US ECONOMY & POLITICS

U.S. Consumer Prices Outpace Forecast as Inflation Dogs Economy – Bloomberg, 10/13/2021

• Prices paid by U.S. consumers rose in September by more than forecast, resuming a faster pace of growth and underscoring the persistence of inflationary pressures in the economy.
• The consumer price index increased 0.4% from August, according to Labor Department data released Wednesday.
• Compared with a year ago, the CPI rose 5.4%, matching the largest annual gain since 2008.
• Excluding the volatile food and energy components, so-called core inflation rose 0.2% from the prior month.
• Hotel fares fell, reflecting the impact of the delta variant on travel, but inflation is broadening out beyond categories associated with reopening.
• Higher home prices are now starting to filter through in the data.
• Rent of primary residence jumped 0.5%, the most since 2001, while a measure of homeowners’ equivalent rent posted the biggest gain in five years.
• American consumers are also experiencing higher prices for new vehicles and household furnishings and supplies, which increased by a record 1.3%, the report showed.
• And looking ahead, elevated energy prices are set to take an additional bite out of workers’ paychecks.
• Inflation-adjusted average hourly earnings rose 0.2% in September from a month earlier, but are down 0.8% from a year ago, separate data showed Wednesday.

Inflation Expectations Among U.S. Consumers Hit New Highs in Fed Survey – Bloomberg, 10/13/2021

• U.S. consumers’ expectations for inflation continued to rise in September amid elevated price pressures, according to a Federal Reserve Bank of New York survey.
• American household expectations for inflation one year ahead rose to 5.3% last month from 5.2% in August, while median expected inflation three years ahead rose to 4.2% from 4%, results of the New York Fed’s monthly Survey of Consumer Expectations, published Tuesday, showed.
• Both marked the highest readings on record in the survey’s eight-year history.

Social Security Benefits to Increase 5.9% for 2022 – Wall Street Journal, 10/13/2021

• Seniors and other Americans receiving Social Security benefits in 2022 will see the largest increase in their payments in four decades, reflecting surging inflation during the pandemic.
• Next year’s cost-of-living adjustment, or COLA, will be 5.9%, the Social Security Administration said Wednesday.
• The increase will translate to an addition of $92 to retirees’ average monthly benefit next year, bringing the amount to $1,657, the agency estimates.
• The nearly 6% cost-of-living adjustment is the largest since 1982, according to Social Security Administration data.
• The adjustment is calculated based on the Labor Department’s measure of inflation faced by blue-collar workers.

L.A. Port to Operate Around the Clock to Ease Cargo Logjams, White House Says – Wall Street Journal, 10/13/2021

• The White House on Wednesday is expected to announce a pledge from one of the country’s busiest ports to operate around the clock, a move aimed at easing cargo bottlenecks that have led to goods shortages and higher consumer costs.
• By going to 24/7, the Port of Los Angeles will join the neighboring Port of Long Beach, Calif., which started doing the same thing last month. Major ports in Asia and Europe have operated around the clock for years.
• Expanded operations at the Port of Los Angeles, which declined to comment ahead of the announcement, would nearly double the hours that cargo can move, according to the White House. It said the extra shifts have been agreed to by the International Longshore and Warehouse Union, which represents dock workers.
• There has been disagreement over 24/7 operations and finger pointing among key players in the supply chain, which includes port workers, truckers, warehouse operators, railways and retailers. On top of all that, there is a shortage of workers.
• When the Port of Long Beach initially launched its expanded hours, it failed to attract more trucks, with operators saying the process was burdensome.
• Biden administration officials said they were also trying to help states speed up licensing for truckers, among other measures.

White House says Walmart, FedEx, UPS to work 24/7 to ease supply bottlenecks for holiday season – Reuters, 10/13/2021

• President Joe Biden will host a meeting on Wednesday to hail progress in addressing supply chain problems weighing on the economy and threatening the holiday season, while he challenges business and union leaders to do more to ease shipping backlogs.
• In addition, the three largest carriers of goods – Wal-Mart, FedEx, and UPS – plan to move toward round-the-clock operations to help speed the shipment of goods across the country, the official said.
• Samsung, Home Depot and Target are also increasing their work in off-peak hours to accelerate the movement of goods, the official said.

EUROPE & WORLD

China readies plan to elevate status of antitrust unit – sources – Reuters, 10/13/2021

• China is considering boosting the status of its antitrust bureau within the market regulatory agency as it steps up a campaign against anti-competitive behavior, two people familiar with the matter said.
• Urged on by President Xi Jinping, the once low-profile State Administration for Market Regulation (SAMR) has made headlines this year with a push to root-out and penalize anticompetitive behavior, particularly in the vast online “platform” economy.
• Under a new structure under consideration by the government, the antitrust bureau would become the National Antimonopoly Bureau and be elevated to deputy-ministerial status, while remaining within SAMR, said two people with knowledge of the plans.
• The higher ranking would help antitrust investigators gain resources when examining mergers and acquisitions, the people said, strengthening their hand as Beijing seeks to rein in the power of corporate behemoths.

