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this is somewhat odd, but the front page of the wsj this morning has as its lead, above the fold story (below), while no sign of it on the website?
Inflation Worries Spread
China Raises Rates Amid Hit to Wheat Crop; Treasury Yields at 9-Month High
Inflation jitters spread through emerging markets on Tuesday, prompting China's central bank to raise interest rates for the third time in four months amid worries that a drought threatening the country's wheat crop will put further pressure on global food prices.
With fireworks still echoing from China's Lunar New Year holiday, its central bank said it is raising rates by one-quarter percentage point. It was just the latest move by an emerging-market government—several of which are deploying a panoply of policies to battle inflation fueled by rising food and commodity prices and growth that is threatening to outstrip their productive capacity.
In Brazil, Latin America's largest economy, the government reported Tuesday that inflation is accelerating, leading markets to expect its central bank to increase its overnight rate, already at 11.25%.
Few emerging-market countries have a firm grip on the inflation problem. Just last week, John Lipsky, the International Monetary Fund's No. 2, said many emerging economies are running out of excess capacity "and yet most of them still have in place the expansionary…monetary and budgetary policies." The cure is clear, he said. "Everybody is going to need to tighten monetary policy, reduce budgetary stimulus and continue with the process of structural reforms."
In contrast to emerging markets, inflation in the U.S. remains low—below the Federal Reserve's informal 2% target—despite rising commodity prices. But an improving growth outlook for the U.S. and the risk that rising food and energy prices will spill over into other goods and services have bond markets pushing up long-term rates and moving up their expectations for a Federal Reserve rate increase. Yields on U.S. Treasurys have been rising, and on Tuesday hit 3.721%, the highest since April.
Trading in futures markets indicates that the market, listening carefully to the latest words of Fed bank presidents, now puts the odds of a Fed rate increase in December at close to 100%, up from just 25% a week ago. The Fed has been holding short-term rates near zero since December 2008 and hasn't finished a $600 billion bond-buying effort aimed at keeping long-term rates down.
Further central bank rate hikes in emerging markets are widely anticipated. Those expectations—along with a flood of money fleeing low interest rates in the U.S., Europe and Japan—are contributing to upward pressure on emerging-market currencies. Several currencies have rallied to multiyear highs. Authorities in South Korea and Malaysia recently have intervened in foreign-exchange markets to slow the appreciation of their currencies.
Inflation fears intensified Tuesday after the U.N. Food and Agriculture Organization said drought in the five Chinese provinces that account for two-thirds of China's wheat production is endangering this year's crop. U.S. wheat futures surged Tuesday to a fresh 30-month high on fears of further strains on global supplies. The current wheat contract rose 1.8% to $8.7425 a bushel in Chicago, up 81.3% from a year ago.
In Brazil, higher bus fares and food prices boosted inflation in January. The government said Tuesday that its main consumer-price index in January was 5.99% above year-earlier levels, well above the official year-end 2011 target of 4.5%. The data add to pressure on Brazil's central bank to raise rates.
Inflation is up in the U.K. and price acceleration in Europe is now running ahead of central bankers' targets. But in the U.S., inflation remains below the Fed's informal target despite rising food and energy prices, in part because businesses haven't been able to pass along rising costs and because still-high unemployment is holding down wages. While some saw last Friday's Labor Department report that wages spurted 0.4% in January as a danger signal, the Fed and many private forecasters see little risk of a worrisome rise in wages and prices while unemployment remains high.
the rest:
http://online.wsj.com/article/SB1000...ORDS=inflation
meanwhile over at: http://inflation.us/news.html
we see that the cat is wiggling out of the bag....
February 9th, 2011: Bloomberg : Two Fed Skeptics of QE Say Inflation Underscores Risks
February 9th, 2011: Bloomberg : `Heavy Lifting' to Come as China Leaves Deposit Rate Below Inflation Pace
February 9th, 2011: Bloomberg : U.K. Food-Price Inflation Soars as Bank of England Begins Policy Meeting
February 8th, 2011: BusinessWeek : China Raises Rates to Counter Accelerating Inflation
February 8th, 2011: Financial Post : Why China’s Rate Hike is Good for Canada
with oil back down into the high 80's, gold ticking up to 1365 and
http://www.kitcosilver.com/ back up above 30
an inflection point?
or didnt the wsj get krugmans memo....
