{"id":1997845,"date":"2023-08-11T13:29:01","date_gmt":"2023-08-11T17:29:01","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/analysis-is-another-wave-of-inflation-happening\/"},"modified":"2023-08-11T13:34:10","modified_gmt":"2023-08-11T17:34:10","slug":"analysis-is-another-wave-of-inflation-happening","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/analysis-is-another-wave-of-inflation-happening\/","title":{"rendered":"Is Inflation Surging Again?"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">8<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fanalysis-is-another-wave-of-inflation-happening%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1997845&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><h2>Is Inflation \u200cMaking \u2064a Comeback?<\/h2>\n<p>Following the latest inflation data, U.S. financial markets are asking two\u200d questions. First, is this the beginning of an inflation revival? Second, how\u2064 will the recent\u200d numbers impact the Federal\u200d Reserve&#8217;s monetary policy\u200b decision-making?<\/p>\n<p>In July, the annual inflation rate \u200dedged up to 3.2 percent,\u200d marking the first \u2062increase in\u200d the \u200dgrowth rate in a\u2062 year. The core consumer\u200d price index (CPI), which strips the volatile food and energy components,\u2064 <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/ny-post-editorial-board-bidenomics-and-blue-state-policies-hurt-black-workers\/\" title=\"NY Post Editorial Board: Bidenomics and Blue-State Policies Hurt Black Workers\">remains stubbornly high<\/a> at 4.7 percent.<\/p>\n<p><a href=\"https:\/\/www.bls.gov\/news.release\/ppi.nr0.htm\" target=\"_blank\" rel=\"noopener\">Producer \u200cprices<\/a> also experienced a notable\u2064 jump,\u2064 rising to 0.8 percent year-over-year last month. The core \u200bproducer \u200bprice index (PPI) was stuck at a higher-than-expected\u2062 2.4 percent.<\/p>\n<blockquote>\n<h3>Related \u2063Stories<\/h3>\n<ul>\n<li><a href=\"http:\/\/www.theepochtimes.com\/article\/us-annual-inflation-marks-first-increase-in-a-year-as-energy-shelter-climb-5455969\">US Annual Inflation Marks 1st\u200b Increase in a Year as Energy, Shelter Climb<\/a> &#8211; 8\/10\/2023<\/li>\n<li><a href=\"http:\/\/www.theepochtimes.com\/article\/more-americans-are-making-withdrawals-from-their-401ks-as-inflation-hits-households-5454499\">More \u200cAmericans Are Making Withdrawals From Their 401(k)s as Inflation Hits Households<\/a> &#8211; \u200b8\/9\/2023<\/li>\n<li><a href=\"http:\/\/www.theepochtimes.com\/article\/as-white-house-touts-economic-record-most-americans-unclear-about-inflation-reduction-act-5448959\">Most Americans Unclear About Inflation\u200c Reduction Act as White House Touts Economic Record<\/a> &#8211; 8\/7\/2023<\/li>\n<li><a href=\"http:\/\/www.theepochtimes.com\/article\/former-treasury-secretary-warns-inflation-could-resurge-5444949\">Former Treasury Secretary\u2062 Warns Inflation Could Resurge<\/a> &#8211; 8\/5\/2023<\/li>\n<\/ul>\n<\/blockquote>\n<h2>Inflation\u200c in the Second\u200b Half<\/h2>\n<p>Despite \u2064the\u2063 substantial surge in crude oil and gasoline prices, the gains did not fully materialize in the Bureau of\u200d Labor Statistics&#8217; (BLS) CPI report.<\/p>\n<p>&#8220;The July\u200d CPI \u200dreport obviously missed this energy price\u200c spike, and we \u200dnow expect it to show up in the August\u200b CPI report, putting\u200d further upward pressure on\u200b inflation year-on-year,&#8221; said Scott Anderson, the chief economist at Bank of the West Economics, in a note.<\/p>\n<p>Over the \u2064last three months, West Texas Intermediate (WTI) crude prices \u200dhave climbed nearly 20 percent\u2063 to above $83 per barrel.\u200b Gasoline prices have also \u200bsoared about 20 \u2063percent year-to-date, topping $3.84 a gallon,\u200d according to the <a href=\"https:\/\/gasprices.aaa.com\/\" target=\"_blank\" rel=\"noopener\">American Automobile Association (AAA)<\/a>.<\/p>\n<div>\n<figure style=\"width:600px\" class=\"alignnone\"><figcaption>People\u200b use the gas station in Columbia, Md., on May 17, 2023. (Madalina Vasiliu\/The Epoch Times)<\/figcaption><\/figure>\n<\/div>\n<p>The Federal Reserve Bank of Philadelphia <a href=\"https:\/\/www.clevelandfed.org\/en\/indicators-and-data\/inflation-nowcasting\" target=\"_blank\" rel=\"noopener\">revised<\/a> its Inflation \u2063Nowcasting model estimate for August lower. The regional \u2063central bank now expects the annual\u200c inflation rate \u200cto be 3.8 percent, down from the previous forecast of 4.1 percent. The core CPI is anticipated to edge lower to\u2062 4.5 percent.