US President Donald Trump is leaving no stone unturned to embarrass other countries by imposing tariffs. However, his gamble seems to be backfiring. Inflation has increased in the US due to tariff pressure. As a result, people are now in a big hurry due to the sharp increase in the prices of various goods.
According to media reports, the price of food and air fares, clothing and second-hand clothes has increased significantly due to tariff pressure. In this regard, the Labor Department said that prices increased by 2.9 percent compared to a year ago, compared to 2.7 percent last month and this is the biggest increase since January. It was also reported that the core price index excluding food and energy increased by 3.1 percent.
Jobs have also decreased
These numbers show the challenges facing the Fed, as President Donald Trump is constantly putting pressure on to reduce interest rates. The situation in the US is not limited to inflation alone. According to government reports, it has been found that jobs have also decreased in the US in the past few months. Fewer people have found jobs this year compared to last year. Let us tell you that the unemployment rate is 4.3 percent. In addition, there was a large increase in unemployment claims last week, indicating that people could lose their jobs at any time.
According to reports, the Fed cuts its key interest rate to stimulate spending and growth when unemployment rises. But rising inflation can do the opposite and raise rates. Inflation has also increased on a monthly basis. Prices rose 0.4 percent between July and August. Core prices also rose during that time, and in the second month, they rose 0.3 percent.
