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Get your Christmas shopping in early! Federal Reserve warns delays and price hikes are expected this holiday season

 Delays and price hikes are anticipated in the United States for holiday merchandise, a Federal Reserve official warned Sunday, calling for more to be done to boost the workforce.

'Right now, we see consumers trying to get out early and spend their money to get their goods before they run out,' Mary Daly, head of the San Francisco branch of the US central bank, told CBS.

When shopping for the upcoming holidays, 'people are buying it now and they're being told oftentimes they can't get it until after the holiday has passed,' she said.

San Francisco Federal Reserve Bank President Mary Daly discussed the economy and holiday spending on Sunday on "Face the Nation."

San Francisco Federal Reserve Bank President Mary Daly discussed the economy and holiday spending on Sunday on 'Face the Nation.'

The sudden acceleration in the economy reopening up is putting a huge strain on the cross-border supply chains that keep factories open and shelves stocked. Pictured, container cargo ships sit off shore from the Long Beach/Los Angeles port complex in Long Beach

The sudden acceleration in the economy reopening up is putting a huge strain on the cross-border supply chains that keep factories open and shelves stocked. Pictured, container cargo ships sit off shore from the Long Beach/Los Angeles port complex in Long Beach

'So there are going to be delays,' as well as 'some pressure on holiday item prices,' the Fed official said.

To address this, it will be necessary to 'get more supply to the labor market, to the goods market.'

In other words, to speed up the flow and production of goods, people who have left the labor market because of the coronavirus pandemic and now cannot return due to constraints such as childcare or health concerns, must be enabled to return to work.

The US labor market, which showed a strong rebound in June and July, adding more than a million jobs in each month, slowed in August and September.

In September, only 194,000 jobs were created. 

Delays and price hikes are anticipated in the United States for holiday merchandise, a Federal Reserve official warned Sunday including these toys seen at a holiday showcase last month

Delays and price hikes are anticipated in the United States for holiday merchandise, a Federal Reserve official warned Sunday including these toys seen at a holiday showcase last month

CVS drug store shelves left empty due to supply chain crisis
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The backlog of billions of dollars of toys, clothing, electronics, vehicles, and furniture came amid surges caused in 2020 by the onset of COVID.

The United States has since largely returned to normal life - but demand for goods has surged as people get the hang of returning to normal.

Americans who were able to save money during COVID lockdowns are now splashing the cash, with that raised demand further credited with pushing up prices.

The trillions of dollars of COVID relief printed to help people put out of work by the pandemic has also been blamed for inflation.  

Supply chains have lagged far behind consumer demand due to a lack of manpower at American ports and the restrictions that came with the COVID-19 outbreak early last year. These constraints, which include social distancing and mandatory quarantines, have severely limited the number and ability of port workers to do their jobs.  

Jerome Powell acknowledges inflation pressures remain high
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 'Global infrastructure was not designed to handle goods at such a rate,' a logistics expert, who asked not to be named, told DailyMail.com.

'Supply chains are the artery who feeds our entire ecosystem. The government needs to intervene to stop this crisis immediately, or face increased inflation and unemployment, and economic breakdown - or face an end to global trade.'

'It is a volatile period we're in right now, Covid is not behind us, so I don't expect the job market to just be continuous,' Daly said.

'It is going to have these ups and downs, especially with the Delta variant,' she added, referring to the coronavirus variant that has spurred recent upticks in cases.

The Fed has said it wants to start tapering its asset purchases, which supported the United States during the pandemic, but it wants to see progress in the labor market before announcing the exact timing.

Most economists believe that September's disappointing job creation, however, should not be an obstacle to an announcement about tapering at the central bank's next meeting in November.

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