(RepublicanNews.org) – The Wall Street Journal recently published an article warning that inflation would rise as the nation’s economy reopened post-pandemic. That prediction came true, according to recent Department of Labor figures released for April 2021.
Inflation rose at its fastest pace in more than a dozen years, rising 4.2% higher year-on-year. However, numbers can be a deceiving. Heather Long, an economics reporter for The Washington Post, broke it down in simple terms in a tweet containing three charts.
This is the best chart I've seen that clearly explains what's going on with inflation.
Yes, April saw the fastest inflation since Sept. 2008
But that's b/c prices were compared to last April.
— Heather Long (@byHeatherLong) May 12, 2021
The figures quoted by the Labor Department compared figures from April 2021 to those from April 2020. However, a year ago, market volatility led to an unusual decrease in prices, making the comparison misleading.
Additionally, the rise in prices over that 12-month period nearly perfectly matched where the numbers would have been in April, had inflation followed its pre-pandemic pattern. Lastly, inflation curves flatten significantly if unstable commodities like gasoline and food are removed from the chart. Granted, it may not look as bad when gas and food prices are not considered, but those are two major necessities where everyone feels the pinch.
The bottom line: Fed Chairman Jerome Powell recently stated that he and other members of the Fed believe the rise “will be temporary.”
Copyright 2021, RepublicanNews.org