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In the United States, consumer goods prices rose 7% in December from a year earlier, marking the highest inflation rate in 40 years, according to a government report released Wednesday by the Department of Labor.
Higher prices were observed in all aspects of the US economy during 2021, with the largest increases since 1982. In November the rise in commodity prices reached 6.8%. Analysts say high consumer demand has been met by supply shortages as a result of the pandemic, with prices rising year-on-year, especially in the automotive and furniture manufacturing industries, as well as food and fuel prices.
Despite rising inflation from one year to the next, President Joe Biden said the report “shows a significant drop in inflation over the past month, with food and fuel prices falling.” He said that “this shows that we are making progress in slowing down the rate of price increase. At the same time, the report points out that we still have more work to do, with rising prices still very high squeezing the budgets of American families.
The rapid rise in consumer costs has caught the attention of the White House and policymakers of the US Federal Reserve, known as the Federal Reserve, although they say they expect inflation to remain high year-round.
In November, President Biden called on the Federal Trade Commission to investigate the actions of oil and gas companies if they are hurting consumers’ pockets. The central bank is signaling new actions to curb inflation by ending in March its direct support for the economy, earlier than planned, and raising the key interest rate affecting the cost of borrowing for businesses and consumers.
Federal Reserve Chairman Jorome Powell told a congressional committee on Tuesday that lowering prices to more stable levels was essential to ensuring a sustained recovery from the pandemic./VOA
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