The Consumer Price Index Rose 4.2% In April Compared To The Same Month Last Year.
The consumer price index rose 4.2% in April compared to the same month last year, officials reported yesterday, the largest year-over-year increase in prices since 2008. The index measures the price of everyday items like groceries, clothes, and activities, and is closely linked to inflation—an effect where consumers are able to buy less with every dollar they spend.
Analysts pointed to a number of drivers for the price rise: a flood of consumer spending, pandemic-induced supply chain issues, and prices returning to normal after a year of weakened demand. Beyond short-term price normalization as the economy recovers, many have expressed concern that the more than $5T in economic stimulus passed over the last year and federal interest rates near zero (see overview) will lead to an overheated economy.
The news follows a weak April jobs report that undershot expectations by more than 730,000.