Goldman CEO Forecasts Higher Inflation, Worst Is Not Over
While most experts predict that the bout of double-digit inflation is over, Goldman Sachs CEO David Solomon does not believe so. In a recent interview on CNN, he said that even if most economists predict that the worst is over and the CPI has peaked, experts from the supply chain and business community feel that inflation is still rising.
Experts Have Differing Opinions On Inflation
The US Bureau of Labor Statistics recently released the CPI or Consumer Price Index for June 2022. CPI had reached 9.1%, the highest in the past 40 years. The surging price rise has become a Global phenomenon aggravated by rising fuel prices caused by the war in Ukraine. The Bank of England released the UK CPI, which had also reached 9.4%.
Solomon indicated a number of factors for the present bout of price rise. It includes the pandemic and the economic package which was announced to alleviate the woes of the pandemic and the dovish policies of the FED all contributed to the present bout of inflation. Solomon predicts that the economy will take a longer time to cool down.
Notable author and economist Pete Grandich put forth somewhat similar sentiments. Peter even questions the figures of CPI put forth by the US Bureau of Labor Statistics and believes the figure to be much higher. Comparing the previous bout of double-digit inflation 40 years ago, Pete thinks that the situation is much worse because of a supply chain crisis that is worsening this economic period.
However, the crypto community is upbeat and believes the worst is over. Lark Davis, a major crypto influencer and investor, vouches that the CPI figures for July will be much better since the prices of most commodities and crude have cooled down.
What Is The Future Of Crypto
Inflation and crypto are intricately linked with one another. When the CPI data was released for May, it had a significant impact on the US equity market, and it also severely impacted the crypto sector. The Fed had increased the interest rates by three-quarters of a percentage point. The crypto prices crashed. However, in June, the prospects seemed a little better, and after an initial fall, crypto prices held and rallied.
However, if the Consumer Price Index continues to rise, as Solomon believes, the crypto prices may tumble again.