National

Washington (US), December 24: A key inflation measure closely watched by the U.S. Federal Reserve rose at the fastest pace in 39 years in November, increasing pressure on the central bank to tighten monetary policy.
The personal consumption expenditure (PCE) price index, the Fed's preferred inflation measure, jumped 5.7 percent in November from a year ago, the fastest annual pace since July 1982, the U.S. Commerce Department reported Thursday.
The so-called core PCE price index that strips out volatile food and energy prices, rose 4.7 percent from a year ago, well above the Fed's inflation target of 2 percent.
A separate report from the U.S. Labor Department also showed that the consumer price index (CPI) rose 6.8 percent in November from a year earlier, the fastest annual pace in almost 40 years.
"Much like the CPI, gains were more broad-based, which has raised red flags at the Federal Reserve," Diane Swonk and Yelena Maleyev, economists at major accounting firm Grant Thornton, said Thursday in an analysis.
"The consensus among members of the Fed is that variants are more disruptive to supply chains, including labor, than to demand and, therefore, more inflationary. Fed officials have left ample room to reassess if need be, before they start raising rates, which we expect to start in June," they said.
The Fed announced last week that the central bank would accelerate the end of its asset purchase program while projecting three interest rate hikes next year.
"We are phasing out our purchases more rapidly because with elevated inflation pressures and a rapidly strengthening labor market, the economy no longer needs increasing amounts of policy support," Fed Chairman Jerome Powell said last week.
Source: Xinhua