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May 13, 2021
Consumer prices, from used cars to airline tickets, shot up in the US last month. But some economists think policy makers in Washington can and should ignore seemingly eye-popping inflation data, and worry instead about the recovery in the labor market.
The consumer price index (CPI), which measures what people pay for goods and services like clothing and restaurant meals, soared 4.2% in April from a year before, the biggest increase in more than a decade, according to a Labor Department report yesterday. The so-called core price index, which excludes prices on food and energy, and can be more volatile, jumped 3% in April from a year before.
Growth was actually taking a bit of a leadership role over the last month or so as Treasury yields came down from that 1.75% level down to sub-1.60% today. I do think at this point investors are really considering that perhaps we re at the start of a reversal of that move, Mahajan told CNBC s Trading Nation on Tuesday.
A rise in rates could be propelled by an assortment of factors, she said – a fully reopened economy in the summer months, continued stimulus and a Federal Reserve on the sidelines while inflation rises could all contribute to the 10-year Treasury yield moving back above 1.7%. Prices and yields move inversely.
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