Gas prices in the United States fell below $4 a gallon on Thursday, retreating to their lowest level since March, a sign of relief for Americans struggling with historically high inflation and a political boost for President Biden, who has been under pressure to do more to bring down prices.
The national average cost of a gallon of regular gasoline now stands at $3.99, according to AAA. That’s still higher than it was a year ago but well below a peak of nearly $5.02 in mid-June. The average price has fallen for 58 consecutive days.
Energy costs feed into broad measures of inflation, so the drop is also good news for policymakers who have struggled to contain rising prices. It is a welcome development for Mr. Biden, who has spent recent weeks trumpeting the drop in gasoline prices, even as he pledges to do more to bring costs down. Mr. Biden has criticized oil companies for their record profits, and this year he released some of the nation’s stockpile of oil in an effort to reduce price pressures.
cost of gasoline at the pump is determined by global oil prices, which have tumbled to their lowest point since the war in Ukraine began in February, a drop that reflects in part the growing concern of a worldwide recession that will hit demand for crude.
said in a statement, citing it as one example of recent “encouraging economic developments.”
Understand the Decline in U.S. Gas Prices
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Understand the Decline in U.S. Gas Prices
Demand is pushing prices down. As gas prices rose, people adjusted their driving habits to accommodate prices, which reached an all-time high in June. Fewer drivers on the road has made gasoline more affordable, and some states have also suspended taxes on gasoline to bring prices down.
Understand the Decline in U.S. Gas Prices
Oil prices have fallen. Just two months ago, oil prices, which are tied to gas prices, surpassed $120 a barrel, helping to push the national average price of gasoline to about $5 a gallon. But prices have steadily decreased with increased oil production, helping to bring gas prices down and easing broader recession fears.
Understand the Decline in U.S. Gas Prices
Gas prices vary. Despite the overall decline, the cost of gas can vary considerably at the state level. In California, regulations to limit pollution make driving more expensive, so gas prices will be higher than in a state like Georgia, which has lower gas taxes.
Understand the Decline in U.S. Gas Prices
A political boost for Joe Biden. The cheaper prices are a political win for President Biden, especially as falling fuel costs have brought down overall inflation. But experts are unsure that the low prices will last, as oil prices are volatile and determined by myriad forces, many of which are hard to predict.
For consumers, falling gas prices offer a respite from a shaky economy, rapid inflation and other worries. “We have new rising diseases and inflation, and people expect a recession,” said Zindy Contreras, a student and part-time waitress in Los Angeles. “If I just had to not worry about my gas tank taking up $70, that’d be a huge relief, for once.”
Ms. Contreras has been filling up her 2008 Mazda 3 only halfway as a result of the higher prices, costing her $25 to $30 each visit to the pump, and she had found opportunities to car-pool with friends. These days, Ms. Contreras usually gets gas twice a week, driving 15 miles to and from work each week and an additional 10 to 50 miles a week, depending on her plans.
The national average price masks wide regional variations. Prices vary according to the health of local economies, proximity to refineries and state taxes, said Devin Gladden, a spokesman with AAA.
weaker demand because of high costs, a sharp decline in global oil prices in recent months and the suspension of taxes on gasoline in a handful of states.
Nearly two-thirds of people in a recent AAA survey said they had altered their driving habits because of high prices, mostly by taking fewer trips and combining errands. On Thursday, the Organization of the Petroleum Exporting Countries revised down its forecast for global oil demand this year.
Regardless of the causes, the lower prices are a welcome change for drivers for whom the added expense — often $10 to $15 extra for a tank of gas — had become yet another hurdle as they sought to get their lives back to normal as the coronavirus pandemic eased.
“The affordability squeeze is becoming very real when you see these high prices at the gas pump,” said Beth Ann Bovino, the U.S. chief economist at S&P Global. “So, in that sense, it’s a positive sign certainly for those folks that are struggling.”
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That cushion — cash not spent on gasoline that can go elsewhere — also extends to businesses, particularly as the price of diesel fuel drops. Diesel, which is used to fuel, for instance, farm equipment, construction machinery and long-haul trucks, has also fallen from a June record, though at a slower pace than gasoline prices.
The drop in the price of gas is also good news for the economy, as businesses face less pressure to pass energy costs on to their customers — a move that would add to the country’s inflation problem.
hurricanes later this year could damage Gulf Coast refineries and pipelines, choking off supplies.
For now, though, the steady drop in the cost of fuel offers Americans a reprieve.
