Prices paid by US consumers surged in June by the most since 2008, topping all forecasts and complicating the Federal Reserve’s debate over how soon to unwind ultra-easy monetary support for the economy.
The consumer price index jumped 0.9 per cent in June and 5.4 per cent from the same month last year, according to Labour Department data released on Tuesday. Excluding the volatile food and energy components, the so-called core CPI rose 4.5 per cent from June 2020, the largest advance since November 1991.
Used vehicles accounted for more than a third of the gain in the CPI, the agency said. The outsize increase was also driven in large part by the pricing rebound in categories associated with a broader reopening of the economy including hotel stays, car rentals, apparel and airfares.
Expectations that those increases will normalise help explain the Fed’s view that inflation is transitory.
“Inflation surprised substantially to the upside in June but, once again, owing to outsize increases in prices in a few categories,” said Michelle Meyer, head of US economics at Bank of America. “This reinforces the idea of transitory inflation.”
The median forecasts in a Bloomberg survey of economists called for a 0.5 per cent gain in the overall CPI from the prior month and a 4.9 per cent year-over-year increase. The S&P 500 declined after the report, while the yield on the 10-year Treasury note eased and the dollar advanced.
The report also may add to challenges for the Joe Biden administration in convincing Congress to approve trillions of dollars in additional fiscal spending in coming years. Republicans have been highlighting the jump in inflation as a reason to reject such new plans.
The year-over-year figures have shown outsize gains in recent months partly because of so-called base effects — the CPI retreated from March through May of last year during the pandemic lockdowns. While the annual figures are expected to peak, it is not yet clear how much moderation will occur over the coming months.
In the three months through June, the core CPI increased at a more than 8 per cent annualised rate, the fastest since the early 1980s.
Household spending on merchandise, fuelled in part by government stimulus, has left businesses scrambling to fill orders while facing shortages of materials and labour. That dynamic is contributing to higher costs, which often feed through to consumer prices.
Meanwhile, the lifting of pandemic restrictions is propelling purchases of services like travel and transport, another contributor to inflationary pressures.
Prices paid for new and used vehicles rose from a month earlier by the most on record. That said, those categories each make up less than 4 per cent of the overall CPI.
The cost of food away from home jumped 0.7 per cent on a month-over-month basis, the largest gain since 1981.
Fed Chair Jerome Powell has said that recent price increases are the result of transitory reopening effects, though more recently acknowledged the possibility of longer-term inflationary pressures. Sustained constraints in the production pipeline, along with a pickup in wages, raise the risk of an acceleration in consumer inflation.
“Bottlenecks, hiring difficulties and other constraints could continue to limit how quickly supply can adjust, raising the possibility that inflation could turn out to be higher and more persistent than we expect,” Mr Powell said after the June Federal Open Market Committee meeting.
Economists have been watching to see whether price pressures broaden out to categories other than those that are only now rebounding after pandemic-related lockdowns.
Shelter costs, which are seen as a more structural component of the CPI and make up a third of the overall index, rose 0.5 per cent last month, the most since October 2005. The gain was driven by a 7.9 per cent jump in hotel stays.
Wage growth rose steadily through the second quarter, but higher consumer prices are taking a toll. Inflation-adjusted average hourly earnings fell 1.7 per cent in June after slumping 2.9 per cent a month earlier, separate data showed Thursday.
Figures out on Tuesday from the National Federation of Independent Business showed 47 per cent of small-business owners, the largest share since 1981, reported higher selling prices in June.
Recent winners
2002 Giselle Khoury (Colombia)
2004 Nathalie Nasralla (France)
2005 Catherine Abboud (Oceania)
2007 Grace Bijjani (Mexico)
2008 Carina El-Keddissi (Brazil)
2009 Sara Mansour (Brazil)
2010 Daniella Rahme (Australia)
2011 Maria Farah (Canada)
2012 Cynthia Moukarzel (Kuwait)
2013 Layla Yarak (Australia)
2014 Lia Saad (UAE)
2015 Cynthia Farah (Australia)
2016 Yosmely Massaad (Venezuela)
2017 Dima Safi (Ivory Coast)
2018 Rachel Younan (Australia)
MATCH INFO
Manchester City 2 (Mahrez 04', Ake 84')
Leicester City 5 (Vardy 37' pen, 54', 58' pen, Maddison 77', Tielemans 88' pen)
Man of the match: Jamie Vardy (Leicester City)
Washmen Profile
Date Started: May 2015
Founders: Rami Shaar and Jad Halaoui
Based: Dubai, UAE
Sector: Laundry
Employees: 170
Funding: about $8m
Funders: Addventure, B&Y Partners, Clara Ventures, Cedar Mundi Partners, Henkel Ventures
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
Five healthy carbs and how to eat them
Brown rice: consume an amount that fits in the palm of your hand
Non-starchy vegetables, such as broccoli: consume raw or at low temperatures, and don’t reheat
Oatmeal: look out for pure whole oat grains or kernels, which are locally grown and packaged; avoid those that have travelled from afar
Fruit: a medium bowl a day and no more, and never fruit juices
Lentils and lentil pasta: soak these well and cook them at a low temperature; refrain from eating highly processed pasta variants
Courtesy Roma Megchiani, functional nutritionist at Dubai’s 77 Veggie Boutique
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
COMPANY PROFILE
Initial investment: Undisclosed
Investment stage: Series A
Investors: Core42
Current number of staff: 47
GOLF’S RAHMBO
- 5 wins in 22 months as pro
- Three wins in past 10 starts
- 45 pro starts worldwide: 5 wins, 17 top 5s
- Ranked 551th in world on debut, now No 4 (was No 2 earlier this year)
- 5th player in last 30 years to win 3 European Tour and 2 PGA Tour titles before age 24 (Woods, Garcia, McIlroy, Spieth)
MATCH INFO
Uefa Champions League semi-final, first leg
Barcelona v Liverpool, Wednesday, 11pm (UAE).
