from Palisades Gold Radio
Food Inflation On the Rise
by Martin Armstrong
Armstrong Economics
Our models do not indicate that food inflation will ease in 2025. In fact, I have repeatedly warned that people may want to stockpile food for the next two years as there will be weather events and supply chain shortages. Our model warns that we may see another severe drought, probably between 2025 to 2027, in both the US and Canada. The drought conditions are already beginning, and this is in line with our model, which warns it will expand into the 2025-2027 period.
Walmart CEO Doug McMillon announced last week that he expects persistent high prices at the grocery store. “I don’t know what the whole year is going to look like. I hope and I think it could be better as these commodities adjust — some of them,” he said per GroceryDrive. According to McMillon, he was “disappointed” at where food inflation was currently and cited that eggs and dairy were the main problems.
Food prices shot up during the pandemic and never fully recovered. Then the was in Ukraine hurt Europe’s food supply in a major way. In America, the Food Industry Association conducted a study that revealed food inflation in America rose 25% since the pandemic, and recently rose 1.1% on a monthly basis in November.
What to Expect From January’s CPI Inflation Report
by Simon Moore
Forbes
The Consumer Price Index for December 2024, will be released on January 15 2025 giving insight into recent inflation trends. Current nowcasts suggest that inflation may come in at a 2.9% headline annual rate, marking an acceleration from November’s figures of 2.7% annual inflation. However, core inflation which removes food and energy is forecast to remain flat at 3.3% compared to November. Nowcast data is based on real time observed prices for December, and so these estimates will update over the remaining weeks of the month.
Drifting Inflation
Inflation drifting away from 2%, should that occur, may help confirm the market’s view that fewer interest rate cuts should be expected from the Federal Open Market Committee in 2025. That’s because inflation could remain stuck at closer to 3% than the FOMC’s 2% annual target and that may prompt the FOMC to retain slightly more restrictive interest rates. Inflation would likely be less of a focus for policymakers if the job market weakened significantly, but for now unemployment is only moving up relatively slowly.
Peter Navarro: Just Like First Term, Trump’s Tariffs Will Not Spike Inflation
by John Binder
Breitbart.com
Tariffs planned by President-Elect Donald Trump next year will not spike inflation, incoming trade advisor Peter Navarro says.
“We put on significant tariffs on China — steel, aluminum, dishwashers, solar, a lot of increased countervailing duties to stop the dumping. We had zero inflation from any of that,” Navarro told CNBC on Tuesday.
“So I would say that just go back and play all the interviews that were done on CNBC of people back in the first term with their hair on fire, worrying about inflation,” Navarro continued. “It never happened, and it’s the same movie this time.”
Indeed, as Breitbart News has chronicled, research has continuously shown that tariffs on foreign imports under Trump are unrelated to inflation that reached record highs under President Joe Biden following the passage of the Inflation Reduction Act.
“Transitory” Inflation is Back On the Rise Again
from King World News
It appears “transitory” inflation is back on the rise again. Take a look…
Inflation Is Back On The Rise
December 17 (King World News) – Gerald Celente: U.S. inflation is rising again.
In October, the annual rate moved up to 2.6 percent from 2.4 percent in September. In November, the pace edged up to 2.7 percent. The Consumer Price Index added 0.3 percent from the month before.
Last month, the core inflation rate, which excludes prices for energy and food, rose at 3.3 percent, its fastest clip in 18 months as vehicle prices jumped, due in part to drivers replacing cars and trucks lost in recent hurricanes.
The Inflation You Don’t See
by Rick Newman
Yahoo! Finance
YouTubeTV just raised the cost of its basic service by $10 per month—a 14% price hike. If you’re on top of your email, you might have seen the notification. But you won’t see any mention of the price hike where you actually consume the product, on your television or other streaming gizmo.
Consumers have grappled with unusually high inflation for the last three years, an economic burden that may have cost incumbent Vice President Kamala Harris the 2024 presidential election. Harris and her boss, President Joe Biden, have repeatedly pointed to steady progress in bringing inflation down since it peaked at 9% in 2022. But inflation has morphed into a different creature than it was in 2022, and it’s proving difficult to slay.
