike interest rates once again later this month.
Some experts belive that the central bank can raise rates possibly by 100 basis points this month. The U.S annual inflation rate is now at its highest level since November 1981. Having risen from 8.6 precent back in May.
Now prices in the country have been rising steadily since late last year. There are many reasons for this. First, there were supply chain disruptions from the COVID-19 pandemic. The war in Ukraine pushed up commodity prices globally. Some economists have also blamed governments COVID spending programs for worsening price hikes in total it deployed five trillion dollars worth of stimulus to shield households and businesses from the economic shock of the pandemic.
Food and housing prices also rose in June as did car prices. Though the rate has stabilized or slowed over the past month, even so, the big jump has left president Biden open to intense criticism from both the republican party and the public.
Biden however has insisted that tackling inflation was the top priority. He promised in July last year that the problem would be temporary.
Rising prices for food, gas, and rent cause U.S inflation to surge to a new four-decade high. Squeezing household budget but also, putting pressure on the Federal Reserve to raise interest rates once again as recession becomes more serious with each passing day.
The government consumer price index soared by 9.1 over the past year. Much higher than wall street had anticipated. As consumer confidence in the economy continues to decline so does president Joe Biden’s poll numbers as Democrats are concerned about how voters will see these numbers leading up to the November midterm election.
Now in June the US central bank announced it’s biggest rate hike in nearly 30 years. Economists say another hike is coming the consequences will be felt in nearly every coner of the economy. From the United States and abroad there are five was that the US rate hikes impact ordinary citizens.
The immediate impact is the United States where borrowing will become more costly. Things like credit cards student loans and other loans will become expensive. For the person buying a median preiced home in the US, this means that monthly payments they have gone up about six hundred dollars since the start of the year.
Those with money in the stock market this is meant seeing a sharp slide in the value of their investments. The S&P500 sunk over 20% since January. NASDAQ shed nearly third of its value. Prices of risky assets like cryptocurrency also droped.
Several giant companies have announced either they have to halted hiring or they have to laid off workers. For example Uber, Amazon, Wallmart, Spotify, and Google have annouced planse slow or halt hiring. Microsoft annouced this week that it will cut some as it realigned business groups and roles after the close of its fiscal year on the 30th of June.
Now it’s not only the United States which is reporting high levels of infration. Countries accorss the world are reporting it too.
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