Prices are skyrocketing in the United States as well. In May, the US government estimated inflation at 8.6 percent. Confidence that we have reached the peak is thus diminished. In April, consumer prices rose 8.3 percent. Economists had expected a stable inflation rate for the past month, but that has not changed.
So inflation is still at its highest level for over forty years. This is due to the high cost of fuel due to the Ukraine war. Like Europe, Americans are struggling at record prices at the pump. Food prices have also gone up, causing many American households to see their purchasing power declining.
Joe Biden’s fame under pressure
Excluding fuel and food prices, which often show big moves, inflation was 6 percent, up from 6.2 percent in April. Economists expect core inflation to be 5.9%.
For US President Joe Biden, inflation is a tough blow. Its popularity is under great pressure as more and more people are dissatisfied with rising prices. Biden says combating inflation is his administration’s top domestic priority.
Coincidentally, the approach to inflation is somewhat faster in the United States than in the EU. The European Union has just decided to raise interest rates from July, The US Federal Reserve already did that in May. It raised interest rates by half a percentage point, the strongest rate hike in 22 years. The central bank has indicated that it will continue to raise interest rates by half a percentage point in future policy meetings aimed at curbing inflation. The central bank has raised interest rates twice this year by a total of 0.75 percentage points.
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