(on November 23, pedestrians wearing masks pass by holiday decorations on the streets of New York, USA.) In November, the United States ushered in the "holiday season" and "shopping season", with thanksgiving, "Black Friday", Christmas and new year coming one after another. However, recently, the impact of the US supply chain crisis is spreading in various fields, and the supply chain shortage is turning into general inflationary pressure. Many US companies say they have to compensate for rising commodity and labor costs by raising prices. In the face of high inflation and rising prices, how to buy on holidays without emptying their wallets has become a difficult problem for many American families. Inflation has once again become the focus of attention in the United States and even the world. It is noteworthy that the Federal Reserve has recently continuously released information on tightening monetary policy, such as reduction, interest rate increase and table reduction, and gradually put it into practice, so as to deal with the impact of high inflation on the economy. Therefore, in addition to inflation, the trend and impact of US monetary policy also deserve high attention. What is the current trend of inflation in the United States? With the unprecedented double expansion of money and finance, US inflation began to rise from the end of 2020. By September 2021, the core PCE reached 3.6%, significantly exceeding the tolerable range of the Federal Reserve's 2% target and average inflation target. However, the shift of monetary policy depends not only on immediate inflation, but also on inflation expectation. Although the Fed's view has been slightly adjusted, it has always adhered to the view that the current inflation is a temporary impact. From the perspective of the yield of us anti inflation treasury bonds, inflation expectations are still at a tolerable level, and major international institutions are optimistic about the trend of US inflation in 2022. Since the outbreak, large-scale, strong and rapid relief, subsidies and economic stimulus policies for enterprises and individuals, as well as the popularization of vaccines, have been the main driving force for the recovery of U.S. economy and demand. However, the labor participation rate in the United States has remained low, and job vacancies have exceeded the number of unemployed. This obviously restricts the growth of supply. In the context of the global value chain, the repeated epidemic has led to slow recovery of the supply chain, and individual supply chains even face the risk of chain disconnection, which has also inhibited the output of the United States. Therefore, there is an obvious gap between the recovery on the supply side and the recovery on the demand side. Coupled with logistics delays and high shipping price index, inflation seems inevitable. Of course, if the epidemic is controlled, inflation will also be alleviated. The global economy may face stagflation risk Before the outbreak of COVID-19, some emerging economies themselves had inflationary pressure, high debt risk and tight financial situation. In addition, the popularization of vaccines in these countries lags behind, the risk of economic restart is high, and the policy space to deal with global inflation is more limited. For these countries, although raising interest rates will help curb inflation, it will also push up refinancing costs, inhibit economic growth and increase debt risk. If the United States tightens monetary policy, it is easy to cause capital outflow and currency devaluation. The expectation of the Fed's wide reduction in 2013 once caused the so-called reduction panic in emerging markets. This time, due to the more serious debt problem and the relatively slow recovery after the epidemic, any move by the Federal Reserve may be a great challenge for emerging markets. (on November 23, pedestrians walk in Times Square in New York, USA.) While the supply side is facing constraints and high uncertainty, the global economy is facing a certain degree of stagflation risk due to the demand expansion brought by the previous monetary easing and fiscal stimulus policies. Moreover, the epidemic has led to the further expansion of the scale of global sovereign debt, and the absolute scale and relative scale have reached an all-time high. In this context, the risks of stagflation and debt crisis coexist, and the global economy is facing challenges. Even if the stagflation pressure is expected to ease, the negative supply shock may continue, the economic recovery of various countries may be divided, and the macro policy exit of major economies may lead to stagflation or debt crisis in some regions and even more countries in extreme cases. How should China respond? There is no doubt that the rise of global price level has brought imported inflation pressure to China. From the perspective of direct impact, imported inflation means that the cost of imported intermediate goods increases and the profits of middle and lower reaches enterprises are compressed. If the Federal Reserve tightens monetary policy, it will increase the financing cost of Chinese enterprises issuing US dollar bonds and test their solvency. From the indirect impact, if the world falls into stagflation, it will have a negative impact on China's exports, and then face the pressure of rising financing costs, capital outflow or asset impairment. If debtor countries default or restructure their debts, China's overseas assets will face risks. Therefore, China should adhere to the "new development pattern with domestic circulation as the main body and domestic and international double circulation promoting each other", that is, adhere to China based macroeconomic management and moderately improve inflation tolerance; Strengthen macro Prudential Management and prevent the transmission of overseas financial risks; Enhance the marketization level and exchange rate flexibility of RMB exchange rate, and improve the tolerance of enterprises to exchange rate fluctuations; Actively participate in international debt governance and alleviate the debt burden of low-income economies. At the same time, as a responsible big country, we should also provide assistance to other countries, especially emerging markets, to tide over the difficulties on the basis of realizing the popularization of domestic vaccines. (Xinhua News Agency)