Inflation slowed in April after seven months of relentless gains, a tentative sign that price increases may be peaking while still imposing a financial strain on American households.
Consumer prices jumped 8.3 per cent last month from 12 months earlier, the Labour Department said Wednesday. That was below the 8.5 per cent year-over-year surge in March, which was the highest rate since 1981.
On a month-to-month basis, prices rose 0.3 per cent from March to April, a still-elevated rate but the smallest increase in eight months.
Consumer prices had spiked 1.2 per cent from February to March, mostly because of a sudden jump in gas prices triggered by Russia’s invasion of Ukraine.
Nationally, the price of a gallon of regular gas has reached a record $4.40 US, according to the American Automobile Association (AAA), though that figure isn’t adjusted for inflation. The high price of oil is the main factor. A barrel of U.S. benchmark crude sold for around $100 a barrel Tuesday. Gas had fallen to about $4.10 a gallon in April, after reaching $4.32 in March.
Inflation becomes political challenge
Beyond the financial strain for households, inflation is posing a serious political problem for President Joe Biden and congressional Democrats in the midterm election season, with Republicans arguing that Biden’s $1.9 trillion financial support package last March overheated the economy by flooding it with stimulus checks, enhanced unemployment aid and child tax credit payments.
On Tuesday, Biden sought to take the initiative and declared inflation “the No. 1 problem facing families today” and “my top domestic priority.”
President Joe Biden speaks about inflation in the South Court Auditorium on the White House complex in Washington, Tuesday, May 10, 2022. (Manuel Balce Ceneta/AP Photo)
Biden blamed chronic supply chain snarls related to the swift economic rebound from the pandemic, as well as Russia’s invasion of Ukraine, for igniting inflation. He said his administration will help ease price increases by shrinking the government’s budget deficit and by fostering competition in industries, like meatpacking, that are dominated by a few industry giants.
Still, new disruptions overseas or other unforeseen problems could always send U.S. inflation back up to new highs. If the European Union decides, for example, to cut off Russian oil, gas prices in the United States would likely accelerate. China’s COVID lockdowns are worsening supply problems and hurting growth in the world’s second-biggest economy.
Previous signs that U.S. inflation might be peaking didn’t last. Price increases decelerated last August and September, suggesting at the time that higher inflation might be temporary, as many economists — and officials at the Federal Reserve — had suggested.
But prices shot up again in October, prompting Fed Chair Jerome Powell to start shifting policy toward higher rates.
More hike rates to come
This time, though, several factors are pointing to an inflation peak. Natural gas prices, which soared in March after Russia’s invasion of Ukraine, fell on average in April and likely slowed inflation. Used car prices are also expected to have dropped last month. Automakers’ supply chains have unraveled a bit, and new car sales have risen.
While food and energy have endured some the worst price spikes of the past year, analysts often monitor the core figure to get a sense of underlying inflation. Core inflation also typically rises more slowly than the overall price increases and can take longer to decline. Rents, for example, are rising at a historically fast pace, and there is little sign of that trend reversing anytime soon.
The unexpected persistence of high inflation has caused the Fed to embark on what may become its fastest series of interest rate increases in 33 years. Last week, the Fed raised its benchmark short-term rate by a half-point, its steepest increase in two decades. And Powell signaled that more such sharp rate hikes are coming.
The Powell Fed is seeking to pull off the notoriously difficult — and risky — task of cooling the economy enough to slow inflation without causing a recession. Economists say such an outcome is possible but unlikely with inflation this high.
In the meantime, by some measures Americans’ wages are rising at the fastest pace in 20 years. Their higher pay enables more people to at least partly keep up with higher prices. But employers typically respond by charging customers more to cover their higher labour costs, which, in turn, heightens inflationary pressures.
Last Friday’s jobs report for April included data on hourly pay that suggested that wage gains were slowing, which, if it continues, could help ease inflation this year.
Source Here: cbc.ca
Russia Launches Fresh Offensive, Wants Sanctions Relief to Free up Ukraine Food Supply Routes
Updates from Day 91 of the invasion
Severodonetsk remains under attack in the east, Ukraine officials say.