<\/p>\n<p>Peter Schiff, the \u200cchief global strategist at Euro Pacific Asse Management, \u200bthinks the upward trend in the July inflation is only the start of\u2062 renewed price\u2062 pressures.<\/p>\n<p>&#8220;Core is bottoming, and the headline number is about to\u2062 rise sharply, led higher by surging #oil prices,&#8221; he said \u200bon X, formerly known as Twitter.<\/p>\n<p>&#8220;Today&#8217;s hotter than expected\u2064 .3 [percent] rise in \u200dJuly PPI is only the beginning. Future,\u2064 even larger upside surprises are coming,&#8221; Mr. Schiff explained in another X post.<\/p>\n<p>Appearing on CNBC following the wholesale prices\u2064 data on Aug.\u200c 11, Heritage Foundation\u200d economist EJ Antoni\u200b also anticipates \u200cinflation \u2063to continue rising, <a href=\"https:\/\/twitter.com\/RealEJAntoni\/status\/1690004190469214208\" target=\"_blank\" rel=\"noopener\">arguing<\/a> that many of the categories within the PPI\u2014foods\u200d and feeds, energy goods, and transportation \u2062and warehousing\u2014will likely be revised upward over\u200d the next \u2063six months.<\/p>\n<p>Some market experts say that\u200d the PPI is a reliable indicator of \u200cwhere\u200b inflation might\u2064 be heading since it measures the\u2064 price producers can\u200c sell their goods. The CPI \u2063gauges the price shoppers pay for goods and services.<\/p>\n<p>Ali Dhanji, a financial advisor at Raymond James, \u200c <a href=\"https:\/\/twitter.com\/DhanjiatRJ\/status\/1690019139459424258\" target=\"_blank\" rel=\"noopener\">warned<\/a> that the PPI &#8220;is not great news for Federal\u2063 Reserve as \u2064PPI tends\u2063 to be a leading \u2064indicator for consumer inflation and signals\u200b potential \u200cinflation ahead.&#8221;<\/p>\n<p>&#8220;YoY PPI up for the first time in 13 months,&#8221; \u200dhe wrote \u200con X. &#8220;More data needed to convince Fed&#8217;s 2 [percent] target.&#8221;<\/p>\n<p>Meanwhile, ING economists believe the July CPI data point to a persistent easing of inflation pressures. At the same time, there could be a divergence between the headline\u200d and core inflation measurements this fall.<\/p>\n<p>&#8220;Unfortunately we \u2062are likely to see headline annual \u200cinflation rise further in \u200bYoY terms in August, \u200balbeit modestly. This \u200bwill largely\u2063 reflect higher energy\u2064 costs, but we suspect it will resume its downward path again\u2063 by October,&#8221; said James Knightley,\u2063 the chief international\u2063 economist at ING, in a research note.\u2064 &#8220;Core inflation won&#8217;t have this \u200bproblem as the 0.6 [percent] MoM prints for August \u2064and\u200d September last year will drop out of the annual comparison \u200dto be replaced by 0.2 [percent] \u200breadings we \u2064predict, allowing annual \u2064core \u200cinflation to slow to below 4 [percent] by September.&#8221;<\/p>\n<p>But one\u2062 economist thinks there will be an inflation surge later this year.<\/p>\n<p>&#8220;Reported 12-month inflation rates are likely to edge up a \u200bfew\u2062 tenths of a percentage point\u200d over the next several months, and then jump in\u200b late fall, hitting 3.9 [percent] in\u200c December before dropping quickly after that. The reason for the\u200d November-December surge:\u2062 Temporary \u2062price declines that\u200d happened 12 \u200dmonths prior will result in bigger year-over-year inflation readings \u2064as 2023 ends,&#8221; <a href=\"https:\/\/www.kiplinger.com\/economic-forecasts\/inflation\" target=\"_blank\" rel=\"noopener\">wrote<\/a> David Payne, a staff economist at Kiplinger.<\/p>\n<p>Former Treasury Secretary Larry Summers \u200d <a href=\"https:\/\/theepochtimes.com\/article\/former-treasury-secretary-warns-inflation-could-resurge-5444949\" target=\"_blank\" rel=\"noopener\">warned<\/a> earlier\u2064 this \u2062month that inflation could resurge, citing\u2062 higher wages.<\/p>\n<p>\u201cI don\u2019t think we\u200d can\u200b yet be confident that we\u2019re\u200b not going\u2062 to see\u2063 a \u200creal acceleration of inflation at some point\u200d down \u2064the road,\u201d Mr. Summers told Bloomberg on Aug. 4. \u201cThat\u2019s the thing that I\u2019m focused on.