Inflation
Meanwhile, service prices and the core index (which excludes food and energy) remain high, with the core CPI descending to 4.8%.
The CPI for May shows egg prices experienced the largest monthly drop in 72 years, but the price consumers are paying for a dozen eggs is still well above average over the past 10 years.
John Phipps: The Link Between Rising Interest Rates and Inflation Isn’t as Simple as You Might Think
The causal link between the Federal Reserve discount rate and inflation is obvious to all serious armchair economists, but calls for an impending recession in the U.S. are missing a few details. John Phipps explains.
The Federal Reserve raised interest rates by a quarter of a percentage point and signaled it may pause further increases. In an overt shift, the central bank no longer says it “anticipates” further rates will be needed.
A study released by Farm Bureau finds 86% of Americans are concerned about food insecurity, but their trust in farmers remains high at 89%.
Between the 2022 CHIPS Act and the 2022 Inflation Reduction Act, there’s a policy push to bring the production of both semiconductor chips and nitrogen to the U.S.
John Phipps says eggs are a perfect example of an inelastic product – one barely sensitive to price. And as egg inventory ramps back up, it may be an indicator of what it could mean for egg prices in the months ahead.
Farm Action is asking the FTC to explore why the nation’s largest egg company is seeing record-high profits while consumers pay record-high prices. Ag economists say the jump in egg prices is simply supply and demand.
The Labor Department showed annual inflation cooled in December, with food prices up 0.3%. And while some food costs are showing improvement, the cost of eggs has spiked since last year.
Inflation and interest didn’t stop Iowa farmland values from reaching their all-time high in 2022. However, the higher interest rates don’t typically affect the land market values for one to two years.