The pandemic boosted buyer demand from customers, but supply chains just can’t hold up, producing inflation. But right after this non permanent situation finishes, what is following? Economists cannot agree.
WASHINGTON (AP) – Two months of sharply mounting rates have elevated considerations that report-large governing administration economic support and the Federal Reserve’s extremely-minimal fascination fee procedures – when the economic system is already surging – have elevated the hazard of accelerating inflation.
In May, customer costs rose 5% from a 12 months earlier, the premier this sort of yr-over-calendar year bounce given that 2008.
Numerous economists see the recent spike as temporary. Others say they fret that bigger shopper prices will persist. Jason Furman, a Harvard professor who was President Barack Obama’s top rated financial adviser, thinks the reality is much more difficult. He does, however, lean toward the higher-inflation-will-persist camp.
Furman notes that when most economists hope inflation to