This week, a report on American inflation for April will be published. According to experts' forecasts, the consumer price index will slow down from 8.5% to 8.1-8.2%, which can be considered the first small victory of the Fed. Nevertheless, we would not advise Americans to open champagne on this occasion, since inflation in the States will remain at the highest value in 40 years. Moreover, a slowdown in inflation alone does not mean a trend. It's like with GDP. In the first quarter, the American economy lost 1.4%, but hardly anyone can conclude that the economy has already entered a recession. It's the same with inflation. One slowdown may be replaced by acceleration as early as next month. Moreover, gas and oil prices continue to rise in the medium term, and the introduction of an oil embargo by the EU may further inflate energy prices. Unfortunately, the whole world is on the verge of important structural changes, on the threshold of a global redistribution of the oil market. And it is unlikely that these changes will go unnoticed.
Meanwhile, the chairman of the Federal Reserve Bank of Chicago, Charles Evans, said that inflation in the United States will not fall to 2.0% even in 2023. He said only that the factors that accelerate inflation can reduce their pressure on prices. Evans also said that the Fed will bring the rate to a neutral level in 2022, after which it will probably take a break. At the same time, the chairman of the Federal Reserve Bank of San Francisco, Mary Daly, also said that we should not expect inflation of about 2.0% in the near future. She is more optimistic and believes that inflation will begin to slow down in 2022. Daly noted the high risks associated with the pandemic and the military conflict in Ukraine, which make any forecasts very inaccurate and vague. Indeed, hardly anyone knows at what point the whole world will be in a month. After all, even before 2020, no one could even imagine that the next two years would be very fun. And not for any particular country or region (wars, cataclysms, and epidemics have occurred in different parts of the world before), but for the whole world, since the consequences of the conflict in Ukraine will be felt everywhere.
Meanwhile, there is no good news in Ukraine. Fierce fighting continues in the East of the country, and reports are increasingly being received about possible new strikes by the Russian Federation on Ukraine, as well as about possible mobilization. Negotiations have long failed, which excludes the possibility of ending the conflict in the near future. Almost all experts believe that military operations will last for a long period. It remains only to follow other important geopolitical news. For example, Finland and Sweden are following the process of joining NATO.