- ASIA NEWS
- FEBRUARY 9, 2011
Inflation Worries Spread
China Raises Rates Amid Hit to Wheat Crop; Treasury Yields at 9-Month High
Inflation jitters spread through emerging markets on Tuesday, prompting China's central bank to raise interest rates for the third time in four months amid worries that a drought threatening the country's wheat crop will put further pressure on global food prices.
With fireworks still echoing from China's Lunar New Year holiday, its central bank said it is raising rates by one-quarter percentage point. It was just the latest move by an emerging-market government—several of which are deploying a panoply of policies to battle inflation fueled by rising food and commodity prices and growth that is threatening to outstrip their productive capacity.
In Brazil, Latin America's largest economy, the government reported Tuesday that inflation is accelerating, leading markets to expect its central bank to increase its overnight rate, already at 11.25%.
Few emerging-market countries have a firm grip on the inflation problem. Just last week, John Lipsky, the International Monetary Fund's No. 2, said many emerging economies are running out of excess capacity "and yet most of them still have in place the expansionary…monetary and budgetary policies." The cure is clear, he said. "Everybody is going to need to tighten monetary policy, reduce budgetary stimulus and continue with the process of structural reforms."
In contrast to emerging markets, inflation in the U.S. remains low—below the Federal Reserve's informal 2% target—despite rising commodity prices. But an improving growth outlook for the U.S. and the risk that rising food and energy prices will spill over into other goods and services have bond markets pushing up long-term rates and moving up their expectations for a Federal Reserve rate increase. Yields on U.S. Treasurys have been rising, and on Tuesday hit 3.721%, the highest since April.
Trading in futures markets indicates that the market, listening carefully to the latest words of Fed bank presidents, now puts the odds of a Fed rate increase in December at close to 100%, up from just 25% a week ago. The Fed has been holding short-term rates near zero since December 2008 and hasn't finished a $600 billion bond-buying effort aimed at keeping long-term rates down.
Further central bank rate hikes in emerging markets are widely anticipated. Those expectations—along with a flood of money fleeing low interest rates in the U.S., Europe and Japan—are contributing to upward pressure on emerging-market currencies. Several currencies have rallied to multiyear highs. Authorities in South Korea and Malaysia recently have intervened in foreign-exchange markets to slow the appreciation of their currencies.
Inflation fears intensified Tuesday after the U.N. Food and Agriculture Organization said drought in the five Chinese provinces that account for two-thirds of China's wheat production is endangering this year's crop. U.S. wheat futures surged Tuesday to a fresh 30-month high on fears of further strains on global supplies. The current wheat contract rose 1.8% to $8.7425 a bushel in Chicago, up 81.3% from a year ago.
In Brazil, higher bus fares and food prices boosted inflation in January. The government said Tuesday that its main consumer-price index in January was 5.99% above year-earlier levels, well above the official year-end 2011 target of 4.5%. The data add to pressure on Brazil's central bank to raise rates.
Inflation is up in the U.K. and price acceleration in Europe is now running ahead of central bankers' targets. But in the U.S., inflation remains below the Fed's informal target despite rising food and energy prices, in part because businesses haven't been able to pass along rising costs and because still-high unemployment is holding down wages. While some saw last Friday's Labor Department report that wages spurted 0.4% in January as a danger signal, the Fed and many private forecasters see little risk of a worrisome rise in wages and prices while unemployment remains high.
the rest:
http://online.wsj.com/article/SB1000...ORDS=inflation
meanwhile over at: http://inflation.us/news.html
we see that the cat is wiggling out of the bag....
February 9th, 2011: Bloomberg : Two Fed Skeptics of QE Say Inflation Underscores Risks
February 9th, 2011: Bloomberg : `Heavy Lifting' to Come as China Leaves Deposit Rate Below Inflation Pace
February 9th, 2011: Bloomberg : U.K. Food-Price Inflation Soars as Bank of England Begins Policy Meeting
February 8th, 2011: BusinessWeek : China Raises Rates to Counter Accelerating Inflation
February 8th, 2011: Financial Post : Why China’s Rate Hike is Good for Canada
with oil back down into the high 80's, gold ticking up to 1365 and
http://www.kitcosilver.com/ back up above 30
an inflection point?
or didnt the wsj get krugmans memo....
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