Will Rising Inflation Force Fed's Hand
July, 2021
Inflation Jumps to Highest Level in 13 years; How Will Fed Respond?
Key Takeaways:
Headline inflation increased to 5.4% in June, the highest level since the summer of 2008.
Reopening of service sectors such as air travel, hotels, recreation and entertainment contributed to the rise.
Labor shortages are putting upward pressure on wages, particularly in the restaurant and hospitality industries.
Increased demand along with supply-chain bottlenecks and higher shipping costs are impacting goods prices, including construction materials.
Many of the inflation drivers are likely to be transitory, keeping Fed stance largely accommodative.