By the 1980s, the success of that strategy in the United States confirmed the earlier views that a loosening of regulatory restraint on business would improve the flexibility of our economies. Flexibility implies a faster response to shocks, a correspondingly greater ability to absorb their downside consequences, and a quicker recovery in their aftermath.
Global factors, such as COVID-19-related supply disruptions and Russia's invasion of Ukraine, account for much of this increase. But domestic price pressures have also been building. Together, this has contributed to the highest rate of core inflation for many years.