Zelenksy addresses Davos gathering, repeats willingness to negotiate with Russia.
Russia wants sanctions relief in exchange for access to food supply corridors.
Russia to eliminate upper age limit for military service.
U.S. won’t extend waiver that has allowed Russia to keep up with debt payments.
Russian forces launched offensives on towns in eastern Ukraine on Wednesday, with constant mortar bombardment destroying several houses and killing civilians, Ukrainian officials said, as Russia focuses its attack on the industrial Donbas region.
Russia has been focused on attempting to seize the separatist-claimed Donbas’s two provinces, Donetsk and Luhansk, and trap Ukrainian forces in a pocket on the main eastern front, according to Ukrainian officials.
In the easternmost part of the Ukrainian-held Donbas pocket, the city of Severodonetsk on the east bank of the Siverskiy Donets River and its twin Lysychansk, on the west bank, have become a pivotal battlefield. Russian forces were advancing from three directions to encircle them.
President Volodymyr Zelensky’s office said Russian forces launched an offensive on Severodonetsk early on Wednesday and the town was under constant fire from mortars.
Luhansk regional governor Serhiy Gaidai said six civilians were killed and at least eight wounded, most near bomb shelters, in Severodonetsk.
Smoke rises above a weapon manned by pro-Russian troops toward the direction of Severodonetsk on Tuesday in the Luhansk region of Ukraine. (Alexander Ermochenko/Reuters)
“At the moment, with the support of artillery, the Russian occupiers are attacking Severodonetsk,” Gaidai said.
Ukraine’s military said it had repelled nine Russian attacks on Tuesday in the Donbas, where Moscow’s troops had killed at least 14 civilians, using aircraft, rocket launchers, artillery, tanks, mortars and missiles.
Targeting unarmed civilians during war is ‘always criminal’ said Michael Newton, a law professor and former U.S. State Department official. There are dozens more war crimes trials to come out of the war between Ukraine and Russia, he said.
Reuters could not immediately verify information about the fighting.
The Donbas fighting follows Russia’s biggest victory in months: the surrender last week of Ukraine’s garrison in the port of Mariupol after a siege in which Kyiv believes tens of thousands of civilians were killed.
Three months into the invasion, Russia still has only limited gains to show for its worst military loss in decades, while much of Ukraine has suffered devastation in the biggest attack on a European state since 1945.
Zelensky said Wednesday that Russia must pull back to its prewar positions as a first step before diplomatic talks, a negotiating line that Moscow is unlikely to agree to anytime soon.
Speaking by video link to attendees at this year’s World Economic Forum in Davos, Switzerland, Zelensky expressed a willingness to negotiate with Russian President Vladimir Putin directly, but stressed that Moscow needs to make clear it, too, is ready to “shift from the bloody war to diplomacy.”
“[Diplomacy is] possible if Russia shows at least something. When I say at least something, I mean pulling back troops to where they were before Feb. 24,” Zelensky said, referring to the day Russia’s invasion began. “I believe it would be a correct step for Russia to make.”
Grain, food exports remain blocked
The war has also caused growing food shortages and soaring prices due to sanctions and disruption of supply chains. Both Ukraine and Russia are major exporters of grain and other commodities.
Russia said it was ready to provide a humanitarian corridor for vessels carrying food to leave Ukraine, in return for the lifting of some sanctions, the Interfax news agency cited Deputy Foreign Minister Andrei Rudenko as saying on Wednesday.
Ukraine’s Black Sea ports have been blocked since Russia sent thousands of troops into Ukraine on Feb. 24, and more than 20 million tonnes of grain are stuck in silos in the country.
The impact of the Ukraine war extends far beyond the country’s borders as Russian forces have destroyed crops and blockaded ports along the Black Sea, affecting the food supply in Africa and the Middle East.
Russia and Ukraine account for nearly a third of global wheat supplies, and the lack of significant grain exports from Ukraine ports is contributing to a growing global food crisis.
Ukraine is also a major exporter of corn and sunflower oil.
Western powers have been discussing the idea of setting up “safe corridors” for grain exports from Ukraine’s ports, adding that any such corridor would need Russian consent.
