Inflation rose 0.1% in August even with sharp drop in gas prices

https://www.cnbc.com/2022/09/13/inflation-rose-0point1percent-in-august-even-with-sharp-drop-in-gas-prices.html

by mfiguiere • 4 years ago

7 3 4 years ago

650REDHAIR• 4 years ago

I know the data says there was a drop, but here in the Bay Area it doesn’t feel like much. I’m still paying nearly $6/g and my groceries are floating around 15% average increase.

I honestly don’t know how people are surviving these increases given that so many people were living on the edge before this.

throwaway_75369• 4 years ago

Ugh. I'm actually nervous about the fact that real wages rose along with this bump.

There also was some good news for workers in the August report, as real average hourly earnings rose a seasonally adjusted 0.2% for the month. However, they remained down 2.8% from a year ago.
The Federal Reserve is hoping to slow a labor market that has posted solid job gains through the year. Specifically, policymakers are concerned about a huge gap between job openings and available workers as labor force participation is stuck below its pre-pandemic levels. That has resulted in rising wages that have in turn put pressure on prices.

Doesn't that mean we could be looking at a wage-price spiral?

If that's true, then maybe the Fed really wants to see a big weakening of the labor market in order to create downward pressure on wages. Doesn't that mean they want to see layoffs? Really hope that's not the case...

francisofascii• 4 years ago

Yeah. it feels like a no win situation. If you want to fight inflation, you probably have to endure the pain of higher unemployment and a recession. People described Volcker raising interest rates in the early 80's as being like chemotherapy.

Inflation rose 0.1% in August even with sharp drop in gas prices

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