While Americans are still feeling the economic pinch of inflation, they aren’t the only ones suffering. Indeed, the most recent report by the Council of Economic Advisers (CEA) shows that other G7 member nations are suffering just as badly, if not worse.
For one thing, the report shows that annual inflation in the United States peaked earlier than in other G7 countries. The CEA pointed out this occurred in the summer of 2022 when gas prices going higher than $5.00 per gallon led to a spike of 10% in the country’s inflation rate.
Indeed, inflation in the United States is now under 3%, the lowest of any other G& nation. Inflation gauges in Canada and Japan presently stand at 4%, while nations that have borne the economic brunt of the Russian invasion of Ukraine like Italy and the United Kingdom remain at 8%.
While the CEA feels that the US economy is not out of the woods just yet, its officials see the results as encouraging as it shows that the country has made significant progress with regard to bringing inflation down.
The Experts Weigh In
For Moody’s Analytics chief economist Mark Zandi, the CEA’s recent analysis of the state of inflation in the US and other G7 nations shows that significantly higher inflation continues to be a challenge throughout the world. He added that the economic situation was also complicated by the effects of the COVID-19 pandemic as well as the ongoing sociopolitical conflict in the Balkans.
For his part, Joe Brusuelas, chief economist for the consultancy RSM, was impressed by the methods used by the CEA to gauge the impact of inflation in its report. He added that the report is more of a subtle message to the US Federal Reserve to bring its rate hikes to an end as opposed to a public relations stunt meant to inform public opinion regarding inflation.
