Latest news with #foodPrices
RNZ News
5 days ago
- Business
- RNZ News
High food prices, 'tariff noise' cast shadow over consumer confidence
Photo: RNZ Consumer sentiment has soured amid tariff-induced economic uncertainty and rising food prices. The ANZ-Roy Morgan Consumer Confidence Index fell 5 points fell in May to 92.9 - a reading below 100 means overall sentiment remains pessimistic. It comes after business confidence fell for the third month in a row . The fall in consumer sentiment erased gains from April . ANZ chief economist Sharon Zollner said it was the first consumer survey where most people answered after the start of "tariff noise". "That could be a factor," she said. "Also, we're experiencing quite high food price inflation at the moment and that tends to go down very badly with consumers." Perceptions about the outlook for the economy over the next 12 months fell 4 points to a net negative 20 percent - indicating most people thought the economy would see bad times financially. A net 10 percent of people felt it was a bad time to buy a major household item, a key indicator for the retail sector. "While that did lift 1 point, it's still a long way from suggesting happy days for the retail sector," Zollner said. Other questions in the survey showed a net 12 percent expected to be better off in a year's time, down 11 points. Household inflation expectations were largely steady, only easing 0.1 percentage points to 4.6 percent. "That's a lot higher than a couple of months ago, with the jump possibly caused by global tariff talk, though household inflation expectations can also be sensitive to food prices," Zollner said. "Household inflation expectations don't have a tight correlation with actual inflation outcomes," Zollner said. "But the perception that inflation is going to be so high is likely to contribute to the sense of a cost of living crisis, potentially dampening spending, if anything." ANZ continued to expect the Reserve Bank to cut interest rates three more times this year, lowering the Official Cash Rate to 2.5 percent. "Our best judgement is that the RBNZ will end up just shoring up the recovery because it's nothing flash at the moment," Zollner said. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
CBC
7 days ago
- Business
- CBC
Food prices are still rising while inflation is dropping. Here's why
Political scientist Sarah Martin says the food supply chain is shaped more like an hourglass, rather than a straight line. At the top of that hourglass is a group she calls the "feeders," or the food producers. The "eaters," or consumers, are on the bottom. In the middle, where the hourglass is pinched, are corporations. "These corporations have a remarkable amount of control," Martin told CBC News on Monday. The associate professor said the big grocers and food companies are part of the reason as to why food prices continue to rise, even while inflation and energy prices are dropping. Canada's inflation rate dropped to 1.7 per cent in April, mainly driven by the removal of the consumer carbon tax, according to Statistics Canada. Meanwhile, another Statistics Canada report released earlier this month says the cost of food purchased from stores rose by 3.8 per cent in April compared to last year. Martin says companies are being defensive against economic shocks like that. One of the largest contributors to the year-over-year acceleration was fresh or frozen beef, which increased by 16.8 per cent according to the report. "Meat is an interesting market," Martin said. She said it's unique because there are only a handful of major players in the North American meat business, but also because animals can move across the Canadian and American borders "quite a bit." In many cases, livestock are raised in Canada and then shipped to the United States for subsidized feed and slaughterhouse labour, and then the product is sent back to Canada. "Decades of free trade have created these really tangled webs," Martin said. It's become an even bigger tangle since U.S. President Donald Trump launched a global trade war, imposing tariffs on various meat products like beef and pork. The economic uncertainty that resulted leads to some sticker shock for those at the bottom of the hourglass. Uncertainty is bad for business, as Martin puts it. "When there's an economic shock and the business climate is unpredictable, prices often rise," she said. "With that kind of market control, you can see that kind of corporate concentration — that pinch in the hourglass. You can see how sellers' inflation can move along very quickly." Martin added that any increase in food prices worsens an "already alarming level of food insecurity" in the province. Lesley Burgess is executive director of the Bridges to Hope food bank in St. John's. She says her organization is constantly aware of the cost of supplies. Bridges to Hope serves about 1,400 people a year, according to Burgess. The team has been trying to find creative ways of addressing food inflation to maintain their level of service. "Now is not the time to pull back or to reduce the amount of food that we're distributing," Burgess said. "Even if our food bank is also, you know, feeling that pinch." The organization implemented a choice model in March, and Burgess said that's helping. Clients are able to choose which items they need at a given time instead of taking home pre-packaged hampers. The food bank's executive director said the new model helps to provide people with food better suited to their needs and preferences— and it helps Bridges to Hope make the best use of its resources. Burgess said Bridges to Hope spends about $18,000 every month, and she's noticed that some of the regularly purchased items have increased in price as much as 25 per cent since December. She's still expecting a high demand leading into the summer months. "Every morning that we're open, which is four mornings a week, we're serving anywhere from 70 to 100 people," said Burgess. "Our job is to make sure that we're getting the best quality of food for the best price."
