Inflation in April accelerates at 'fastest pace in more than 12 years'

A Labor Department report published Wednesday indicated that April's inflation accelerated "at its fastest pace in more than 12 years," reports CNBC — and car prices saw some of the most dramatic surges, with used vehicles reaching "new all-time highs," writes MarketWatch.

The report showed a 4.2 percent increase in the Consumer Price Index from last year, overshooting initial Dow Jones estimates of 3.6 percent.

The bottoming out of the U.S. economy this time last year contributed to the index's overall rise. While the country continues to reopen, the Federal Reserve is expected to hold off on major policy changes "until inflation averages around 2 percent over an extended period," as pandemic-related distortion is "expected for a few months," reports CNBC. Bloomberg adds: "This phenomenon — known as the base effect — will skew the May figure as well, likely muddling the ongoing inflation debate."

Notably, used car and truck prices rose 21 percent, including a "10 percent increase in April alone," says CNBC. The CPI, which measures the average price change in a market basket of goods and services, treats these transport prices as "key" inflation indicators. Even as Jalopnik reminds buyers that used cars are absolutely "not" appreciating assets, The Wall Street Journal reports the market may not normalize until next year.

COVID-19 production bottlenecks and an increased demand for commodities have also contributed to inflationary pressures, but Federal Reserve Chair Jerome Powell claims the overall impact will be "transitory." According to Bloomberg, "many" disagree.

More stories from theweek.com
The Republican theory of unemployment is classic Marx
There's growing speculation that Meghan Markle and Prince Harry will name their daughter 'Philippa'
Biden reportedly has a 'short fuse'