“We have repeatedly stated on this point that a solution to the food problem requires a comprehensive approach, including the lifting of sanctions that have been imposed on Russian exports and financial transactions,” Rudenko was quoted as saying.
“And it also requires the demining by the Ukrainian side of all ports where ships are anchored. Russia is ready to provide the necessary humanitarian passage, which it does every day,” he said.
Russia and Ukraine accuse each other of planting drifting mines in the Black Sea.
European Commission President Ursula von der Leyen said on Tuesday that Russia was using food supplies as a weapon with global repercussions.
“We are always ready for dialogue with all those who seek … peaceful resolution of all problems. I leave Ursula von der Leyen’s statement to her conscience,” Rudenko said.
He said that Russia would discuss the possibility exchanging prisoners with Ukraine once those who surrendered had been convicted. Russian and separatist officials have said some of those who surrendered should be tried for war crimes.
British military authorities say Ukraine’s overland export routes are “highly unlikely” to offset the problems caused by Russia’s blockade of the Black Sea port of Odesa.
The U.K. Ministry of Defence, in an update posted Wednesday morning, says there has been no “significant” merchant shipping in or out of Odesa since the start of the Russian invasion.
Defence Minister Anita Anand announced that the federal government is set to send Canada’s biggest single donation of military equipment to Ukraine since the start of Russia’s invasion.
The ministry says that the blockade, combined with the lack of overland routes, means that significant supplies of grain remain in storage and can’t be exported.
“While the threat of Russia’s naval blockade continues to deter access by commercial shipping to Ukrainian ports, the resulting supply shortfalls will further increase the price of many staple products,” the ministry said.
Russia could be squeezed by U.S. move on debt
The U.S. announced early Wednesday it would not extend a waiver set to expire on Wednesday that enabled Russia to bondholders.
The Treasury Department said on its website late on Tuesday it would not extend the waiver, set to expire Wednesday, which allowed Russia to make interest and maturity payments on its sovereign debt.
A boy plays in front of houses ruined by shelling in Borodyanka, Ukraine, Tuesday, near Kyiv. While the Russian military has largely abandoned that region at present, the damage from the earliest days of the invasion is apparent. (Natacha Pisarenko/The Associated Press)
That waiver has allowed Russia to keep up government debt payments, but its expiry now appears to make default inevitable — the country’s first major one on international sovereign bonds in more than a century.
Almost $2 billion US worth of payments on Russian international bonds fall due before year-end.
Unlike in most default situations, Moscow is not short of money. Russia’s debt repayment dues pale in comparison to its oil and gas revenues, which stood at $28 billion in April alone thanks to high energy prices.
The Russian Finance Ministry said it will pay in rubles and offer “the opportunity for subsequent conversion into the original currency,” but that could be viewed by foreign investors as a default.
Russia to amend military service age rules
Russia’s parliament approved a law on Wednesday removing the upper age limit for contractual service in the military, amid heavy casualties in Ukraine. The bill now needs only the signature of Putin to become law.
Currently, only Russians aged 18-40 and foreigners aged 18-30 can enlist as professional soldiers in the Russian military.
Russia’s defence ministry said on March 25 that 1,351 service personnel had been killed and 3,825 wounded since Moscow sent its armed forces into Ukraine on Feb. 24. It has not updated its casualty figures since.
Both Ukrainian and Western intelligence officials have said Russia’s losses in Ukraine were significantly higher at the time, and have risen sharply since March.
Original Post: cbc.ca
Earth’s Oceans Were the Hottest, Most Acidic on Record in 2021, UN Report Finds
The world’s oceans grew to their warmest and most acidic levels on record last year, the World Meteorological Organization (WMO) said on Wednesday, as United Nations officials warned that war in Ukraine threatened global climate commitments.
Oceans saw the most striking extremes as the WMO detailed a range of turmoil wrought by climate change in its annual State of the Global Climate report. It said melting ice sheets had helped push sea levels to new heights in 2021.
“Our climate is changing before our eyes. The heat trapped by human-induced greenhouse gases will warm the planet for many generations to come,” said WMO Secretary-General Petteri Taalas in a statement.
