Economics
The US Is Exporting Inflation, and Fed Hikes Will Make It Worse
Pandemic spending on goods and a supercharged dollar boost inflation elsewhere, as the US trade gap—once a boon—becomes a headache.
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For decades, US households bailed out the global economy when it needed a consumer of last resort. America’s latest spending spree has come with a sting in the tail.
Stuck at home in the pandemic, people all over the world bought more goods—TV sets, laptops, and exercise bikes, to name a few—at the expense of services such as hotel rooms and gym memberships. The shift was significantly bigger in the US than in other rich countries.