High inflation will last well into 2022, economists say, indicating that supply chain bottlenecks will keep increasing prices and curbing production.
Experts expect to see average inflation of 5.25% in December, slightly down from the current maximum predicted 5.4% figure, according to The Wall Street Journal. If inflation stays around its current level, Americans will experience the longest period during which inflation has stayed above 5% since 1991.
“It’s a perfect storm: supply-chain bottlenecks, tight labor markets, ultra-easy monetary and fiscal policies,” Michael Moran, Daiwa Capital Markets America’s chief economist, told the WSJ.
During the latter part of the 20th Century, Americans became accustomed to hearing stories of shortages of basic items in the Soviet Union. The metaphor of “waiting in line for bread” came to signify anything where a state-managed effort led to the inefficient and ineffective distribution of consumer goods and services. The state-generated supply chain problems were the butt of jokes for comedians everywhere.
Well, “bread lines” have now officially arrived in America and nobody is laughing. The middle class and the poor have especially lost their sense of humor over the supply chain disruptions that have led to shortages and higher prices being found everywhere from the grocery store shelves to the provision of medical supplies. Nothing is funny about shelves, wallets, and medicine cabinets all emptying out simultaneously.
A series of economic struggles that have grown increasingly worse this year will likely have a significant impact on the holiday season, many economic experts predict.
After President Joe Biden gave remarks from the White House this week, one reporter called out, “Will Christmas presents arrive on time, sir?” The president did not respond to that question or the flurry of others as he walked away from the podium.
U.S. retail sales increased in September, beating expectations amid growing inflation and supply chain disruptions, the U.S. Census Bureau reported Friday.
Retail sales increased 0.7% in September, beating experts’ estimates of 0.2%, according to the Census Bureau report. The number rose 0.8%, excluding auto sales, beating the 0.5% forecast.
Sales were up 13.9% compared to September 2020, and they increased 15.6% compared to September 2020, excluding auto sales, according to the Census Bureau.
The Consumer Price Index increased 0.4% in September, bringing the key inflation indicator’s year-over-year increase to 5.4%, the U.S. Bureau of Labor Statistics announced Wednesday.
The year-over-year 5.4% inflation figure is an increase from August’s 5.3%, and September’s figure represents the highest year-over-year inflation increase since January 1991, according to CNBC. The 5.4% increase in the CPI is slightly above the 5.3% economists estimated.
The International Monetary Fund cut its global growth forecast for 2021 on Tuesday, citing supply chain disruptions and pandemic-related health concerns.
In the International Monetary Fund’s (IMF) World Economic Outlook report, released Tuesday, the IMF’s economists share anticipations for global economic growth measuring 5.9% in 2021, a downgrade from their 6% projection in July.
Food prices have surged as companies battle increasing costs, labor shortages and supply chain problems, The Wall Street Journal reported.
Food companies are struggling to find trucks and staff processing lines as costs for necessary products surge, The Wall Street Journal reported.
The International Chamber of Shipping, a coalition of truck drivers, seafarers, and airline workers, recently warned heads of state at the United Nations General Assembly that if restrictive COVID policies don’t change and freedom of movement isn’t restored to transportation workers, a supply-chain collapse is imminent.
Industry leaders representing some 65 million transport workers asked the United Nations and heads of government to “take meaningful and swift action to resolve the crisis now.”
“Global supply chains are beginning to buckle as two years’ worth of strain on transport workers take their toll,” they wrote in an open letter signed by the International Air Transport Association, the International Road Transport Union and the International Transport Workers’ Federation.
The construction industry is struggling to recover from the pandemic due to difficulties hiring workers and severe supply chain shortfalls, a report found.
Construction contractors project revenue to remain stagnant and below pre-pandemic levels over the next 12 months even as the economy-wide recovery continues, according to the report published Wednesday by the U.S. Chamber of Commerce. While the Commerce Commercial Construction Index (CCI), which the Chamber measures on a quarterly basis, ticked up one point, it remained eight points below its early 2020 figure.
Retailers are frequently running out of everything from flour and fresh meat to toilet paper and pharmaceuticals as supply chains hammered by the coronavirus struggle to keep up with stockpiling consumers.