I’m no economist, even though my degree was in Economics. The only sector of the economy I really pay attention to is the one that affects me at work, steel.
As I’ve mentioned here before, the cost of steel at the mill in nearly all its forms has jumped 30% to 40% over the last four months, and the price of scrap is about double what it was a year ago. These increases are due to an incredible demand from the Chinese economy, which is projected to use more steel this year than the Japanese and American economies combined.
Now, I don’t remember much from my collegiate studies, but I retain enough to reach this conclusion: Sooner or later, this has to impact consumers.
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.6 percent in March, before seasonal adjustment, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The March level of 187.4 (1982-84=100) was 1.7 percent higher than in March 2003.
That 0.6% increase last month is a 7.2% annual rate.
Hold on, fellers, here she comes!