Consumers around the globe face higher prices for a wide variety of everyday purchases, as supply chain problems bedevil markets for all manner of goods, and energy prices spike to highs not seen in years.

That means consumers around the world are paying more for items like food, clothing and household supplies, and for major purchases like cars, appliances and homes. The impact is felt most acutely by low-income families, who find that their limited incomes cover fewer of their immediate needs than before.

The question on the minds of many economists, however, is whether surging prices really are "transitory," as senior officials in the United States have been saying for months, or are they the beginning of a period of more sustained price growth than most of the world's major economies have seen in decades.

In testimony before Congress last week, Federal Reserve Chair Jerome Powell said that "frustrating" global supply chain problems resulting from the end of pandemic lockdowns have extended a period of inflation longer than he and other central bankers had originally expected. But he said he remained confident that they would eventually resolve themselves.

"The current inflation spike is really a consequence of supply constraints meeting very strong demand, and that is all associated with the reopening of the economy, which is a process that will have a beginning, a middle and an end," Powell said. "We see those things resolving. It's very difficult to say how big those effects will be in the meantime or how long they will last."

Inflation concerns

Some economists, however, worry that the Fed is underestimating the forces driving prices on everything from food to automobiles.

"There are very many reasons to think that this inflation is not transitory — that it's going to be with us for quite a while," Desmond Lachman, a senior fellow at the American Enterprise Institute in Washington, told VOA.

On Tuesday, the price of the global benchmark for oil, Brent crude, rose to $82.56 per barrel, hitting a level not seen in three years. Worldwide, prices for food, fuel and consumer goods are on the rise.

The price of natural gas has more than tripled in Europe and Asia this year, leading to economic slowdowns in much of Europe and power cuts in China. Even in the United States, which normally has a plentiful supply of the fuel, prices are jumping on concern that there may be shortages in the winter months.

https://www.crimeandmoreworld.com/as-prices-for-goods-and-services-rise-worldwide-inflation-feels-less-transitory/

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