Daily update
Daily update
- UK profit-led inflation is coming under political scrutiny—Parliament is to investigate the influence of food producers and supermarkets on food price inflation. Profit-led inflation tends to occur at the end of supply chains, when companies with strong brands get consumers to accept price increases by disguising margin expansion with a convincing story. Consumer outrage (and associated political focus) is one way to combat this.
- GDP data signalled first quarter UK growth of 0.1%. There was a lot of pessimism about UK growth from multinational institutions—structural change makes high conviction in economic forecasting unwise. The quarter was affected by strikes, but the economic damage of transport strikes is weakened when 44% of the UK workforce can work from home.
- Eurozone economies offer final April consumer price data, but the inflation numbers are rarely revised and thus this is rarely interesting. US import and export prices are unlikely to show any impact from dollar weakness—firms price to market, and US imports are generally paid for with dollars.
- The US Michigan consumer sentiment poll offers the always hilarious partisan breakdown. Republicans think things are worse than the global financial crisis, Democrats think things are better than nearly all of US ex-President Trump’s time in office.
