The U.S. Labor Department’s Consumer Price Index rose 0.6 percent in June after falling sharply during the previous three months.
Prices were pushed up by demand for a range of goods as stores reopened and consumers restocked basic items, replaced worn-out goods, and indulged in discretionary spending that had been postponed.
Gasoline prices rose 12.3 percent during the month, accounting for more than half of the price index’s jump.
The cost of groceries grew 0.7 percent and restaurant meals 0.5 percent.
TRENDPOST: The price gains implied a return of inflation, but most analysts believe any inflationary pressures will be eased by the ongoing lockdowns and consumer cautions as the lockdown effects linger and unemployment remains high.
Again, we forecast Draglflation: Prices will go lower as supply greatly outstrips demand. However, it will cost more to buy products as the value of the dollar declines and take more dollars (as well as other currencies) to buy products.
Of course, as currencies lose value, safe monetary assets, such as gold and silver, will be in greater demand, thus driving their prices higher.
