Don't Be Fooled, Inflation Is Already Here

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Offline Letsbereal

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U.S. wholesale prices climb 0.4% in February
« Reply #240 on: March 15, 2012, 04:45:56 pm »
U.S. wholesale prices climb 0.4% in February - Energy costs, mainly gasoline, spur increase; food prices fall
15 March 2012
, by Jeffry Bartash - Washington (MarketWatch)
http://www.marketwatch.com/story/us-wholesale-prices-climb-04-in-february-2012-03-15-852190

U.S. wholesale prices posted the biggest increase in February in five months as a spike in oil added to the cost of doing business.

The producer price index rose a seasonally adjusted 0.4% last month, the Labor Department said Thursday. Economists surveyed by MarketWatch had predicted a 0.5% hike.

The bulk of the increase in wholesale costs stemmed from higher prices for petroleum and key offshoots such as gasoline.

The wholesale cost of gasoline shot up 4.3%, also the biggest increase in five months.

Yet a 14% drop in the cost of natural gas, which posted its biggest decline in four years, helped to keep energy prices partly in check.

Overall energy costs rose 1.3% in February.

Higher energy prices in the long run are bad news for businesses and consumers.

Companies either have to absorb the higher price at the expense of profits or pass the cost onto consumers.

That leaves people with less money to save or spend on other things.

The rising cost of fuel is also a threat to the recovering U.S. economy and even the prospects of reelection for President Barack Obama.

His administration has aggressively sought to counter Republican criticism that his policies are to blame for higher fuel prices.

On the brighter side, the wholesale cost of food fell 0.1% in February to mark the third straight decline.

Prices in almost every category, particularly vegetables and dairy, fell.

One notable exception was the price of young chickens, which jumped 5.0%.

Minus the volatile categories of food and energy, “core” wholesale prices rose a smaller 0.2%, matching the MarketWatch forecast.

The core index is viewed by the Federal Reserve as a more accurate gauge of inflationary pressure.

The price of soap and detergents jumped 1.2% last month, while costs rose 0.7% for medical devices, 0.6% for pharmaceuticals and 0.5% for commercial airplanes.

Wholesale prices have actually been declining despite the recent spike in energy costs.

The PPI has risen 3.3% over the past year, but that’s the smallest 12-month increase since August 2010.

Just five months ago the 12-month increase was a much higher 7.0%.

The core rate of wholesale price inflation, however, has remained relatively high.

It’s risen 3.0% over the past year, a number that’s little changed over the past five months.

Meanwhile, the price index for intermediate goods, such as the cloth used to make clothes or stamped metal parts used in heavy machinery, jumped 0.7% last month.

Crude prices — the cost of raw materials — rose 0.4% in February.

Sustained increases in wholesale costs eventually translate into higher prices of consumer goods and services, but the relationship is not precise.

Companies raise or lower prices for a number of reasons.

The true cost to Americans is better seen through the consumer price index, which measures what people actually pay.

The consumer price index, to be released Friday, is also expected to rise 0.5% in February.
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Offline Letsbereal

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John Williams: Inflation Effect - Tough to Ignore or Contain
« Reply #241 on: March 17, 2012, 02:03:08 am »
John Williams: Inflation Effect - Tough to Ignore or Contain
16 March 2012
, by Eric King (King World News)
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/3/16_John_Williams__Inflation_Effect_-_Tough_to_Ignore_or_Contain.html

John Williams just warned that significant inflation will feed into the global system because of rising oil prices and the Fed’s policy to debase the dollar. 

Williams, who founded ShadowStats, also warned the US dollar will take a major hit because of global “dollar dumping.” 

Here is what Williams had to say about the situation: 

“With oil and gasoline prices pressured by market concerns over Middle Eastern political stability, monthly consumer inflation jumped in February and stabilized in the three-plus percentage range on a year-to-year basis.”

“The current level of inflation, however, stands where it is due primarily to the effects of the Federal Reserve’s efforts to debase the dollar, which, in turn, spiked global oil prices into the $100 per barrel range. 

The effects of the dollar-debasement and oil-price-spiking policies not only had direct inflationary impact on energy-related prices, but also—in the period following QE2—had an accelerating upside impact on inflation throughout the broad economy, as indicated by rising “core” inflation (net of food and energy inflation).

While the Fed and Wall Street like to tout “core” inflation, since rising food and energy prices can be ignored, protracted higher oil prices—in particular—eventually work their way into the broad economy and create inflation issues that are tough to ignore and for the Fed to contain.

The following graph reflects year-to-year “core” inflation as reported for both the CPI-U and PPI, since the onset of QE2. 



The annual CPI-U “core” inflation rate for February softened slightly, after 15 straight months of higher annual inflation.

The inflation ahead very much will be tied to the exchange rate value of the dollar, which should be hit heavily by eventual dollar dumping in the global markets. 

That event could be triggered by the Fed’s next effort at easing, which likely will be aimed at propping the banking system, under the guise of trying to boost economic activity.   

The U.S. Treasury/Administration and the Fed will use whatever lending, spending, guarantees and money creation that are needed, in order to prevent a systemic collapse, much as was seen in 2008.”

Regarding volatility in gold and silver, Williams stated:  “Market conditions remain unstable and highly volatile, and the precious metals and stronger major currencies remain the primary hedges against the coming U.S. dollar calamity. 

Recent upside pressure on oil prices primarily reflects supply concerns tied to political instabilities in the Middle East, but those pressures have built upon the upside shift in oil prices that was triggered by the Fed’s policies (i.e. QE2) aimed at debasing the U.S. dollar.”
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Offline Letsbereal

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Gasoline pushes up US inflation, dents confidence
« Reply #242 on: March 18, 2012, 06:06:45 am »
WRAPUP 5-Gasoline pushes up US inflation, dents confidence
16 March 2012
, by Lucia Mutikani - Wshington (Reuters)
http://www.reuters.com/article/2012/03/16/usa-economy-idUSL2E8EG1MV20120316

* Consumer prices up 0.4%, largest rise in 10 months

* Gasoline accounts for more than 80% of CPI rise

* Core CPI muted, showing lack of broad price pressure

* Consumer confidence slips in early March on gasoline
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Offline Letsbereal

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Pento - Soaring Oil, Inflation and Households Soaked in Debt
« Reply #243 on: March 18, 2012, 08:15:11 am »
Pento - Soaring Oil, Inflation and Households Soaked in Debt
17 March 2012
, by Eric King (King World News)
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/3/17_Pento_-_Soaring_Oil%2C_Inflation_and_Households_Soaked_in_Debt.html

Excerpt:

There has been a great deal of hype in the mainstream media stating the US economy is recovering. 

Pento, who founded Pento Portfolio Strategies, told King World News the truth is the US economy is not recovering and global readers should expect a surge in inflation. 

This is what Pento had to say:
“Since the US economy is so intertwined with the global economy, I decided to look at claims by the mainstream media that the US economy is strengthening. 

The conclusion, please don’t believe the hype that the American economy is healing. 

While it is true that some data is showing improvement, the true fundamentals of the economy continue to erode. “America’s trade deficit hit $52.6 billion in January. 

That’s the highest level since October of 2008 and is clear evidence that we have fully reverted back to our under production, under saving and overconsumption habits with alacrity.

The nation’s debt has now eclipsed 100% of our GDP

After 13 straight quarters of paying down debt, households have now started to releverage their balance sheets and total non-financial debt is at a record 250% of GDP

The sad truth is that the U.S. economy is more addicted to debt than at any other time in history ....
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Offline Geolibertarian

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Re: Pento - Soaring Oil, Inflation and Households Soaked in Debt
« Reply #244 on: March 18, 2012, 09:06:20 am »
Quote
The sad truth is that the U.S. economy is more addicted to debt than at any other time in history ....

