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Inflation tracker: latest figures as countries grapple with rising prices

Much of the world is going through a dramatic episode inflationary. However, many central banks are keeping interest rates at or near record lows, despite price increases due to higher energy costs, strong consumer demand and global supply chain disruptions due to Covid-19. -19 and its latest variants caused.

Some fear that this combination could mark a return to the chronic inflation of the 1970s. One of the Exception for the worldwide bullish pattern are East Asian countries such as China and Japan. But even here, there are signs that inflation is starting to pick up.

This page provides a regularly updated visual narrative of consumer price inflation around the world, both now and over the coming year. * It also separates inflation into its main components; what higher food prices mean for consumers; and where investors think inflation is headed in the medium term.

One of the main points of debate among policymakers and economists is whether the price increase is temporary and will soon disappear, or whether it can be more permanent.

However, even among those who believe inflation will ease next year as supply chain problems ease and consumer demand stabilizes, there is acceptance that the inflation shock will last longer. compared with the original estimate. Economists polled by Consensus Economics, a company that collates predictions by top forecasters, have steadily revised their projected inflation figures for 2022.

Rising inflation is a challenge for central banks, especially G7 countries with a price stability target of 2%. To that end, central banks can adjust monetary policy to curb demand. But such tools are less effective in addressing inflation due to lack of supply. As the governor of the Bank of England, Andrew Bailey, put it, monetary policy “is not more petrol, more computer chips, more truck drivers”.

The rise in energy prices, which leads to inflation in many countries, is a case in point. In a sign that inflation may be starting to spread beyond energy, prices of many other commodities are also rising – especially in countries where consumer demand is strong enough for businesses to can pay higher costs.

Rising prices limit what households can spend on goods and services. For the less well-off, it can lead to an inability to pay for basic needs, such as food and shelter.

Daily data on staples, such as the wholesale prices of breakfast ingredients, provides an up-to-date indicator of the price pressures faced by consumers. In developing countries, the wholesale cost of these ingredients has a larger impact on the final food price; Food also accounts for a larger share of household spending.

The debate over whether rising inflation is temporary or permanent continues. Advocates of the “temporary group” believe that this year’s price spike is due to a one-time spike in consumer demand versus a single one-time increase due to supply chain disruptions. Proponents of the “permanent group” point to an increasingly broad bullish pattern, especially in countries where labor shortages are pushing up. wage.

For now, markets appear to be on the “permanent” side and, in many countries, have stabilized prices as inflation picks up over the next five years.

* Consumer inflation refers to the annual percentage change in the consumer price index of countries. This data is internationally comparable, although some countries and regions use a different headline number. The euro area, for example, takes the harmonized consumer price index as its headline number, while also reporting the CPI.

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