Surge in Consumer Prices Reaches Highest Level in 31 Years

574

The consumer prices in the United States accelerated at the most rapid annual pace in over 30 years. This happens as supply chain shortages continue and the prices of gasoline surge. 

The prices of food, shelter, and energy surpassed the projected monthly increases

According to the data released by the Labor Department, the consumer price index went up 6.2% over one year. The huge increase marks the biggest annual gain since November 1990, as prices spike by 0.9% every month. 


SPECIAL: Get Your FREE Red Trump 2024 Hat Here

The price increase is higher than the expected rise by analysts surveyed via Refinitiv, as they previously predicted a 5.8% increase annually. 

Bankrate Chief financial analyst, Greg McBride stated inflation in the country is broadening. He added continuous inflation in food, shelter, and energy surpassed the expected monthly increases. Also, the prices of cars (either new or used) are again stirring into overdrive.

The prices of energy jumped to up to 4.8% last month and they were up to 30% higher than last year. Accordingly, the 6.1% spike in October was largely attributed to the higher cost of gasoline. 

The inflation in consumer prices was felt most by American households when dozens of goods jumped by their highest level in a decade. 

Last month, food prices rose up to 0.9%, as the food at home section saw a 1% increase. Moreover, all food prices also increased to up to 5.3%. 

Core prices, which exclude energy and food, likewise increased by 0.6% month over month and by more than 4.6% in the last 12 months. 

Also contributing to the massive jump in inflation are the prices for new and used vehicles which rose 1.4% and 2.5% in October, respectively. 

Democrats’ legislative agenda is adding fuel to the fire

Meanwhile, Senate Minority Leader Mitch McConnell blamed the Biden administration for the massive inflation. He noted there is no relief that can be seen anytime soon. 

McConnell then claimed that the huge spike in prices is an immediate result of flooding the nation with money. The Republican also added the last thing the nation wants right now is adding another massive and reckless spending spree. 

 

The COVID relief package also brought more movement into the economy, as the money handed out by the government kept the finances of American households intact.

Meanwhile, this money wound up enabling consumers to keep spending, despite the high rate of unemployment. The savings of households also skyrocketed, fueling unprecedented levels of spending activities, such as traveling and dining out, when those activities started to become available again.

The main argument of Republicans against the Biden administration is the multi-trillion-dollar agenda makes inflation even worse by drowning the U.S. economy with government spending and more. 

Included among these Democrat agendas are the infrastructure bill, American Rescue Plan, and the Build Back Better climate/social spending package.