Archive
Reuters blog archive
from George Chen:
China is still waiting for inflation to peak
By George Chen
The opinions expressed are the author’s own.
How time flies. It's already the end of August and speculations naturally arise about what China's inflation reading will be for this month.
The most optimistic view these days is that the August Consumer Price Index (CPI) could decline to below 6 percent. The most pessimistic view I've heard is that growth has slowed down in August, but probably only to 6.2 percent or 6.3 percent.
But, why should we care about the August CPI so much? One month cannot tell the whole story.
The reason we care so much is because if the August CPI growth slows down (we will see the official release of August economic data in the coming weeks), it's good news for the central bank as well as for the ordinary people in China who have been fighting with fast inflation for more than three years already. But, it's not good enough.
from The Great Debate UK:
Little chance of a rate hike until at least Q3
-Jane Foley is research director at Forex.com. The opinions expressed are her own. -
Bank of England Governor Mervyn King's speech this week was well timed insofar as it has nipped in the bud a growing fear that inflation in the UK could be lurching higher.
from Breakingviews:
China gets growth and a nasty dilemma
Chinese Premier Wen Jiabao once said 2009 would be China’s toughest economic period in fifty years. He wasn’t thinking ahead. In 2010, policymakers face a seemingly impossible mission – continuing 2009’s growth of 8.7 percent while curbing resurgent inflation. December’s figures show the government is already behind the curve.
The annual inflation rate for consumer prices was a seemingly mild 1.9% in December. But that number understates the threat. The consumer price index excludes the rapidly rising cost of property. And year-on-year changes miss the most recent trend. In the most recent month, prices rose 0.8 percent – a nerve-wracking 10 percent annualised rate.
from Global Investing:
Never mind the output gap
The inflation vs. deflation debate has livened up again following the jump in December's UK consumer price inflation (CPI) to 2.9 percent. Last year you couldn't move for economists harping on about the output gap and blithely dismissing arguments about imported inflation, rising commodity prices, and oh yes, the little matter of the money supply.
Simon Ward, chief economist at Henderson Global Investors, takes the threat of inflation more seriously. He points out that the big swings in inflation in recent years have been driven by food and energy prices, and the latter are beginning to rebound sharply.
from The Great Debate UK:
Will inflation soar when QE is withdrawn?
- Mark Bolsom is Head of the UK Trading desk at Travelex, the world’s largest non-bank foreign exchange and international payments provider. The opinions expressed are his own. -
The rise in November’s CPI figure was larger than expected, but not a total surprise and markets have largely ignored the data.
from From Reuters.com:
The day ahead: Wednesday
Consumer prices are forecast to have risen 0.2 percent in October, unchanged from the mild rise seen in September. Housing starts are expected to edge higher.
Other Highlights:
* Limited Brands, operator of the Victoria's Secret and Bath & Body Works chains, is set to post a third-quarter loss, having struggled with sales of what are seen as non-necessities.
from From Reuters.com:
The day ahead: Wednesday
Consumer prices data and quarterly results from technology company Oracle are among the highlights expected on Wednesday.
* A spike in gasoline prices probably lifted consumer prices in August, but the overall inflation picture remains benign as the economy struggles to emerge from recession.
from Financial Regulatory Forum:
Argentina gives economics ministry more say on statistics
BUENOS AIRES, July 21 (Reuters) - Argentina's economy ministry will have increased control over the national statistics agency, the government said on Tuesday in a bid to restore credibility to the country's consumer price data.
But Economy Minister Amado Boudou told reporters he is not planning to replace the current price index, which the government is accused of massaging for political gain to save money on debt payments.
About 40 percent of Argentine sovereign bonds are inflation-indexed.
"We do not see it as a reform. We see it as a strengthening of an organism surrounded in controversy, which must be made to stop," Boudou told reporters at a late-night news conference.
from Shop Talk:
Check Out Line: Prices rose in May but they’re still down
Check out the latest data that could help erase some inflation worries.
U.S. consumer prices rose at a slower-than-expected pace in May, despite higher gasoline costs. Also, consumer prices have fallen over the past 12 months by the most since 1950, according to new data from the Labor Department.
The Consumer Price Index edged up 0.1 percent in May after being flat in April, below market expectations for a 0.3 percent increase. Compared to the same period last year, consumer prices fell 1.3 percent, the largest decline since April 1950.
from The Great Debate UK:
Deflation? It’s inflation you need to watch
-- David Kuo is a director at the financial Web site The Motley Fool. The views expressed are his own. --
What are consumers supposed to make of the latest inflation numbers? Do we have inflation, deflation or a bit of stagflation?