Indeed it is. However, contrary to popular myth, it's not because money is being "printed." The U.S. Treasury could "print" trillions of Federal Reserve Notes tomorrow, and the money supply would not increase one iota. Why? Because those notes do not become "money" (legal tender) until they've been "issued" by the private banking system. And how do banks issue them? By loaning them into circulation at interest.

So it's not the "fiat" or "paper" aspect of the current money system that's causing so much damage, but the debt aspect:

------------------------------

"Have you ever wondered how everyone -- governments, corporations, small businesses, families -- can all be in debt at the same time and for such astronomical amounts? Have you questioned how there can be that much money out there to lend? Now you know: there isn't. Banks do not lend money; they simply create it from debt....Isn't it astounding that, despite the incredible wealth of resources, innovation and productivity that surrounds us, almost all of us -- from governments to companies to individuals -- are heavily in debt to bankers? If only people would stop and think: 'How can that be? How can it be that the people who actually produce all the real wealth in the world are in debt to those who merely lend out the money that represents the wealth?' Even more amazing is that once we realize that money really is debt, we realize that if there's no debt, there'd be no money. If this is news to you, you are not alone. Most people imagine that if all debts were paid off, the state of the economy would improve. It's certainly true on an individual level. Just as we have more money to spend when our loan payments are finished, we think that if everyone were out of debt, there would be more money to spend in general. But the truth is the exact opposite: there would be no money at all. There it is: we are totally depenedent on continually renewed bank credit for there to be any money in existence. No loans, no money."



http://web.archive.org/web/20061116031731/landru.i-link-2.net/monques/moneyeats.html

WHEN MONEY EATS THE WORLD

by John McMurtry, Professor of Philosophy
University of Guelph.

As the wheels come off the global market juggernaut, we need to understand that the unfolding collapse has been programmed into the machine. Stay the course of capital deregulation long enough and a truly momentous wreck is guaranteed. The fact is that our political and market leaderships have ensured no intelligent thought relating to the actual life needs of societies has been listened to for 15 years. "No alternative," they incanted without a break since the Reagan revolution of mindless govenment first began stripping social infrastructures by ever lower tax rates for the rich and 20% compound interest rates on public debt. Even now as the government of France pulls out of the MAI declaration of rights for unaccountable borderless capital, Ottawa is still prating about "sticking to its commitments" to the meltdown program.

The problem is a generalized mind-seizure. As money-to-more-money circuits have become increasingly autonomous, public consciousness has fetishized money demand as the sovereign authority of the world. The lifeblood of societies has been circulated away as fast as possible to "pay off deficits as a national emergency," "reduce social costs to attract investors," "cool down the employment rate to ward off currency devaluation," "deregulate the labour and resource markets economy for greater efficiencies," and so on. The litany for expropriation of societies' common heritage and infrastructure has been recited every hour for almost twenty years, and it has always and everywhere been the disguise for highly leveraged money sequences to feed on the social life substance across the planet.

But even as the meltdown progresses across continents, the unseen seat of the disease is not yet whispered—that money sequences are overloaded far beyond the capacity of social and environmental capacities to feed them, and that they increasingly attack life-serving functions to continue their decoupled cycles.

Because these money sequences are increasingly without productive outcome of any kind, redistribute more and more wealth to the economically parasitic while stripping the civil commons and the poor, and progressively demand ever more revenue extraction from social and environmental hosts, their reproduction has become increasingly incompatible with civil and planetary life.

The overloading of the life-system by ever more ravenous money sequences is, in truth, behind every crisis people face today in the global market—behind the stressing and breaking of the planetary environment's carrying capacities, behind government debt and deficit loads and crises across the world, behind the ceaseless mergers, acquisitions and job-sheddings by corporate finance departments, behind the speed-ups of every process of work and resource extraction, behind the privatization and enclosure of evolved civil commons in every culture, and behind now the Asian meltdown and the great slump of Japan.

We need not summarize all the symptoms. But consider some figures of money-demand aggregates increasing exponentially on life systems at every level, every new unit of the escalating load requiring "more competitive performance" or "more competitive cost cutting" from individual, social and environmental life-hosts, with no limit set to what will be demanded next.

[Continued...]

------------------------------

If anyone is curious to know what the real solution to this problem is, please see the following:

       http://forum.prisonplanet.com/index.php?topic=98465.0
"Abolish all taxation save that upon land values." -- Henry George

"If our nation can issue a dollar bond, it can issue a dollar bill." -- Thomas Edison

http://webofdebt.com
http://schalkenbach.org
http://forum.prisonplanet.com/index.php?topic=203330.0

Offline Effie Trinket

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Re: Pento - Soaring Oil, Inflation and Households Soaked in Debt
« Reply #245 on: March 18, 2012, 10:35:01 am »
Indeed it is. However, contrary to popular myth, it's not because money is being "printed." The U.S. Treasury could "print" trillions of Federal Reserve Notes tomorrow, and the money supply would not increase one iota. Why? Because those notes do not become "money" (legal tender) until they've been "issued" by the private banking system. And how do banks issue them? By loaning them into circulation at interest.

So it's not the "fiat" or "paper" aspect of the current money system that's causing so much damage, but the debt aspect
:

Create Conflict and Control the Debt the Conflict Creates
http://www.youtube.com/watch?v=ttO0XaZGRzY

Watch that vid clip from the International.  Incredible that was put into a movie.

Offline Letsbereal

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U.K. Consumer Inflation Rose 0.6% From January
« Reply #246 on: March 20, 2012, 06:34:38 am »
U.K. Feb. annual inflation rate slows to 3.4%
20 March 2012
, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/uk-feb-annual-inflation-rate-slows-to-34-2012-03-20

Annual consumer price inflation in Britain slowed to 3.4% in February, slowing from a 3.6% annual pace in January, the Office for National Statistics reported Tuesday.

On a monthly basis, consumer inflation rose 0.6% from January.

Economists surveyed by Dow Jones Newswires had forecast monthly inflation of 0.5% and a year-on-year rate of 3.3%.
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Offline Letsbereal

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RBI: Easing growth may help contain inflation
20 March 2012
, by Manoj Kumar & Suvashree Dey Choudhury - New Delhi (Reuters)
http://profit.ndtv.com/News/Article/easing-growth-may-help-contain-inflation-rbi-300078

Excerpt:

Yields had risen sharply after the government announced a higher-than-expected borrowing programme for 2012/13 in its budget on Friday.

Subir Gokarn, who handles monetary policy, said that crude oil prices were not the only factor impacting inflation, but other variables like the exchange rate also play a role.

However, RBI Governor Duvvuri Subbarao separately said he remains worried about inflation in essential items like food and fuel.

India’s headline inflation rose 6.95% from a year earlier in February, after a spike in vegetable prices fanned food inflation.


RBI worried about inflation in essential items: chief
20 March 2012
, Jammu, India (Reuters)
http://in.reuters.com/article/2012/03/20/rbi-inflation-idINDEE82J04W20120320

The Reserve Bank of India is worried about inflation in essential items, Governor Duvvuri Subbarao said on Tuesday.

