The cost of goods and services rose sharply again in August and left the rate of U.S. inflation at a 30-year high, with all signs pointing to price pressures snaking into next year. The personal consumption expenditure price index climbed 0.4% in August. It was the sixth straight big increase. The rate of inflation in the 12 months ended in August edged up to 4.3% from 4.2% — the highest rate since 1991, when George H.W. Bush was president.
The Institute for Supply Management’s U.S. manufacturing index rose to 61.1% in September from 59.9% in the prior month. The reading was the highest since May. Any reading above 50% indicates improving conditions. The ISM index had hit a high of 64.7% in March before rebounding over the last two months from a 59.5 reading in July. Demand is still strong but manufacturers are struggling with supply shortages. Survey participants talked about an “unprecedented number of hurdles to meet” rising demand.
The CEO of Marvell technologies one of the largest semiconductor makers in the world says that the semiconductor chip shortage that is hamstringing the production of products ranging from cars and computers to appliances and toothbrushes will extend into 2022 and potentially beyond that.