from George Gammon
Fed’s Kashkari Says Trump Tariffs Could Reheat Inflation if They Provoke Global Trade ‘Tit for Tat’
Minneapolis Federal Reserve President Neel Kashkari said that tariffs would hurt long-term inflation if global trade partners were to strike back.
by Rebecca Picciotto
CNBC.com
Minneapolis Federal Reserve President Neel Kashkari said Sunday that President-elect Donald Trump’s tariff proposals could worsen long-term inflation if global trade partners were to strike back.
One-time tariffs, Kashkari said on CBS’ “Face the Nation,” “shouldn’t have an effect long run on inflation.”
“The challenge becomes, if there’s a tit for tat and it’s one country imposing tariffs and then responses and it’s escalating. That’s where it becomes more concerning, and, frankly, a lot more uncertain,” Kashkari said.
During his first term, Trump essentially sparked a trade war with China when he imposed a series of import taxes on Chinese goods, which triggered the country to retaliate with its own set of tariffs on the U.S.
Forecasts for October CPI Report Show Inflation Progress Stalling for Now
Analysts believe gas prices fell while used-car prices spiked.
by Sarah Hansen
Morningstar Advisor
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Forecasts for the October Consumer Price Index report show that inflation likely remained steady on a monthly basis in October, reflecting a pause in the good news on price pressures in the economy.
Analysts say falling gasoline prices during the month continued to pull down inflation overall, but rising prices in other areas offset some of that progress.
Investors are watching the data with renewed focus in the aftermath of last week’s presidential election, given the anticipated Republican policy proposals that economists think could exacerbate inflationary pressures. In recent weeks, bond traders have pushed bond yields higher, partly due to concerns about the longer-term inflation outlook.
U.S. Dollar Continues Gaining Ground as Markets Brace of U.S. Inflation Data
US Dollar gains on Monday with the DXY above 105.50.
by Patricio Martín
FX Street
The US Dollar Index (DXY), which measures the value of the USD against a basket of six currencies, is broadly gaining in Monday’s session. The focus for traders is now on the US inflation data for October, which will be released later this week. A strong inflation reading could further boost the US Dollar as it would increase expectations that the Federal Reserve (Fed) might slow the pace of interest rate easing.
The DXY initially rose last Friday after positive UoM consumer confidence data and the Federal Open Market Committee’s (FOMC) announcement of a 25 bps rate cut. Despite concerns over easing labor market conditions, the Fed expressed optimism about economic growth.
Inflation and Retail Sales Data Greet a Roaring Stock Market Rally: What to Know This Week
by Josh Schafer
Yahoo! Finance
Stocks just had their best week of 2024.
All three major indexes pressed to record highs after Donald Trump won the 2024 presidential election.
For the week, the S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) rose more than 4.5%, while the Nasdaq Composite (^IXIC) rose nearly 6%.
In the week ahead, a fresh reading on inflation and retail sales will lead the economic calendar.
In corporate news, quarterly results from Home Depot (HD), Cisco (CSCO), and Disney (DIS) will highlight another week of earnings reports.
Donald Trump’s Victory and the Politics of Inflation
Joe Biden’s strong record on jobs and Kamala Harris’s vow to reduce the cost of living couldn’t prevent the Democrats from succumbing to a global anti-incumbency wave.
by John Cassidy
The New Yorker
In March, I was a guest at a dinner discussion organized by a progressive advocacy group in New York. As the talk turned to Joe Biden’s low approval ratings, another attendee brought up the skewed media coverage of the President’s economic record, which seemed to be a source of vexation for nearly everyone around the table. I readily agreed that positive news about jobs, G.D.P., and Biden’s efforts to stimulate manufacturing investment—of which there was plenty—wasn’t receiving as much attention as it deserved, particularly compared with the voluminous coverage of inflation. But I also pointed to governments from across the political spectrum in other countries, such as Britain, Germany, and France, that had experienced big rises in consumer prices. Inflation, it seemed, was poison for all incumbents, regardless of their location or political affiliation.
At that juncture, I was still hopeful that, with the U.S. inflation rate falling back toward pre-pandemic levels, there was enough time for public sentiment to shift, and for Biden’s approval ratings to recover. It never happened, of course. According to the network exit poll, conducted by Edison Research, seventy-five per cent of the voters in last week’s election said that inflation had caused them moderate or severe hardship during the past year, and of this group about two-thirds voted for Donald Trump.
