The primary cause of inflation in the US was rising oil and gas prices
Inflation is on the rise everywhere in the world. Inflation surged during the pandemic but escalated due to the Russia Ukraine war. It was assumed that the increase in inflation would be temporary. But the change of policy rates by the banks in 2022 suggests otherwise.
Like all other countries in the world the US is also hit by inflation. Inflation in the U.S reached its peak in June at 9.1%. This was the highest in four decades. It did lower in July and dropped at 8.5%. The economists expected a further drop of 0.1% in August instead it rose to 0.1%.
This inflation in the US is different and unusual than the previous ones. In the previous decades, it took years to reach the peak inflation rates but this time the consumer price index increased from 1.4 to 9.1 in a matter of 12 months. The last time inflation in the U.S was this highest was in 1960 and 1970 but even then it took 12 years to reach such heights.
At first this inflation was a result of a pandemic since when demand increases, supply chain gets affected. But the Russian Ukraine war brought inflation on a global scale. The food and energy prices have skyrocketed all over the world. This directly impacted the rates of inflation in the U.S.
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The price of every commodity has increased. At first, it started with the prices of luxury items where people adjusted by holding onto their old cars or equipment. Instead of going to the gym they bought home based fitness machines. Simple living was the new thing. But the problem escalated. After the pandemic, due to the Russia Ukraine war, the cost of even the basic necessity item has plummeted. People are finding it hard to adjust to current inflation. The sanctions on Russian export of oil and gas have increased the prices of energy resources all over the world. It has majorly affected the import, export processes since the cost of transportation has increased manifolds. Due to this reason not only the governments are unable to provide food and basic supplies on lower costs but the local businesses are also impacted. The increased costs and less purchasing power of people has affected many businesses. Many of them are completely shut down or are nearing the end. This directly affected the economy.
The U.S government tried to control the inflation to a stable price point. They somewhat did find success but the prices of notoriously volatile commodities like fuel and food can rise again and the prices for other essential commodities are still high.
This has become a challenge for the government to stabilize their economy and cut back on inflation in the U.S.
The primary cause of inflation in the US was rising oil and gas prices The primary cause of inflation in the US was rising oil and gas prices The primary cause of inflation in the US was rising oil and gas prices The primary cause of inflation in the US was rising oil and gas prices The primary cause of inflation in the US was rising oil and gas prices The primary cause of inflation in the US was rising oil and gas prices The primary cause of inflation in the US was rising oil and gas prices
