Inflation hits hard, Biden vows to lower prices,
the white house is on the defensive as inflation rises yet again,
it’s draining bank accounts of everyday Americans.
According to the labor department consumer prices jumped 8.6 percent year-over-year in may,
Prices are rising everywhere,
airline tickets up about 38 percent from a year ago,
energy about 35 percent, and food about 10 percent.
Breakfast as an example the average price for a dozen eggs up a 1,2 dollar 20 in the past year,
Bacon about a one dollar, a gallon of milk up 70 cents.
Meantime wall street didn’t like the new inflation data at all,
the DOW dropped nearly 900 points today,
it’s been down for 10 of the past 11 weeks,
Biden vows to lower prices,
that happened since the great depression president biden spoke at the port of Los Angeles.
Nobody can forecast peak inflation,
optimismhad been building in recent weeks on wall street,
that prices had seen their high points,
this shockingly strong and broad read today proved them to be wrong.
Despite the troubling rise economis,
it should start to come down in the coming months,
supply chains have started to improve chinese factories,
and ports are open for the moment after being shut down for covid.
And while the American consumer has held up relatively well,
the federal reserve is slamming the brakes on the economy,
and likely to see the impact of that in the coming months.
The FED chairman Jay Powell, has ruled out 75 point rate hikes this year,
that’s actually one of the reasons stocks sold off so hard that,
the FED is likely to now be more aggressive,
in fact a few wall street firms like barclays,
today change their forecast for a 75 basis point increase in rates at the next meeting.
And that happens next week that’s a triple increase in interest rates something,
the FED chair Powell previously ruled out,
he could also change his tune in the news conference next week,
and now say they are open to it.
Bottom line the FED has to get it under control,
and it has to preserve its credibility remember,
the mandate for the FED from congress,
is stable prices and maximum employment.