The July reading of the U.S. Consumer Price Index (CPI) is set to be released on Wednesday, with expectations for another surge in the inflation rate.<\/p>\n\n\n\n
A recent survey by the Wall Street Journal expects that the reading of the CPI will register a monthly increase of 0.5% with core CPI leveling up by 0.4% after both indices reached 0.9% in June.<\/p>\n\n\n\n
Meanwhile, the annual inflation rate is seen slightly easing from 5.4% in June to 5.3% last month, with core CPI that excludes food and energy prices increasing by 4.4%, following a 4.5% rise in the previous month.<\/p>\n\n\n\n
Earlier today, the President of the Federal Reserve Bank of Richmond, Tom Barkin, said that high inflation this year might have fulfilled the Fed’s criteria for an interest rate hike.<\/p>\n\n\n\n
Barkin repeated what Fed officials recently indicated that the central bank is closely looking into the conditions of the labor market before making any moves.<\/p>\n\n\n\n
The current Fed guidelines tolerate inflation running above 2% for some time with a goal of reaching sustainable inflation at 2% to achieve price stability.<\/p>\n\n\n\n
Barkin thinks raising interest rates will take place when inflation hits 2%, \u201cwhich I think you can argue it already has, and it looks like it is going to sustain there.\u201d<\/p>\n\n\n\n
\u201cThere is still room to run in the labor market.\u201d<\/p>\n\n\n\n
\u201cThe demand for labor continues to outpace the supply of people willing to work.\u201d<\/p>\n\n\n\n
\u201cThe current pressure on wages is intense at lower levels of the pay scale.\u201d<\/p>\n\n\n\n
It is worth noting that data showed that the United States economy created more jobs than previously expected last month, recording 943,000, with the unemployment rate decreasing to 5.4% from 5.9%.<\/p>\n\n\n\n
Atlanta Fed President Raphael Bostic thinks that the Federal Reserve should begin tapering the massive asset purchases following two consecutive months of strong job creation.<\/p>\n\n\n\n
\u201cMy sense is if we are able to continue this for the next month or two I think we would have made the \u2018substantial progress\u2019 toward the goal and should be thinking about what our new policy position should be.\u201d<\/p>\n\n\n\n
Recently, Former Chair of the Federal Reserve and the current Treasury Secretary, Janet Yellen, expressed concerns about housing costs, expecting high inflation to remain for several months before easing.<\/p>\n\n\n\n
<\/p>\n","protected":false},"excerpt":{"rendered":"
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