India's headline inflation edged up a faster-than-expected 6.95% from a year earlier in February, after a spike in vegetable prices fanned food inflation.
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Offline Letsbereal

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Record UK gasoline prices stoke inflation fears
« Reply #248 on: March 23, 2012, 05:22:27 pm »
Record UK gasoline prices stoke inflation fears
23 March 2012
, by Sarah Kent - London (MarketWatch)
http://www.marketwatch.com/story/record-uk-gasoline-prices-stoke-inflation-fears-2012-03-23

-- Price of gasoline above 140 pence a liter for first time

-- Rise stokes fresh inflation fears, piles pressure on consumers

Gasoline prices in the U.K. hit a new record high this week, stoking fresh fears on inflation and piling more pressure on hard-pressed consumers
.

The price of gasoline rose above 140 pence a liter for the first time ever to hit 140.20p/liter Thursday, having already increased 7.95 pence a liter, or 6%, this year, according to data from the Automobile Association.

Diesel prices have also hit a new record high of 146.72p/liter.

The rise in gasoline prices will be unwelcome news for many Britons, whose spending power has been hit by high inflation and meager wage increases.

In a blow to motorists, Chancellor of the Exchequer George Osborne ignored calls to scrap a looming increase in fuel taxes when he presented the government's latest budget plan Wednesday.

The AA, which provides breakdown recovery service and car insurance in the U.K., said the three-pence increase in road fuel duty due to come into force Aug. 1 will add GBP3.84 to the average car user's monthly fuel bill.

The rise in prices at the pump may also unnerve policy makers at the Bank of England, who are counting on cooling inflation to loosen the squeeze on household incomes and help drive the economy's recovery.

The annual rate of inflation slowed to 3.4% in February from a high of 5.2% in September, and policy makers expect it to slow to near the central bank's 2% target by the end of the year.

Yet central bank officials are already fretting that higher-than-expected oil prices may hinder inflation's retreat.

Martin Weale, a rate-setter on the BOE's Monetary Policy Committee, has already signaled his unwillingness to back further stimulus for the U.K. economy while inflation lingers and has identified oil prices as a particular concern.

Still, Philip Rush, an economist at Nomura, said although gasoline prices have climbed to a new record, the pace of acceleration in prices this year hasn't matched the quicker gains that stoked a substantial surge in inflation last year.

"The increase in petrol prices isn't too scary yet," he said. Rush added that were prices to keep rising rate-setters would be unlikely to respond by raising interest rates.

The central bank chose to treat high oil prices last year as a temporary phenomenon, and would probably do so again, he said.
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Offline Letsbereal

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Vietnam inflation up 14.15% on year
« Reply #249 on: March 26, 2012, 10:52:25 pm »
Vietnam inflation up 14.15% on year
24 March 2012
, by Vu Trong - Hanoi (MarketWatch)
http://www.marketwatch.com/story/vietnam-inflation-up-1415-on-year-2012-03-24

Vietnam's consumer price index in March rose 0.16% from the previous month led by the increases in the prices of transport and education services, government figures showed Saturday.

March CPI's on-month rise is much slower than a rise of 1.37% in February, despite an increase of between 3% and 10% in the prices of oil products on March 7.

Food and food service prices fell 0.83% from the previous month, while the prices of postal and telecommunication services fell 0.02%, the General Statistics Office said in a statement.

The index rose 14.15% from a year earlier and was up 2.55% from the end of 2011, the GSO said.

Vietnam aims to bring down year-on-year inflation to single digits this year from a recent peak of 23% in August last year, and from 18.13% at the end of last year.
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Offline Letsbereal

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RBA member: Inflation to rise but not productivity
« Reply #250 on: March 28, 2012, 08:19:31 pm »
RBA member: Inflation to rise but not productivity
27 March 2012
, Sydney (MarketWatch)
http://www.marketwatch.com/story/rba-member-inflation-to-rise-but-not-productivity-2012-03-27

--China slowing reflects policy tightening, Europe

--Chinese growth to remain solid

--Inflation remains medium-term threat

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Offline Letsbereal

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The creeping cost of consumer inflation
« Reply #251 on: April 09, 2012, 10:27:56 am »
The creeping cost of consumer inflation brought to you by a lower US dollar – Americans squeezed as inflation filters into the cost of daily life. The uncertain employment market of low wage work.
2 April 2012
, by mybudget360 (mybudget360.com)
http://www.mybudget360.com/cost-of-consumer-inflation-us-dollar-index-dollar-decline-energy-costs/

Excerpt:

There are unintended consequences when policy aims at depreciating a currency in favor of bolstering an ailing banking system

The Federal Reserve has been on a multi-decade mission to lower the value of the US dollar. 

The primary purpose of this mission is to inflate banks into solvency as they try to work their way out of the massive financial crisis. 

The amount of troubled real estate loans is still impressive when we look at the temporary sanctuary being provided by the Federal Reserve on their overloaded balance sheet. 

This luxury is not afforded to your common household and consequently many Americans are now facing higher and higher costs in items like energy even though demand is slightly lower. 

This occurs for a variety of reasons but a main driver is the declining purchasing power of the US dollar. 

This permeates over into the employment market that is largely being driven by lower wage positions. 

Inflation is creeping back into the economy.
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Offline Letsbereal

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Chinese inflation rate rises to 3.6% in March
« Reply #252 on: April 09, 2012, 12:16:52 pm »
Chinese inflation rate rises to 3.6% in March
9 April 2012
, (AFP)
http://www.france24.com/en/20120409-chinese-inflation-rate-rises-36-march

China's inflation rate edged up in March, driven by rising food costs, official data showed on Monday, but analysts said there was still scope for Beijing to stimulate the slowing economy.

The consumer price index rose to 3.6% in March from 3.2% in February, slightly higher than analysts' expectations, as bad weather pushed up food prices and authorities raised the price of fuel.

Inflation -- one of China's biggest economic concerns because of the potential for rising prices to trigger social unrest -- hit a high of 6.5% last July, but has gradually slowed since then.

In February it hit its lowest rate since 2010, and analysts expect it to remain under 4% this year, allowing the government to further loosen credit conditions to boost businesses hit by the global economic slowdown.

"CPI was mainly pushed up by food prices, which resulted from an undersupply of vegetables due to relatively cold weather in March," Li Huiyong, a Shanghai-based analyst at Shenyin Wanguo Securities, told AFP.

"We think the downward trend will likely be unchanged, with the CPI bottoming out in July this year."

Stock markets throughout Asia reacted negatively to Monday's figure which was slightly higher than analysts' expectations of 3.3%.

Tokyo fell 1.47% and Shanghai dropped 0.90%, while Seoul was down 1.57%.

Premier Wen Jiabao, speaking at the opening of the annual session of parliament in March, warned consumer prices remained high and said the government's aim was to keep inflation within 4% this year.

Inflation has triggered social unrest in the past and senior leaders are anxious to keep prices of basic goods such as vegetables, meat and housing under control ahead of a once-a-decade power transition that begins later this year.

Nonetheless, Beijing has twice lowered the banks' reserve requirement ratio in the past four months, effectively increasing the amount of money they can lend, and analysts said they expected further such moves in the coming months.

"There's still room for the central bank to lower reserve ratio requirements soon," said Tang Jianwei, an economist with the Bank of Communications in Shanghai.

The producer price index (PPI), which measures the cost of goods at the farm and factory gate and is a leading indicator of consumer prices, fell 0.3% year-on-year in March, showing deflationary pressures are still at work on prices.

"PPI figures could be of concern and push the government to be more active on easing credit," said Xianfeng Ren, an economist with IHS Global Insight.

Food prices, regularly the source of government concern as they hit China's most sensitive populations, rose 7.5% in March.

Meanwhile the government put up fuel prices by the biggest margin in three years last month, as easing inflation gave it more room to adjust to international price levels.

China has cut its economic growth target to 7.5% this year, from 8% last year, in an official acknowledgement that the export-driven economy is slowing.

