1960 - 2022: A History of U.S. Inflation
1960 - 2022: A History of U.S. Inflation
June 2022 marks the third highest inflation peak since 1960.
The U.S. CPI inflation for 2022 was 6.5%. The core CPI, excluding prices of food and energy, reached 5.7%. Yearly inflation peaked at 9% in the month of June. This is the third-highest inflation peak since 1960.
As I mentioned in a previous post at AIER’s Sound Money Project, the Federal Reserve committed two mistakes. The first one was to let NGDP fell below its trend. The second one was to let NGDP go above its trend, which is an important explanation of 2021 and 2022 inflation rates.
This is not to say that Covid-19 and other supply restrictions bear no explanation on the rise in the price level. Yet, overall numbers and timing seems to fit better an explanation centered around NGDP deviations from trend once the whole period is taking into consideration.