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Recent Editions
Risk Channel
North America
U.S. consumer prices rose 3.8% annually in April, the Labor Department reported on Tuesday, marking the highest inflation rate since May 2023, as higher energy costs and broader price increases intensified concerns about persistent inflationary pressures. The consumer price index increased 0.6% for the month, while core inflation, which excludes food and energy, rose 0.4% monthly and 2.8% annually, remaining above the Federal Reserve’s 2% target. Energy prices climbed 3.8% in April and were up 17.9% year-over-year, with gasoline prices surging 28.4% annually. Food prices rose 0.5% during the month, while grocery prices recorded their biggest monthly increase since August 2022. Inflation pressures also spread across shelter, apparel, airline fares, and household furnishings, while tariffs and elevated oil prices linked to the conflict in Iran added to broader economic concerns. The report also showed real average hourly wages fell 0.5% during the month and declined 0.3% annually, signaling that inflation is now outpacing wage growth.
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Risk Channel
UK/Europe
European Central Bank (ECB) President Christine Lagarde has said policymakers face “massive uncertainty” and need “a lot more data” to understand the repercussions of the conflict in the Middle East, and the ECB is carefully considering its response to the war and the impact on inflation to ensure it acts neither prematurely nor too late. “We are constantly torn between the risk of reacting too quickly or the risk of reacting too late, and we have to find the right path to navigate our economies toward that 2% medium term inflation, which is our goal,” she said. Lagarde offered no indication as to whether the ECB will raise interest rates next month, as many expect.
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