Inflation

[TimeISmoney]

The question(s) to ask with any of this stuff is why

That's a million dollar question in an answer of opinion in a 10 page essay form.

Basically, in a simple form it's supply and demand, but without surplus money in the economy, prices can't reach new heights.

 

[greggles]

Jamie Dimon predicting higher interest rates due to "persistent inflationary pressures" and, of course, "high government spending". Inflation isn't going anywhere.

The boss of one of the world's biggest banks has warned US interest rates could climb to 8%.

Jamie Dimon, the head of JPMorgan Chase, said his bank has prepared for interest rates to jump because of "persistent inflationary pressures".

Central banks around the world have been busy raising rates in a bid to dampen rising prices.

But with US inflation gradually easing, the overwhelming expectation is for the Federal Reserve to cut rates this year.

Markets are pricing in two quarter-point rate cuts in 2024.

In his annual letter to shareholders, Mr Dimon said that the bank was ready for a "very broad range" of rates, from 2% to 8% or even higher, potentially pushed up because of high government spending and the need to curb price rises.

Jamie Dimon: Bank boss warns US interest rates could rise to 8%

Jamie Dimon, the boss of JPMorgan Chase, said the bank is preparing for both rate cuts and rises.

www.bbc.com

 

[TimeISmoney]

From memory we don't include housing or rent rises in our CPI calculations.
I'm on limited wifi access, or I would look it up.

They include rents and new homes in Australia.

" The Consumer Price Index (CPI)​

The CPI measures changes in the price of a basket of goods and services over time, designed to be representative of average household expenditure. It is calculated using price changes within each capital city only and cannot be used to compare differences between regions. The CPI does not include the cost of buying established dwellings but includes rents, the cost of new dwellings (excluding value of land) and major alterations and additions to dwellings. Mortgage repayments are not included in the CPI. The CPI is often referred to as the measure of inflation, or headline inflation."

https://www.aph.gov.au/About_Parlia...t include,of inflation, or headline inflation.

 

[Chipp]

I thought it would be a hot MoM core print and US indice waterfalls

 

[Chipp]

Paradigm shift in Yields and rate cut expectations . Annualize the last 3 US Core MoM and its a number Powell is not going to like . ZQ IB futures now pricing only 38bps cuts by dec



" Early in the fed rate cycle Powell stated many times he needed UE at 4.5% to put a full stop on ending inflation , that last print will have him sweating . US CPI this week also pivotal . Another hot MoM core of 0.4% will stir things up . Looking at ZQ futures these rate cuts are getting priced further out and shallower terminally . I would not be super surprised to see no rate cuts in '24 given the trend in interbank futures . In less than 4 months its gone from 160 BPS of cuts priced in dec '24 to 53 BPS this very minute . Thats a significant paradigm shift and the market just isnt seeing it at all . "

I think market just starting to see it now

The next Powell speech going to be worth watching and Fed Minutes later today also

 

[sptrawler]

They include rents and new homes in Australia.

" The Consumer Price Index (CPI)​

The CPI measures changes in the price of a basket of goods and services over time, designed to be representative of average household expenditure. It is calculated using price changes within each capital city only and cannot be used to compare differences between regions. The CPI does not include the cost of buying established dwellings but includes rents, the cost of new dwellings (excluding value of land) and major alterations and additions to dwellings. Mortgage repayments are not included in the CPI. The CPI is often referred to as the measure of inflation, or headline inflation."

https://www.aph.gov.au/About_Parliament/Parliamentary_departments/Parliamentary_Library/pubs/BriefingBook47p/CostOfLiving#:~:text=The CPI does not include,of inflation, or headline inflation.

Thanks for that, isn't it the cost of established homes that are flying in major cities? At least rents and new builds are captured, by the sound of it.