Analyst expect first-quarter economic data due out on Friday will confirm the slowdown in growth in the world's second biggest economy as Europe's debt crisis and sluggish US economic recovery hurts demand for its products.

The Asian powerhouse expanded 9.2% last year, slowing from 10.4% in 2010, as global turbulence and efforts to tame high inflation put the brakes on growth.

"Looking forward to next few months the economy will continue to get worse, but should pick up in the second half as external conditions are expected to get better," said Ren.
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Offline Letsbereal

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ECB money is fueling inflation in Germany
« Reply #253 on: April 11, 2012, 04:15:34 pm »
The Bundesbank will stamp out this rally - ECB money is fueling inflation in Germany
11 April 2012
, by Matthew Lynn - London (MarketWatch)
http://www.marketwatch.com/story/the-bundesbank-will-stamp-out-this-rally-2012-04-11

Excerpt:

What’s the scariest statistic in the financial markets of the last few weeks? Easy.

The 6 million euro house in Munich. The Bavarian city isn’t the kind of place you associate with property bubbles.

But one piece of real estate recently went for that hefty sum — and more to the point, it was twice what was paid for it six years earlier.

Germany is starting to see a sudden run-up in property prices. And that matters.

The recent storming bull run has been driven by the vast sums of money pumped into the system by the European Central Bank.

But as that starts to spill over into higher prices in Germany, that country’s central bank will start fighting furiously to bring them under control.

The ECB started this rally. The Bundesbank will stamp it out.
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Offline Letsbereal

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Core wholesale prices rose a seasonally adjusted 0.3%
« Reply #254 on: April 13, 2012, 10:13:23 am »
U.S. producer prices flat in March; core up 0.3%
12 April 2012
, by Jeffry Bartash - Washington (MarketWatch)
http://www.marketwatch.com/story/us-producer-prices-flat-in-march-core-up-03-2012-04-12

U.S. wholesale prices were unchanged in March as a recent surge in energy prices was mostly reversed, the Labor Department said Thursday.

Excluding the volatile categories of food and energy, core wholesale prices rose a seasonally adjusted 0.3%.

Economists surveyed by MarketWatch had predicted a 0.1% decrease in the overall producer price index and a 0.2% rise in core PPI.

Energy prices fell 1.0% last month, led by a sharp reduction in gas.

The wholesale cost of food, however, rose 0.2% to mark the first increase in five months.

Over the past year wholesale prices have risen an unadjusted 2.8%, the smallest year-over-year increase since June 2010.

Read the full story: U.S. wholesale prices unchanged in March http://www.marketwatch.com/story/us-wholesale-prices-unchanged-in-march-2012-04-12
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Offline Letsbereal

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U.S. cost of living climbs 0.3% in March
« Reply #255 on: April 13, 2012, 10:19:11 am »
U.S. cost of living climbs 0.3% in March - Prices of most goods and services rose last month
13 April 2012
, by Jeffry Bartash - Washington (MarketWatch)
http://www.marketwatch.com/story/us-cost-of-living-climbs-03-in-march-2012-04-13

The cost of living rose again in March even as the price of gasoline leveled off, the U.S. government reported Friday.

The consumer price index climbed 0.3% last month as the cost of most goods and services rose, the Labor Department said.

The increase outstripped the rise in wages, so inflation-adjusted earnings for the average American worker fell 0.1% last month.

Economists surveyed by MarketWatch expected a 0.2% increase in the cost of living. Prices rose for a wide variety of goods.

Energy costs, for example, climbed 0.9% last month, though that was far smaller than February’s 3.2% increase as gas prices eased.

A retreat in the price of oil from recent highs should offer a bit of additional relief to consumers, at least temporarily.

Natural-gas prices rose for the first time in five months, but electricity costs dropped to mark the biggest decline since June 2011.

The cost of food rose a smaller 0.2% last month after being unchanged in February. Meat, poultry, fish and eggs posted the biggest increases.

Yet fruit and vegetable prices fell, as did the cost of dairy and baked goods.

Over the past year, consumer prices have risen an unadjusted 2.7%, but that’s down from 2.9% in February.

Excluding food and energy, the so-called core consumer price index climbed 0.2% in March and matched Wall Street’s expectations.

Prices for shelter — rental units or homes — and used autos spurred the increase.

Prices for used vehicles jumped 1.3% after falling in each of the past six months.

The cost of new cars and trucks, medical care, clothing and airfare also rose in March.

Among the few things to fall in price were tobacco, household furnishings and liquor.
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U.K. March Producer Prices Increased More Than Forecast: Economy
« Reply #256 on: April 13, 2012, 03:26:47 pm »
U.K. March Producer Prices Increased More Than Forecast: Economy
13 April 2012
, by Svenja O’Donnell (Bloomberg)
http://www.bloomberg.com/news/2012-04-13/u-k-producer-prices-increased-more-than-forecast-in-march-1-.html

Excerpt:

U.K. factory-output prices and raw- material costs rose more than economists forecast in March, suggesting inflation pressures remain in the economy.

The price of goods at factory gates increased 0.6% from February, the Office for National Statistics said today in London.

The median forecast of 20 economists in a Bloomberg News survey was for a 0.5% gain.

Raw material costs rose 1.9%, exceeding a median estimate of 1.4%.

While Bank of England Governor Mervyn King maintains that the U.K. economy’s predicament still feels “like a crisis,” policy makers Martin Weale and Spencer Dale have shown concern about consumer-price growth slowing less than projected.

Officials refrained last week from increasing emergency stimulus before new growth and inflation forecasts due next month.

“It all adds to the pressure to at least bring quantitative easing to a halt for now,” said Brian Hilliard, an economist at Societe Generale SA in London and a former Bank of England official.

“The signals on growth are still very weak. I don’t think the Monetary Policy Committee is going to have any serious concerns.”

The pound was little changed after the release, trading at $1.5920 as of 9:39 a.m. in London.

The yield on the two-year government bond was also little changed at 0.396%.

Producer prices climbed for a third month, gaining in six out of 10 categories.

The biggest increases were in petroleum products and tobacco and alcohol.

From a year earlier, prices rose 3.6%, compared with a 4.1% gain in February, the statistics office said.
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India inflation slows less than expected in March
« Reply #257 on: April 16, 2012, 07:22:36 am »
India inflation slows less than expected in March
16 April 2012
, by Nick Godt - Mumbai (MarketWatch)
http://www.marketwatch.com/story/india-inflation-slows-less-than-expected-in-march-2012-04-16

Inflation in India slowed less than expected in March, as food and energy prices kept climbing, but a cooling in manufacturing prices kept intact market hopes for a rate cut by the Reserve Bank of India on Tuesday.

The wholesale price index rose 6.89% in March from a year earlier, compared with February's 6.95% increase, India's ministry of commerce said on Monday.

Economists surveyed by Dow Jones Newswires on average expected inflation to slow to 6.65% in March.

However, inflation for manufactured products, which is the main component of the index, slowed to 4.87% in March from 5.75% in February.

With growth slowing in recent months, the RBI is widely expected to cut its key lending rate by 25 basis points to 8.25% on Tuesday.

On the Bombay Stock Exchange, the Sensex traded between gains and losses, and was recently down 0.1% at 17,072.
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Offline Letsbereal

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Shadowstats - Alternate Inflation Charts
« Reply #258 on: April 16, 2012, 11:23:58 am »
Alternate Inflation Charts Last Updated: April 13th, 2012
http://www.shadowstats.com/alternate_data/inflation-charts



• CPI Headline Inflation of 0.3% Was 0.8% Not Seasonally Adjusted

March Year-to-Year Inflation: 2.7% (CPI-U), 2.9% (CPI-W), 10.3% (SGS)






CPI Year-to-Year Growth

The CPI-U (consumer price index) is the broadest measure of consumer price inflation for goods and services published by the Bureau of Labor Statistics (BLS).

