Author: MOS Finance Team – Leah
According to Kitco News Bites, the U.S. consumer price index rose to 6.2 percent in October – the highest in nearly 30 years. The Fed is trying to convince people that inflation is only temporary, but the market is no longer buying the perfunctory rhetoric.
In response to the inflation data, gold jumped nearly $40 on Wednesday. December Comex futures last traded at $1,867.50, up 2 percent. Stocks, on the other hand, slumped as tension spread.
Energy, housing, and food, all essential commodities for everyday life, rose to a record high in October. Gasoline prices soared 6.1%, food was up 5.3% from a year ago, fuel saw the biggest increase, up 12.3% from the previous month, and electricity costs rose 1.8%. Housing, a commodity not indexed for inflation, rose 20 percent from the previous year.
U.S. Treasury Secretary Janet Yellen tried to reassure the market on Tuesday, saying inflation would not persist. Yellen also said the Fed will take any effort to prevent 1970s-style inflation.
However, economists are not as optimistic as the Fed. They are now looking at the possibility of inflation rising to an annual 7 percent in the near term.
If uncontrolled money printing can solve all economic problems, then why does the debt ceiling crisis come back haunting us again and again?
Edited by: Hetangyuese
Proofread by: Hetangyuese
Posted by: Hetangyuese
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