The U.S. Department of Labor released data on the 10th, the U.S. Consumer Price Index (CPI) rose 1% in May, up 8.6% year-on-year, the year-on-year increase has been three consecutive months in more than 8%.

　　Although the Federal Reserve has opened a cycle of tightening monetary policy, and said it will raise interest rates and "tapering" on the fast track, but the most serious inflation in 40 years has not seen relief. Economists believe that inflation continues to be high to the Federal Reserve to bring enormous pressure, the Fed policy "tightrope walking" difficulty is increasing, at the same time, the risk of recession in the United States intensified.

　　High inflation is difficult to "see the top"

　　Since October last year, the U.S. CPI year-on-year rate of increase has been higher than 6% for eight consecutive months. The latest data show that the CPI rose year-on-year in May to the maximum since December 1981, and the chain rate of increase was also significantly larger than in April. Excluding volatile food and energy prices, the core CPI rose 0.6% in May, up 6% year-on-year, both higher than the market's general expectations.

　　Specifically, U.S. energy prices rose 3.9% in the month, climbing 34.6% year-on-year, the largest year-on-year increase since September 2005. Among them, gasoline prices rose 4.1% from a year earlier and jumped 48.7% year-on-year. Food prices rose 1.2 percent from a year earlier and 10.1 percent from a year earlier, the first time in more than 40 years that the indicator rose more than 10 percent year on year.

　　Previously, some economists believe that U.S. inflation may have "peaked" in March, but the latest data show that this view does not hold water.

　　Wells Fargo senior economist Sam Bullard told Xinhua that food and gasoline prices are still climbing, at least in the next few months, no signs of inflation relief.

　　Data released by the American Automobile Association on the 10th showed that the national average price of regular gasoline hit a record high of $4.986 per gallon that day, up about 14 percent from a month ago, and up more than 60 percent compared to a year ago. Decreasing supply and increasing demand have led to higher gasoline prices, which, combined with higher crude oil prices, are likely to remain high in the near term.

　　American Enterprise Institute economist Desmond Rahman also said that the recent rise in international crude oil prices to more than $120 per barrel makes the view that inflation will peak in the short term doubtful.

　　U.S. Treasury Secretary Yellen said during a Senate Finance Committee hearing on the 7th that U.S. inflation is at an unacceptably high level and is expected to remain high.

　　Rising risk of recession

　　The latest data show that the Federal Reserve has a long way to go to control the continued surge in inflation, and the chances of a recession in the United States are increasing.

　　At its regular monetary policy meeting in March, the Fed raised its target range for the federal funds rate by 25 basis points from near-zero levels, starting a tightening cycle to curb inflation. in early May, the Fed announced a 50-basis-point rate hike and hinted at the possibility of multiple 50-basis-point rate hikes in the future.

　　Wells Fargo Securities economists Sarah Howes and Michael Plesse pointed out in a report that data in May showed that the level of U.S. inflation remains above the level the Fed wants, and the Fed is expected to continue tightening monetary policy, with a 50 basis point rate hike in next week's meeting not in doubt.

　　As the Fed takes more aggressive measures to tackle inflation, more economists believe that the risk of the U.S. economy falling into recession is on the rise.

　　Rahman told Xinhua that the fall in stock and bond market prices since the beginning of the year has led to the evaporation of about $12 trillion worth of U.S. household wealth, if it continues will increase the risk of an economic "hard landing" early next year.

　　Former vice chairman of the Federal Reserve Randall Quarles recently said in a media interview, taking into account the severity of inflation and unemployment levels, the Federal Reserve is unlikely to achieve a "soft landing" of the economy, its policies may be the result of economic recession.

　　The U.S. Consumer News and Business Channel 9 released a questionnaire for chief financial officers, 77% of respondents believe that the U.S. economy will fall into recession in the first half of 2023, none of the 22 chief financial officers interviewed believe that recession can be avoided.

　　Inflation continues to be high and the White House is feeling great pressure. A new poll by a U.S. political news and polling data aggregator site shows President Joe Biden's approval rating at a record low of 39 percent. Darrell West, a senior fellow at the Brookings Institution, told Xinhua that if inflation continues to grow at this rate, it will certainly hurt the Democratic Party's midterm election prospects in November.

Translated with www.DeepL.com/Translator (free version)