Meat in a Los Angeles supermarket as rising inflation affects US consumer prices. Reuters
Meat in a Los Angeles supermarket as rising inflation affects US consumer prices. Reuters
Meat in a Los Angeles supermarket as rising inflation affects US consumer prices. Reuters
Meat in a Los Angeles supermarket as rising inflation affects US consumer prices. Reuters

US Fed rate rises expected in 2023 as producer prices top estimates


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US producer prices rose in November by more than forecast, driven by services and underscoring the stickiness of inflationary pressures that support Federal Reserve interest-rate increases into 2023.

The producer price index for final demand climbed 0.3 per cent for a third month and was up 7.4 per cent from a year earlier, Labour Department data showed on Friday. On an annual basis, the measure continued to decelerate.

The median estimates in a Bloomberg survey of economists called for the index to be up 0.2 per cent in November and 7.2 per cent from 2021.

The data comes just days before the release of the closely watched consumer price index, which is forecast to show that inflation, while much too high, continues to decelerate.

That said, cooler demand at home and abroad has taken some stress off supply chains, allowing annual producer-price growth to slow significantly.

Excluding the volatile food and energy components, the so-called core PPI rose 0.4 per cent in November and increased 6.2 per cent on an annual basis.

With core-goods inflation easing, attention is shifting to price growth in the services side of the economy. The housing components, which are currently a key driver of consumer inflation, are expected to eventually turn, but wages may prove key to the ultimate path of inflation.

US stocks were down slightly after the report, while Treasury yields jumped and the dollar fluctuated.

Fed Chair Jerome Powell said in a recent speech that core services ex-housing, as measured by an index tied to personal consumption, “may be the most important category for understanding the future evolution of core inflation”. And that the “labour market holds the key to understanding inflation in this category”.

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The more serious side of specialty coffee

While the taste of beans and freshness of roast is paramount to the specialty coffee scene, so is sustainability and workers’ rights.

The bulk of genuine specialty coffee companies aim to improve on these elements in every stage of production via direct relationships with farmers. For instance, Mokha 1450 on Al Wasl Road strives to work predominantly with women-owned and -operated coffee organisations, including female farmers in the Sabree mountains of Yemen.

Because, as the boutique’s owner, Garfield Kerr, points out: “women represent over 90 per cent of the coffee value chain, but are woefully underrepresented in less than 10 per cent of ownership and management throughout the global coffee industry.”

One of the UAE’s largest suppliers of green (meaning not-yet-roasted) beans, Raw Coffee, is a founding member of the Partnership of Gender Equity, which aims to empower female coffee farmers and harvesters.

Also, globally, many companies have found the perfect way to recycle old coffee grounds: they create the perfect fertile soil in which to grow mushrooms. 

UAE currency: the story behind the money in your pockets
Updated: December 09, 2022, 11:53 PM`