This week stock markets have been under pressure as investor worries about meaningfully higher inflation have begun to go mainstream. Indeed just last week we wrote about the price of lumber, which has spiked almost 500% in the last 12 months, making housebuilding significantly more expensive.
The numbers are in
So the US inflation data released this morning had a lot of eyeballs on it — and the numbers came in pretty meaningfully ahead of expectations. Overall the Consumer Price Index (which measures the prices of a basket of consumer goods and services) is up 4.2% over the last 12 months. That's the highest reading since 2008.
Some of that jump can be explained by the pandemic because comparing anything from this year with 12 months ago can look pretty weird — but even the monthly gain was +0.8%, way ahead of forecasts for +0.2%. Inflation might be back.
