The testimony comes as the war in Ukraine pushes up the price of energy and agricultural commodities.
The study found that to keep up with price increases, Americans also expect their household spending to rise next year. Spending expectations rose to 7.7%, also a new high for the New York Fed survey and the biggest monthly jump since the series began in 2013.
Economists polled by Refinitiv forecast the CPI for March to hit 8.4%, in line with January 1982 levels and a new 40-year high.
It is not yet clear whether this is indeed the peak of inflation, as the conflict in Ukraine continues to increase price pressure. Americans faced a sharp rise in store prices in March, while food inflation is expected to remain high throughout the year.
So what to do?
The Fed has already begun to roll back its pandemic stimulus measures, including raising interest rates last month for the first time since 2018. The central bank is expected to continue raising rates this year to keep inflation under control.
Market expectations for a rare half-percentage increase at the next Fed meeting in early May are above 80%.
But there are fears that the Fed’s actions could do more harm than good.
Russia rejects “default”, trying to pay in rubles
The bills are coming due, putting Russia on track for its first external debt default in a century.
Here’s where things get fuzzy: Moscow has a 30-day grace period starting April 4 to pay capital and interest. This will be difficult to do under Western sanctions.
Of course, Russia has money. He just can’t access a lot of them.
Since 2014, the Kremlin has accumulated about $640 billion in foreign exchange reserves. More than half of these funds are now frozen due to Western sanctions imposed after the invasion of Ukraine.
Russia plans to challenge the “default” label, though it’s unclear exactly how.
“We will sue because we have taken all the necessary steps to ensure that investors receive their payments,” Finance Minister Anton Siluanov told the pro-Kremlin newspaper Izvestia on Monday.
“We will provide the court with evidence of our payments to confirm our attempts to pay in rubles, as we did in foreign currency. It will not be an easy process,” he added. He did not say who Russia is going to sue.
Kremlin spokesman Dmitry Peskov said at a press conference last week that any default would be “artificial” because Russia has dollars to pay – it just can’t access them.
“There are no grounds for a real default,” Peskov said. “Not even close.”
Spread Musk on Twitter
The saga was absolutely dizzying.
These are stunning achievements even for Twitter, a company that is certainly no stranger to corporate chaos, writes my colleague Claire Duffy. And that could be the start of many headaches for her relatively new CEO.
Musk still has a 9.2% stake and over 80 million followers on the platform. In other words, he may say no to a seat on the board, but he’s almost certainly not done trying to shake up Twitter yet.
Some analysts expect Musk to try to buy up even more shares of the company now that he is not bound by the board’s condition that his ownership stake is capped at 14.9%. If Agrawal has dealt with the friendly Musk so far, one can only imagine what a hostile approach would look like.
In a note to investors on Monday, Wedbush analyst Dan Ives laid out several possible scenarios for Musk’s next moves, including teaming up with a private equity partner to push for change or even stage a takeover. Or Musk could just continue to “create more noise and anxiety for the Board/Chiefs of Twitter.”
After all, Musk is a wild card, and now he is a powerful enough force to undermine Agrawal’s leadership once he came to power.
The US Bureau of Labor Statistics is to release its US consumer price report at 8:30 am ET.