WASHINGTON: The smourge price increase is now among the main concerns of American business leaders, according to a survey released on Thursday, while the Federal Reserve official shows the central bank is ready to move against inflation.
Official data show signs of wave of increase may have peaked at the end of the year, but with inflation at the highest level in almost four decades, more economists and some Fed officials said the central bank might have to be more aggressive to stem the waves.
Inflation is the number two concern among the chief executive, behind the lack of labor, and price pressure can last up to 2023, according to a survey by the conference agency released on Thursday.
“I am very worried about the high inflation rate,” said Governor Fed Lael Brainard at his nomination hearing in front of the Senate Banking Committee.
Brainard, nominated by President Joe Biden to serve as a vice chairman of the central bank, said most of the estimates show prices tend to remain high for the first half of this year and go down later in 2022.
But he warned to “take this projection with a large number of hearts -heart.
“Brainard told MPs The Fed will focus on bringing inflation back to the target of two percent but will do it” Consistent with sustainable and strong recovery.
“The Fed’s main inflation battle tool is a benchmark loan interest rate, which is cut to zero at the beginning of the Covid pandemic -19.
Many economists expect three interest rate increases this year, but Federal Bank President St Louis James Bullard said Wednesday policy makers may have to be more aggressive and up four times In early March.
Brainard, however, said the steps would be made with “well communicated ways” to ensure the “measured” response by the financial market and allow the economy to continue to restore work.
If confirmed, Brainard will replace Richard Clarida, which is in a paper released before departure Friday from The Fe D believes that the price increase is closer to the Fed target than that appears.
“The surge in inflation that was not liked in 2021, so the relative price adjustment was complete and the obstacles had not been proven, ultimately proved mostly transitories under the appropriate monetary policy,” he wrote.
The shift of the Hawkish Fed came after the consumer price index ended the year with a seven percent leap, the highest since 1982, while the producer price index reached a record 9.7 percent.
But data shows pressure in easing prices in the last month of this year, with the price of producers for energy and food declining.
“The price of producers ends the year on encouraging records, increasing less than expectations as headlines and core PPI moderated in December,” said Advanced Rasheed of Oxford Economics.
Pandemic Covid-19 has created a shortage of important items such as computer chips for cars while transportation barriers have fanned inflation flames, all as new strains of viruses cause additional business disruptions.
“Persistent supply disorders will make producer prices near the recording level in the near future, especially considering the omicron variants that spread rapidly that will fanned inflationary pressures,” Rasheed said.
The price surge has beaten Biden’s reputation even when the economy recovered from the damage caused by a pandemic, and the White House welcomed pressure signs might blow.
“The results of monthly inflation are always fluctuating, and this report is driven largely with a reduction in energy and food prices that are very fluctuating, but also reflects the potential for price increases for goods and services related to supply chains,” said Cecilia Rouse, Head of the White House Economic Advisory Board.
But he said the data underlined the need to continue working to solve supply chain problems.
“Even when the economy has a historic recovery, we continue to face challenges at prices driven by supply chain disorders throughout the world.”