The Herald
7 days ago
- Business
- The Herald
‘We are shielding the poor,' says Ramaphosa on high cost of living
President Cyril Ramaphosa says his government has sufficient measures in place to shield poor South Africans from the high costs of basic necessities. This is in light of the increase of the average household food basket by nearly 40% of inflation. However concerning, the president insists that his government not only recognises the high cost of living facing South Africans, but has measures in place to cushion its most vulnerable. 'Food staples, such as maize meal, brown bread, rice, samp, milk, eggs and other basic foodstuffs remain exempt from VAT and this helps to cushion the lower income households in our country from the high prices. 'Our fiscal policy has been redistributive, prioritising poor and low income households. In the end, government spends about 60% and in the current budget, the minister of finances advises that [government] has edged up to 61% of its revenue in the social wage, which includes spending on social grants, education and health.' Ramaphosa said tackling poverty and the cost of living is one of the three strategic priorities of the GNU and forms a strategic pillar of the medium-term development plan. He said South Africa's macroeconomic policy framework has been a key lever for shielding the poor from the high costs of living. 'The framework includes an inflation target, which has helped to keep prices low and stable and has been important in reducing average prices,' he said. Ramaphosa explained that when inflation is high, the purchasing power of ordinary people becomes weaker — hailing the drop in inflation as a positive for poor South Africans. 'Food price inflation has fallen quite significantly, from 12.7% at the end of 2022 to 2.2% in March 2025. Headline inflation, which is a measure of the general costs of living, has also declined, averaging 4.4% in 2024, with inflation even moderating further to 2.7% in March 2025.' He commended finance minister Enoch Godongwana's tabling of expenditure and revenue plans in parliament last week , particularly highlighting the increasing of social grants to a rate higher than inflation. In addition, Ramaphosa reminded MPs that government does provide free basic services such as water and electricity for indigent households. 'This is an essential measure in reducing the high cost of living. It has been calculated that in other areas it would have amounted to R400-R600 that is now given as a subsidy to our people. The bulk of local governments' equitable share in this year's budget goes towards a free basic services package, to over 11-million households in our country. 'This package of free municipal services in our country continues to be a key tool for reducing poverty and inequality, while raising living standards and facilitating access to greater economic opportunities for many of our people. It is essential that municipalities ensure that it reaches all of the households that need it.' Ramaphosa said he frequently encourages municipalities to revamp their indigent register, despite some not doing so on a regular basis, which results in allocations being diverted to other purposes. Another measure reported by the president is a network of over 3,000 centre-based food programmes established by the department of social development to provide nutritious food to poor and vulnerable people. 'These centres provide comprehensive services which include psychosocial support, welfare and developmental interventions while addressing the immediate need of providing nutritious food on a daily basis.' He reflected on what he calls 'structural factors' that contribute to a high cost of living, naming apartheid spatial planning as a factor. 'We are therefore reforming our housing policies to provide affordable housing closer to economic centres as well as improving the capacity of commuter rail services — making it less expensive for people to get to work and access services.'
CNA
27-05-2025
- Business
- CNA
BOJ's Ueda calls for vigilance over risks from food inflation
TOKYO :The Bank of Japan must be vigilant to the risk rising food prices could push up underlying inflation that is already near its 2 per cent target, Governor Kazuo Ueda said, signaling the central bank's readiness to continue its rate hikes. The BOJ keeps interest rates low as inflation expectations, or the public's perception on future price moves, stand between 1.5 per cent and 2 per cent - the highest in 30 years though still below its 2 per cent target, Ueda said in a speech at a BOJ-hosted conference. But a renewed rise in food prices, particularly a 90 per cent spike in the price of rice, is pushing up not just headline but underlying inflation, which is typically influenced mostly by improvements in the economy and a tight job market, Ueda said. "Our baseline view is that the effects of food price inflation are expected to wane," he said. "However, given that underlying inflation is closer to 2 per cent than a few years ago, we need to be careful about how food price inflation will impact underlying inflation," he added. The remarks highlight how the BOJ is keeping an eye out not just on economic risks from higher U.S. tariffs, but simmering domestic inflationary pressure, in judging how soon to resume interest rate hikes. Although the BOJ downgraded its forecasts due to trade policy uncertainties, it expects underlying inflation to gradually move toward its 2 per cent target over the second half of its forecast horizon running through fiscal 2027, Ueda said. "To the extent that incoming data allows us to gain more confidence in the baseline scenario, as economic activity and prices improve, we will adjust the degree of monetary easing as needed" by raising rates, he said. Japan's core inflation hit 3.5 per cent in April, accelerating at its fastest annual pace in more than two years due largely to a 7 per cent surge in food costs, raising the odds of another rate hike this year. The BOJ will judge whether the economy and prices are moving in line with its forecasts "without any preconceptions," given extremely high uncertainties over the outlook, Ueda said. The BOJ ended a decade-long, massive stimulus programme last year and in January raised short-term interest rates to 0.5 per cent on the view Japan was on the cusp of durably meeting its 2 per cent inflation target. While the central bank has signalled readiness to raise rates further, the economic repercussions from higher U.S. tariffs forced it to cut its growth forecasts and complicated decisions around the timing of the next rate increase. A Reuters poll, taken on May 7-13, showed most economists expect the BOJ to hold rates steady through September with a small majority forecasting a hike by year-end.
Bloomberg
21-05-2025
- Politics
- Bloomberg
Rice Costs Imperil Ishiba After Bragging Minister Quits in Japan
By and Eddy Duan Save During Japan's Edo period, feudal lords were warned that peasant revolts start with rice. Prime Minister Shigeru Ishiba is finding political survival can still hinge on the price of the staple food. The cost of rice has more than doubled over the past year, straining household budgets and forcing people to find alternatives. It's gotten so bad that some schools are cutting back on rice-based school lunches, a drastic move in a country where the meals are seen as key to raising healthy children.
