Latest news with #foodPrices
Reuters
14 hours ago
- Business
- Reuters
Japan's core inflation hits 2-year high, keeps rate-hike bets alive
TOKYO, June 20 (Reuters) - Japan's core inflation hit 3.7% in May, the fastest annual pace in more than two years and keeping pressure on the central bank to resume interest rate hikes. The data underscores the challenge the Bank of Japan faces in juggling mounting pressure from sticky food inflation and risks to the fragile economy from U.S. tariffs. The increase in the core consumer price index (CPI), which excludes volatile fresh food costs, compared with a median market forecast for a 3.6% gain and followed a 3.5% rise in April. It was the fastest annual pace since 4.2% marked in January 2023, government data showed on Friday. A separate index that strips away the effects of both volatile fresh food and fuel costs, which is closely watched by the BOJ as a better indicator of demand-driven price moves, rose 3.3% in May from a year earlier after a 3.0% rise in April. It was the fastest year-on-year rise since January 2024, when the index was up 3.5%. Stubbornly high prices of food, particularly those of Japan's staple rice, remained the main driver of inflation, the data showed. Food prices, excluding those of volatile fresh food, rose 7.7% in May from a year earlier, faster than the 7.0% gain in April, reflecting the pain households are feeling from rising living costs. The price of rice doubled in May from year-before levels, the data showed. Service-sector inflation hit 1.4% in May, slightly faster than the 1.3% in April but much slower than the 5.3% increase for goods prices, the data showed. The BOJ ended a massive stimulus programme last year and in January raised short-term rates to 0.5% on the view Japan was on the cusp of durably meeting its 2% inflation target. While the central bank has signalled readiness to raise rates further, the economic repercussions from higher U.S. tariffs forced it to cut its growth forecasts and complicated decisions around the timing of the next rate increase. A slight majority of economists in a Reuters poll expected the BOJ's next 25-basis-point increase to come in early 2026.
Washington Post
2 days ago
- Business
- Washington Post
UK inflation eases by less than anticipated ahead of Bank of England rate decision
LONDON — Inflation in the U.K. dropped modestly in May as a drop in air fares and transport costs were largely offset by rising food prices, particularly chocolate, official figures showed Wednesday. The Office of National Statistics said consumer prices rose by 3.4% in the year to May, down from 3.5% the previous month.
The Independent
2 days ago
- Business
- The Independent
UK inflation eases by less than anticipated ahead of Bank of England rate decision
Inflation in the U.K. dropped modestly in May as a drop in air fares and transport costs were largely offset by rising food prices, particularly chocolate, official figures showed Wednesday. The Office of National Statistics said consumer prices rose by 3.4% in the year to May, down from 3.5% the previous month. That means inflation remains substantially above the Bank of England's target rate of 2%. The bank's rate-setting Monetary Policy Committee is due to announce its latest interest rate decision on Thursday. Most economists expect the nine-member panel, which has cut borrowing rates on a quarterly basis since last August, to keep its main interest rate at 4.25%. The decline was less than expected. Most economists were expecting the rate to come in at 3.3% for May as price rises cooled, following a raft of bill increases the previous month that pushed inflation to the highest level in more than a year. The higher-than-anticipated outcome was largely due to a 4.4% increase in food and non-alcoholic drink prices. Larder items like sugar, jam and chocolate, as well as ice cream, saw the biggest monthly price hikes, while meat costs also rose. Economists, including those at the Bank of England, expect inflation to remain above target over the rest of the year. Uncertainty over U.S. President Donald Trump 's tariff agenda and the unrest in the Middle East make it difficult to forecast economic developments and the path of interest rates. 'We are sticking with our call for the Bank of England to continue to reduce rates at a quarterly cadence,' said Felix Feather, economist at asset management firm Aberdeen. "But geopolitical uncertainty and risks from U.S. trade policy raise both upside and downside risks to this forecast.'