“If gasoline prices stay at or near the levels they have reached, that would mean much more cushion for households,” Ms. Bovino said.
Plastic letters arranged to read “Inflation” are placed on U.S. Dollar banknote in this illustration taken, June 12, 2022. REUTERS/Dado Ruvic/Illustration
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LONDON, June 26 (Reuters) – The world’s central bank umbrella body, the Bank for International Settlements (BIS), has called for interest rates to be raised “quickly and decisively” to prevent the surge in inflation turning into something even more problematic.
The Swiss-based BIS has held its annual meeting in recent days, where top central bankers met to discuss their current difficulties and one of the most turbulent starts to a year ever for global financial markets.
Surging energy and food prices mean inflation in many places is now its hottest in decades. But the usual remedy of ramping up interest rates is raising the spectre of recession, and even of the dreaded 1970s-style “stagflation”, where rising prices are coupled with low or negative economic growth.
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“The key for central banks is to act quickly and decisively before inflation becomes entrenched,” Agustín Carstens, BIS general manager, said as part of the body’s post-meeting annual report published on Sunday.
Carstens, former head of Mexico’s central bank, said the emphasis was to act in “quarters to come”. The BIS thinks an economic soft landing – where rates rise without triggering recessions – is still possible, but accepts it is a difficult situation.
“A lot of it will depend on precisely on how permanent these (inflationary) shocks are,” Carstens said, adding that the response of financial markets would also be crucial.
“If this tightening generates massive losses, generates massive asset corrections, and that contaminates consumption, investment and employment – of course, that is a more difficult scenario.”
World markets are already suffering one of the biggest sell-offs in recent memory as heavyweight central banks like the U.S. Federal Reserve – and from next month the ECB – move away from record low rates and almost 15 years of back-to-back stimulus measures.
Global stocks (.MIWD00000PUS) are down 20% since January and some analysts calculate that U.S. Treasury bonds, the benchmark of world borrowing markets, could be having their biggest losing first half of a year since 1788.
Carstens said the BIS’s own recent warnings about frothy asset prices meant the current correction was “not necessarily a complete surprise”. That there hadn’t been “major market disruptions” so far was also reassuring, he added.
Part of the BIS report published already last week said that the recent implosions in the cryptocurrency markets were an indication that long-warned-about dangers of decentralised digital money were now materialising.
Those collapses aren’t expected to cause a systemic crisis in the way that bad loans triggered the global financial crash. But Carstens stressed losses would be sizeable and that the opaque nature of the crypto universe fed uncertainty.
Returning to the macro economic picture, he added that the BIS didn’t currently expect a period of widespread stagflation to take hold.
He also said that though many global central banks and the BIS itself had significantly underestimated how quick global inflation has spiralled over the last six to 12 months, they weren’t about to lose hard-earned credibility overnight.
“Yes, you can argue a little bit here about an error of timing of certain actions and the responses of the central banks. But by and large, I think that the central banks have responded forcefully in a very agile fashion,” Carstens said.
“My sense is that central banks will prevail at the end of the day, and that would be good for their credibility.”
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Reporting by Marc Jones; Editing by David Holmes
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WASHINGTON — When President Biden signed a modern-day Lend-Lease Act on Monday, 81 years after the original version helped lead the way into World War II, he effectively thrust the United States even deeper into another war in Europe that has increasingly become an epic struggle with Russia despite his efforts to define its limits.
Recent days have underscored just how engaged the United States has become in the conflict in Ukraine. In addition to the new lending program, which will waive time-consuming requirements to speed arms to Ukraine, Mr. Biden has proposed $33 billion more in military and humanitarian aid, a package that congressional Democrats plan to increase by another $7 billion. He sent the first lady for a secret visit to the war zone. And he provided intelligence helping Ukraine to kill a dozen generals and sink Russia’s flagship.
But even after two and a half months, Mr. Biden is still anxious about looking like the United States is fighting the proxy war that President Vladimir V. Putin of Russia says it is. While Mr. Biden publicly sends aid and signed the lend-lease bill on camera, off camera he was livid over leaks about the American intelligence assistance to Ukraine that led to the deaths of Russian generals and the sinking of the cruiser Moskva out of concern that it would provoke Mr. Putin into the escalation Mr. Biden has strenuously sought to avoid.
