JUST IN: Consumer prices rose by 7% in December over previous year, marking third consecutive month of high inflation.
driven supply chain issues — and also took the opportunity to increase profit margins on the back of brisk consumer spending.
Prices for shelter rose 0.4 percent, used cars and trucks rose 3.5 percent, and food rose 0.5 percent, the largest contributors to the increase.“Supply has not kept up with this rise in demand, and prices of goods have surged,” Moody’s Investor Services said in a report. “Supply disruptions, especially for semiconductors, have also contributed to shortages of high-ticket items such as new and used cars, and pushed up prices.
“That could be right, it could also just be though that demand is incredibly strong and they’re raising prices because they can,” Powell replied. “Across the country, dairy manufacturers are struggling to run with the surge of coronavirus cases, squeezing already constrained labor,” Matt Gould, editor of The Dairy Market Analyst, said in a research note.
Consumer expectations of continued inflation have also driven up demand as shoppers feel pressure to go and buy and “lock in” prices before they rise again, creating a self-fulfilling inflation prophecy.