Yahoo
6 days ago
- Business
- Yahoo
5 Ways Tariffs May Affect Your Budget If You Earn a Low Income
With tariffs wavering back and forth, it's critical to know how these changes can affect your budget. Especially if you're in a lower income bracket, even a small hike in prices can negatively impact your entire month's budget by putting more strain on the already expensive prices. Trending Now: Explore Next: Understanding those changes can help you plan accordingly and, ideally, avoid taking too big of a hit. To that end, GOBankingRates spoked to some experts on the economy for insight into what the future might hold regarding the effects of tariffs — below is what they had to say. There was once a time when people thought of imported goods as fine wine, art or high-end furniture. You may import a luxury vehicle. Of course, no one on a tight budget was thinking about these types of luxury imports. But today, virtually anything and everything can be imported and if it's imported, it will have a tariff. This means higher prices and less purchasing power for your budget. Read Next: 'Pretty much all goods manufactured today are to varying degrees important — there is, for example, no car made in the US and entirely of U.S.-origin parts,' said Dr. Brandon Parsons, economist at Pepperdine Graziadio Business School. 'The tariffs that are going to sneak up on lower-income Americans will be the ones on food — meat, fresh fruits and vegetables and specialty food items,' he added. 'And the most hidden tariff impact will be on processed foods that incorporate imported foodstuffs — think tomato sauce made with Mexican or Canadian tomatoes.' Some have assumed in recent months that companies distributing goods will absorb the cost of these tariffs. But nothing could be further from the truth. 'As Walmart and a growing number of retailers have made very clear, the cost of tariffs will be passed along to consumers,' Parsons said. This means you'll have less purchasing power with your budget. reported that only 10 percent of businesses did not intend to pass along any of the tariff costs to their consumers. What this means for the low-income budget, then, is that items people need to buy will now cost significantly more than they used to. Most people living on low incomes are already struggling to make ends meet, often living paycheck to paycheck. These tariffs will make budgeting for basic, everyday necessities hard. 'Another reason is lower-income families will often live paycheck to paycheck and have a smaller (potentially no) cushion to absorb these higher costs. Without the ability to cover the higher costs created by the tariffs, lower-income families will be forced to adjust what they can purchase to a greater extent than their higher-income counterparts,' said Dr. Wayne Winegarden, senior fellow of business and economics at the Free Market Pacific Research Institute and director of PRI's Center for Medical Economics and Innovation. 'Compounding these problems, the recent bout of inflation has created a huge affordability problem that harmed lower-income families to a greater extent than higher-income ones,' Winegarden added. 'The tariffs will worsen the current affordability problem and further destabilize the household budgets of lower-income and working families.' Of course, families still have to eat, put a roof over their heads, buy clothes and perhaps get gifts for their kids on birthdays and important holidays. So, if they don't have the budget on hand to make these purchases, you may choose to go into debt rather than cut out the necessities, which can turn bad really fast. 'If purchases are for essentials, forgoing them is not an option and debt can result. This can trigger a downward financial spiral, where persistent budget shortfalls lead to rising credit card balances, which in turn eat up more of a household's limited disposable income,' Parsons explained. 'Finally, tariffs are regressive, like sales tax, since individuals pay the same price for a product regardless of their income. This means tariffs carry a heavier burden on those with less income to spare.' It becomes a vicious cycle for low-income families who may end up in a spiral they cannot pull themselves out of and with no end in sight. There's no reason to expect incomes to rise or for tariffs to drop. And housing costs are not going anywhere but up for people in these situations. From there, the drop into homelessness is not far, according to a study by the University of California, San Fransisco. If you can't afford food and you can't pay your bills, you can't pay your rent with your low-income budget, the next natural step is eviction. The effects are serious, life-altering and can be devastating. 'From a legal perspective, tariffs are within the government's authority under the Commerce Clause, a portion of the Constitution that assigns to the federal government the power to regulate commerce, but they can spark lawsuits if misapplied,' said Seann Malloy, founder and managing partner of Malloy Law Offices. 'Low-income and working-class families that simply can't absorb a 15% price hike on imported groceries may be subject to evictions or ruined credit, clogging our courts with cases I frequently litigate,' Malloy added. 'Equal protection challenges could stem from relief programs that exclude some groups. It is important to push for transparent tariff impact assessments and the expansion of legal aid to protect vulnerable clients' The best thing working-class people can do right now is to cut spending as much as possible to live well below their means. It's also a good idea to take on a side gig or hustle that will increase their income, allowing them to start investing in themselves and growing their wealth. This can help create a more stable living situation that will help keep them in their homes and purchasing the necessities for their families. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard How Much Money Is Needed To Be Considered Middle Class in Every State? Mark Cuban Tells Americans To Stock Up on Consumables as Trump's Tariffs Hit -- Here's What To Buy This article originally appeared on 5 Ways Tariffs May Affect Your Budget If You Earn a Low Income
