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Inflation is not an issue that has only affected the United States, this phenomenon of economic adversity is suffered by various nations around the world, so stop the rises is not entirely dependent on Joe Biden’s government officials .
So much so, that the International Monetary Fund (IMF) warned that the recent inflationary explosion could be longer than expected , forcing central banks around the world to take action to address rising costs of goods and services.
In its latest global economic outlook report, the organization reported that “the aftershocks of last year’s pandemic upheaval pose unique political challenges.” The IMF added that “pent-up demand and supply chain bottlenecks are pushing prices up “.
The US authorities have publicly said that the supply channel has been one of the major problems faced by the country . The Labor Department reported that consumer prices rose 0.9% since May and 5.4% over the past year , the largest increase in 13 years, fueling concerns that a rapidly rebounding economy could lead to runaway growth.
In a FOX television report, it was reported that rising inflation has shaken markets, and investors are concerned that a rise in consumer prices force the Federal Reserve to change the monetary policies that it implemented to support the economy during a pandemic.
Despite this scenario, the IMF stated that inflation is expected to decrease for 2022, although it acknowledged that “uncertainty continues to be high”. In addition, the international organization stated that “there is a risk that transitory pressures will become more persistent and central banks will have to take preventive measures.”
Given this, the International Monetary Fund asked central banks to avoid tightening monetary policy until there are more clarity on the direction in which inflation is headed and to provide “clear communication” on the economic outlook.
Meanwhile, the president of The Fed, Jerome Powell, has downplayed the rise in prices, blaming the rise on widespread shortages that have disrupted the global supply chain and pent-up demand between the consumers. Although he said inflation could turn out to be “higher and more persistent than we expect,” Powell has repeatedly said that it is likely to be transitory.
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