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: U.K. faces threat of 19% inflation. Could that happen in the U.S., too?

Inflation in the United Kingdom could soar to as high as 19% by next year because of high winter-fuel prices, according to a new estimate. Could it happen in the U.S.?

It already has, once. The rate of U.S. inflation skyrocketed to 18% in 1946 after the government ended price controls and rationing put in place during World War II. Inflation also topped 13% in 1981 during the last bout of high U.S. inflation.

But there’s virtually no economist who thinks U.S. inflation is poised to explode well above 10% and reach early 1980s or post-World War II levels.

“Can it happen here? Anything can happen,” said Steve Blitz, a U.S. economist at London-based TS Lombard. “But will inflation go back to double digits? I doubt it.”

The situation in the U.S. and U.K. is very different, economists say.

For one thing, the U.K. is facing perhaps its worst energy shortage in history. The nation is already paying sky-high prices for natural gas and prices could keep going up if Russia further limits fuel exports to the U.K. and Europe over the winter.

Russia, the world’s second-largest producer of natural gas, has cut supplies to Europe after it imposed sanctions following the invasion of Ukraine.

A Citibank economist in London predicted in a new report that escalating natural-gas prices could push U.K. inflation to as high as 19% in 2023 from the current level of 10%. The U.K. only produces a small amount of natural gas itself.

The U.S., on the other hand, is the world’s No. 1 producer of natural gas and it has plenty available. While prices have climbed to a 14-year high, the U.S. is less dependent on natural gas for heating during the winter compared to Europe.

What’s also exacerbated the problem for the U.K. and Europe are weakening currencies, especially against the dollar.

A weak pound or euro means Europeans have to pay more to buy natural gas from alternative suppliers such as the U.S. or Canada. They also have to pay more for any North American good or service they buy.

That’s adding to their high-inflation readings.

The strong dollar has the opposite effect in the U.S. by making imports cheaper. It’s actually reducing U.S. inflation.

U.S. import prices sank 1.4% in July — they’ve been trending lower since the spring — to mark the first decline in almost a year.

The biggest impact the U.S. will face from soaring winter-fuel prices in the U.K. and Europe, economists say, is potentially slower growth at home.

Europe could tip into recession because of the financial pressure on consumers, especially if central banks raise interest rates high enough to counter inflation. That would curb U.S. exports and tourist revenue.

A slower global economy, however, would help clear up supply bottlenecks that have been a huge contributor to soaring U.S. inflation and make it easier for the Federal Reserve to rein in prices, said chief economist Chris Low of FHN Financial.

That’s another reason U.S. inflation is unlikely to match U.K. levels.

The yearly rate of U.S. inflation climbed to as high as 9.1% in June before tapering off to 8.5% in July. Economists predict inflation could slow again in August.

Just a year and a half ago, inflation was running around 2%.

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