After reports in The New York Times and NBC News about the intelligence, Mr. Biden called Defense Secretary Lloyd J. Austin III; Avril D. Haines, the director of national intelligence; and William J. Burns, the C.I.A. director, to chastise them, according to a senior administration official. That seemed to be where Mr. Biden was drawing a line — providing Ukraine with guns to shoot Russian soldiers was OK, providing Ukraine with specific information to help them shoot Russians was best left secret and undisclosed to the public.
“There’s this constant balancing act the administration has been trying to strike between supporting Ukraine and making sure it can defend itself militarily and at the same time being very concerned about escalation,” said Alina Polyakova, the president of the Center for European Policy Analysis and a specialist on Russia policy.
“It’s increasingly untenable to maintain this kind of hand-wringing,” she added. “It’s probably more effective to say this is what our policy is and we will deal and manage the potential escalation responses we see from the Kremlin.”
From the start of the war, the administration sought to parse its response, deciding which weapons could be called defensive and therefore were acceptable to send to Ukraine and which ones could be called offensive and therefore should not be delivered.
But the line has shifted in recent weeks with the administration shipping ever more sophisticated military equipment and expressing more openly its ambitions not just to help the Ukrainians but to defeat and even enfeeble Russia. After a visit to the war-torn capital, Kyiv, two weeks ago, Mr. Austin declared that “we want to see Russia weakened to the degree that it can’t do the kinds of things” it has done in Ukraine again, while Speaker Nancy Pelosi said during her own subsequent trip to Kyiv that America “will stand with Ukraine until victory is won.”
Some veteran government officials said Mr. Biden was right to be cautious about too overtly poking Mr. Putin because the consequences of an escalation with a nuclear-armed Russia are too devastating to take chances with.
“Putin wants us to make it a proxy war,” said Fiona Hill, a former Russia adviser to two presidents now at the Brookings Institution. “Putin is still telling people outside Europe this is just a repeat of the Cold War, nothing to look at here. This isn’t a proxy war. It’s a colonial land grab.”
Michael A. McFaul, a former ambassador to Russia now at Stanford University, said there was a difference between clandestinely helping Ukrainian forces target Russian forces and flaunting it. “Yes, Putin knows that we are providing intelligence to Ukraine,” he said. “But saying it out loud helps his public narrative that Russia is fighting the U.S. and NATO in Ukraine, not just the Ukrainians. That doesn’t serve our interests.”
Angela Stent, a former national intelligence officer on Russia and the author of a book on American relations with Mr. Putin, said being too open about what the United States was doing in Ukraine could undermine efforts to turn China, India and other countries against Russia. “For global public opinion, it’s not a good idea,” she said. “They should do whatever they do, but not talk about it.”
Mr. McFaul said he also believed it undermined Ukrainians, making it look like they were dependent on the Americans, a concern that Mr. Biden was said to share in his phone calls with his security officials, which were first reported by the Times columnist Thomas L. Friedman.
But others said the administration has been too cautious in letting Russia set the rules of the conflict — or rather Washington’s guesswork about what would push Russia into escalation. No one in Washington really knows the line that should not be crossed with Mr. Putin, and instead the United States has simply been making assumptions. “Are we having a conversation about red lines with ourselves?” asked Frederick W. Kagan, a military scholar at the American Enterprise Institute. “Because I rather think we are.”
The consequence, he added, is being too slow to provide what Ukraine really needs. “They’ve done amazingly well at making stuff happen in a relatively timely fashion,” Mr. Kagan said of the Biden administration. “But there does seem to be a certain brake on the timeliness of our support driven by this kind of parsing and self-negotiation that is a problem.”
The legislation that Mr. Biden signed on Monday reflected the historical echoes and reversals of the current war. President Franklin D. Roosevelt signed the original Lend-Lease Act in 1941 to help the British fend off Nazi aggressors in World War II, and it was later expanded to help other allies — including the Soviet Union.
Now, Moscow will be on the other side of the arms channel as the modern-day version, called the Ukraine Democracy Defense Lend-Lease Act, will direct weapons and equipment not to Russian soldiers but to those fighting them.
“Every day, Ukrainians pay with their lives,” Mr. Biden said in the Oval Office as he approved the legislation. “And the atrocities that the Russians are engaging in are just beyond the pale. And the cost of the fight is not cheap, but caving to aggression is even more costly. That’s why we’re staying in this.”
Mr. Biden signed the law on the same day that Russia celebrated Victory Day, the 77th anniversary of the allied defeat of Nazi Germany, a feat facilitated in part by the original Lend-Lease Act.