Why Inflation Helped Tip the Election Toward Trump, According to Experts
Inflation has helped fuel a global backlash toward incumbents, experts say.
by Max Zahn
ABC News
A surging stock market, low unemployment and robust growth — by just about every measure, the economy stood poised to deliver victory for Vice President Kamala Harris.
The exception, of course, was inflation, and it appears to have overshadowed other indicators. More than two-thirds of voters say the economy is in bad shape, according to the preliminary results of an ABC News exit poll.
Inflation likely shaped negative voter perceptions of the economy and helped fuel anger toward the party in power, just as it has done across the globe since the pandemic unleashed a wave of rapid price increases, experts told ABC News.
The political potency of inflation stems from the visceral, recurring sense of unease caused by high prices, experts added. That feeling leaves voters insecure about their future and desperate for a leader who can change the nation’s course.
Breitbart Business Digest: How Trumponomics Can Reduce Inflation
by John Carney
Breitbart.com
A GOP Sweep Won’t Lead to Higher Inflation
The conventional wisdom on Wall Street has long been that a sweep by Republicans in the election would be inflationary. That’s probably wrong.
The basic idea behind the claim that a unified Republican government would be more inflationary than a divided government is that GOP control would lead to a great fiscal expansion in the form of tax cuts fueling higher deficits. More generally, many analysts believe that without an opposition empowered to rein in ambitious economic plans, parties tend to become fiscally irresponsible.
Historically, however, this is not the rule. While on average inflation is a bit higher during periods of unified government, it has also often been lower. Going all the way back to the Truman administration, inflation was much higher during the periods of divided government than unified government. The same pattern applies to the Eisenhower administration: lower inflation during the period of unified Republican control, higher when Democrats gained control of Capitol Hill.
Why Data Points On the Economy Aren’t Telling the Full Story
We came out of the Covid pandemic and then experienced the biggest inflation spike that most of us have seen in our lifetime. That takes a toll.
by Stephanie Ruhle
MSNBC
In the aftermath of the election, there’s been a lot of talk about how anger over the U.S. economy helped fuel Donald Trump’s win. According to the NBC News Exit Poll, 46% of Americans said their family’s financial situation was worse today than it was four years ago.
That number may come as a shock to people looking at the overall state of the U.S. economy. Under President Joe Biden and Vice President Kamala Harris, we’ve seen significant job growth, wage increases and unemployment rates at historic lows.
But for Americans just trying to make it through their daily lives, those data points don’t tell the whole story. The fact of the matter is we came out of the darkest hole, the Covid pandemic, and then we experienced the biggest inflation spike that most of us have seen in our lifetime. That takes a toll on people.
U.S. Inflation Progress Gets Harder in Last Mile Down
by Molly Smith and Craig Stirling
BNN Bloomberg
(Bloomberg) — US inflation probably moved sideways at best in October, highlighting the uneven path of easing price pressures in the home stretch toward the Federal Reserve’s target.
The core consumer price index due on Wednesday, which excludes food and energy, likely rose at the same pace on both a monthly and annual basis compared to September’s readings.
The overall CPI probably increased 0.2% for a fourth month, while the year-over-year measure is projected to have accelerated for the first time since March.
“The October CPI report will likely support the notion that the last mile of inflation’s journey back to target will be the hardest,” Wells Fargo & Co. economists Sarah House and Aubrey Woessner wrote in a report. “Excluding the more volatile energy and food components, the unwinding of pandemic-era price distortions has proven to be frustratingly slow.”
Tariffs, Inflation, and the Donkey That Cried Wolf
by John F. Di Leo
American Thinker
President Trump has been re-elected, and the American left is losing its mind. That was to be expected.
It’s one of the ways leftists are losing their minds that might be a bit surprising. They warn that President Trump will increase tariffs. “That’s a tax increase!” they declare. “It’s inflationary!”
Now, it is true that President Trump has proposed an array of tariffs and related measures for his upcoming term, intended to address a few of the fundamental problems suffered by not only the United States, but also the rest of the developed world.
Over the past four decades, Red China has gradually taken over the manufacturing of a shocking percentage of the world’s products, from consumer items to commercial machinery, from small components to finished goods. The first Trump administration did the research to prove — for the benefit of anyone who didn’t already realize it — that much of this Chinese takeover of the world’s factory work has been unfairly obtained at best, malevolently intentioned at worst.