Economic Week to be Dominated by Inflation With Tuesday’s Report on Consumer Prices – By Tim Smart (US News) / Sept 12, 2022
Economists are expecting another dip in the rate of price increases.
Earlier this year, as prices for common necessities such as gasoline and groceries began their inexorable rise, economists and market analysts seized on the monthly readout of the consumer price index for signs as to how entrenched inflation was becoming.
In June, the annual rate reached 9.1%, its highest level in four decades, stunning most observers and prompting the Federal Reserve to hike interest rates by a consecutive three-quarters of a point.
Now, however, with the rate easing to 8.5% in July, the focus has shifted to seeing how much inflation is receding from its peak, if that indeed has been reached. On Tuesday, the government will report the CPI for August, with expectations it may hit 8% or even break that barrier to 7.9%.
While that would still be nearly four times the rate the Fed sets as its average annual target of 2%, it would represent some small victory in the central bank’s battle against the scourge of steadily rising prices. The direction of inflation is often cited by economists as more important than the numerical level.