“This day is supposed to be about celebrating peace and unity in Europe and the defeat of Nazis in World War II,” said Jen Psaki, the White House press secretary. “And instead, Putin is perverting history, changing history, or attempting to change it, I should say, to justify his unprovoked and unjustified war.”
The lending program came as congressional Democrats moved quickly to consider the $33 billion aid package proposed by Mr. Biden and indicated they would increase it substantially. With Republicans pushing to add more military spending, Democrats insisted on an equal boost for humanitarian aid, nudging the price tag to $39.8 billion, according to two people familiar with the proposal who previewed it on the condition of anonymity.
Ms. Pelosi and Senator Chuck Schumer of New York, the Democratic majority leader, spoke by telephone with Mr. Biden on Monday as they finalized the details of the proposal, one of the people said. House leaders want to bring up the measure as early as Tuesday.
The increase reflects a striking consensus in both parties to pour vast amounts of money into the war against Russia, even as lawmakers remain deeply divided on domestic spending. In March, Congress approved $13.6 billion in emergency aid for Ukraine, and Mr. Biden has warned that those resources would run out soon without new legislation.
It was not clear, however, whether Republicans, whose support would be needed in the Senate, had agreed on the specifics of the proposal. A spokeswoman for Republicans on the Senate Appropriations Committee said that a deal had not been reached, but that discussions were continuing.
Democrats plan to advance the package separately from the administration’s emergency coronavirus aid measure, which has become snarled in an election-year dispute over immigration restrictions.
“We cannot afford delay in this vital war effort,” Mr. Biden said in a statement. “Hence, I am prepared to accept that these two measures move separately, so that the Ukrainian aid bill can get to my desk right away.”
ODESSA, Ukraine — Ukrainian forces carried out counter-offensives against Russian positions on Wednesday, seeking to inflict what one official called “maximum losses,” even as the invading Russian military stepped up its lethal attacks on cities.
In Mariupol, an airstrike destroyed a theater where about 1,000 people had taken shelter, according to city and regional administrators, and photos and videos posted online showed the burning wreckage of the building. Officials in Mariupol, the besieged southern city that has suffered the most intense bombardment, said they could not yet estimate the number of casualties among civilians, who might have been in a bomb shelter beneath the theater.
After falling back under a relentless pounding over the war’s first weeks, Ukrainian troops tried to regain some momentum with counterattacks on Russian positions outside of Kyiv and in the Russian-occupied city of Kherson, in Ukraine’s south, a senior Ukrainian military official said.
Rather than seek to regain lost territory, Ukrainian forces tried to cause as much destruction and death as possible, attacking Russian troops and equipment with tanks, fighter jets and artillery, the official said, speaking on condition of anonymity to discuss sensitive military information.
“In the task of inflicting maximum losses, we’ve done excellently,” the official said.
While President Volodymyr Zelensky of Ukraine pleaded with Congress for more aid and President Biden promised more weaponry, Russia’s President Vladimir V. Putin falsely accused Ukraine of seeking weapons of mass destruction and asserted that what he called an “economic blitzkrieg” by the West, aimed at destroying Russia, had failed.
Mr. Putin also sneered at Russians who oppose the war, saying the Russian people could distinguish “true patriots from the scum and the traitors, and just to spit them out like a midge that accidentally flew into their mouths.”
Ukrainian and Russian negotiators held a third consecutive day of talks on a possible settlement to the conflict, and in typical fashion, the Kremlin left a muddy picture of its intentions. Mr. Putin’s bellicose, often false statements, larded with World War II references, clashed with more conciliatory comments from his underlings.
But little appeared to have changed on the battlefield. The war in Ukraine, about to enter its fourth week, has become a grinding daily slog with little evidence of significant gains for either side.
Details of the Ukrainian offensive could not be fully established independently, though several top Ukrainian officials, including key aides to Mr. Zelensky, confirmed that the counterattacks were underway.
In Kyiv, missile strikes and heavy artillery sounded overnight and in the early morning on Wednesday in exchanges in the outlying suburbs that were notably heavier and louder than in previous days. Two people were wounded and a residential building was damaged in a strike that landed near the city zoo, the second time in two days that shells have landed close to the city center.
Satellite pictures from Tuesday showed heavy black smoke above the Kherson airport, where the senior military official said Ukrainian forces had targeted parked Russian military aircraft.
