*
Wholesale price index hits highest level on record
*
Firms struggle to pass on costs, building pressure on margins
*
Cost-push inflation unsustainable without stronger wage growth
*
Households inflation expectations turn weaker vs 3 months ago
(Adds household inflation expectations survey)
By Tetsushi Kajimoto
TOKYO, Oct 13 (Reuters) – Japanese corporate goods prices grew the most in five months in September, Bank of Japan data showed on Thursday, highlighting the squeeze on business profits from persistently strong wholesale inflation.
The 9.7% year-on-year rise in the corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, was much bigger than a median market forecast for a 8.8% increase, BOJ data showed.
It was the biggest annual increase since a 9.8% rise registered in April, underlining the stiff margin pressure facing businesses as many of them struggle to pass on the costs to consumers.
A weak yen, which inflates the cost of imports, has exacerbated already high wholesale inflation from a global surge in commodity prices.
The yen-based import price index rose 48.0% year-on-year in September, after a revised 43.2 in August and a revised 49.2% in July, the data showed.
That combination has driven the index, at 116.3, to a record high since the survey began in 1960. Electricity bills for business and urban gas utility were the main contributors to the uptick in costs, reflecting rises in fuel costs for the second quarter.
The month-on-month input cost pressure also remained strong, with wholesale prices up 0.7% in September from August, when it increased 0.4%.
HOUSEHOLD INFLATION EXPECTATIONS
After failing to achieve the 2% inflation goal for nearly a decade, the BOJ is finally seeing consumer inflation exceeding 2% but for the wrong reasons – soaring fuel and raw material costs largely blamed on the Ukraine crisis.
In a sign cost-push inflation may not be sustainable, however, a separate BOJ survey showed on Thursday household inflation expectations turned somewhat weaker.
The ratio of households expecting prices to be higher a year from now stood at 85.7% in September, down from 87.1% in June, which was the highest level since June 2008, the quarterly BOJ survey showed.
The ratio of households expecting prices to be higher in five years was 78.3% in September, down from 79.8% in June.
Japan's core consumer inflation hit 2.8% in August, the fastest annual pace in 21 years, underscoring the rising cost of living with wage growth lagging far behind.
However, given the moderate consumer inflation rate compared with many other advanced nations, the central bank has vowed to keep interest rates ultra-low to revive a fragile economy, remaining an outlier in a global tide of monetary policy tightening. (Reporting by Tetsushi Kajimoto; Editing by Shri Navaratnam)
The economist warned in 2006 that the U.S. housing bust would cause a financial crisis. Now he has a new economic doomsday prediction, and it isn't pretty.
The U.S. stock market took an unusual swing after Thursday’s inflation report. “Shortly after the open, the S&P 500 index had dropped nearly 4% from its pre-market highs before staging an epic rally of over 5%,” Bespoke Investment Group said in a note Friday. “Even in this ‘all or nothing’ type of market environment, reversals of that magnitude are rare.”
The U.S. Treasury Department put an item on its agenda Friday to start talking with primary dealers about the potential for it to buy back some of its older debt to help keep markets functioning smoothly.
It's never a dull time analyzing Tesla's (NASDAQ: TSLA) stock. The innovative electric car company always seems to have something interesting going on. In this video, I take a beginner-friendly walk-through of Tesla's second-quarter earnings transcript.
The Senior Citizen’s League says there ‘may be no COLA payable in 2024.'
Investors seemingly can’t stop trying to pick a stock market bottom, no matter how bad the news—and it continues to backfire. Consider: This past Thursday, September’s consumer inflation report came in much hotter than expected, with the core CPI hitting a 40-year high. The initial response was exactly what you’d expect—the traded down as much as 2.4%—but then it started rallying…and rallying.
This week’s worse-than-expected inflation report led to turmoil in more than one market, but you only read about one of them. What got far less attention was the flurry of excitement that the inflation report caused in the normally-staid I-bond market.
Currently, AT&T sports a high 7.4% dividend yield, which means the company will pay an estimated 7.4% of its stock price to shareholders each year. This number constantly fluctuates because it is calculated using the annual dividend payout divided by the stock price. The yield rises if the dividend goes up and the stock price stays the same.
Things have been even worse for the technology stock-driven Nasdaq Composite (NASDAQINDEX: ^IXIC). Historically, every double-digit percentage decline in the major U.S. stock indexes, including the Nasdaq, has eventually been placed in the rearview mirror by a bull market rally. This makes every bear market a surefire buying opportunity for patient investors.
Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) owns a massive stock portfolio with about 50 different investments and a total market value of more than $308 billion. Here are two Buffett stocks in particular that could be worth a closer look right now, and one that has limited upside potential and is best to avoid. Many financial sector stocks have been beaten down lately, and it's easy to understand why.
These diversified natural-resource giants have solid balance sheets, earnings, and dividends. All that they need is a rebound in commodity prices.
Investors have become more confident that the company can put the past behind it as demand for air travel recovers.
Making investments pay out for the long term is the true challenge in today’s market environment. The series of headwinds piling up – from persistently high inflation to rising interest rates to slowing demand to bureaucratic bloat – are rising to hurricane force, and renewing investors’ attention to defensive stocks. It’s only logical. The classic defensive stock, the dividend payer, ensures an income stream no matter how the markets move, and if the yield is high enough, these stocks can also
By selling US$25m worth of Broadcom Inc. ( NASDAQ:AVGO ) stock at an average sell price of US$610 over the last year…
The research firm came up with a list of the best companies to own based on ones to which Morningstar analysts assign a wide moat.
This hasn't been a great year for chip stocks, but Advanced Micro Devices' positive, long-term trajectory is undeniable.
The premium being paid by Kroger (KR) for the company's merger values ACI closer to its 52-week highs and could eventually give the stock another short-term catalyst. With or without the merger, ACI stock may be worth investors' consideration as its growth outlook has become more intriguing.
It's easy to see what makes investors so interested in this high-yield stock, but there are concerns.
Want to put an S&P 500 investor in a good mood during earnings season? A huge earnings surprise would do it.
If you only read headlines, you might think that Beyond Meat's (NASDAQ: BYND) Friday press release announcing that the plant-based "meat" producer is shooting to be cash flow positive by the second half of 2023 was a piece of good news. Demand for plant-based meat has weakened, with consumers moving away from the category amid sky-high inflation.