The US Bureau of Labor Statistics reports a continued monthly increase in producer cost inflation. The latest May report illustrates a jump to 6.6% from last month’s 6.2%.
The increase is the greatest since 2008 when the index was reformulated. When the economy essentially shuttered at the beginning of the COVID-19 pandemic in March of 2020, inflation turned negative and remained low for the past year. However, as businesses reopened, prices began to surge and with it, inflation grew. The Federal Reserve predicts the surge in inflation will level out by next year as companies pivot to meet new production demands.
FBA previously reported, “Americans are also rushing to dine out, travel or go far away for vacation, activities they shied away from during the pandemic. That’s also driving up prices at popular vacation resorts and other venues where people plan to congregate.
Senior Federal Reserve officials, who are supposed to protect the U.S. from high inflation, insist the increase is temporary. They contend inflation will subside by next year once the pandemic fades, most people go back to work and the global economy is largely recovered.”
ARTICLE: ANTOINETTE AHO
MANAGING EDITOR: CARSON CHOATE
PHOTO CREDITS: REUTERS
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