Austan Goolsbee discusses the cause of surging inflation in the U.S., supply chain issues putting a strain on the economy and GDP growth.
A key measure of annual inflation that is closely watched by the Federal Reserve is running at the hottest pace in nearly four decades as widespread supply disruptions, extraordinarily high consumer demand and worker shortages fuel rapidly rising prices.
Core prices, which exclude the more volatile measurements of food and energy, soared by 5.4% in the year through February, according to the personal consumption expenditures price index data released Friday morning. That measurement is the Fed’s preferred gauge to track inflation; it marks the 11th consecutive month the measure has been above the central bank’s target range of 2%.
Including food and energy, the inflation gauged jumped 6.4% in February from the previous year, the strongest gain since February 1982.
In the one-month period between January and February, core prices soared 0.4%, while the headline gain shot up by 0.6%.
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