China Targets News Media in Xi Jinping’s Campaign to Expand Communist Party Control – wall Street Journal, 10/13/2021

• China’s Communist Party is ratcheting up its control over news media and online commentary, warning away private investors and cracking down on what it describes as misinformation, as it continues a campaign to assert itself more forcefully across the economy and Chinese society.
• The country’s central economic planning agency released on Friday a draft regulation that promised to expand restrictions on the involvement of “nonpublic capital” in swaths of the news industry—a warning to news organizations with private funding to step carefully, according to analysts.
• On the same day, authorities in southern China detained a well-known former journalist for allegedly insulting national martyrs in a post on social media that questioned the Communist Party’s account of the Korean War.
• Both events come on the heels of other tightening moves, including a decision by China’s internet regulator at the end of August to muzzle over 1,000 independent financial bloggers, some with large followings, whom it accused of spreading false information.

China’s Sept exports surprisingly robust despite power crunch – Reuters, 10/13/2021

• China’s export growth unexpectedly accelerated in September, as still solid global demand offset some of the pressures on factories from power shortages, supply bottlenecks and a resurgence of domestic COVID-19 cases.
• Outbound shipments in September jumped 28.1% from a year earlier, up from a 25.6% gain in August. Analysts polled by Reuters had forecast growth would ease to 21%.
• China’s September imports rose 17.6%, lagging an expected 20% gain in a Reuters poll and 33.1% growth the previous month.
• China posted a trade surplus of $66.76 billion in September, versus the poll’s forecast for a $46.8 billion surplus and $58.34 billion surplus in August.
• Its trade surplus with the United States rose to $42 billion, Reuters calculations based on the customs data showed, up from $37.68 billion in August.

China Raises Coal and Gas Imports to Counter Energy Crisis – Bloomberg, 10/13/2021

• China’s energy crunch pulled in more coal and gas imports in September, as buyers scrambled to ensure adequate supplies to counter a deepening power shortage ahead of peak winter demand.
• Coal purchases rose 17% on the month to 32.9 million tons, the highest total this year, according to the customs administration on Wednesday, although the tally for the first nine months still lags last year’s pace.
• Gas purchases could only nudge up 1.8% to 1.06 million tons, as sky-high prices and a shortage on international markets affected buyers’ ability to secure enough shipments, although imports of the cleaner-burning fuel are still running 22% ahead of last year.

SAP lifts full-year outlook as more customers shift to cloud – Reuters, 10/13/2021

• German business software group SAP raised its full-year outlook for a third time on the back of a strong showing in the third quarter as more customers shift their IT operations to the cloud.
• Adjusted revenue rose 5% to 6.68 billion euros ($7.70 billion) for the third quarter ended Sept. 30, the company reported in a preliminary earnings statement. SAP is expected to release full results on Oct. 21.
• SAP now expects cloud revenue to grow by 16%-19% in the year as a whole, helping its overall cloud and software revenue to gain by 2%-4%, it said in a statement late on Tuesday.
• Operating profit is expected to be flat to down 2% for the year, an improvement from its earlier forecast of unchanged to down 4%.
• SAP raised its forecast for cloud and software revenue for the full year by 200 million euros to 23.8 billion-24.2 billion euros.

Luxury giant LVMH’s third-quarter sales up by 20% – Reuters, 10/13/2021

• Sales at French luxury group LVMH’s fashion and leather goods division rose strongly in the third quarter even though overall revenue growth in Asia and the United States eased from their stellar first-half performance.
• Overall Like-for-like sales, stripping out the effect of foreign exchange fluctuations, rose by 20% to 15.51 billion euros ($17.90 billion) in the three months to September.
• LVMH recorded 28% revenue growth in the United States, compared with a 60% rise in the first half of the year, and 12% in Asia, excluding Japan, compared with 70% in the first six months of the year.
• Guiony said the company would continue to focus on broadening the appeal of its blockbuster acquisition, U.S. jeweller Tiffany, by refocusing its product assortment and ongoing marketing efforts.

Factmonster – TODAY in HISTORY

• The Continental Congress authorized the construction of a naval fleet. (1775)
• The cornerstone of the White House was laid. (1792)
• Italy declared war on Germany, its former Axis partner, during World War II. (1943)
• Egypt’s vice president Hosni Mubarak was elected president, one week after Anwar Sadat’s assassination. (1981)