By John Meyer, financial consultant. Eurasia Business News, January 12, 2022

Dow Jones Stock Exchange, Manhattan, New York City- Photo credit : Swann Collins.

The U.S. inflation surged to 7% over 2021, a record since June 1982, after hitting 6.8% in November.

The U.S. Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5 percent in December on a seasonally adjusted basis after rising 0.8 percent in November, reported today the U.S. Bureau of Labor Statistics. Over the last 12 months, the all items index increased 7.0 percent before seasonal adjustment.

Inflation has exceeded 6% annually for three months. This is three times the Federal Reserve’s medium-term target of 2%. Inflation has become the number one political subject for President Joe Biden, especially since wages do not follow.

Prices increases in the indexes for shelter (+ 4.1%), for used cars and trucks (+37.3%), for new vehicles (+ 11.8%), energy services (+10.4%) and energy commodities (+48.9%) were the largest contributors to the seasonally adjusted all items increase over 2021. The food index increased less in December than in recent months, rising 0.5 percent. Food prices increased by 6.3% over 2021.

The index for all items less food and energy rose 0.6 percent in December following a 0.5-percent increase in November. This was the sixth time in the last 9 months it has increased at least 0.5 percent. Along with the indexes for shelter and for used cars and trucks, the indexes for household furnishings and operations, apparel, new vehicles, and medical care all increased in December. As in November, the indexes for motor vehicle insurance and recreation were among the few to decline over the month.

The all items index rose 7.0 percent for the 12 months ending December, the largest 12-month increase since the period ending June 1982. The all items less food and energy index rose 5.5 percent, the largest 12-month change since the period ending February 1991. The energy index rose 29.3 percent over the last year, and the food index increased 6.3 percent.

Read also : Inflation surges in the United States, challenging Biden policies

Very bad news for President Joe Biden, who has promised to reverse the trend but is struggling to convince Congress that his social and environmental spending plan will boost the U.S. economy without fuelling inflation.

As a result of this high inflation in the U.S., gold prices are up 0.35 % on January 12 and up 2.73 % on the past 30 days, as the yellow metal is usually seen as a great hedge against inflation and the loss of purchasing power of paper money.

Read more about gold and inflation with Gold : Build Your Wealth and Freedom

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