(PatriotWise.com)- There are troubling signs in the economy, as inflation for businesses has reached a rate of 8.3% year-over-year. That marks the highest mark of that metric in at least the last 11 years.
The Bureau of Labor Statistics recently released the results of the Producer Price Index. That monitors changes in input prices for all businesses and also other domestic producers. In August, that index increased by 0.7%, which beat the 0.6% mark that many economists had earlier predicted.
On a year-over-year rate, the Producer Price Index is increasing at a rate of 8.3%. That marks the fastest it has increased since November of 2010. This marks the fifth month in a row that the Producer Price Index has increased, too, according to a Fox Business article.
Higher meat prices accounted for a large portion of the inflation for final demand goods, according to the Bureau of Labor Statistics. The agency explained:
“About a quarter of the August advance in prices for final demand goods can be attributed to an 8.5% rise in the index for meats. Prices for residential natural gas, industrial chemicals, processed young chickens, motor vehicles and steel mill products also moved higher.
“In contrast, the index for iron and steel scrap decreased 3.7%. Prices for diesel fuel and for natural, processed and imitation cheese also moved lower.”
Lawmakers and economists are becoming increasingly worried about inflation that is rising in the U.S. This often signals that the purchasing power of consumers and businesses is diminishing.
Republican Representative Kevin Brady of Texas told the Daily Wire last month that inflation as it’s occurring under President Joe Biden is the “mirror image” of various trends the U.S. saw under former President Donald Trump.
Brady, who serves as the ranking member of the House Ways and Means Committee, explained the situation:
“Wages grew twice as fast as prices. Every family’s purchasing power was growing under President Trump. As a matter of fact, in 2019, household income grew more in just one year than in all eight years of the Obama-Biden administration.”
For much of 2021 so far, inflation has outpaced real wage growth. That’s a huge problem for not just low-income and middle-class Americans, but for all Americans and for all U.S.-based businesses.
According to Brady, both the White House and the Federal Reserve share the responsibility for these rising levels of inflation. He said that both are “in denial about the seriousness and the length” of the price levels that are continuing to increase.
“Both the Fed and the White House have been very slow to recognize the role they’re playing in driving these higher prices.
“If we continue the emergency spending and expanding government checks as the President has proposed — and the fact that workers are not coming back to the workforce — what you’re going to see is the ‘demand inflation’ that we’re seeing today will transform into a ‘cost inflation’ — a ‘push inflation’ for the longer term.”