MWL Secretary General stressed the need for unrestricted delivery of humanitarian aid to the Palestinians by opening all crossings
world9 hours ago
US consumer prices unexpectedly rose in August and underlying inflation picked up amid rising costs for rents and healthcare, giving the Federal Reserve ammunition to deliver a third 75 basis points interest rate hike next Wednesday.
The surprisingly firm inflation readings reported by the Labour Department on Tuesday followed in the wake of recent data showing labour market resilience. The reports suggested that inflation could remain elevated for some time. Fed Chair Jerome Powell reiterated last week that the central bank was “strongly committed” to fighting inflation.
“The renewed jump in core prices for August undercuts the weaker headline inflation rate spurred by lower gasoline costs,” said Ben Ayers, a senior economist at Nationwide in Columbus, Ohio.
“This should secure another 75-basis point rate hike at next week’s policy meeting as the Fed continues to take a strong stance against inflation.”
The consumer price index gained 0.1 per cent last month after being unchanged in July. A 10.6 per cent decline in gasoline prices was offset by increases in rents, food and healthcare. Food prices rose 0.8 per cent, with the cost of food consumed at home increasing 0.7 per cent. Consumers also paid more for electricity and natural gas.
Economists polled by Reuters had forecast the CPI dipping 0.1 per cent. In the 12 months through August, the CPI increased 8.3 per cent. While that was a deceleration from July’s 8.5 per cent rise, inflation is running way above the Fed’s two per cent target.
Beyond the dilemma the August inflation numbers present to the Fed, they are a headache as well for the Biden administration and congressional Democrats hoping to limit their losses in November’s mid-term elections, which are expected to flip the House of Representatives into Republican hands.
Though annual CPI peaked at 9.1 per cent in June, which was the biggest gain since November 1981, it has remained above eight per cent for six straight months. With only one more CPI report due before Election Day it is unlikely to give up that handle before Americans head to the polls.
US gasoline prices have plunged from an average record high above $5 per gallon in June, according to data from AAA. They were averaging $3.707 per gallon on Tuesday.
US stocks opened lower. The dollar rallied against a basket of currencies. US Treasury prices fell.
Fed officials gather next Tuesday and Wednesday for their regular policy meeting. Financial markets have almost priced in a 75 basis points rate increase next Wednesday, according to CME’s FedWatch Tool.
The Fed has twice hiked its policy rate by three-quarters of a percentage point, in June and July. Since March, it has lifted that rate from near zero to its current range of 2.25 per cent to 2.50 per cent.
Data last week showed first-time applications for unemployment benefits at a three-month low. Job growth was solid in August. There were two job openings for every unemployed person on the last day of July.
That is supporting strong wage gains, contributing to higher prices for services and keeping underlying inflation elevated.
Excluding the volatile food and energy components, the CPI rose 0.6 per cent in August after advancing 0.3 per cent in July. Economists had forecast the so-called core CPI increasing 0.3 per cent.
Underlying inflation was also driven by higher prices for household furnishings and operations as well as new motor vehicles, motor vehicle insurance and education.
But there were decreases in the costs of airline fares, communication and used cars and trucks.
In the 12 months through August, the core CPI increased 6.3 per cent after rising 5.9 per cent in July. — Reuters
MWL Secretary General stressed the need for unrestricted delivery of humanitarian aid to the Palestinians by opening all crossings
world9 hours ago
In the initial phase, the organisation will process 600 applications from individuals who meet the required conditions
visa and immigration in uae9 hours ago
Israeli forces carried out similar strikes in some other parts of the Hamas-run territory overnight, killing at least 10 people
mena10 hours ago
The suspect was believed to be the key figure behind the January 28 attack
mena10 hours ago
The total number of captives exchanged between the two countries in these mediations to 1994 prisoners
world10 hours ago
Both CCI reports said that during investigations Amazon and Flipkart 'deliberately downplayed' allegations of exclusive launches
tech11 hours ago
The makers released the show's trailer on Instagram on Saturday, giving fans a sneak peek at what's to come
entertainment11 hours ago
With airfares soaring and long waits to secure visas, 'seacations' are now becoming all the rage among travel enthusiasts
uae12 hours ago