David Solomon, CEO of Goldman Sachs, in an interview with CNN said that inflation in the United States has not reached its peak. He has urged people to prepare for worsening inflation and an approaching recession.
Solomon revealed that while economists believe that inflation has already peaked, the business people and supply chain experts have a different view. According to them, inflation is still going to increase. On Goldman’s second-quarter earnings, Solomon addressed the investors stating that inflation is entrenched in the economy and it may not come down in the second half of the year.
According to data from the US Bureau of Labor Statistics on Consumer Price Index for June 2022 to be at 9.1%. This is the highest it has been in the past 40 years. CPI is a strong indicator of inflation levels in the country. The Bank of England also revealed the UK consumer price index to be at 9.4%.
Solomon believes that the current state of the economy is due to a number of factors, such as the pandemic, the monetary relief package during it, and the Fed’s dovish policies. It would take a long time for it to cool down because of this.
Pete Grandich, a notable author and economist, has the same perspective as Solomon about inflation. He also revealed that the previous major inflation 40 years ago did not have a supply chain crisis, this has made this economic period worse.
Lark Davis, a major crypto investor, and influencer has a different perspective. He believes that inflation has already peaked and the CPI data will be better in July now that the prices have calmed down.
Inflation has a major impact on the prices of crypto assets as well. The CPI data released in May led to the FED’s increasing the interest rates by three-quarters of a percentage point. There has been a significant decrease in the crypto prices after.
After the CPI data for June was released, the prices initially went down but then held and rallied. According to Davis, the fears regarding the CPI data might already be priced in.
Solomon believes that if inflation continues to rise, the crypto princess might decrease again.