Experts are comparing current inflation to price pressures seen following World War II. “It’s the greatest historical anomaly in the relationship between core goods and services prices that we’ve seen since the end of World War II,” Michael Gapen, chief U.S. economist at Barclays, told CNBC. “I think the World War II experience is the closest parallel to what we’re seeing.” New data indicates that key inflation measures did ease a bit in the third quarter, but economists say prices are still very high.

 

CNBC/Patti Domm
Not since Americans came home from World War II has inflation run through the economy like it is now

Not since Americans came home from World War II has inflation percolated through the U.S. economy like it is now, and it could continue to do so for months to come.

That’s because the pandemic hit the economy like a sledge hammer, shattering the normal way business is conducted and consumers live their lives. The disruptions for many businesses have been difficult to repair, and the return to normal has been challenging due to supply chain disruptions and labor shortages.

“You had a very quick and abrupt shift in the economy,” said Michael Gapen, chief U.S. economist at Barclays. “And it takes time to retool. It’s a super tanker. It takes time to turn.”

Companies and consumers across the country are feeling the hit from rising prices and goods shortages, and many businesses are adjusting the way they operate.

You can read the full story, here.

 

CNN Business/Anneken Tappe, CNN Business
Inflation edged down in the third quarter. But it’s still really high

US price surges eased in the third quarter of the year.

A key measure of inflation grew at an annualized rate of 5.3% in the third quarter, data from the Bureau of Economic Analysis showed Wednesday. That compares with an increase of 6.5% in the second quarter.

That’s good news for consumers, but even with the decrease in the personal consumption expenditure index, prices are still very high.

The same report updated the pace of US economic growth between July and September to 2.1% on an annualized basis. An initial report last month said the economy had grown at a rate of 2% last quarter. The little bump was due to strong consumer spending in spite of the high prices.

You can read the full story, here.

 

Yahoo Finance/Brian Cheung
San Francisco Fed president: ‘Certainly see a case’ for speeding up taper

Federal Reserve Bank of San Francisco President Mary Daly said that she could support more quickly ending the central bank’s asset purchase program, dependent on incoming data on inflation and jobs.

Since the depths of the pandemic, the Fed has been buying about $120 billion in U.S. Treasuries and agency mortgage-backed securities to signal its commitment to supporting the economy. This month, the Fed said the economy appeared to make substantial further progress in the recovery — and began slowing those purchases at a clip of about $15 billion per month.

Stay ahead of the market

But Daly told Yahoo Finance that if the November jobs report and the Consumer Price Index read on inflation show no reversal of existing trends, she would support paring back those purchases at a faster speed.

Continue reading, here.

 

 

 

 

 

 

 

 

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