In order to avoid the downward spiral of wages and prices, the Fed may have to act in advance.
There are more and more signs that this round of inflation in the United States may be worse than expected.
Judging from the data released on Friday, the United States9Monthly personal consumption expenditure price index (PCEPrice index) increased year-on-year4.4%，This is1991The fastest growth rate since the year,The month-on-month increase is0.3%。
Eliminate the food and energy categories with high volatility,9Moon corePCEThe price index increased year-on-year3.6%，Continuation30Highest level of the year。
Compared toCPIThis is an inflation indicator that the Fed values more. The difference between the two has been introduced in detail by Wall Street.
In addition, personal income levels have declined and expenditures have risen month-on-month, which means thatSupply chain shortages and inflation have weakened consumers’ ability to buy their favorite products.
The slowdown in consumer spending has led toThe U.S. economy grew at the slowest rate in more than a year in the third quarter of this year。
Consumption is the largest component of U.S. GDP, accounting for about two-thirds of overall economic activity. In the third quarter, consumption growth slowed to 1.6%, which is also the slowest growth rate since the second quarter of 2020. The previous value is 12%. It dragged down the US GDP growth in the third quarter by only 2.0% from the previous quarter, a sharp slowdown from the growth rate in the second quarter.
While inflation is high, companies’ employment costs have grown at the highest rate in two decades.
According to data released by the U.S. Department of Labor,Employment cost index for the third quarter(employment-cost index)Ring up1.3%,Yes2001The highest growth rate since 2015.
This indicator mainly measures the changes in the labor cost of an enterprise. The labor cost of an enterprise usually includes employee salaries, subsidies, bonuses, and welfare expenditures.
Another indicator to track wages comes from Goldman Sachs, this one can be traced back to1965The chart for the year shows thatSalary increases in the United States are close to the eve of the financial crisis.
The reason why wage data is important is that labor costs account for a relatively high proportion of the operating costs of American companies.If labor costs rise sharply, it will severely squeeze the company’s operating profits, and even cause the company to shift costs to the consumer side.
This spiral of labor costs and prices is a situation that economists and Fed officials are particularly worried about.
now,U.S. companies’ labor shortage is getting worse, Due to the inability to recruit enough employees, employees in the leisure, hotel and retail industries have seen substantial salary increases.
Among U.S. adults, only62%，This is the last century70Lowest ratio since the decade。
People had hoped that more people would go to work after the relief payments ceased. But the actual situation is,In the context of the continuous and repeated raging of the new crown, the labor force is still in short supply.While economic activity has slowed, the number of Delta virus-related infections has surged in the third quarter.
This has planted a landmine for economic recovery. The tight job market is combined with factors such as insufficient production capacity, low port efficiency, and strong demand.Make the supply chain situation worse.
The Wall Street Journal citedRSM US LLCChief EconomistJoe BrusuelasExpress,The biggest concern right now is the continuing supply problem, which may keep prices high.
The latest University of Michigan Consumer Confidence Index shows thatConsumer expectationInflation will reach4.8%, Which is2008The highest level since the year.
In the United States, consumer confidence at the University of Michigan declined in October compared with September. The current conditions index was the lowest since the beginning of the epidemic last year. Consumers expect the inflation rate for the next year to be 4.8%, the highest since 2008, and it was 4.6% in September. Consumers expect the inflation rate for the next five to ten years to be 2.9%, initially 2.8%, and 3% in September.
Concerns about rising prices have kept consumer confidence levels low in recent months.
Continued high inflation may offset wage growth and worsen household financial conditions.In order to avoid wages–In the vicious circle of price spiraling, the Fed may have to act in advance.
“This is not because they have deviated from their core point of view, but because the risk of making mistakes has increased.”The Wall Street Journal cited Pantheon’s chief economist at Macroeconomic ConsultingIan ShepherdsonExpress.
The Fed is likely to be11moon2Day to3Officially announced at the meeting onReduce debt purchases (taper）In the last heavy speech before officials entered the silence period, Fed Chairman Powell’s attitude changed.
He said,“Now is the time to reduce debt purchases, but not the time to raise interest rates”, The Fed is stepping into soon and starting to graduallytaperThe track is expected2022Complete this process mid-year.
but,“If the Fed sees a serious risk of rising inflation expectations, it will use tools to reduce inflation.”
The Wall Street Journal, which has always reported on the Fed’s expertise, said,The point of Powell’s speech is“Implies that he is more worried about rising inflation”, Seems to have relaxed the calibre on raising interest rates. If concerns about inflation intensify and the rate of reduction is faster than expected, it may open a window for interest rate hikes.
officersexist9Bitmap of the monthIt is expected that once the debt reduction plan is completed,2022yearwillRaise interest rates once or not.
Prior to this, Canada and Australia in developed countries had taken the lead in releasing hawkish signals. The bond market was caught off guard, and the short-term national debt of the two countries soared rapidly.
Now, the market has bet that the Fed may significantly advance the time point of the first interest rate hike, next year6First rate hike in the month25The expected probability of a basis point is as high as90%, People speculate,2022The interest rate will be raised more than twice throughout the year, each time the interest rate is raised25Basis points.
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