This comes on the heels of data released late on Wednesday that showed THE US consumer price index (CPI) rose 9.1% year on year in June, beating market expectations of 8.8% and recording the fastest growth since 1981. Stocks and bonds plunged in Europe and the US, the dollar rallied in the short term and gold fell sharply on hopes the Fed would take a more aggressive approach to fighting inflation. Demand outlook cast a shadow again!
1. Prices shoppers paid for a wide range of goods rose sharply in June as inflation kept a lid on the slowing U.S. economy, the Bureau of Labor Statistics reported Wednesday. The CPI Consumer price index, a broad measure of everyday goods and services, surged 9.1% from a year earlier, higher than dow Jones' estimate of 8.8%. That's the fastest rate of inflation since December 1981.
2. Excluding volatile food and energy prices, the so-called core CPI rose 5.9%, versus expectations of 5.7%. On a monthly basis, headline CPI rose another 1.3% and core CPI rose 0.7% versus expectations of 1.1% and 0.5% respectively. Taken together, the numbers seem to run counter to the idea that inflation may be peaking, as increases are based on various categories.
3. "The CONSUMER price index delivered another shock, with the June number rising further and, just as painfully, the sources of inflation broadening," said Robert Frick, business economist at Navy Federal Credit Union. . "While the surge in the consumer price index has been driven by energy and food prices, which are largely global issues, prices of domestic goods and services, from housing to cars to clothing, are also still rising."
4. Energy prices soared 7.5% in the month and 41.6% in 12 months!! The food index rose 1 percent, the sixth straight month that household food rose at least 1 percent. Housing costs, which account for about a third of the CPI, rose 0.6% for the month and an annual average of 5.6%. Rents rose 0.8% in June, the biggest monthly increase since April 1986.
5.Stock futures tumbled and government bond yields soared after the data were released. Most of the increase in inflation came from gasoline prices, up 11.2 percent for the month and just under 60 percent in 12 months. Electricity costs rose 1.7% and 13.7%, respectively. New and used car prices rose 0.7% and 1.6% respectively. Medical expenses rose 0.7 per cent in the month, driven by a 1.9 per cent increase in dental services, the biggest monthly change recorded by the industry since 1995. Air fares were one of the few areas to show a decline, falling 1.8 percent in June but still up 34.1 percent from a year earlier. Meat, poultry, fish and eggs also fell 0.4% in the month, but rose 11.7% from a year earlier.
6.The price rises mark another tough month for consumers as the cost of everything from airline tickets and used cars to bacon and eggs soared.
7. Accelerating price rises in the US were compounded by a further fall in real incomes, the 15th consecutive month of falling real wages. For workers, the numbers amounted to another blow as inflation-adjusted earnings, based on average hourly earnings, fell 1% for the month and 3.6% from a year earlier, according to a separate report from the Bureau of Labor Statistics. Policymakers have been trying to find a solution to the problem, this situation is rooted in a variety of factors, including supply chain block, the demand for goods than services, and related to COVID - 19 trillions of dollars in stimulus spending, these spending that consumers have plenty of cash, and facing the highest price since the early days of the Reagan administration. Fed officials laid out a series of rate increases that pushed up benchmark short-term borrowing costs by 1.5 percentage points. The central bank is expected to keep raising rates until inflation approaches its long-term target of 2%.
8. The us inflation accelerated more than expected in June, pushing the Federal Reserve to a more aggressive position. Price pressure is huge, and the Federal Reserve may raise interest rates sharply again later this month. White House officials blamed the price increases on Russia's invasion of Ukraine, even though inflation had risen sharply before the February attack. President Biden called on gas station owners to lower prices. The administration and leading Democrats have also accused what they say are greedy companies of using the pandemic as an excuse to raise prices. Since inflation began in the second quarter of 2021, however, corporate profits have risen a total of just 1.3%.
9. There are reasons to expect July's inflation numbers to cool but keep the pressure on the White House high. Gasoline prices have fallen from their June peak to $4.64 for a gallon of regular, down 4.7% for the month, according to the Energy Information Administration. The S&P GSCI Commodities Index, a broad-based measure of a broad range of commodity prices, fell 7.3 per cent in July but is still up 17.2 per cent this year. Wheat futures are down 8 percent since July 1, while soybeans are down 6 percent and corn is down 6.6 percent.
10, truck drivers plan on Wednesday in Los Angeles/long beach to cease to protest the AB5 act, the shutdown large probability of truck driver will affect the port of long beach and Los Angeles transit goods, will inevitably lead to congestion at the port, in the first half of this year between China and the United States the whole ark shipping date this is not stable, if combined with port workers went on strike, the supply chain in China - the United States will usher in a huge
Post time: Jul-14-2022