The latest official inflation data show that consumer prices rose 1.5 percent in the U.S. last year, while they increased 2.4 percent in the euro zone for the year ended in January. Marc Faber, publisher of the Gloom, Boom and Doom report, says don’t believe those numbers.
Inflation totals 5 percent to 8 percent in the United States and slightly lower in Europe, he tells CNBC.
“I guarantee you … the annual (U.S.) cost of living increases are more than 5 percent, and the Bureau of Labor Statistics (which computes the consumer price index) is lying,” Faber says.
“Inflation is much higher than what they publish. I would imagine for most households it’s between 5 and 8 percent in the United States, and in Western European countries maybe a little bit lower — 4 or 5 percent.”
Inflation isn’t just a problem in the developed world, Faber explains. High food prices will cause political turmoil in Pakistan just like they have in Egypt, he says.
“You may not have the problem in Saudi Arabia and the Emirates, because there the governments can heavily subsidize food. But I’m particularly worried that what has happened in Egypt will happen in Pakistan.”
Read more: Faber: Global Inflation Far Higher Than Official Data