The fall in US prices is expected to reach the fastest level in almost 40 years

Rising consumer prices in the US are expected to rise sharply for almost four decades in December, with the Federal Reserve concerned about the risk of rising inflation and its effects on the economic recovery.

Consumer Price Index (CPI) is said to have risen by 7 percent last month, down from 6.8 percent registered in November, according to a consortium forecast made by Bloomberg.

However, monthly interest rates are expected to be 0.4 percent between November and December, down from 0.8 percent in the previous period. The news will be released at 8:30 a.m. Wednesday morning.

“Core” inflation, which removes static items such as food and energy, is expected to continue with significant growth compared to the last reading. Economists predict that the average CPI will have jumped to 5.4 percent, more than 4.9 percent annually. This means another monthly increase of 0.5 percent.

The news comes a day after Jay Powell, chairman of the US Federal Reserve, warned that inflation was “high risk“Recovering the labor market and reaffirming the intentions of the central bank to quickly reduce its financial support.

Senior executives are beginning to revise their plans to raise interest rates from the lowest to zero levels once they reach their two high-performance and inflation target of about 2 percent over time.

The events of December are expected to show further evidence that inflation is on the rise in the mainstream of the economy and is at stake.

December inflation estimates are expected to force Biden officials on the financial system in preparation for the mid-202 election. has been hampered by rising prices and declining stock prices.

“Obviously, this is a big problem. . . Americans feel the price has dropped, “a White House official told FT. [of inflation] Throughout the year, the President and administrators look intently and strive to move forward as much as possible. “

The White House has been working to reduce barriers to major ports, overcome competitive practices in other markets such as the meat industry and promote mass production around the world to lower oil prices. It has refused to adopt other measures to control inflation, such as the removal of logs from China.

Inclusion and recent developments in the labor market – where the risk of unemployment falls below 4 percent and wage earnings are rising sharply due to declining labor – economists are now. wait the Fed to raise interest rates in March, with two or three other changes that take place at the end of the year.

The Fed has also shown its willingness to start reduction growth of $ 9tn at some point in 2022 with no further repercussions for growing Treasury revenue and mortgage-backed security.

This, so-called run, should happen “sooner and later” than when the central bank last tried to downgrade its operations in 2017, Powell said Tuesday.

There are no fixed plans for when the money may start to decrease and how fast the Fed can move forward.

Raphael Bostic, President of Atlanta Fed, Tuesday he said contributes to lowering interest rates by at least $ 100bn per month after the first interest rate expected in March. At least two interest rates will be appropriate in 2022, he said.