While the headline number usually is the seasonally-adjusted month-to-month change, the formal CPI is reported on a not-seasonally-adjusted basis, with annual inflation measured in terms of year-to-year percent change in the price index.

In the charts to the right we show two SGS-Alternate CPI estimates: One based on the pre-1990 official methodology for computing the CPI-U, and the other based on the methodology which was employed prior to 1980.


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Euro-zone Mar. annual inflation revised up to 2.7%
« Reply #259 on: April 17, 2012, 06:41:00 am »
Euro-zone Mar. annual inflation revised up to 2.7%
17 March 2012
, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/euro-zone-mar-annual-inflation-revised-up-to-27-2012-04-17

The annual rate of inflation in the euro-zone came in at 2.7% in March, unchanged from the previous month but revised upward from a preliminary estimate of 2.6%, the European Union statistics agency Eurostat reported Tuesday.

The European Central Bank's inflation target is for annual inflation of near but just below 2%.

The ECB has said it expects inflation to remain above target in 2012, due in part to rising energy prices, falling back to target next year.
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Offline Letsbereal

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U.K. annual inflation accelerates to 3.5% in March
« Reply #260 on: April 17, 2012, 06:45:15 am »
U.K. annual inflation accelerates to 3.5% in March
17 April 2012
, by William L. Watts - Frankfurt (MarketWatch)
http://www.marketwatch.com/story/uk-annual-inflation-accelerates-to-35-in-march-2012-04-17

The pace of inflation in Great Britain accelerated to 3.5% in March from 3.4% the previous month, the U.K. Office for National Statistics reported Tuesday.

On a monthly basis, inflation rose 0.3%. Economists had forecast a 0.3% monthly rise and a 3.4% annual reading.

The Bank of England's inflation target stands at 2%. The British pound gained ground after the data and traded at $1.5945 versus the dollar in recent action, a gain of 0.3%.

"We feel that today's rise in inflation is just a temporary setback in a downward trend,

but given the recent better tone to some of the activity data it reduces the chances of additional Bank of England [quantitative easing] in May," said James Knightley, economist at ING Bank.
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Offline Letsbereal

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Re: Don't Be Fooled, Inflation Is Already Here
« Reply #261 on: April 17, 2012, 10:34:27 am »
Euro-Area March Inflation Rate Exceeds Estimate on Energy
17 April 2012
, by Patrick Henry (Bloomberg)
http://www.bloomberg.com/news/2012-04-17/euro-area-march-inflation-rate-exceeds-estimate-on-energy-1-.html

European consumer prices increased at a faster pace than initially estimated in March, driven by energy costs, complicating the European Central Bank’s task as it tries to push the inflation rate below its 2% limit.

Inflation in the 17-nation euro region held at 2.7% for a fourth month, the European Union’s statistics office in Luxembourg said in an e-mailed statement today.

That’s higher than the estimate of 2.6% published on March 30.

The economy may struggle to gather strength as budget cuts and rising energy prices erode consumer spending and company investment.

European Central Bank President Mario Draghi on April 4 quashed talk of an early exit from emergency stimulus measures as Spain struggled to borrow in financial markets.

Policy makers left the benchmark rate at a record low 1%.

“Inflation remains relatively high on the back of one-off factors,” said Annalisa Piazza, a fixed-income analyst at London-based Newedge Group.

“However, the ECB has clearly signaled that policymakers are ready to act in a timely manner, should pass-through effects start to put upside risks to medium term inflation.”

The euro extended gains after the data were released, trading at $1.3166 at 11:03 a.m. in Brussels, up 0.2%.

Energy Costs

Euro-region inflation may average about 2.4% this year and 1.6% in 2013, the ECB said on March 8.

The Frankfurt-based central bank aims to keep annual gains in consumer prices just below 2%.

Energy costs rose 8.5% after a 9.5% gain in February, while transport gained 4.6%, according to today’s report.

The price of crude for May delivery was at $103.41, up 48 cents, in electronic trading on the New York Mercantile Exchange at 10:38 a.m. Brussels time.

Prices are 3.2% higher this year.

The euro-region’s core inflation rate, excluding volatile costs such as energy, rose to 1.6% from 1.5% in February, the statistics office said.

In the month, consumer prices gained 1.3%.
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Offline Letsbereal

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Japan central bank may hike inflation view: report
« Reply #262 on: April 18, 2012, 07:51:39 am »
Japan central bank may hike inflation view: report
17 April 2012
, by Michael Kitchen - Los Angeles (MarketWatch)
http://www.marketwatch.com/story/japan-central-bank-may-hike-inflation-view-report-2012-04-17

The Bank of Japan may raise its consumer inflation outlook for the current and next fiscal years, though the new forecast would remain below the level the central bank has tagged as necessary to tighten its policy, according to a Nikkei report Wednesday.

Given price gains from crude oil and post-earthquake rebuilding demand, the bank would hike its projection for the current fiscal year ending March 2013 to a 0%-0.5% year-on-year rise in the core consumer price index,

up from its current 0.1% forecast increase, the report said, citing unnamed sources familiar with the bank's thinking.

For fiscal 2013, the outlook would be raised to 0.5%-1% from 0.5% currently.

The core consumer price index excludes volatile fresh-food prices and is a key metric watched by the Bank of Japan.

The central bank has said it wants to see stable inflation of 1% before considering any policy-tightening moves, and the report said further easing measures may come before then.

The revised forecast would be presented as the median consensus of Bank of Japan policy board members in their next economic report, due April 27.
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Mining inflation is running on average 3%-4% above consumer inflation
« Reply #263 on: April 18, 2012, 08:08:32 am »
Global mining costs could double by 2022: Cutifani
18 April 2012
, by Diana Kinch - Nova Lima, Brazil (MarketWatch)
http://www.marketwatch.com/story/global-mining-costs-could-double-by-2022-cutifani-2012-04-18

--Mine costs may escalate as quality reserves decline

--Executive calls for more R + D investment

--AngloGold Ashanti developing prototype for deeper mining

Average operating costs in the global mining industry could double in the next five to ten years, Mark Cutifani, the CEO of gold producer AngloGold Ashanti Ltd., said Tuesday
.

Mining inflation is running on average 3%-4% above consumer inflation due to the increasing depth of mines of all types, declining ore grades and restrictions on access to new mineral reserves for political and geographical reasons, Cutifani said during an event in Minas Gerais state.

The rate of mining inflation could escalate in coming years, as difficulties may be faced in developing new mines in Africa, where 40% of the world's untapped minerals reserves are located, he said.

Commodity price inflation has accelerated over the last 10 years along with the acceleration of global demand particularly from Asia.

At the same time supplies have diminished, leading to the recent so-called supercycle, according to Cutifani.

"The market is surging and industry's unable to deliver," Cutifani said.

"The world's growing three percent a year, driven largely by Asia, and the mining industry has been left behind."

In the case of gold and base metals, ore grades are declining by between 1% and 5% a year.

In 10 years time, all mines will be on average 400 meters deeper than they are today and 70% more material will need to be shifted to get to the ore, according to the executive.

Mining companies need to collaborate on new technologies that will help overcome the current "crisis in how to deliver products to the market," he said.

Research and development spending currently represents 0.2% of the sector's gross revenues, compared to up to 2% in the oil and gas sector, he said.