The report follows the latest UN climate assessment, which warned that humanity must drastically cut its greenhouse gas emissions or face increasingly catastrophic changes to the world’s climate.
The world’s oceans are the most acidic in at least 26,000 years, the UN agency said. (J. Sumerling/Great Barrier Reef Marine Park Authority via Associated Press)
Taalas told reporters there was scant airtime for climate challenges as other crises, such as the COVID-19 pandemic and war in Ukraine, grabbed headlines.
Selwin Hart, UN Secretary-General Antonio Guterres’s special adviser on climate action, criticized countries reneging on climate commitments due to the conflict, which has pushed up energy prices and prompted European nations to seek to replace Russia as an energy supplier.
“We are … seeing many choices being made by many major economies which, quite frankly, have the potential to lock in a high-carbon, high-polluting future and will place our climate goals at risk,” Hart told reporters.
On Tuesday, global equity index giant MSCI warned that the world faces a dangerous increase in greenhouse gases if Russian gas is replaced with coal.
The WMO report said levels of climate-warming carbon dioxide and methane in the atmosphere in 2021 surpassed previous records.
Globally, the average temperature last year was 1.11 C above the preindustrial average — as the world edges closer to the 1.5 C threshold beyond which the effects of warming are expected to become drastic.
“It is just a matter of time before we see another warmest year on record,” Taalas said.
Oceans bear much of the brunt of the warming and emissions. The bodies of water absorb around 90 per cent of the Earth’s accumulated heat and 23 per cent of the carbon dioxide emissions from human activity.
The ocean has warmed markedly faster in the last 20 years, hitting a new high in 2021, and is expected to become even warmer, the report said. That change would likely take centuries or millennia to reverse, it noted.
The ocean is also now its most acidic in at least 26,000 years as it absorbs and reacts with more carbon dioxide in the atmosphere.
Sea level has risen 4.5 centimetres in the last decade, with the annual increase from 2013 to 2021 more than double what it was from 1993 to 2002.
The WMO also listed individual extreme heat waves, wildfires, floods and other climate-linked disasters around the world, noting reports of more than $100 billion in damages.
Source Here: cbc.ca
NASA’s Mars InSight Mission Coming to an End As Dust Covers Solar Panels
A NASA spacecraft on Mars is headed for a dusty demise.
The Insight lander is losing power because of all the dust on its solar panels. NASA said Tuesday it will keep using the spacecraft’s seismometer to register marsquakes until the power peters out, likely in July. Then flight controllers will monitor InSight until the end of this year, before calling everything off.
“There really hasn’t been too much doom and gloom on the team. We’re really still focused on operating the spacecraft,” said Jet Propulsion Laboratory’s Bruce Banerdt, the principal scientist.
Since landing on Mars in 2018, InSight has detected more than 1,300 marsquakes; the biggest one, a magnitude 5, occurred two weeks ago.
It will be NASA’s second Mars lander lost to dust: A global dust storm took out Opportunity in 2018. In InSight’s case, it’s been a gradual gathering of dust, especially over the past year.
NASA’s two other functioning spacecraft on the Martian surface — rovers Curiosity and Perseverance — are still going strong thanks to nuclear power.
The space agency may rethink solar power in the future for Mars, said planetary science director Lori Glaze, or at least experiment with new panel-clearing tech or aim for the less-stormy seasons.
InSight currently is generating one-tenth of the power from the sun that it did upon arrival.
Deputy project manager Kathya Zamora Garcia said the lander initially had enough power to run an electric oven for one hour and 40 minutes; now it’s down to 10 minutes max.
The InSight team anticipated this much dust buildup, but hoped a gust of wind or a dust devil might clean off the solar panels. That has yet to happen, despite several thousand whirlwinds coming close.
“None of them have quite hit us dead-on yet enough to blow the dust off the panels,” Banerdt told reporters.
Another science instrument, dubbed the mole, was supposed to burrow five metres underground to measure the internal temperature of Mars. But the German digger never got deeper than a half-metre because of the unexpected composition of the red dirt, and it finally was declared dead at the beginning of last year.
Original Article: cbc.ca
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