Rising Energy Poses Big Inflationary Threat To U.S. Economy

Rising Energy Poses Big Inflationary Threat To U.S. Economy

Fears about inflation are rampant in Europe where natural gas and power shortages are colliding with the onset of winter to drive energy prices to record-breaking levels. Mix in the effects of supply chain bottlenecks caused by the global pandemic and you have a dangerous cocktail of rising prices and falling purchasing power of must-have energy products. And while the situation in the United States is not as bad, consumers and investors can't afford to be complacent. Wall Street traders are watching what's happening in Europe and anticipating inflation will continue to rise on these shores, too. Concerns about the most recent Consumer Price Index (CPI) report put the jitters in traders that knocked the wind out of the sails of the stocks market. The year-over-year CPI rose 5. 3 percent over its level last August and the core CPI is up 4 percent over the same period. That's a slight decrease from where they were in July, but it's still double the 2 percent inflation rate targeted by the Federal Reserve. U. S. consumer prices increased at their slowest pace in six months in August, however those figures ignore the volatile food and energy components of the market. Consumers