Giuseppe Sandro Mela.
2021-06-15.
«The Fed is suffering from tantrum paranoia»
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«Consumer prices in U.S. top forecast, stoking inflation concern»
«Prices paid by U.S. consumers rose in May by more than forecast, extending a months-long buildup in inflation that risks becoming more established as the economy strengthens»
«The consumer price index climbed 0.6% from the prior month after a 0.8% jump in April …. the so-called core CPI rose by a larger-than-forecast 0.7%»
«The increase in previously owned cars and trucks accounted for about one-third of the total monthly advance in the CPI»
«→→ Compared with the same month a year ago, the CPI jumped 5% ←←»
«The comparison to the pandemic-depressed index in May 2020 makes year-over-year inflation appear stronger.»
«However, underscoring the clear acceleration in inflation more recently, the core CPI over the past three months has increased at a 5.2% annualized pace»
«The lifting of pandemic restrictions, increases in vaccinations and a flurry of social activity are translating into more services demand — another propellant for inflation»
«The question economists and investors are wrestling with is whether these factors will have a temporary impact on inflation as the Federal Reserve expects or whether they will become more ingrained against a backdrop of massive fiscal and monetary policy support»
«Fed Chair Jerome Powell has said upward pressure on prices is likely to be temporary»
«Others disagree, citing trillions of dollars in fiscal support, the likely persistence of product shortages and rising labor costs»
«Shelter costs, which make up a third of the overall CPI, rose 0.3% after rising 0.4%»
«While transitory factors did a lot of the heavy lifting driving the May upside, the more persistent components like rents and OER firmed up as well much more than expected, pointing to a firmer source of foundation for the inflation data as the transitory factors begin to fall out of the figures»
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Fed. Inflazione. Iniziano i forti dubbi. Tutti sul braciere. – Bloomberg.
Usa. Fed. Bloomberg afferma che soffre di crisi paranoiche. Ipp +6.2% – Bloomberg.
Fed. Questa allarmante inflazione è proprio quello che avrebbe voluto evitare. – Bloomberg.
Fed. Che l’inflazione alta sia temporanea è un ‘article of faith’. – Bloomberg.
Usa. Indice dei Prezzi al Consumo +4.2% anno su anno. Fed in tilt.
Fed. Non solo tapering. Il quantitative easing costituisce una bomba ad orologeria.
Harris-Biden Administration. Brucia sulla graticola degli eventi che non sa dominare.
Banche Centrali. Alti tassi oppure alta inflazione. Possono scegliere come fallire.
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«The Fed is suffering from tantrum paranoia»
Magari un giorno o l’altro la Harris-Biden Administration si interesserà un pochino di più dello stato del sistema economico americano, che certo non trae giovamento dai prezzi delle energy commodities saliti del 54.5%. In ogni caso la prossima riunione dei G7 sarà sconsolante. Una corte dei miracoli ….
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Consumer Prices in U.S. Top Forecast, Stoking Inflation Concern. – Bloomberg.
– Consumer price gauge increases 0.6%; core measure up 0.7%
– Gains reflect further advances in vehicle prices, airfares
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Prices paid by U.S. consumers rose in May by more than forecast, extending a months-long buildup in inflation that risks becoming more established as the economy strengthens.
The consumer price index climbed 0.6% from the prior month after a 0.8% jump in April that was the largest since 2009. Excluding the volatile food and energy components, the so-called core CPI rose by a larger-than-forecast 0.7%, according to Labor Department data Thursday
The gains were fairly broad and driven by steady growth in the costs of used vehicles, household furnishings, airfares and apparel. The increase in previously owned cars and trucks accounted for about one-third of the total monthly advance in the CPI, the Labor Department said.
Price pressures continue to build across the economy as businesses scramble to balance a rush of demand against shortages of materials and, in some cases, labor. Shipping bottlenecks, higher input costs and rising wages are challenges to companies looking to protect profit margins.
Compared with the same month a year ago, the CPI jumped 5%, the largest annual gain since August 2008, though the figure remains distorted by the base effect. The comparison to the pandemic-depressed index in May 2020 makes year-over-year inflation appear stronger.
The core measure rose 3.8% from 12 months ago, the most since 1992.
However, underscoring the clear acceleration in inflation more recently, the core CPI over the past three months has increased at a 5.2% annualized pace, the fastest since 1991.
Robust Demand
Strong consumer spending on merchandise — in part driven by government stimulus — has led to growing orders backlogs and lean inventories. The lifting of pandemic restrictions, increases in vaccinations and a flurry of social activity are translating into more services demand — another propellant for inflation.
“The May CPI report shows reopening-sensitive categories dominating price pressures for a second straight month,” Bloomberg economists Andrew Husby and Yelena Shulyatyeva said after the release.
The question economists and investors are wrestling with is whether these factors will have a temporary impact on inflation as the Federal Reserve expects or whether they will become more ingrained against a backdrop of massive fiscal and monetary policy support.
The yield on the 10-year Treasury rose after the report, topping 1.5%. The dollar was little changed and the S&P 500 advanced. Separate figures showed applications for state jobless benefits declined for a sixth straight week.
A slew of companies have raised prices or announced plans to do so, including Chipotle Mexican Grill Inc. and Reynolds Consumer Products Inc.
Even though orders and backlogs at Hooker Furniture Corp. are elevated, “we’re cautiously optimistic, considering the industry-wide supply chain logistics and raw materials shortages and inflation,” Chief Executive Officer Jeremy Hoff said on the company’s June 4 earnings call. “We believe we have mitigated these dynamics as much as possible through surcharges and price increases.”
Fed Chair Jerome Powell has said upward pressure on prices is likely to be temporary, noting in late April that “in an episode of one-time price increases as the economy reopens is not the same thing as, and is not likely to lead to, persistently higher year-over-year inflation into the future.”
Others disagree, citing trillions of dollars in fiscal support, the likely persistence of product shortages and rising labor costs. Bond market expectations for the pace of inflation over the next five years have been easing from a 15-year high last month but remain elevated.
“The frothiness in CPI continues for now but between base effects and pent-up demand pressures, it is probably not giving a definite answer to the great inflation debate, and you need to read the bond market tea leaves,” said Anu Gaggar, senior global investment analyst at Commonwealth Financial Network.
While wage growth has blown past economists’ estimates in the last two monthly jobs reports, the rise in consumer prices has taken a sizable toll. Inflation-adjusted average hourly earnings declined 0.2% in May after a 0.1% drop, separate data showed Thursday. The retreat in real earnings, if it persists, could prompt workers to ask for a bump in pay.
Shelter costs, which make up a third of the overall CPI, rose 0.3% after rising 0.4%. The increase included a 0.4% gain in hotel costs and a 0.3% increase in owners equivalent rent.
“While transitory factors did a lot of the heavy lifting driving the May upside, the more persistent components like rents and OER firmed up as well much more than expected, pointing to a firmer source of foundation for the inflation data as the transitory factors begin to fall out of the figures,” economists at Morgan Stanley said in a note.
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