Is US inflation finally starting to slow down?
Is US consumer price growth finally beginning to moderate?
An upcoming US Consumer Price Index report is expected to show that inflation continued to rise in April, albeit at a slightly slower pace than in previous months.
Economists polled by Bloomberg estimate that US consumer prices have risen 8.1 percent year-on-year, compared to 8.5 percent in March. Inflation at that level would remain close to a four-decade high, but would represent the first slowdown in momentum since August 2021.
The so-called “core” CPI, which offsets the effects of volatile food and energy sectors, is also expected to slow down compared to April last year. But data released on Wednesday may still show that core inflation has picked up in comparison to the previous month.
The category to watch would be shelter costs, according to Bankrate’s chief financial analyst Greg McBride. “Sheltering is 40 percent of the CPI – as is the case for many household budgets – and with rents rising in the double digits, it puts the household budget in a vice, even when food and energy costs level out, ” They said. ,
It is one of two consumer price reports that will be considered by the Federal Reserve at its June meeting, during which interest rates are widely expected to rise 0.5 percentage points. A large deviation in either direction from the CPI forecast could change the Fed’s calculations. Kate Duguido
How much did UK GDP grow in the first quarter?
The Bank of England expects the UK economy to grow by 0.9 per cent in the first quarter, driven by the easing of all COVID-19 restrictions at the start of the year.
Economists polled by Reuters forecast a 1 percent growth in GDP in the quarter when the data was released on Thursday, but they also forecast a 0.1 percent increase in output between February and March. The reading would confirm the slowdown seen in February when growth declined to just 0.1 percent from 0.8 percent in January.
“We expect the economy to pick up again,” said Eli Henderson, an economist at Investec. She expects a 0.1 percent expansion in March, driven by services, manufacturing and construction ready to contract as they did in February. It said the slowdown in Covid vaccinations would ease, but the revolt in the entertainment and hospitality sectors would also subside.
After the first quarter, the BoE expects economic growth to be “rapid . . . a significant impact on the real incomes of most UK households and the profit margins of many UK companies due to higher global commodity and commodity prices,” according to its latest outlook published last week. indicating adverse effects.
The BoE’s forecasts were “clearly bleak”, said Ross Walker, an economist at NatWest Markets, with quarterly growth expected to alternate from near stagnation to outright contraction this year and next year.
Britain’s inflation expected to hit a 40-year high later this year, largely reflecting rising energy costs following Russia’s invasion of Ukraine, with economic output expected to fall by around 1 percent in the fourth quarter Is. And by the second quarter of 2025, the UK economy is expected to grow by less than 1 percent compared to today. valentina romi
Who will fill the gap in the wheat market left by Ukraine?
The war in Ukraine has stirred agricultural commodity markets, as buyers of grain and vegetable oils from the country as well as Russia try to find alternative sellers.
A jump in food import bills for poor countries has worsened hunger, as well as raised concerns about political instability. Russia is the world’s largest exporter of wheat, while Ukraine is the fifth largest exporter. According to the Food and Agriculture Organization of the United Nations, they account for 30 percent of global exports. Both countries contribute more than 60 percent of the world’s sunflower oil trade.
“My biggest concern for the egg market right now is wheat,” said Craig Turner, senior commodities broker at StoneX. India, which had a bumper crop in 2021, is cashing in on the jump in the price of wheat. This year’s crop was initially estimated to be a record one, but the scorching heat in India could damage the crop and trigger export restrictions.
“The world needs an exportable supply of wheat, and things could be very tight this summer,” Turner said.
The US Department of Agriculture on Thursday published its crop production report, covering cereals, oilseeds and other agricultural commodities, along with its monthly World Agricultural Supply and Demand Estimates report. The production report will include projections for this year’s US winter wheat crop, while WASDE will provide some insight into which producing countries can fill gaps in export markets. amico terrazzano
