The Fed’s delicate task - to raise rates enough to restrain inflation, without going so far as to tip the economy into recession - has now become more difficult. Russia’s invasion and the likely resulting rise in inflation have increased pressure on the Federal Reserve, which is expected to raise interest rates by a quarter-point as many as five or six times this year beginning in March. The costs of other commodities that are produced in Ukraine, such as wheat and aluminum, have also increased. Inflation, though, is expected to remain high and perhaps accelerate in the coming months, especially with Russia’s invasion likely disrupting oil and gas exports. Rain Augustine speaks with Economist, Dr. households, especially lower-income families faced with elevated costs for food, fuel and rent. Robust consumer spending has combined with widespread product and worker shortages to create the highest inflation in four decades - a heavy burden for U.S. RELATED: Russia-Ukraine updates: What to know as Ukrainian troops resist advance on key cities However, Burger King’s public relations team didn’t cite inflation for the nugget change but said it was to allow more resources for the restaurants to roll out the company's latest menu item, "Ghost Pepper Nuggets." The company rolled out the spicy option last October.Īn inflation gauge that is closely monitored by the Federal Reserve jumped 6.1% in January compared with a year ago, the latest evidence that Americans are enduring sharp price increases that will likely worsen after Russia’s invasion of Ukraine. "As a result, commodity inflation overall was approximately 16% this past quarter compared to the prior year period," he continued. There are three factors that could lead to inflation which include demand-pull inflation, cost-push inflation and built-in inflation.
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