Consumer prices in the United States rose 0.8% in November, above expectations. On an annual basis, the increase was 6.8%: this is the highest figure since 1982. A figure that is coupled with the alarm raised by the Parliamentary Budget Office (Upb) in the 2022 Budget Policy Report where it is emphasized that the increase in prices “could be more persistent than anticipated; in this case, inflation would affect purchasing power and could trigger a reaction of monetary policy, with adverse effects on economic activity ”.
In the US, the prices of Treasury securities fell immediately: beyond the 0.7% increase in food prices, those of energy grew by 3.5%, with that of gasoline increased by 6.1%. Over the past year, energy prices have increased by 33.3%, those of food by 6.1%. The Federal Reserve is expected to react to rising inflation with acceleration of tapering: next week, at the end of the meeting of the FOMC – its monetary policy arm – a monthly cut of $ 30 billion in the program could be announced. purchase of bonds worth 120 billion a month, against the initially planned cut of 15 billion a month.
Italy
As regards the scenario of the Italian economy, “it is surrounded by risks of various kinds, mainly oriented to the downside as regards the coming years”. The forecasts for the next quarters are based on the hypothesis that the current wave of infections does not create tensions on the health system, such as to require new restrictions on production activities in Italy.
Vaccination campaigns have been shown to be effective in reducing the most severe symptoms of Covid-19, but immunization currently affects less than half of the world‘s population, the UPB points out. The discovery of the new variant has made it clear that the time needed to overcome the pandemic is still very uncertain; however, the tool of vaccines could be joined in the near future by that of antiviral drugs, which would improve the course of the disease especially for the most fragile categories.
From a medium-term perspective, the context of the international economy outlined by the major forecasters “appears favorable today, but if the frictions in logistics and bottlenecks in supply were to be reabsorbed more slowly than expected, there would be risks on the dynamics of demand foreign exchange next year. There is also a risk connected to the hypothesis, implicit in the macroeconomic scenario of the Mef, of an integral, timely and efficient use by Italy of the European funds of the Next Generation Eu program, in order to implement the investment projects prepared with the Pnrr. This presupposes the effective availability of a large unused production capacity, especially in the construction sector; otherwise, this sector could show constraints on the supply side in supporting the considerable strengthening of public demand, thus mitigating the multiplicative effects on the other production sectors. A partial, delayed or inefficient implementation of the interventions would lead to the loss of a significant factor supporting growth ».