&#8221;<\/p>\n<p>In July, annualized hourly earnings were unchanged at 4.4\u200c percent.<\/p>\n<p>According \u2064to Bloomberg Television host Lisa\u200b Abramowicz, market-implied inflation projections for the next five to ten\u2063 years have <a href=\"https:\/\/twitter.com\/lisaabramowicz1\/status\/1688574342408310785?s=20\" target=\"_blank\" rel=\"noopener\">climbed<\/a> \u200b to \u2064their\u200d highest\u2064 levels in about a \u200cyear.<\/p>\n<p>&#8220;Traders are starting to\u2063 game out a future with sustainably \u200chigher inflation and <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/analysis-is-another-wave-of-inflation-happening\/\" title=\"Is Inflation Surging Again?\">higher\u200d long-term bond yields<\/a>,&#8221; Ms. Abramowicz\u2064 said on X.<\/p>\n<p>Consumers are\u2062 more optimistic as their inflation expectations have been trending downward since last spring.<\/p>\n<p>The <a href=\"http:\/\/www.sca.isr.umich.edu\/\" target=\"_blank\" rel=\"noopener\">University \u2062of Michigan&#8217;s 1-year inflation expectations index<\/a> dipped to 3.3 percent in August, down from 3.4 percent in July. Five-year inflation expectations also edged down from 3 percent to 2.9 percent.<\/p>\n<p>The Federal Reserve Bank of New\u200d York&#8217;s Survey\u2064 of Consumer Expectations\u200b (SCE) will be released on Aug. 14, and Trading Economics predicts consumer inflation expectations \u2063will \u200cremain \u2064unchanged\u200d at 3.8 percent.<\/p>\n<h2>All About September<\/h2>\n<p>The\u200d rate-setting Federal Open Market Committee (FOMC) will convene its \u200cnext two<a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/fed-doubles-taper-to-30-billion-a-month-sees-more-rate-hikes-next-year\/\" title=\"Fed Doubles Taper to  Billion a Month, Sees More Rate Hikes Next Year\">-day policy meeting<\/a> \u2064in September.<\/p>\n<p>According to the <a href=\"https:\/\/www.cmegroup.com\/markets\/interest-rates\/cme-fedwatch-tool.html\" target=\"_blank\" rel=\"noopener\">CME FedWatch \u2062Tool<\/a>, the futures market is pricing \u2062in a rate pause next month, keeping\u200b the \u2063benchmark\u2062 fed\u2062 funds \u200brate in a range of 5.25 percent\u2063 and 5.50 percent. Only\u2063 33 percent of investors expect a\u2063 rate hike in November, and 32 percent\u200d forecast a \u200drate increase in December.<\/p>\n<p>But a chorus of Fed officials has offered mixed messaging on what the central bank could do next month, citing one\u2062 more jobs report and another CPI release before the September\u2062 FOMC meeting.<\/p>\n<div>\n<figure style=\"width:600px\" class=\"alignnone\"><figcaption>Federal Reserve\u2062 Board Chairman Jerome Powell \u2062delivers remarks at a news conference following a Federal Open Market Committee meeting in Washington on May 3, \u200c2023. (Anna Moneymaker\/Getty Images)<\/figcaption><\/figure>\n<\/div>\n<p>Speaking to reporters at last month&#8217;s post-FOMC press conference, Fed\u200b Chair Jerome Powell\u200c did\u2064 not\u2062 convey what \u200bthe central bank will do in September, saying that a final decision is \u2064&#8221;live.&#8221;<\/p>\n<p>&#8220;I would say it is \u2063certainly \u200cpossible that we would raise funds again at the September \u200cmeeting if the\u2064 data warranted it,&#8221; Mr. Powell told the press. \u2062 <\/p>\n","protected":false},"excerpt":{"rendered":"<p>U.S. financial markets ponder two key questions after the latest inflation data: Is this the start of an inflation resurgence? And how will these recent figures influence the Federal Reserve&#8217;s monetary policy decisions? July saw a 3.2 percent annual inflation rate, the first growth rate rise in a year.<\/p>\n","protected":false},"author":278,"featured_media":1997846,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[543],"tags":[],"class_list":["post-1997845","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-epoch-times"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1997845","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/278"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1997845"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1997845\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1997846"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1997845"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1997845"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1997845"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}