A global recession is on the horizon - please read OP for mod warning

The second sentence is false.

If CPI YoY is 10% in June 2022, it means that the price level (not the inflation rate) is 10% higher than June 2021.

Similarly, the third sentence is false.

The inflation rate refers to the rate of change of the consumer price level.

A rate of 5.5% means that the price of a basket of g+s is 5.5% higher than a year ago.

The inflation 'rate' is measured over a period of time, hence its a rate not an index. YoY or MoM is a rate.

The index is the absolute measure at a single point in time. CPI of 120 for example means prices are 20% higher than baseline of 100 (based on 1980s basket of goods I think)

A YoY metric is a comparison between 2 indexes, or the inflation growth rate for that year. It is not a comparison of the rate of inflation for 2 year periods as you claimed.

YoY of 5% means prices are 5% higher than last year, it does not mean prices have risen 5% more than they rose in the prev year on year period.

Chances of a recession in USA:

Wolfey, 5.5% what, higher or lower, it can only be one of those ? Your figures are totally correct BTW

"You do not understand what year on year means i think.

If CPI YOY was 10% June 2022 it means inflation rate was 10% higher than June 2021.

If CPI YOY is 5.5% June 2023 it means inflation rate is 5.5% higher than June 2022.

So inflation is 5.5% higher in June 2023 than June 2022 not lower."

The issue here is with the English language, as well as economics.

An inflation rate of 5.5% means that the price level is 5.5% higher than it was a year ago.

In simple terms, the cost of a basket of g+s is 5.5% higher than the cost of the same basket a year ago.

Whereas, an increase in the inflation rate of 5.5% means that the rate is 5.5% higher than the rate was a year ago.

For example, inflation rate a year ago of 3%, and inflation rate now of 8.5%.

This means that inflation is speeding up, that the rate of increase of prices is itself increasing.

You are correct. An inflation rate of 5.5% means that the price level is 5.5% higher than it was a year ago. On the other hand, an increase in the inflation rate of 5.5% means that the rate is 5.5% higher than the rate was a year ago, indicating a faster increase in prices.

Earlier this month the US dollar took a sharp dive because the FED indicated it might only raise interest rates two more times. If this is enough to lower the value of the US dollar, the FED may have no choice but to continue hiking rates a lot more than two more times. After all, a weeker US dollar will increase US inflation. The same is true of the Eurozone. If the ECB even hints it is nearing the end of it`s hiking cycle, the Euro will probably begin to fall in value and fall more substantially if the ECB really does stop increasing interest rates. This will increase EU inflation as imports to the EU will be more expensive. Higher inflation will necessitate higher interest rates.

But one other point about the US dollar, if it falls in value, that will portend a recession in Ireland. Why? I am not exactly sure but I think it was George Lee who said so in a documentary he made about a year before the Celtic Tiger`s demise. (Probably because we export a lot to the US and a lot of our multinational companies are US owned). And yes, when the US dollar went lower the following year, multinational activity slowed in Ireland. Today, we do not have a booming construction sector like we had then so we rely more than ever on the multinationals. If they were to shut shop, we would be in serious difficulty but there would be a way forward and here it is (drum roll):

In order to generate enormous income for the government, and create a strong market driven construction boom with all the jobs and support services that would require, and to solve the present housing crisis, we could and should tax existing housing stock heavily but exempt first time buyers and new builds from the tax. If we did this, existing homeowners would sell to tax exempt first time buyers in order to buy newly built tax exempt houses for themselves. This would deflate our artificially inflated property prices, fuel a construction boom and generate the 200 billion euro revenue needed to undo everything Enda Kenny did and return the national debt to pre Enda Kenny levels. Deflating Enda Kenny`s bubble in house prices is the best thing we could do for our economy, especially if we needed to generate economic activity should a faultering US dollar begin to stress the multinational sector going forward.

That is my two cents.

George lee, now an rte environmental correspondent....

DOW just posted it's best consecutive winning streak since 1987

...yup, lets protect asset markets, hence asset owners, at all costs!

...happy days, should make citizens and businesses debt repayments much easier so.....

Some turnaround in Ireland GDP with a 6.5% turnaround in just a quarter.

....but what about rate rises, what negative effect is this having on debt repayments, particularly in the private domain, i.e. private debt, thus the economy at the macro level?