The Corona pandemic has reduced the livelihoods of billions of people around the world over the past year. Now the infections have been reduced, and vaccination rates have increased in most countries. So, life has returned to normal. However, the supply is not keeping pace with the new demand. As a result, the cost of living has increased at a significant rate. The combination of rising energy costs, strong demand, and supply chain disruptions has led economists to rethink the economy for the coming year.
In October, consumer prices in the United States, Canada, the United Kingdom, and the other European countries rose sharply in three decades. In emerging markets such as Turkey, Brazil, and Argentina, inflation has reached double digits. In this context, inflation is still relatively low in some parts of the Asia-Pacific, such as China, Japan, and Indonesia. However, economists say that there is a tendency for inflation to rise in the region.
Sylvian Brewer, an economist at rating agency S&P, said inflation was generally higher in countries that had fallen last, such as Germany. In addition, the emerging economy is growing exceptionally well. In these economies, prices of local products are rising faster than currency devaluation.
In October 2021, inflation in the United States, Chile, Hungary, Mexico, Poland, Turkey, Brazil, and Russia exceeded 6 percent. Some people have exceeded two digits. According to Trading Economics, the US inflation rate in October stood at 7.2 percent, Mexico at 8.24 percent, Russia at 6.13 percent, Brazil at 10.6 percent, Turkey at 19.69 percent, and Argentina at 52.2 percent.
However, Americans who have been to the grocery store lately or started holiday shopping may have noticed that consumer prices have spiked. The annual inflation rate in the United States hit 6.2% in October 2021, the highest in more than three decades, as measured by the Consumer Price Index (CPI). So, the U.S has seen one of the biggest inflation increases in the world.
Understanding why the inflation rate has risen so quickly could help clarify how long the surge might last – and what, if anything, policymakers should do about it. Moreover, the recent acceleration in the inflation rate appears to be fundamentally different from other inflationary periods that were more closely tied to the regular business cycle. Explanations for the current phenomenon proffered to date include continuing disruptions in global supply chains amid the coronavirus pandemic; turmoil in the labor markets; the fact that today’s prices are being measured against prices during last year’s COVID-19-induced shutdowns; and strong consumer demand after local economies were reopened.
At least one thing is clear: A resurgent inflation rate is by no means solely a U.S. concern. A Pew Research Center analysis of data from 46 nations finds that the third-quarter 2021 inflation rate was higher in most of them (39) than in the pre-pandemic third quarter of 2019. Moreover, in 16 of these countries, including the U.S, the Inflation rate was two percentage points higher last quarter than in the same period of 2019. (For this analysis, we used data from the Organization for Economic Cooperation and Development, a group of most highly developed, democratic countries. The data covers the 38 OECD member nations, plus eight other economically significant countries.
