Deutsche Bank publishes a report saying that the United States is facing real issues related to client-driven inflation. And, the chief economist of the bank, David Folkerts-Landau, points out that this is because of Federal Reserve’s recent policy on inflation.
The Deutsche Bank thinks Feds are delaying and inflation is like a Time Bomb
According to many articles in the last few months, the price of different commodities in the US is rising rapidly. Moreover, we saw that oil was a two-year high, the price of lumber touched 377%. Also, electronics are now 10% more than the previous price. At the same time copper, soybeans, and prices of corn are also going up like crazy, and prices of meats are a shocker.
A few days back, the Deutsche Bank of Germany published a report showing a shocking inflation rate in the US. Folkerts-Landue, Peter Hooper, and Jim Reid play a vital role in the studies conducted. Esteemed analysts say that inflation is like a time bomb, and the US may face the consequences for its actions.
It is better to avoid delaying our solutions to a problem as the repercussions could be irreversible. And so says Folkerts-Landua that the consequence of delay can cause bigger problems both economically and financially. He adds that these issues might also create financial depression worldwide, and emerging markets will be affected the most. Although, the inflation may hit later because now economies are smarter than last year. Consumers worldwide will spend some of their savings as soon as economies open once again, says Folkerts-landau.
Foreign markets are also Confused by the US inflation rate
The United States is a big country, and many continents like Asia and Europe look up to that country for many things. Now, due to rising inflation in the US, foreign markets are also affected. Moreover, everyone had high hopes for cryptocurrency, but it did not perform as well as everyone expected. On the other hand, Gold saw a significant rise in value from the economic fears rising in the States.
However, everyone thinks that the Federal Reserve may stay patient for a year and tolerate the rising inflation rates. But, the authors who published the reports think; otherwise, they disagree with whatever Fed’s said on this.
No one is happy with the rising inflation rate, and the authors think that Fed’s negligence could lead people to a disaster. But, unfortunately, the feds are concentrating more on social goals than looking over the rising inflation. The authors say that the effects could be devastating, and it would affect vulnerable societies more. They also say that inflation could be temporary, but later it could worsen, which no one would have thought.
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