TrumpWorld Fears Fed Cuts May Stoke Renewed Inflation
by John Carney
Breitbart.com
As the Federal Reserve prepares to decide on another interest rate cut this week, people close to President-elect Donald Trump’s economic team are urging caution, warning that inflation risks may be underestimated even as price growth has moderated in recent months.
“Powell had better be careful with these rate cuts,” said a person familiar with the team’s thinking. “Bidenflation may not be dead.”
The concerns reflect unease about a series of factors that suggest the economy remains strong, with persistent inflationary pressures that could complicate the Fed’s efforts to balance growth and price stability. A key point of concern is that underlying inflation remains elevated. Core services inflation, excluding shelter—a metric often cited by Fed officials, including chairman Jerome Powell, as a proxy for entrenched price pressures—stood at 4.2 percent in November.
Businesses Report Inflation is Taking Wrench to Their Cash-Strapped Customers
by Ireland Owens
DailyCaller.com
Dollar stores are reporting softened demand and increased financial stress among their lower-income consumers, according to The Wall Street Journal.
Some businesses say their customers are spending less money toward the end of the month and more focused on purchasing from cheap store brands, according to the WSJ. Dollar General said in a December earnings call that its best-performing category in its last quarter was its “value valley” aisle, which offers $1 products, the WSJ reported.
Dollar stores are also saying that consumers put off shopping for special occasions like Halloween until the last minute, according to the WSJ. Walmart CEO Doug McMillon said at a conference on Dec. 3 that the “inflationary cycle has been really detrimental” for lower-income families, the WSJ reported.
What to Expect From Friday’s Report On Inflation
Inflation as measured by Personal Consumption Expenditures likely accelerated in November, mirroring the trend of a different inflation measure, the Consumer Price Index, released earlier in the month.
by Diccon Hyatt
Investopedia
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Not long ago, the Federal Reserve’s favorite measure of inflation looked tantalizingly close to the central bank’s goal of a 2% annual rate. But in November, it likely headed in the wrong direction.
A report from the Bureau of Economic Analysis due Friday is likely to show that the cost of living, as measured by Personal Consumption Expenditures (PCE), rose 2.5% over the year in November, up from a 2.3% annual increase in October, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal.
The trend would mirror the uptick in inflation seen in a different measure, the Consumer Price Index, released earlier this month. Officials at the Federal Reserve pay closer attention to PCE when setting the nation’s monetary policy. So Friday’s report could have a bigger impact on the trajectory of the central bank’s key interest rate and, hence, borrowing costs on all kinds of loans down the road.
Fed’s Rate Cuts Likely to Slow With Inflation Pressures Still Elevated
by Christopher Rugaber
PBS
WASHINGTON (AP) — Americans hoping for lower borrowing costs for homes, credit cards and cars may be disappointed after this week’s Federal Reserve meeting. The Fed’s policymakers are likely to signal fewer interest rate cuts next year than were previously expected.
The officials are set to reduce their benchmark rate, which affects many consumer and business loans, by a quarter-point to about 4.3 percent when their meeting ends Wednesday. At that level, the rate would be a full point below the four-decade high it reached in July 2023. The policymakers had kept their key rate at its peak for more than a year to try to quell inflation, until slashing the rate by a half-point in September and a quarter-point last month.
Price Growth Ticked Up in November as Inflation Progress Stalls
by Rob Wile
NBC News
Price growth sped up a bit in November, a sign that efforts to cool inflation may be stalling.
Over the past 12 months, the consumer price index climbed 2.7%, the Bureau of Labor Statistics reported Wednesday. That was in line with expectations but higher than the 2.6% annual rate in October. On a monthly basis, the index rose 0.3%, faster than the 0.2% rate in the previous month.
Excluding more volatile items like food and gas, the “core” measure of inflation climbed 3.3% on a 12-month basis, the same as in October. On a monthly basis, the core index rose 0.3%, matching its pace for the past three months. The monthly pace of price increases picked up for new cars and apparel, while shelter costs and the category that includes auto insurance showed declines.