Inflation.... It's Baaack!
As a public school teacher who doesn't get cost-of-living pay increases, (my monthy take-home pay is only $100 more than it was in 2002) I'm very sensitive to rising prices. The news is not good:
US inflation jumped to an annual rate of 4.3 per cent in November, explaining why the Federal Reserve remains reluctant to cut interest rates too aggressively in spite of the risks to growth.And let's not forget that in order for one's salary to actually keep up with rising prices, a teacher not only needs to have a pay increase that keeps pace with higher prices, but also covers the additional taxes on income.
The data showed the continued pressure on prices from high food and energy costs and highlighted the risk the economy will face at least a brief period of "stagflation" as growth slows and inflation rises.
For the fifth year in a row, it looks like my salary's purchasing power is going to take yet another hit...