“China’s Producer Price Index, which tracks what manufacturers charge wholesalers, is up 10.7%, which is the highest it’s been since they began recording in the mid-90s. China has been experiencing power shortages, and there is a global commodities rally, meaning it is costing manufacturers a lot more to produce goods. Currently it doesn’t seem this price inflation is being passed onto consumers but there’s only so long wholesalers can absorb these cost increases.
Q3 2021 hedge fund letters, conferences and more
Global Inflation Is Rising
Worth noting that inflation across the globe is rising – last week we saw interest rates in New Zealand rise for the first time in seven years in a measure to combat higher inflation. And we’re running ahead of target here in the UK too.
Inflation, trade issues and commodity prices are all weighing on markets this week. Apple shares slumped yesterday as the firm revealed the production of the iPhone 13 had been impacted by global computer chip shortages, but on the other hand you have the backdrop of commodity companies – oil and gas firms – that are riding high thanks to low supply and high demand. Highest risers on the FTSE today are natural resources and mining firms Rio Tinto, Glencore, Anglo American, Antofagasta and BHP.”
Article by Emma Wall, Head of Investment Analysis at Hargreaves Lansdown
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