 

[divs4ever]

Thanks for that, isn't it the cost of established homes that are flying in major cities? At least rents and new builds are captured, by the sound of it.

if you can get your new home completed ( not just to 'lock-up stage ' ) i believe the prices are still steep , but of course the flaw in this is the land the house is on , is more likely to be further out of town/city or on less than prime land , so while the building cost has ballooned , the land cost stays subdued ( to some extent )

 

[over9k]

Well would you look at that.

 

[divs4ever]

By Karen Langley

A fresh inflation shock drove major stock indexes lower Wednesday, heightening investors' worries that the Federal Reserve won't cut interest rates anytime soon.

Stocks dropped broadly, with 10 of the S&P 500's 11 sectors falling and the Dow Jones Industrial Average losing more than 400 points. Shares of smaller companies, banks and real-estate firms slid. The yield on the benchmark 10-year U.S. Treasury note, which rises when bond prices fall, posted its biggest one-day climb in more than 18 months.

Wednesday's moves came after data showed the consumer-price index rose more than Wall Street expected on both a monthly and annual basis. So-called core prices, which exclude the volatile categories of food and energy, also topped investors' estimates.

That marked the latest in a series of readings showing persistent growth and lingering inflation that has forced investors to reconsider when the Fed will shift from raising interest rates to cutting them. The prospect of rate cuts had sparked a rally that helped send major indexes to records, but now investors are doubting central bank officials will cut rates many times in 2024. Some are even beginning to question whether any cuts are in store.

"If you travel 1,000 miles to go fishing, the most important aspect is the last 30 feet where you're presenting the fly to the fish," said Richard Saperstein, chief investment officer at Treasury Partners. "Inflation has come down, yet the final stage in moving it towards their anticipated goal of 2% is not occurring."

The S&P 500 dropped 0.9%, paring its 2024 advance to 8.2%. The tech-heavy Nasdaq Composite lost 0.8%.

The Dow industrials retreated 1.1%, or about 422 points. Home Depot fell 3%, UnitedHealth lost 2.1% and Microsoft declined 0.7%.

Shares of smaller companies fell even more, hit by the prospect of higher borrowing costs. The Russell 2000 slumped 2.5%, its worst day since Feb. 13, when January's CPI reading also topped Wall Street's expectations.

Bank stocks also took a blow, with the KBW Nasdaq Regional Banking Index dropping 5%. Banks have struggled under the weight of higher interest rates, particularly small and midsize lenders.

Within the S&P 500, the real-estate sector tumbled 4.1% in its worst day since June 2022. Public Storage and American Tower shares retreated 6% and 5.6%, respectively.

Investors often turn to real-estate stocks for their hefty dividend payments, but rising rates make those dividends less enticing. Higher borrowing costs can also hurt earnings for the group, said James Ragan, director of wealth management research at D.A. Davidson.

"Inflation for really three months now has trended a little bit hotter than expected," Ragan said. "That's a concern."

Investors' growing doubts about the prospect for rate cuts helped drive up Treasury yields. A $39 billion auction of 10-year Treasury notes also attracted weak demand from investors, forcing banks to absorb more of the debt than usual.

The 10-year yield, which helps set borrowing costs on everything from mortgages to corporate debt, settled at 4.559% Wednesday, its highest close since November. The yield on the 2-year Treasury, which tends to climb when investors expect higher rates, notched its biggest one-day gain since March 2023.

Some investors said stocks could get new direction from the coming earnings season, which kicks off in earnest this week when JPMorgan Chase, Citigroup and Wells Fargo open their books Friday. Analysts expect companies in the S&P 500 to report a third consecutive quarter of earnings growth, with profits for the first quarter rising 3.1% from a year earlier, according to FactSet.

Oil prices rose, with Brent crude gaining 1.2% to $90.48 per barrel. That helped the energy sector rise 0.4%, the only S&P 500 sector to advance for the day. Exxon Mobil shares gained 0.8%, while Chevron shares added 0.4%.