Kherson was the first (and so far, only) major city to be fully taken over by Russian forces, which have turned it into a forward military base from which they have launched attacks on surrounding cities and villages, according to Ukrainian officials. On Tuesday, the Russian Defense Ministry announced that it had taken control of the entire Kherson region, giving Russian forces a significant foothold in southern Ukraine that Ukraine’s military will have difficulty dislodging.
Even so, neither side can be said to have made much progress militarily. The Institute for the Study of War, which has been tracking developments closely, noted in a Tuesday evening assessment that, for nearly two weeks, Russian forces have not been conducting extensive simultaneous attacks that would allow them to seize control of multiple areas at once in Ukraine. And they are unlikely to do so in the next week, it said.
In the absence of significant military gains, Russian forces on Wednesday continued a campaign of terror against Ukrainian civilians.
At least 10 people were killed when a Russian strike hit a bread line in Chernihiv, a city north of Kyiv that has been subject to intense shelling by Russian troops seeking to move on the capital. Ukraine’s prosecutor general’s office said in a statement that the attack occurred at about 10 a.m. as people were lined up at a grocery store. Photos released by the prosecutor’s office showed several bodies scattered around a dirt yard.
Using heavy artillery, cruise missiles and fighter jets, Russian forces have systematically targeted civilian areas with no military presence, striking apartment buildings, schools and hospitals in cities and villages all over a broad front in the north, east and south of Ukraine. The attacks may have killed thousands of civilians, though reaching a precise count of the dead has been impossible.
Saying it was “profoundly concerned” by Russia’s use of force, the International Court of Justice ordered Russia on Wednesday to suspend its military operations immediately, pending its full review of a case submitted by Ukraine last month. However, the order was not expected to lead to any immediate cessation in the onslaught.
According to the United Nations, at least 726 civilians have been killed, including 64 children, since the invasion began on Feb. 24, though its figures do not include areas where fighting has been heaviest, like Kharkiv and Mariupol. In Mariupol alone, which has been turned into a hellscape of burning and decimated buildings, local authorities say at least 2,400 have been killed, and probably far more.
In Kharkiv, Ukraine’s second largest city, the municipal emergency services agency first reported on Wednesday that 500 civilians had been killed since the war began, but then revised that number to 100 later in the day. In any case, the agency said in statement on Facebook, the true number of deaths could be much higher, noting that emergency workers were continuing to scour the rubble of residential neighborhoods for more bodies, often under fire.
Western defense and intelligence agencies estimate that each side has suffered thousands of combatants killed.
Mr. Zelensky’s appeal to Congress on Wednesday was in part a desperate effort to obtain the weaponry and defenses capable of fending off such attacks. Central to this appeal was a call for a no-fly zone to be imposed over Ukraine, aimed at preventing Russian fighter jets, which cause some of the most severe death and destruction, from operating over Ukrainian territory. “Close the sky” has become a rallying cry for Ukrainian officials and regular citizens.
“Russia has turned the Ukrainian sky into a source of death for thousands of people,” Mr. Zelensky said.
Knowing that the request had little chance of being approved, given that it would thrust American pilots into direct confrontation with the Russians, Mr. Zelensky quickly pivoted to something to which Republicans and Democrats have been far more receptive: asking for more weapons to enable his people to keep up the fight themselves.
Mr. Biden announced $800 million in new military aid to Ukraine, including antiaircraft and antitank missiles, body armor, vehicles, drones and small arms, bringing to $2 billion the amount delivered or pledged since early last year. But as expected, he did not offer to deliver warplanes or enforce a no-fly zone.
The United States and its allies have relied primarily on financial sanctions that are already devastating the Russian economy.
Mr. Putin, in a televised videoconference with top officials, once again falsely described the government in Kyiv, led by a Jewish president and prime minister, as being “pro-Nazi” and on its way to acquiring nuclear weapons. “Their aim, of course, would have been Russia,” he said.
And then he went deeper into unreality, accusing the government in Kyiv of disregard for the suffering of the Ukrainian people that his own forces were bombing every day.
“The fact that people are dying, that hundreds of thousands, millions have become refugees, that there is a real humanitarian catastrophe in cities held by neo-Nazis and armed criminals,” he said. “They’re indifferent.”
Russian officials closer to the talks said Wednesday there had been signs of progress, though even there, the picture was unclear. They said the idea of a neutral Ukraine, with a status like that of Sweden or Austria, was on the table, which their Ukrainian counterparts disputed.
