from Kitco NEWS
Russians Are Buying Huge Amounts of Gold with the Ruble Under Pressure from High Inflation and Sanctions
The World Gold Council said Russians bought 75.6 metric tons of gold last year, up by 6% from 2023.
by Matthew Fox
Business Insider
Russian consumers are buying record amounts of gold, according to data from the World Gold Council.
The organization said in a report published on Wednesday that Russian consumers purchased 75.6 metric tons of the precious metal last year, representing a 6% jump from 2023 and a 62% increase from 2021, right before the war in Ukraine broke out.
Russians have been piling up gold — which investors often view as a safe-haven asset— as surging inflation and strict sanctions eat into the value of the ruble domestically and internationally.
Russia’s statistics agency has said the country’s inflation rate in 2024 was 9.5%, the highest level since the war broke out in February 2022, and recent data indicates prices have continued to rise in the first few weeks of 2025.
No Signs of Inflation Slowdown Yet, Russian Central Bank Says
from The Moscow Times
The Russian Central Bank’s decision to raise interest rates to their highest level in two decades has so far failed to slow rising inflation, the regulator acknowledged in a bulletin published Wednesday.
The Central Bank raised its key rate to a record-high 21% in October 2024 as inflation, sanctions pressure and record defense spending for the war in Ukraine put the economy at risk of overheating.
“There are still no signs of a transition to a sustainable slowdown in price growth,” the Bank wrote in its report, titled “What the Trends Are Saying: Macroeconomics and Markets.”
What Decades of Easy Money Mean for Japan’s Fiscal Future
The Bank of Japan has absorbed half that country’s national debt, creating huge liabilities and leaving the nation at a monetary fork in the road.
by Peter C. Earle
The Daily Economy
Over the past three decades, Japan’s monetary policy has been characterized by near-zero interest rates and significant quantitative easing (QE), aimed at countering persistent deflation and stimulating economic growth. The outcome of decades of accommodative policies has resulted in the Bank of Japan (BOJ) accumulating a balance sheet equivalent to 125 percent of Japan’s GDP — a ratio that surpasses any other major central bank. Japanese government bonds (JGBs) dominate the balance sheet, accounting for over three-quarters of the total; more than half of Japan’s outstanding government debt is held on the BOJ’s balance sheet.
That extraordinary accumulation has created an acute vulnerability. As interest rates rise, the value of JGBs could plummet due to heightened inflation and duration risks (bonds with longer maturities decline more sharply as rates rise). Moreover, the yen, a liability of the BOJ, is inherently tied to the proportion of “hard” assets on the bank’s balance sheet. A significant selloff in JGBs could erode the yen’s value, triggering broader financial instability. In consequence, the dual vulnerability of Japanese Government Bonds (JGBs) and the yen to a protracted selloff could have significant repercussions for global markets.
Inflation Worsened in December. What it Means for Fed Rate Cuts.
by Nicholas Jasinski
Barron’s
The Federal Reserve’s preferred inflation measure accelerated slightly in December, as price growth remains stubbornly above the central bank’s goal.
Fed policymakers are on hold with interest rates until the inflation picture improves.
The personal consumption expenditures, or PCE, price index rose 0.3% in December and was up 2.6% from a year earlier, according to data from the Bureau of Economic Analysis on Friday. That matched expectations and followed a 0.1% uptick in November and 0.2% in October.
A spike in energy prices helped to lift the headline PCE price index in December. The combined cost of gasoline, electricity, and other energy goods and services jumped 2.7% during the month—but was still down by 1.1% from a year earlier.
Stocks End Down as Fed Shifts Inflation View. Nvidia Slides On Talk of China Sales Curb.
by Medora Lee
USA Today
U.S. stocks closed lower after the Federal Reserve left interest rates unchanged and took a less confident view on inflation, and chip darling Nvidia renewed its slide on a report President Donald Trump’s considering restricting the company’s sales to China.
Nearly everyone expected the Fed to keep interest rates steady, but the Fed dropped in its statement reference to inflation making “progress” toward its 2% objective. It simply noted that inflation remained “somewhat elevated.”