AngloGold Ashanti is spending $15 million a year on the development of a new prototype large-scale underground drilling mechanism that will be used to mine gold at its mines in South Africa at a depth of below 5,000 meters from 2014, rather the 4,000 meter limit at present, Cutifani said in an interview.

This will use a tunnelling method to extract ore, rather than explosives.

The system is being developed together with General Electric Co. and 3M Co. and will allow output of four times as much gold for the same costs as at present, according to the executive.

"If we don't find a solution to mining below 5,000 meters we don't have mines," he said.
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Curtains for quantitative easing? Bank of England set to turn off cash taps as it admits inflation is 'uncomfortably high'
19 April 2012
, by Adrian Lowery (MailOnline)
http://www.dailymail.co.uk/money/news/article-2131462/Bank-England-set-pause-QE-admits-inflation-uncomfortably-high.html

The UK could have seen the last of quantitative easing because inflation is not coming down as far or as fast as expected, the Bank of England admitted today.

After the rate of inflation rate crept up yesterday to 3.5%, deputy governor Paul Tucker said that the news on inflation had been 'bad'.

'Though [inflation] has fallen significantly over the past six months, from over 5% to 3.5% on yesterday's reading, it remains uncomfortably above target,' Tucker said in a Liverpool speech. 

Meanwhile, minutes to the Bank's April meeting showed that QE stalwart Adam Posen had surprisingly dropped his long-standing call for more stimulus, and that others were worried the Bank risked losing credibility regarding its commitment to keeping inflation under control.

The BoE said that the policy challenge it faced was thrown into 'sharp relief' by increased risks of high inflation over the past month.

'The upside risk to inflation, on the back of higher oil prices, has clearly thrown the MPC off guard,' said Nida Ali, economic advisor to the Ernst & Young ITEM Club, 'causing even Adam Posen to withdraw his call for more QE.'

'But with growth prospects now looking weaker than a couple of months ago, the MPC faces a major dilemma,' she added.

'In our view, the Bank is unlikely to authorise more QE in the coming months, especially in light of the latest oil price developments.'

Mr Tucker - who has said he has 'great sympathy’ for savers and pensioners affected by QE and price rises - said inflation was likely to stay a little higher than projected in the February Inflation Report in the short-term and might remain above 3% throughout the second quarter of this year and possibly into the second half.

In its February Inflation Report, the Bank predicted that inflation would fall below its 2% target towards the end of this year.   

But food and oil prices prodded inflation up to 3.5% in March, from 3.4% in February, halting a five-month decline from a peak of 5.2% in September 2011.   

Economists had not expected more QE next month, but most had not ruled it out later in the year after uneven signs on the economy's recovery in recent months.

George Buckley at Deutsche Bank said: 'The only thing that could sway [the MPC] back to more QE is next week's GDP figures and the PMIs. Those are the things to watch out for.'

The aim of the Bank's loose monetary policy was to boost economic growth, prevent a wave of mortgage repossessions and pump money into the flagging economy.

But the whole QE project was called into question overnight by MPs who slammed the policy for destroying the incomes of pensioners and savers.

damning Treasury select committee report laid bare how the Bank's £325bn in QE and ultra-low bas rate has had a crippling effect on annuity incomes and savings rates.

The committee even called for some sort of compensation for those hurt by QE, saying:

‘We recommend that the Government consider whether there are any measures that should be taken to mitigate the redistributional effects of QE.’

Tucker said the real economy is recovering broadly in line with the Bank's February forecasts, but the Bank's minutes admitted official data could reveal the UK economy is back in recession with a second quarter of GDP contraction.

'Monetary policy will underpin the recovery so long as that remains consistent with anchoring inflation expectations in line with achieving the 2% target over the medium run,' he said. 'We shall not let that slip.'

Fellow policymakers Spencer Dale and Martin Weale have also voiced concerns over the inflation outlook and indicated their reluctance to back another round of asset-buying when the current £325bn QE tranche is completed in May.   

The QE programme – which has been likened to printing money – started under Labour in 2009 and has continued under the Coalition.

The Treasury committee report highlighted how it has had the effect of slashing annuity rates, or ‘incomes for life’.

When a pensioner cashes in his savings for retirement, he is paid an annuity for the rest of his life.

In 1990, the average annuity rate for a 65-year-old man was an annual return of 16% of his pension pot. Today it is just 6%.

Thus a man who cashed in a £100,000 pension pot in 1990 would have got an annual income of £16,000.

A person retiring today, who had diligently saved the same amount, would get just £6,000 a year, an annual cut of £10,000.

The committee called on the Bank, particularly the nine men on its interest-rate setting committee, to ‘improve upon their efforts’ to  explain their controversial policy to the country.

It says: ‘The policy of extremely lax monetary policy has not been without criticism.

Under this policy, savers receive a far lower return on their savings than under more normal conditions.’

The report quotes Mr Tucker as saying he has ‘great sympathy’ for savers, but insisting the economy would have been ‘destroyed’ without the Bank’s action.
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Re: Don't Be Fooled, Inflation Is Already Here
« Reply #265 on: April 18, 2012, 06:14:58 pm »
The SHOCKING Truth About the U.S. Dollar: What The Media Never Told You
 
http://www.youtube.com/watch?v=Enm0CBx52g4a


Offline Letsbereal

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UK inflation expectations rise in April: survey
« Reply #266 on: April 26, 2012, 08:40:02 pm »
UK inflation expectations rise in April: survey
26 April 2012
, by Nicholas Winning - London (MarketWatch)
http://www.marketwatch.com/story/uk-inflation-expectations-rise-in-april-survey-2012-04-26

The U.K. public's expectations for inflation in the coming year rose in April, presenting the Bank of England with an awkward policy dilemma for the recession-hit economy, a monthly survey by Citi Inc. and polling firm YouGov showed Thursday.

The median for inflation expectations in the year ahead increased to 3.0%, the highest reading since December and up from 2.7% in March, Citi said. Expectations for inflation over the next five to 10 years also rose to 3.7% from 3.4% in March, the highest level since September last year.

Official data released Wednesday showed U.K. GDP fell 0.2% in the first quarter of this year after a 0.3% contraction in the final three months of 2011.

It is the first time the economy has contracted for two consecutive quarters--the standard definition of a recession--since early 2009.

But despite the weakness of the economy, inflation has remained stubbornly high.

The official rate rose unexpectedly to 3.5% in March from 3.4% in February driven by non-alcoholic beverages and food.

"We do expect that headline CPI inflation will fall further in coming months, but the MPC [Monetary Policy Committee] will be on high alert for signs that inflation expectations may become entrenched at an undesirably high level," Michael Saunders, an economist at Citi, said in the survey.
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Japan March core consumer prices rise 0.2%
« Reply #267 on: April 27, 2012, 05:12:32 pm »
Japan March core consumer prices rise 0.2%
26 April 2012
, by Sarah Turner SYDNEY (MarketWatch)
http://www.marketwatch.com/story/japan-march-core-consumer-prices-rise-02-2012-04-26

Japan's core consumer prices rose 0.2% during March compared to a year ago, the Statistics Bureau of Japan reported Friday.

Economists had been expecting a 0.1% rise in core CPI, according to separate surveys by Reuters and Dow Jones Newswires.

Core CPI, which strips out volatile food prices, rose 0.5% from the previous month, while overall CPI rose 0.5% on an annual and monthly basis.

In a heavy day for Japanese data, other releases from the ministry showed the unemployment rate was at 4.5% in March, unchanged from February and in line with economists' expectations.

