November Inflation Up 7.1% Over Last Year

Inflation is beginning to hit everyone hard. The Consumer Price Index (CPI) for November showed a 7.1% increase in prices over last year and a 0.1% increase over the prior month, the Bureau of Labor Statistics said Tuesday.

On a “core” basis, which strips out the volatile food and energy components of the report, prices climbed 6.0% year-over-year and 0.2% over the prior month. Consensus estimates called for a 6.1% annual increase and a 0.3% monthly rise in the core CPI reading, according to a report by Yahoo News. 

While November’s figures showed a modest deceleration in inflation, the costs of essential items and housing facing U.S. consumers still remain stubbornly high and well above the Federal Reserve’s long-term price stability target of 2%. –Yahoo News

The Federal Reserve is expected to raise rates yet again in an effort to stifle the economy but slow inflation. So far, the inflation the central bank is wholly responsible for by creating money out of thin air is to be resolved by more intervention.

“Another downside inflation surprise not only validates a Fed decision to slow the pace of rate hikes, it also raises hopes that the inflation surge may actually be tamed within the next 12 months,” Seema Shah, the chief global strategist at Principal Asset Management said in emailed comments. “Yet, Powell will likely maintain an element of caution in his comments tomorrow,” Shah added, pointing to wage inflation from a continuously strong labor market that still poses a problem for Fed officials.

IMF: Persistent Inflation Will Slow Economic Growth

“The difference between inflation at 5% and inflation at 3% next year lies in the ability of the Fed to slow the labor market further, which likely requires further monetary tightening and absolutely no rate cuts,” Shah added.

November’s jobs report released earlier this month showed non-farm payrolls rise by 263,000, bringing the three-month average to a robust 272,000 and revising away the moderation in average hourly earnings. The labor force participation rate fell to 62.1%, suggesting a substantial amount of job openings remain — a factor that continues to put upward pressure on wages. –Yahoo News

Inflation is here to stay. It’ll eventually compound into a problem that the ruling class and central banks will already have a solution for:

The Endgame: Central Bank Digital Currency