Overseas, stocks were mixed. The Stoxx Europe 600 added 0.2%, while Japan's Nikkei 225 fell 0.5% and the Shanghai Composite dropped 0.7%

Gold lost 0.6% after a streak of three consecutive record closes. Silver rose for a 10th consecutive session, its longest winning streak since June 2014, according to Dow Jones Market Data.

--Gina Heeb and Eric Wallerstein contributed to this article.

Write to Karen Langley at karen.langley@wsj.com

(END) Dow Jones Newswires

April 10, 2024 16:51 ET (20:51 GMT)

i am surprised that they are surprised , don't they ever do their own shopping

the print is an absolute joke

but maybe all these commentators live in a server farm ( actually written by AI )

but here we are , now who among us can create to create a ( personal ) profit

 

[over9k]

without surplus money in the economy, prices can't reach new heights.

They can if there's a supply restriction

 

[TimeISmoney]

They can if there's a supply restriction

There isn't though, banks are still fiancing as usual. People have equity in their homes by default to borrow against. Govts are still supplying first home owner grants to squeeze people into the housing markets.

 

[JohnDe]

There isn't though, banks are still fiancing as usual. People have equity in their homes by default to borrow against. Govts are still supplying first home owner grants to squeeze people into the housing markets.

And people are still going on holidays.

Melbourne Airport international pax numbers hit record in February

More than 900,000 international passengers travelled through Melbourne Airport last month, setting a new February record. The 915,456 international travellers welcomed in February 2024 represents 102% of the previous busiest February in 2019. Overall, Melbourne Airport welcomed a total of 2,859,942 people in February, just 7,301 travellers shy of the February record set in 2019.

 

[over9k]

There isn't though

Wait, are you talking about housing specifically or what?

 

[Dona Ferentes]

inflation thread plz

 

[qldfrog]

As I said a while ago, the Australian Govt has a massive defence spend to fund, a massive cost to transition to renewable energy, a massive debt left over from covid to fund, a massive welfare cost spiral and they are cutting income taxes.

Inflation going down, doesn't really fit in the equation, a reduction in consumer spending, a reduction in the income tax reciepts, a reduction in business tax = catastrophe IMO.

More pump priming is my guess, how long that goes for is the big question, sooner or later it has to pop, how that pop manifests itself is the question. IMO

Cut in tax??? Where..we have reached the highest level of commoners money going in various taxes at all levels 43% of income as per a previous post of mine last week I believe.
Ahh the beauty of inflation for a socialist regime..spend endless free money, tax endlessly

 

[TimeISmoney]

Thanks for that, isn't it the cost of established homes that are flying in major cities? At least rents and new builds are captured, by the sound of it.

They said on the Qld mainstream media that the average 4 bedroom build went from 250K to 450k, and land values seem to go up daily. The housing market is one big mess, every time a builder goes under it's adding value to existing stock. The increase in population adds more stress to the market.

The Govts are just playing the patch up game, 700~1000 people a week coming to Qld and they've proposed about 1700 new dwellings for public housing.

 

[TimeISmoney]

Wait, are you talking about housing specifically or what?

I was talking about surplus money in the economy. As others have said before 5% interest is nothing in the grand scheme of things, Inflation is still lingering.

 

[over9k]

I was talking about surplus money in the economy. As others have said before 5% interest is nothing in the grand scheme of things, Inflation is still lingering.

Yes but I was talking about the cause of the inflation being a reduction in supply of, well, many things.

 

[divs4ever]

Is Australia ready for its population growth over the next decade?​

Is Australia ready for its population growth over the next decade?

Australia will have 3.7 million more people in a decade's time, though the growth won't be evenly distributed. Over 85s will see the fastest growth, while the number of younger people will barely rise.

www.firstlinks.com.au

 

[JohnDe]

Is Australia ready for its population growth over the next decade?​

Is Australia ready for its population growth over the next decade?

Australia will have 3.7 million more people in a decade's time, though the growth won't be evenly distributed. Over 85s will see the fastest growth, while the number of younger people will barely rise.

www.firstlinks.com.au

Has Australia ever been ready for population growth?