Paul Ashworth, Capital Economics chief North America economist still forecasts a rate cut in March, but “that will require a big downward benchmark revision to payrolls and a muted inflation out-turn in January. If the Fed doesn’t resume cutting in the next few months, however, we suspect the window will have closed.”
Inflation and a Pivot in U.S. to Healthier Snacks Weighs On Pepsico in the Fourth Quarter
by Dee-Ann Durbin
Yahoo! Finance
The Purchase, New York-based company said its revenue fell slightly to $27.78 billion in the fourth quarter. That was short of Wall Street’s forecast of $27.89 billion, according to analysts polled by FactSet.
U.S. demand flagged last year after two years of outsized, double-digit price increases. The average price of a 16-ounce bag of potato chips peaked at $6.68 in October 2023, according to government data.
Americans Rebel Against Inflation and Overconsumption with ‘No Buy’ Challenges in 2025
2025 is shaping up to be the year of underconsumption or “no buy” trends, as Americans express their fatigue with inflation, consumerism, and threats of tariff-related price hikes.
by Chloe Berger
Fortune
Tired of the constant gift guides and endless grocery store receipts, Americans are cutting down on spending. “No buy” challenges have taken off in the past couple of years, gaining traction on social media platforms like Instagram and TikTok, which previously served as showcases of consumption. Now a strict budgeting lifestyle is the way to go for people who are tired of inflation, constant decluttering, and dread that Trump’s tariffs will make essentials even more expensive.
True to its name, the no buy movement refers to a challenge where people stop buying nonessential items for a period of time—often a year. It’s also come under a new viral name, “project pan,” which refers to hitting the pan, or bottom, of a makeup container, or using a product to its end. Just a month into the year, a swath of beleaguered Americans are pledging to practice a “no buy 2025.”
Eurozone Inflation Rises Once Again as Risks to 2025 Outlook Linger
Inflation rose from 2.4 to 2.5% in January, the fourth increase in a row for the eurozone. While it’s set to moderate over the course of the year, upside risks surrounding inflation have far from abated
by Bert Colijn
ING
Inflation across the eurozone ticked up thanks to a higher contribution from energy prices, while food inflation fell and core inflation remained stable at 2.7%. Base effects – which have driven inflation higher in recent months – eased in January, which contributed to keeping the increase in inflation muted.
The trajectory for 2025 should be disinflationary, but the question is to what degree. With wage growth set to drop substantially towards the end of the year, a big current driver of domestic inflation is set to fade. At the same time, energy prices have jumped to higher levels again and businesses are expecting to price higher costs through to consumers as business surveys indicate stronger goods and services inflation in the coming months.
Underlying Job Market Dynamics Retighten as Fed Moves Any Rate Cuts Into Distance Amid Accelerating Inflation
by Wolf Richter
Wolf Street
The low point was in September, which had spooked the Fed. But that’s over.
The reason we’re looking at the underlying dynamics of the labor market is to gauge the pressure within the Fed to cut interest rates to prevent the labor market from weakening. And in these underlying dynamics, there are no reasons for the Fed to cut interest rates further. The labor market is not weakening, it has been tightening just a little since September. Over the same period, inflation measures have accelerated some. And that combination has caused the Fed to move any rate cuts into the distance, and even Trump suddenly thought that this pivot to wait-and-see “was the right thing to do.”
Injustice: Doctor Fees Rose Twice as Fast as Rate of Inflation in Finland in 2024
by Connor Morpurgo
Euro Weekly News
Private doctors rates have soared, doubling those of inflation in Finland over the past year, according to benefits agency Kela, today, February 4.
Why is private healthcare now so expensive in Finland?
Citizens can expect to pay on average 8% more for private healthcare in Finland, as reported by Kela, more than double the 3.3% growth in the Consumer Price Index, the standard metric to measure inflation.
Between January and June in 2024 in particular, aggressive rises in rates for doctors in Finland were observed, as private medical specialties such as oncology and neurology took a drastic price hike.