Average March monthly spending for household of two or more people rose 3.4% to 303,841 yen ($3,754) in real terms compared to the previous year, below economist expectations for a 4.0% rise.
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Offline Letsbereal

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Singapore central bank flags inflation risks - 4.5%
« Reply #268 on: May 01, 2012, 02:03:24 am »
Singapore central bank flags inflation risks
30 April 2012
, by Gaurav Raghuvanshi - Singapore (MarketWatch)
http://www.marketwatch.com/story/singapore-central-bank-flags-inflation-risks-2012-04-30

Excerpt:

-- Singapore's central bank says risks remain to inflation in Asia.

-- It keeps 2012 inflation, economic growth forecasts.

-- It says elevated oil prices could spur inflation.

Singapore's inflation is likely to stay elevated in the coming months and ease only gradually later in 2012, the island nation's central bank said in a report Monday, reiterating its existing estimates for inflation and economic growth this year
.

"While the pace of subsequent price increases will ease from the high seen earlier this year, overall inflation will remain firm," the Monetary Authority of Singapore said in its post monetary policy Macroeconomic Review,

flagging tight resource constraints in the labor market  and high global crude oil prices.

The central bank expects consumer price inflation to average between 3.5% and 4.5% and the economy to grow between 1% and 3% in 2012.
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Chilean consumer prices seen rising in April
« Reply #269 on: May 07, 2012, 09:03:57 pm »
Chilean consumer prices seen rising in April
7 May 2012
, by Graciela Ibanez - Santiago (MarketWatch)
http://www.marketwatch.com/story/chilean-consumer-prices-seen-rising-in-april-2012-05-07

Gains in fuel prices, partially offset by a one-time discount in residential electricity bills, likely pushed Chile's consumer prices slightly higher in April.
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Offline Letsbereal

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BOE Halts Stimulus as Inflation Threat Outweighs Slump
« Reply #270 on: May 10, 2012, 10:57:19 am »
BOE Halts Stimulus as Inflation Threat Outweighs Slump
10 May 2012
, by Scott Hamilton and Jennifer Ryan (Bloomberg)
http://www.bloomberg.com/news/2012-05-10/boe-halts-stimulus-as-u-k-inflation-threat-trumps-slump.html

Excerpt:

Bank of England officials halted stimulus expansion after seven months of bond purchases as the threat of inflation trumped concerns about an economy that’s succumbed to a double-dip recession.

The nine-member Monetary Policy Committee led by Governor Mervyn King today held its quantitative-easing target at 325 billion pounds ($525 billion), ending a second round of stimulus, a move forecast by 43 out of 51 economists in a Bloomberg News survey.

Officials also left the benchmark interest rate at a record low of 0.5%. The pound erased its decline against the dollar.

With inflation on course to exceed Bank of England forecasts and the economy struggling to recover, policy makers have been divided on how to resolve the dilemma.

Today’s decision signals price-growth worries are mounting even as the U.K. struggles with government budget cuts, high unemployment and threats from Europe’s debt crisis.

“They’re trying to signal a transition away from a mild dovish bias toward a more normal stance,” said Ross Walker, an economist at Royal Bank of Scotland Group Plc in London.

Our forecast is that they’re done with QE, but you can’t rule out more later this year. They could get blown off course if market conditions deteriorate.”
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British producer prices jump 0.7% in April
« Reply #271 on: May 13, 2012, 12:25:03 am »
British producer prices jump 0.7% in April
11 May 2012
, by Jason Douglas - London (MarketWatch)
http://www.marketwatch.com/story/british-producer-prices-jump-07-in-april-2012-05-11

Prices charged by U.K. companies at the factory gate rose in April, official data showed Friday, driven by tax increases for alcohol and tobacco and higher prices for oil products and electrical equipment.

The Office for National Statistics said prices for manufactured products rose 0.7% on the month, compared with a rise of 0.6% in March.

Economists polled by Dow Jones Newswires were expecting a rise of 0.5%.

Factory gate prices were 3.3% higher on the year, compared with a rise of 3.7% in March.

Companies raw material costs fell, the ONS said. Input prices fell 1.5% on the month, largely due to lower crude oil prices.

The annual rate of input price inflation slowed sharply in April, to 1.2% from 5.6% in March.

Despite the month-on-month rise in output prices, the slowdown in the annual rates of both output and input price inflation may reassure rate-setters at the Bank of England that inflationary pressures in the domestic economy may be easing.

The key rate of inflation in the U.K., as measured by the annual change in the consumer prices index, slowed to 3.4% in February from a high of 5.2% in September but unexpectedly accelerated in March, to 3.5%.

Rate-setters at the central bank have signaled they are unhappy with the pace of inflation's retreat to its 2% target, and Thursday decided not to increase the size of the BOE's bond-buying stimulus program.
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Bank of Thailand: Inflation risk increasing
« Reply #272 on: May 14, 2012, 11:49:52 pm »
Bank of Thailand: Inflation risk increasing
14 May 2012
, by Bangkok Bureau - Bangkok (MarketWatch)
http://www.marketwatch.com/story/bank-of-thailand-inflation-risk-increasing-2012-05-14

The Bank of Thailand said Monday inflation risk is increasing, while growth risk is decreasing.

The country's economic recovery from devastating floods late last year has been faster than expected, Songtum Pinto, director of the central bank's Office of Macroeconomic Policy and Analysis, told reporters.

The central bank Friday raised its 2012 GDP growth forecast to 6.0% from 5.7% previously.
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India Inflation Quickens, Curbing Room for Cutting Rates
« Reply #273 on: May 15, 2012, 01:07:39 am »
India Inflation Quickens, Curbing Room for Cutting Rates
14 May 2012
, by Unni Krishnan (Bloomberg)
http://www.bloomberg.com/news/2012-05-14/india-inflation-unexpectedly-accelerates-curbing-rate-cut-scope.html

Excerpt:

Indian inflation unexpectedly accelerated in April, crimping the central bank’s scope to bolster economic growth by extending interest-rate cuts. Stocks fell, reversing earlier gains.

The benchmark wholesale-price index rose 7.23% from a year earlier, after climbing 6.89% in March, the Ministry of Commerce and Industry said in a statement in New Delhi today.

The median of 32 estimates in a Bloomberg News survey was for a 6.67% gain.

Reserve Bank of India Governor Duvvuri Subbarao signaled last month that inflation might limit the room for further cuts after he slashed the benchmark rate by half a percentage point, flagging price risks from the fiscal deficit, energy costs and a weaker rupee.

Greece’s political turmoil and a deepening debt crisis in Europe are increasing pressure on Asian nations to support growth as exports falter from Taiwan to Malaysia.

China cut banks’ reserve requirements on May 12 to revive demand.

“The Reserve Bank of India faces somewhat of a dilemma,” Robert Prior-Wandesforde, Singapore-based director of Asian economics at Credit Suisse Group AG, said in a note after the report.

“Our guess is that the chance of a June rate move has diminished.”
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Offline Letsbereal

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Bank of England raises inflation outlook while cutting growth forecast
« Reply #274 on: May 18, 2012, 12:30:10 am »
Bank of England raises inflation outlook
16 May 2012
, by Kim Hjelmgaard - London (MarketWatch)
http://www.marketwatch.com/story/bank-of-england-raises-inflation-outlook-2012-05-16

The Bank of England on Wednesday raised its short-term outlook on consumer-price inflation, and also lowered its outlook for British growth.

The BOE's quarterly inflation report projected that inflation is now "likely to remain above the 2% target for the next year or so," which is higher than expected three months ago.

At the time of the central bank's last report, in March, CPI stood at 3.5%, down from 5.2% in September of last year.

