- US inflation jumps to 4.2%; US 10-year bond yields soar
- UK remains hardest hit by pandemic among G-7 nations
- European Commission lifts growth forecasts on vaccines, stimulus
- UK trade with EU recovers in March
- Oil prices rise as IEA sees demand recovery outpacing supply
- Tui to deploy Dreamliner as Portugal bookings skyrocket
Alright, not to the moon, but US inflation surged higher in April, primarily on the back of higher used car prices, says James Knightley, chief international economist at ING. He says this means that the Federal Reserve could raise interest rates a year earlier than expected, in early 2023.
Troublingly, there is evidence of broadening price pressures too. We increasingly doubt the Fed’s position that this is transitory and think they will end up hiking rates far sooner than 2024.
We’ve been warning about the prospect of higher for longer inflation in the US for many months, but even we hadn’t predicted this. Headline inflation jumped 0.8% month-on-month versus the 0.2% consensus while the core (ex food and energy) component rose 0.9% versus the 0.3% forecast.
Wall Street has fallen at the open after the jump in US inflation to the highest rate since 2008.