Second leg
Liverpool v Barcelona, Tuesday, May 7, 11pm
Games on BeIN Sports
Overview
Cricket World Cup League Two: Nepal, Oman, United States tri-series, Tribhuvan University, Kathmandu
Fixtures
Wednesday February 5, Oman v Nepal
Thursday, February 6, Oman v United States
Saturday, February 8, United States v Nepal
Sunday, February 9, Oman v Nepal
Tuesday, February 11, Oman v United States
Wednesday, February 12, United States v Nepal
Ukraine%20exports
%3Cp%3EPresident%20Volodymyr%20Zelenskyy%20has%20overseen%20grain%20being%20loaded%20for%20export%20onto%20a%20Turkish%20ship%20following%20a%20deal%20with%20Russia%20brokered%20by%20the%20UN%20and%20Turkey.%3Cbr%3E%22The%20first%20vessel%2C%20the%20first%20ship%20is%20being%20loaded%20since%20the%20beginning%20of%20the%20war.%20This%20is%20a%20Turkish%20vessel%2C%22%20Zelensky%20said%2C%20adding%20exports%20could%20start%20in%20%22the%20coming%20days%22%20under%20the%20plan%20aimed%20at%20getting%20millions%20of%20tonnes%20of%20Ukrainian%20grain%20stranded%20by%20Russia's%20naval%20blockade%20to%20world%20markets.%3Cbr%3E%22Our%20side%20is%20fully%20prepared%2C%22%20he%20said.%20%22We%20sent%20all%20the%20signals%20to%20our%20partners%20--%20the%20UN%20and%20Turkey%2C%20and%20our%20military%20guarantees%20the%20security%20situation.%22%3C%2Fp%3E%0A
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
Tips for job-seekers
- Do not submit your application through the Easy Apply button on LinkedIn. Employers receive between 600 and 800 replies for each job advert on the platform. If you are the right fit for a job, connect to a relevant person in the company on LinkedIn and send them a direct message.
- Make sure you are an exact fit for the job advertised. If you are an HR manager with five years’ experience in retail and the job requires a similar candidate with five years’ experience in consumer, you should apply. But if you have no experience in HR, do not apply for the job.
David Mackenzie, founder of recruitment agency Mackenzie Jones Middle East
What is a robo-adviser?
Robo-advisers use an online sign-up process to gauge an investor’s risk tolerance by feeding information such as their age, income, saving goals and investment history into an algorithm, which then assigns them an investment portfolio, ranging from more conservative to higher risk ones.
These portfolios are made up of exchange traded funds (ETFs) with exposure to indices such as US and global equities, fixed-income products like bonds, though exposure to real estate, commodity ETFs or gold is also possible.
Investing in ETFs allows robo-advisers to offer fees far lower than traditional investments, such as actively managed mutual funds bought through a bank or broker. Investors can buy ETFs directly via a brokerage, but with robo-advisers they benefit from investment portfolios matched to their risk tolerance as well as being user friendly.
Many robo-advisers charge what are called wrap fees, meaning there are no additional fees such as subscription or withdrawal fees, success fees or fees for rebalancing.
The specs
Engine: 3.0-litre twin-turbo flat-six
Power: 480hp at 6,500rpm
Torque: 570Nm from 2,300-5,000rpm
Transmission: 8-speed dual-clutch auto
Fuel consumption: 10.4L/100km
Price: from Dh547,600
On sale: now
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%3Cp%3E%3Cstrong%3EEngine%3A%20%3C%2Fstrong%3EDual%20permanently%20excited%20synchronous%20motors%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E516hp%20or%20400Kw%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E858Nm%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESingle%20speed%20auto%3Cbr%3E%3Cstrong%3ERange%3A%20%3C%2Fstrong%3E485km%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh699%2C000%3C%2Fp%3E%0A
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
if you go
The flights
Emirates have direct flights from Dubai to Glasgow from Dh3,115. Alternatively, if you want to see a bit of Edinburgh first, then you can fly there direct with Etihad from Abu Dhabi.
The hotel
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Located in the heart of Mackintosh's Glasgow, the Dakota Deluxe is perhaps the most refined hotel anywhere in the city. Doubles from Dh850
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Events and tours
There are various Mackintosh specific events throughout 2018 – for more details and to see a map of his surviving designs see glasgowmackintosh.com
For walking tours focussing on the Glasgow Style, see the website of the Glasgow School of Art.
More information
For ideas on planning a trip to Scotland, visit www.visitscotland.com
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants
UAE squad
Esha Oza (captain), Al Maseera Jahangir, Emily Thomas, Heena Hotchandani, Indhuja Nandakumar, Katie Thompson, Lavanya Keny, Mehak Thakur, Michelle Botha, Rinitha Rajith, Samaira Dharnidharka, Siya Gokhale, Sashikala Silva, Suraksha Kotte, Theertha Satish (wicketkeeper) Udeni Kuruppuarachchige, Vaishnave Mahesh.
UAE tour of Zimbabwe
All matches in Bulawayo
Friday, Sept 26 – First ODI
Sunday, Sept 28 – Second ODI
Tuesday, Sept 30 – Third ODI
Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
Gifts exchanged
- King Charles - replica of President Eisenhower Sword
- Queen Camilla - Tiffany & Co vintage 18-carat gold, diamond and ruby flower brooch
- Donald Trump - hand-bound leather book with Declaration of Independence
- Melania Trump - personalised Anya Hindmarch handbag
