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Tech & Science Monetary Policy: Inflation in the USA lies in August at 5.3 percent

03:40  15 september  2021
03:40  15 september  2021 Source:   handelsblatt.com

Labor says wages fell 2.1 per cent over the year to June 2021, the 'fastest drop in 20 years'. Is that correct?

  Labor says wages fell 2.1 per cent over the year to June 2021, the 'fastest drop in 20 years'. Is that correct? In a Facebook post, the Australian Labor Party claimed real wages fell 2.1 per cent over the year to June 2021, and that this was the largest drop in 20 years. RMIT ABC Fact Check investigates. The verdictLabor's claim is not the full story.Real wages — that is, wages adjusted for inflation — were 2.1 per cent lower in the June quarter of 2021 compared to the June quarter of 2020, when calculated using headline figures for the consumer price index and the wage price index, both published by the Australian Bureau of Statistics (ABS).This was indeed the sharpest annual fall recorded since June 2001, when real wages plunged 2.

The August report on inflation was highly anticipated because it comes after a jobs report that was far worse than expected. The economy added just 235,000 new jobs last month, far fewer than the 750,000 that were expected. Despite the meager gains, the overall unemployment rate dropped slightly from The Federal Reserve has not tightened its monetary policy to dampen inflation but has rather kept with the easy- money policies it has maintained since the start of the COVID-19 pandemic. Fed officials have said that they don’t intend to raise interest rates until inflation is running at 2% and the economy

Inflation Rate in the United States averaged 3.23 percent from 1914 until 2021, reaching an all time high of 23.70 percent in June of 1920 and a record low of -15.80 percent in June of 1921. The US consumer price inflation rate stood at 5 .4 percent in July 2021, unchanged from the previous month's 13-year high and slightly above market expectations of 5 . 3 percent , reflecting the low base effect caused by the coronavirus crisis, the re-opening of the economy and continued supply constraints.

the inflation rate weakens marginal. Now all the eyes depend on the meeting of the US Federal Reserve Fed in the coming week.

The inflation rate in the US remains at a high level. In August, consumer prices in the world's largest economy attracted by 5.3 percent compared to the same month last year. This was announced by the US Department of Labor on Tuesday afternoon. Economists have calculated at a rate of inflation of 5.4 percent.

In the July, consumer prices had risen by 5.4 percent. Compared to the previous month, prices are 0.3 percent (expectation: 0.4 percent) higher. The core inflation that excludes the volatile prices for food and energy is 0.1 percent.

Canada inflation hits 18-year high as Trudeau faces tight race

  Canada inflation hits 18-year high as Trudeau faces tight race Inflation figures gave the opposition Conservatives fresh political fodder to use against Trudeau’s Liberal Party.But with less than a week to go before Canadians cast their votes in a tight federal election race pitting Prime Minister Justin Trudeau’s Liberal Party against the Conservatives headed by Erin O’Toole, the latest readings on Canada’s inflation provided fresh fodder for the opposition to seize upon.

Retail inflation fell marginally to 5 . 3 percent in August mainly due to easing food prices, official data showed on Monday. The Reserve Bank had kept the key interest rate unchanged in its monetary policy review in August . It focuses mainly on the CPI while deciding its bi-monthly monetary policy . The RBI has projected the CPI inflation at 5 .7 percent during 2021-22 — 5.9 percent in the second quarter, 5 . 3 percent in the third, and 5.8 percent in the fourth quarter of the fiscal, with risks, broadly balanced.

Food inflation comes as a relief. The cooling of food & beverages inflation was the chief driver behind the moderation in the CPI inflation to a four month low in August , Nayar said. "In month-on-month terms, the food & beverages basket remained flat, with downticks in eggs, meat and fish, fruits Arora said that the headline CPI may average almost 60 basis points lower than the RBI’s forecast of 5.7 percent . "With the monetary reaction function currently hinging more on growth revival becoming sustainable, the RBI is unlikely to change key policy rates this year and the focus will be more on

At Wall Street, Dow Jones and Sampersandp 500 opened with marginal price gains. The dollar gave slightly, while yields for ten-year US bonds followed easily after initial growth. The gold price made his daily loss and rose to almost $ 1806.

