The U.S. inflation data for April, released in the past two days, reveal a sharp acceleration, which is reflected today, May 15, in Treasury interest rates not just rising, but “spiking”. By the afternoon, maturities of 5 years, 10 years, and 30 years had all risen by 13-14 basis points, and the 5-year Note had risen by nine basis points.
Consumer price inflation, released May 13, was (under-) estimated by the Bureau of Labor Statistics at 1.2% in the month of April and 3.8% for the year to April. On May 14, producer-price or “wholesale” inflation was announced at 1.4% in April and 6% for the year to April, well above the tame “estimates” from Wall Street. The Bureau also released, as included in wholesale inflation on May 14, “import inflation” (i.e., tariff inflation) at 1.9% for April and 4.2% for the year; and “trade services inflation” May 14, at 2.2% for the month.
Meanwhile India, this year’s chair for the BRICS nation conferences, including the Foreign Ministers’ conference now underway, registered 3.5% annual consumer price inflation in April—but annual producer price inflation was 8.3% for that month, indicating just how much the government, by price caps and other subsidies, is absorbing price increases for gasoline and other fuels. Fuel costs rose 25% for the month of April.
India and the U.A.E. have stood out, within the BRICS, for “soft” but pronounced support for the U.S.-Israeli war. Nonetheless, a total of 13 India-flagged LPG tankers have now crossed the Strait of Hormuz, according to Statesman News Service in India, indicating some BRICS solidarity by Iran, perhaps encouraged by China, whose tankers are also crossing. China’s Foreign Ministry spokesman Guo Jiakun said on May 14 that China is willing to work with all parties to support India in hosting a successful BRICS foreign ministers’ meeting, according to CGTN that day.