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Inflation in the US has reached 6.8%, its highest level in 40 years

Prices continue to rise in the United States and in November they grew at the fastest rate recorded in almost 40 years, since June 1982.

Inflation in the US has reached 6.8%, its highest level in 40 years

Inflation in the US has reached 6.8%, its highest level in 40 years

Specifically, according to the Bureau of Labor Statistics, the consumer price index (CPI) rose by 6.8% year-on-year, significantly above the 6.2% registered in October, although in line with analysts’ forecasts.

Food prices registered an increase of 6.1% in the eleventh month of the year, eight tenths more than the increase registered in October.

On its side, energy inflation shot up 33.3%, representing a rise of 3.3 percentage points compared to the 30% year-on-year increase observed the previous month.

Thus, without taking energy and food prices into account, given their higher volatility, core inflation in the United States reached 4.9% in the year-on-year rate in November. This represents an acceleration of three tenths compared to the October figure.

The Office has explained that the data collection for November has been affected by the temporary closure or limited operations of various types of establishments. This limitation, together with the suspension of in-person visits that has been in force since March 2020, has caused the number of prices considered “not available” to be temporarily increased.

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  • The data registered in October, of a year-on-year rise of 6.2%, had already been the highest figure since 1990 (31 years), so the price increase maintains its upward spiral with highs of several decades that conditions the sheet Route of the Federal Reserve (Fed). The monetary authority in the US has a dual mandate to promote full employment and price stability.

    The rebound in prices is known just a few days before its last meeting of the year, in which the market expects an acceleration in the settlement – rate or amount – of its purchase program.

    In November, the Fed left interest rates unchanged in the range between 0% and 0.25% and announced the beginning of the reduction of liquidity injections by $15 billion per month.

    Central banks are under increasing pressure to deal with rising inflation, which they anticipated was temporary. However, the Fed has already withdrawn this adjective due to the misinterpretation it could lead to.

    As explained by the president of the Fed, Jerome Powell, they consider “transitory” a factor that is not permanent, while part of the public opinion seemed to understand “transitory” as something limited in time.

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