Yahoo
6 days ago
- Business
- Yahoo
5 Ways Tariffs May Affect Your Budget If You Earn a Low Income
With tariffs wavering back and forth, it's critical to know how these changes can affect your budget. Especially if you're in a lower income bracket, even a small hike in prices can negatively impact your entire month's budget by putting more strain on the already expensive prices. Trending Now: Explore Next: Understanding those changes can help you plan accordingly and, ideally, avoid taking too big of a hit. To that end, GOBankingRates spoked to some experts on the economy for insight into what the future might hold regarding the effects of tariffs — below is what they had to say. There was once a time when people thought of imported goods as fine wine, art or high-end furniture. You may import a luxury vehicle. Of course, no one on a tight budget was thinking about these types of luxury imports. But today, virtually anything and everything can be imported and if it's imported, it will have a tariff. This means higher prices and less purchasing power for your budget. Read Next: 'Pretty much all goods manufactured today are to varying degrees important — there is, for example, no car made in the US and entirely of U.S.-origin parts,' said Dr. Brandon Parsons, economist at Pepperdine Graziadio Business School. 'The tariffs that are going to sneak up on lower-income Americans will be the ones on food — meat, fresh fruits and vegetables and specialty food items,' he added. 'And the most hidden tariff impact will be on processed foods that incorporate imported foodstuffs — think tomato sauce made with Mexican or Canadian tomatoes.' Some have assumed in recent months that companies distributing goods will absorb the cost of these tariffs. But nothing could be further from the truth. 'As Walmart and a growing number of retailers have made very clear, the cost of tariffs will be passed along to consumers,' Parsons said. This means you'll have less purchasing power with your budget. reported that only 10 percent of businesses did not intend to pass along any of the tariff costs to their consumers. What this means for the low-income budget, then, is that items people need to buy will now cost significantly more than they used to. Most people living on low incomes are already struggling to make ends meet, often living paycheck to paycheck. These tariffs will make budgeting for basic, everyday necessities hard. 'Another reason is lower-income families will often live paycheck to paycheck and have a smaller (potentially no) cushion to absorb these higher costs. Without the ability to cover the higher costs created by the tariffs, lower-income families will be forced to adjust what they can purchase to a greater extent than their higher-income counterparts,' said Dr. Wayne Winegarden, senior fellow of business and economics at the Free Market Pacific Research Institute and director of PRI's Center for Medical Economics and Innovation. 'Compounding these problems, the recent bout of inflation has created a huge affordability problem that harmed lower-income families to a greater extent than higher-income ones,' Winegarden added. 'The tariffs will worsen the current affordability problem and further destabilize the household budgets of lower-income and working families.' Of course, families still have to eat, put a roof over their heads, buy clothes and perhaps get gifts for their kids on birthdays and important holidays. So, if they don't have the budget on hand to make these purchases, you may choose to go into debt rather than cut out the necessities, which can turn bad really fast. 'If purchases are for essentials, forgoing them is not an option and debt can result. This can trigger a downward financial spiral, where persistent budget shortfalls lead to rising credit card balances, which in turn eat up more of a household's limited disposable income,' Parsons explained. 'Finally, tariffs are regressive, like sales tax, since individuals pay the same price for a product regardless of their income. This means tariffs carry a heavier burden on those with less income to spare.' It becomes a vicious cycle for low-income families who may end up in a spiral they cannot pull themselves out of and with no end in sight. There's no reason to expect incomes to rise or for tariffs to drop. And housing costs are not going anywhere but up for people in these situations. From there, the drop into homelessness is not far, according to a study by the University of California, San Fransisco. If you can't afford food and you can't pay your bills, you can't pay your rent with your low-income budget, the next natural step is eviction. The effects are serious, life-altering and can be devastating. 'From a legal perspective, tariffs are within the government's authority under the Commerce Clause, a portion of the Constitution that assigns to the federal government the power to regulate commerce, but they can spark lawsuits if misapplied,' said Seann Malloy, founder and managing partner of Malloy Law Offices. 'Low-income and working-class families that simply can't absorb a 15% price hike on imported groceries may be subject to evictions or ruined credit, clogging our courts with cases I frequently litigate,' Malloy added. 'Equal protection challenges could stem from relief programs that exclude some groups. It is important to push for transparent tariff impact assessments and the expansion of legal aid to protect vulnerable clients' The best thing working-class people can do right now is to cut spending as much as possible to live well below their means. It's also a good idea to take on a side gig or hustle that will increase their income, allowing them to start investing in themselves and growing their wealth. This can help create a more stable living situation that will help keep them in their homes and purchasing the necessities for their families. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard Are You Rich or Middle Class? 8 Ways To Tell That Go Beyond Your Paycheck 6 Big Shakeups Coming to Social Security in 2025 This article originally appeared on 5 Ways Tariffs May Affect Your Budget If You Earn a Low Income Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
