The deeper anxieties of inflation hawks – MENAFN.COM

The deeper anxieties of inflation hawks – MENAFN.COM

FLIP SIDE: Today's dollar-centred world reflects the power alignments of the period between the end of World War II and the end of the Cold War in 1989. US power has since eroded, opening the possibility that the world's monetary system could one day flip. (MENAFN - Gulf Times) In a recent commentary for The Washington Post, former US Secretary of the Treasury Lawrence H Summers stated that ''the consumer price index rose at a 7. 5% annual rate" in the first quarter of 2021. I could not reproduce this number from the Bureau of Labour Statistics CPI-U website, which reports a year-on-year increase (April 2020-April 2021) of 4. 2%, driven largely by a sharp 49. 6% rebound in gasoline prices from their pandemic crash. When food and energy prices are excluded, the inflation rate over the past year comes to just 3%. Odder still is Summers's rationale for projecting future inflation risks: ''Inflationary pressures are mounting from the boost in demand created by the $2 trillion-plus in savings that Americans have accumulated during the pandemic; from large-scale Federal Reserve debt purchases, along with Fed forecasts of essentially zero interest rates into 2024; from roughly $3 trillion in fiscal stimulus