The BOE said that "the prospects for U.K. growth remain unusually uncertain," as it said that "the single biggest threat to the recovery stems from the challenges within the euro area."

Earlier, Britain's Office for National Statistics said the number of people claiming jobless benefits fell sharply in April.
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Offline Letsbereal

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Canada Inflation Reaches 2% in April
« Reply #275 on: May 19, 2012, 05:50:53 pm »
Canada Inflation Reaches 2% in April on Higher Car Costs
18 May 2012
, by Greg Quinn (Bloomberg)
http://www.bloomberg.com/news/2012-05-18/canada-inflation-reaches-2-in-april-on-higher-car-costs.html

Excerpt:

Canadian consumer price inflation accelerated last month on higher prices for automobiles and clothing, supporting the view that interest rates will probably rise sooner than in the U.S.

The consumer price index rose 2% in April from a year ago compared with a 1.9% gain the prior month, Statistics Canada said today from Ottawa.

The core inflation rate, which excludes eight volatile components, increased to 2.1% after a March gain of 1.9%.

Economists surveyed by Bloomberg had forecast that both the total and core rate would be unchanged at 1.9%.

Bank of Canada Governor Mark Carney said April 18 that it “may become appropriate” to raise his key 1% interest rate for the first time since September 2010 with growth and inflation stronger than earlier forecast.

Toronto- Dominion Bank’s TD Securities unit predicts two rate increases by year-end, while U.S. Federal Reserve policy makers last month discussed further easing.

“It supports the view that the Bank of Canada is likely to raise rates before the Fed,” said Camilla Sutton, head of currency strategy at Bank of Nova Scotia in Toronto.

The yield on the benchmark five-year government bond rose to 1.43% from 1.39%.
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King Seen Writing U.K. Inflation Letter as 3% Overshoot Persists
« Reply #276 on: May 19, 2012, 05:57:01 pm »
King Seen Writing U.K. Inflation Letter as 3% Overshoot Persists
19 May 2012
, by Scott Hamilton (Bloomberg)
http://www.bloomberg.com/news/2012-05-18/king-seen-writing-u-k-inflation-letter-as-3-overshoot-persists.html

Bank of England Governor Mervyn King will probably have to write a 10th consecutive letter to Chancellor of the Exchequer George Osborne to explain why inflation remained above the government’s upper limit in April, according to a survey of economists.

U.K. consumer prices rose an annual 3.1% after a 3.5% gain in March, according to the median forecast of 30 economists surveyed by Bloomberg. That would be the slowest in 19 months.

King is obliged to write a quarterly open letter to Osborne while inflation stays above the 3% ceiling, explaining the deviation and what he will do about it.

While consumer-price gains have slowed from a peak of 5.2% in September, they have been above the 2% target for more than two years and the central bank said earlier this week that may continue for another year.

King has previously blamed temporary factors for the overshoot and said on May 16 that the impact of tax rises and increases in commodity costs this year meant price gains have slowed less than expected.

“Mervyn has been writing a version of the same letter every quarter since February 2010,” said Howard Archer, an economist at IHS Global Insight in London.

While “underlying inflationary pressures will gradually ease,” the fact “remains that consumer price inflation is proving a lot stickier than had been expected and hoped for.”

Bank of England policy makers voted to halt expanding their bond-purchase program at £325 billion ($414 billion) last week after some officials stepped up their rhetoric on inflation.

Deputy Governor Paul Tucker said April 18 that the “uncomfortably above target” rate could hold above 3% into the second half of the year.

Minutes of the May 9-10 policy meeting will be published on May 23.

The Office for National Statistics in London will publish April’s inflation data at 9:30 a.m. on May 22, while any letter from King, as well as Osborne’s response, will be released an hour later by the central bank.
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Offline Letsbereal

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Disinflation in China feels like deflation, says economist
« Reply #277 on: June 14, 2012, 08:51:28 am »
Disinflation in China feels like deflation, says economist
14 June 2012
, by V. Phani Kumar (MarketWatch - Blogs)
http://blogs.marketwatch.com/thetell/2012/06/14/disinflation-in-china-feels-like-deflation-says-economist/

From a peak of 6.5% in July last year, China’s CPI has steadily declined to 3% in May.

That’s more than three percentage points above deflationary territory. But to many parts of the economy, it feels like deflation, as corporations are losing their pricing power, according to Credit Suisse’s China economist Dong Tao.

“Although not definite yet, we have started to sense an emerging deflationary force in the Chinese economy, as [it] seems to be losing momentum quickly.

Even worse, unlike 2009, there doesn’t seem to be an easy way out; policy makers seem to believe that the 4 trillion yuan ($634 billion) stimulus in 2009 has caused more trouble than gain,” Tao said in research released Thursday.

Credit Suisse said it’s lowered its 2012 consumer price index inflation forecast to 3.1% from 3.7% earlier. But for 2013, it’s slashed the CPI forecast to 2.3% from 4.5%.

With inflationary pressures falling, it expects China’s nominal GDP growth to fall at a much quicker rate than real GDP growth.

“We call it deflation to express our view that corporate profit margins will get squeezed, cash flow will become more difficult to generate, and the risk of seeing the debt-chain break down will increase,” Tao said.

Consumer prices in China have been known to change sharply and swiftly.

During the previous cycle, China’s CPI soared as high as 8.7% in February 2008, before recording negative readings for nine straight months between February and October 2009, in the aftermath of the global financial crisis.
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Offline Letsbereal

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Euro-zone June CPI unexpectedly holds steady
« Reply #278 on: June 29, 2012, 10:49:28 am »
Euro-zone June CPI unexpectedly holds steady
29 June 2012
, London (MarketWatch)
http://www.marketwatch.com/story/euro-zone-june-cpi-unexpectedly-holds-steady-2012-06-29

Consumer price inflation across the 17 countries that use the euro held steady in June compared with May, despite a bigger than expected slowdown in the pace of German price rises, data showed Friday.

The European Union's official statistics agency Eurostat said the flash estimate of the annual consumer price index in the euro zone rose 2.4% on the year in June, the same pace increase reported in May.

That was higher than expected as economists surveyed by Dow Jones Newswires last week predicted a slowdown to 2.3%.

The June euro zone inflation outcome reflects a mixed picture across the euro zone, according to early indicators from Germany, Spain, Belgium and Italy.

In Germany the CPI rose 1.7% in June, down from a 2.0% increase in May, while Belgian inflation also eased to levels last seen around two years ago.

In Spain inflation held steady, rising 1.9% in June and the Italian CPI rose unexpectedly to 3.3% in June from 3.2% a month earlier.

The steady pace of inflation between May and June will likely mean the European Central Bank will continue to keep interest rates on hold at 1.0% until they can be sure of an ongoing retreat in the pace of inflation over the coming months.

However, inflation is now much closer to the central bank's target rate of around 2% and still gives them enough scope to introduce any additional policy measures aimed at improving growth in a region where GDP was flat in the first three months of the year and is widely expected to have contracted in the second quarter.

And, if inflation does show a further slowdown in the coming months, then the ECB may be more inclined to cut interest rates from the current 1%, and there has been growing evidence that some members of the governing council are becoming less averse to that option.

The full breakdown of euro zone June inflation will be published on June 14.


Meaning: Disinflation–> Deflation–> QE3–> Inflation
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Offline Letsbereal

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Inflation/Deflation Face-Off: Harry Dent vs. James Rickards - Vid
« Reply #279 on: July 04, 2012, 03:15:30 pm »
Inflation/Deflation Face-Off: Harry Dent vs. James Rickards http://www.youtube.com/watch?v=pSOGwthC_JQ
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