Inflation in the U.S. is surging to the highest level in 40 years.
Wednesday, the bureau of labor statistics reported consumer prices rose nine-point-one percent last month, in a year-over-year comparison. That's the highest rate since 1981.
Refinitiv reports, that it's also higher than the eight-point-eight percent that economists predicted. Analysts say gas prices played a major factor in June's spike....with the national average rising above five dollars per gallon in much of the u-s, according to AAA.
The bureau also reported electricity prices rose 13.7% for the 12-month period ending in June. Natural gas prices also jumped 38.4 % for the same time period.
The typical American household now needs to spend $493 more per month to buy the same goods and services they did at this time last year, said Mark Zandi, chief economist at Moody’s Analytics. As prices continue to rise, they’re also outstripping wage gains.
Real average hourly earnings – which represent wage growth adjusted for inflation – slumped 1% from May to June and are down 3.6% from June 2021, according to separate BLS data released Wednesday.
While it’s too soon to say whether inflation has peaked (especially given the broader volatility within the global economy), core inflation appears to have leveled off, and expectations are for it to continue to come down in the year-over-year comparison, said Cailin Birch, global economist at the Economist Intelligence Unit.