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Everything is still getting more expensive

You have already noticed that prices are rising in supermarkets and drug stores. Unfortunately, the sticker shock may be imminent. What’s happening: Consumer goods manufacturers are announcing left and right price increases. Unilever CEO Alan Jope recently told analysts. Dove and Ben & Jerry’s said last week that they would raise prices by 4.1% in the third quarter to “offset rising commodity and other input costs.” That wasn’t the only thing. Nestlé, which owns the Nescafe, Tallhouse and Haagen-Dazs brands, said it had raised prices by 2.1% in the last quarter and will continue to raise prices for the rest of 2021 and as needed in 2022. “The situation hasn’t improved,” said Nestlé CEO Mark Schneider. “If anything, there are even more downsides than we talked about in the summer.” Problem: Supply chain bottlenecks and huge demand for commodities push up raw material prices, resulting in higher product manufacturing costs. .. Soaring wages, soaring shipping costs, and soaring energy prices needed to deal with labor shortages are also increasing costs, putting pressure on manufacturers to increase their bills when selling to stores. Next, these retailers need to decide whether to pass on higher costs to their customers. For most of this year, economists, investors and policy makers have argued whether inflation is a transit phenomenon that eases as the pandemic recedes, or a more permanent situation. It’s “temporary,” as the Federal Reserve Board maintains. Please remember. JPMorgan Chase CEO Jamie Dimon believes supply chain issues are exaggerated and will improve next year, but most CEOs believe the turmoil will “continue until the second half of the year.” .. Some central bankers are also beginning to change languages, according to a recent study from Duke University’s Fuqua School of Business and the Federal Reserve Bank of Richmond and Atlanta. Top economists at the Bank of England warn that inflation is possible. In the UK, it surged by more than 5% early next year. “I wouldn’t be shocked to see inflation prints close to or above 5%. The Financial Times.” And it’s a very unpleasant place for central banks with an inflation target of 2%. Pill refused to reveal how to vote at the Bank of England’s next meeting in early November, but the central bank should raise interest rates from 0.1%, which has been going on since the start of the pandemic. Yes, it is “alive.” Central banks use interest rates to keep prices stable. Bank of England Governor Andrew Bailey said earlier this month that the central bank “must act” in response to rising prices. “I believe the rise in inflation will be temporary,” he said, but acknowledged that rising energy prices could result in longer-lasting than previously thought. Tech stocks continued to rise in October as inflation concerns forced investors to abandon companies like Amazon, Microsoft and Apple. Quick Rewind: Wall Street believes central banks could be more aggressive, with plans to roll back pandemic support for the economy, boosting government bond sales and boosting yields. It hurt the stock of tech companies. Extremely low yields on government bonds tend to increase interest in higher-risk investments that provide better returns. The valuation of tech companies is also related to future profits, which becomes less glossy with the advent of inflation and high interest rates. Concerns have been put aside for the time being. Tech stocks have recovered in recent weeks as investors are looking to the latest batches of corporate earnings. Now it depends on the result. Signs of Warning: On Friday, Snap’s stock plunged after the company said its advertising business was being hit by change. To Apple’s privacy policy, which was rolled out earlier this year. Facebook also warns that it could be seriously affected. Intel’s stock also fell sharply after the company said its efforts to roll out next-generation chip technology would hurt profit margins over the years. Microsoft earned more than $ 75 billion in the second quarter. As the top five members of the S & P 500, their ability to sustain rapid growth will have a significant impact on the wider market.

You have already noticed that prices are rising in supermarkets and drug stores. Unfortunately, more sticker shocks may be imminent.

What’s happening: Consumer goods manufacturers are announcing left and right price increases. Faced with sustained high costs, they do not expect the situation to ease soon.

“Inflation will continue to be an important theme for the rest of this [year] And next year, “Unilever CEO Alan Jope recently told analysts.

Unilever, it makes pigeons and Ben & Jerry’s, Said last week It raised prices by 4.1% in the third quarter, “offset the rise in commodity and other input costs.”

It wasn’t the only thing. Nestlé, which owns the Nescafe, Tallhouse and Haagen-Dazs brands, said it had raised prices by 2.1% in the last quarter and will continue to raise prices for the rest of 2021 and as needed in 2022.

“The situation hasn’t improved,” said Nestlé CEO Mark Schneider. “If anything, there are more downsides compared to what I told you in the summer.”

Problem: Product manufacturing costs more because supply chain bottlenecks and huge demand for goods drive up raw material prices. Higher wages, higher shipping charges, and higher energy prices needed to deal with labor shortages are also added to costs.

It pressures manufacturers to charge more when selling to stores. Next, these retailers need to decide whether to pass on higher costs to their customers. Many do so.

For much of this year, economists, investors and policy makers have argued whether inflation is a transit phenomenon that eases as the pandemic recedes, or is it a more permanent situation.

Many executives are beginning to move away from the idea that it is “temporary,” as the Federal Reserve Board maintains.

Remember: JPMorgan Chase CEO Jamie Dimon believes supply chain issues will be exaggerated and improved next year, but a recent study by Duke University found that most chief financial officers were confused. Will continue “until the second half of 2022”. Duke Business School and the Federal Reserve Bank of Richmond and Atlanta.

Some central bankers are also beginning to change languages.

Bank of England Top Economist It’s a warning That inflation could exceed 5% in the UK early next year.

“If inflation is close to or above 5%, I’m not shocked. Let’s say so. [in the months ahead]Hugh Pill told the Financial Times. “And it’s a very unpleasant place for a central bank with an inflation target of 2%.”

Pill refused to reveal how to vote at the Bank of England’s next meeting in early November, but the question of whether the central bank should raise interest rates from 0.1%, which has been going on since the start of the pandemic. Is “live”. Central banks use interest rates to keep prices stable.

Bank of England Governor Andrew Bailey said earlier this month that the central bank “must act” in response to rising prices. “I believe the rise in inflation will be temporary,” he said, but acknowledged that rising energy prices could result in longer-lasting than previously thought.

Tech stocks are on the rise. Will it continue?

Tech stocks continued to rise in October following the brutal September when inflation concerns forced investors to abandon companies like Amazon, Microsoft and Apple.

Rapid Rewind: Wall Street increased government bond sales and boosted yields, believing that central banks could be more aggressive in their plans to roll back economic support during the pandemic era.

It hurt the stock of tech companies. Extremely low yields on government bonds tend to increase interest in higher-risk investments that provide better returns. The valuation of tech companies is also related to future profits, which becomes less glossy with the advent of inflation and high interest rates.

Concerns have been pushed aside for the time being. Tech stocks have risen again in recent weeks as investors look to the latest batches of corporate earnings.

Well, it depends on the result.

Signs of Warning: On Friday, Snap’s share price plummeted after the company announced that its advertising business had been hit by changes in Apple’s privacy policy that took place earlier this year. Facebook also warns that it could be seriously affected.

Intel’s stock also fell sharply after the company announced its efforts to roll out next-generation chip technology. Will hurt its rate of return for years..

Retreat: Facebook, Google’s parent Alphabet, Apple, Amazon and Microsoft earned more than $ 75 billion in the second quarter.

As the five largest members of the S & P 500, their ability to sustain rapid growth will have a significant impact on the wider market.

Everything is still getting more expensive Source link Everything is still getting more expensive

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