Inflation in the US Could Rise to 12% By Year-end: Analyst

Vinod Dsouza
michael wilkerson stormwall advisors founder

The current inflation rate in the United States is 6.41%, down from 7.5% in the fourth quarter of 2022. While inflation has considerably cooled down and analysts predict that the cost of living could return to normal, the founder of Stormwall Advisors, Michael Wilkerson, believes otherwise. Wilkerson cautioned that things could get worse this year as the Federal Reserve “is going to run out of firepower.”

According to Wilkerson, inflation in the U.S. could reach 12% by the end of 2023 and wreak havoc in the markets.

His prediction comes at a time when the consumer price index (CPI) has been on a downward trend for seven consecutive months. Wilkerson emphasized that inflation dropping doesn’t signify normalcy, as “inflation doesn’t move in a linear path; you do see some cycling,” he said.

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US Inflation At 12% in 2023?

Source: Gulf Crypto

The market strategist admitted that his views are in the minority, but things could turn sour as each month passes. “I don’t believe we’ve seen the end of inflation, and I do think we’re gonna see another spike up,” he told Kitco News.

He added, “Whether it’s 8% or 12%, nor can I say precisely what it will be by the end of 2023. But I do believe that it is possible that we find ourselves back in that range this year”.

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The strategist revealed that the Feds could misstep and run out of firepower to tame the rising inflation. “The Fed is going to run out of firepower. Ultimately, this becomes a trade-off between tamping down on inflation, slaying the inflationary dragon, and allowing recession and unemployment to rise. And governments, always and everywhere, choose inflation,” he summed it up.

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In addition, leading banks such as JP Morgan, Standard Chartered, and the World Bank have predicted that a recession could hit the markets this year. You can read more details about it here.