In the coming week, the next interest rate decision of the Fed is committed to expect investors worldwide with tension. The US Federal Reserve could start this year , retiring its bond purchases. Time and design of monetary policy turns are still open.

Since the beginning of the corona pandemic, the key interest rate is in the USA at zero percent. In addition, the Fed purchases monthly bonds and mortgage documents in the volume of $ 120 billion. The central bank should therefore first begin to shut down the bond purchases ("tapering").

Bank of England warns inflation may rise to 10-year high in coming months

  Bank of England warns inflation may rise to 10-year high in coming months The Bank of England has warned inflation will increase further this year to double its target rate, but insisted rising prices will only be temporary as it kept interest rates on hold. © Reuters The Bank of England says the increase in inflation is 'transitory' and will return to the target level in the medium term The monetary policy committee (MPC) also kept in place measures to bolster the economy, despite some calls for them to be cut to cool cost pressures.Latest economic forecasts from the Bank show it expects inflation to peak at 4% in 2021 - a 10-year high - against a previous prediction of 2.5%.

Monetary policy promised to become more routine. Although the 1990s saw the longest cyclical expansion in U.S. history, the promised tranquility did not materialize. In many ways the period to be chronicled here proved to be about as difficult for monetary policy as the preceding inflationary period. My account of Fed monetary policy divides the period since 1987 into six distinct phases. This division is natural because in each phase the Fed was confronted with a different policy problem. Phase 1 begins with rising inflation in the aftermath of the October 1987 stock market crash and

Retail inflation fell marginally to 5 . 3 percent in August mainly due to easing food prices, official data showed on Monday. The Reserve Bank had kept the key interest rate unchanged in its monetary policy review in August . It focuses mainly on the CPI while deciding its bi-monthly monetary policy . The RBI has projected the CPI inflation at 5 .7 percent during 2021-22 -- 5.9 percent in the second quarter, 5 . 3 percent in the third, and 5.8 percent in the fourth quarter of the fiscal, with risks, broadly balanced.

would be further attracted inflation in the US, the pressure on central bank boss Jerome Powell would have further strengthened. The slight slowdown in August is likely to be in its argumentation line. In the US, a lively and very controversial debate has emerged about the further monetary policy course. More and more well-known economists warn against a delayed response of the Fed, , which then the financial markets could be the more violent shock .


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Powell , however, is also convinced that the higher inflation is a temporary phenomenon. The Fed expects a lower momentum in the coming months. This has clarified the central bank boss on the much noteworthy virtual central bank conference in Jackson Hole at the end of August several times.

Another factor is the development in the US labor market. There, the growth in new bodies had weakened surprisingly high over the past month. In August, only 235,000 new jobs have emerged. Powell also focuses on "substantial progress" on the Labor Market , he recently emphasized.

Most Asian markets drop as record US inflation fans taper talk

  Most Asian markets drop as record US inflation fans taper talk Asian markets mostly fell on Monday following another retreat on Wall Street as a surge in US inflation to a record high ramped up concerns the Federal Reserve will be forced to tighten monetary policy sooner than later. Reports that President Joe Biden was considering a fresh trade probe into China added to the downbeat mood and nullified the optimism sparked by news that he had held talks on Friday with Xi Jinping in a bid to smooth relations between the superpowers. After driving a healthy run-up in Asia so far this month, investor sentiment was once again roiled by data on Friday showing US factory gate inflation had soared in August to an all-time high of 8.

Monetary policy plays an important role in stabilizing the economy in response to these disturbances. The Committee's primary means of adjusting the stance of monetary policy is through changes in the target range for the federal funds rate. The Committee judges that the level of the federal funds rate consistent with maximum employment and The Committee reaffirms its judgment that inflation at the rate of 2 percent , as measured by the annual change in the price index for personal consumption expenditures, is most consistent over the longer run with the Federal Reserve's statutory mandate.

contractionary monetary policy . plan to reduce the amount of money in circulation when the Econ overheated; plan to tighten up the Econ by decreasing inflation and increasing interest rates. cost push inflation . a situation in which increases in production costs push up prices. Occurs when a government spends more than it collects in revenue for a specific budget year. Deflation. A decrease in the general price level. Demand - Pull Inflation . A situation where total demand is rising faster than the production of goods and services.

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