U.S.’ CPI breaks 8% for the first time in 41 years

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The inflation statistics in the U.S. is grime, as the CPI breaks 8% for the first time in 41 years.

The Consumer Price Inflation in the United States rose in March, since December 1981. The prices of rents, foods, and energy have gone exorbitant.

The new rates have been recorded. The CPI has increased to 8%, and recorded 8.5%, the highest one, since December of 1981.

Mark Zandi, chief economist at Moody’s Analytics said, “It’s going to be ugly. It’s a perfect storm – Russia invades, oil prices soar, China is locked down, supply chains are further disrupted, wage growth accelerates, jobs go unfilled. Just a messy situation leading to painfully high inflation. We’re in two huge Struggling with a global supply shock. It’s hard to imagine we’re not suffering from higher inflation.”

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The oil prices surged after Russia’s invasion of Ukraine. West Texas’ intermediate futures hit a high of $130.50 a barrel. The price had fallen to $94 a barrel, on Monday.

Diane Swonk, chief economist at Grant Thornton, said, “The good news is that it does look like it’s going to be a peak because of oil prices.”

The price of unleaded gasoline soared hitting $4.33 a gallon. The price was $4.11 on Monday.

Zandi said, “The Fed is on track. At least half a percentage point hike, and balance sheet cuts have begun.”

Tom Simons, money market economist at Jefferies, says, “”If it’s significantly higher than expected, and I don’t think it’s going to be, it’s going to start talking about a 75-basis-point rate hike, or a rate hike during the meeting. It’s almost nonsense in my opinion.”

He expects the FED to raise prices by 50 points, and CPI shouldn’t change that, according to him.

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The energy prices in the CPI are expected to increase 18% in March. And renting costs to rise by 0.5%. This area is expected to rise additionally.

U.S. stock index futures surged after the CPI data was released, with Nasdaq futures rising 0.86 percent, S&P 500 futures rising 0.41 percent, and Dow futures rising 0.34 percent.

Gold continued to soar, rising $13 to $1,967.76 per ounce, up 0.68 percent on the day.

In the short term, the US dollar index slid over 20 points to 100.00. Non-US currencies climbed in general, with the euro rising against the dollar.

GBP/USD against the US dollar climbed 30 points in the short term, now at 1.3032. EUR/USD rose 25 points in the short term, currently at 1.0871, GBP/USD against the US dollar rose 25 points in the short term, now at 1.0871.

 

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