Interesting Inflation

The US economy is currently experiencing two types of inflation, base-effect and bottleneck. Base-effect inflation is the result of collapsing prices a year ago, during the lockdown. This inflation thus manifests itself in year-over-year inflation measures and will quickly subside. Conversely, bottleneck inflation is due to current shortages of parts, materials, and labor, and reveals itself in month-over-month inflation. Focus on M-o-M inflation. It should begin to subside by 1/1/22.

Recent Posts

Categories