Sergei V. Lavrov, Russia’s foreign minister, told a Russian television network that the status of the Russian language and Russian news outlets in Ukraine were under discussion, and that “there are concrete formulas that are close to being agreed on.”
Mr. Zelensky indicated that he was willing to compromise on one of Russia’s central demands. In his daily video message, he said Ukraine “must recognize” that it would not join NATO. He added that negotiations had become more “realistic.” But one of his negotiators, Mykhailo Podolyak, said Ukraine needed “absolute security guarantees,” including military support from its allies.
Michael Schwirtz reported from Odessa, Ukraine; Valerie Hopkins from Lviv, Ukraine; and Carlotta Gall from Kyiv. Reporting was contributed by Anton Troianovski and Ivan Nechepurenko from Istanbul, and Richard Pérez-Peña from New York.
Russia’s threatened invasion of Ukraine could have economic repercussions globally and in the United States, ramping up uncertainty, roiling commodity markets and potentially pushing up inflation as gas and food prices rise around the world.
Russia is a major producer of oil and natural gas, and the brewing geopolitical conflict has sent prices of both sharply higher in recent weeks. It is also the world’s largest wheat exporter, and is a major food supplier to Europe.
The United States imports relatively little directly from Russia, but a commodities crunch caused by a conflict could have knock-on effects that at least temporarily drive up prices for raw materials and finished goods when much of the world, including the United States, is experiencing rapid inflation.
Global unrest could also spook American consumers, prompting them to cut back on spending and other economic activity. If the slowdown were to become severe, it could make it harder for the Federal Reserve, which is planning to raise interest rates in March, to decide how quickly and how aggressively to increase borrowing costs. Central bankers noted in minutes from their most recent meeting that geopolitical risks “could cause increases in global energy prices or exacerbate global supply shortages,” but also that they were a risk to the outlook for growth.
contending with quickly rising prices, businesses are trying to navigate roiled supply chains and people report feeling pessimistic about their financial outlooks despite strong economic growth.
“The level of economic uncertainty is going to rise, which is going to be negative for households and firms,” said Maurice Obstfeld, a senior fellow at the Peterson Institute for International Economics, noting that the effect would be felt most acutely in Europe and to a lesser degree in the United States.
A major and immediate economic implication of a showdown in Eastern Europe ties back to oil and gas. Russia produces 10 million barrels of oil a day, roughly 10 percent of global demand, and is Europe’s largest supplier of natural gas, which is used to fuel power plants and provide heat to homes and businesses.
The United States imports comparatively little Russian oil, but energy commodity markets are global, meaning a change in prices in one part of the world influences how much people pay for energy elsewhere.
It is unclear how much a conflict would push up prices, but energy markets have already been jittery — and fuel prices have risen sharply — on the prospect of an invasion.
loss of purchasing power over time, meaning your dollar will not go as far tomorrow as it did today. It is typically expressed as the annual change in prices for everyday goods and services such as food, furniture, apparel, transportation and toys.
What causes inflation? It can be the result of rising consumer demand. But inflation can also rise and fall based on developments that have little to do with economic conditions, such as limited oil production and supply chain problems.
Is inflation bad? It depends on the circumstances. Fast price increases spell trouble, but moderate price gains can lead to higher wages and job growth.
Can inflation affect the stock market? Rapid inflation typically spells trouble for stocks. Financial assets in general have historically fared badly during inflation booms, while tangible assets like houses have held their value better.
If a conflict drives global uncertainty and causes investors to pour money into dollars, pushing up the value of the currency, it could actually make United States imports cheaper.
Other trade risks loom. Unrest at the nexus of Europe and Asia could pose risk for supply chains that have been roiled by the pandemic.
Phil Levy, the chief economist at Flexport, said that Russia and Ukraine were far less linked into global supply chains than a country like China, but that conflict in the area could disrupt flights from Asia to Europe. That could pose a challenge for industries that move products by air, like electronics, fast fashion and even automakers, he said at an event at the National Press Foundation on Feb. 9.
“Air has been a means of getting around supply chain problems,” Mr. Levy said. “If your factory was going to shut because you don’t have a key part, you might fly in that key part.”
Some companies may not yet realize their true exposure to a potential crisis.
Victor Meyer, the chief operating officer of Supply Wisdom, which helps companies analyze their supply chains for risk, said that some companies were surprised by the extent of their exposure to the region during the Russian invasion of Ukraine in 2014, when it annexed Crimea.
Mr. Meyer noted that if he were a chief security officer of a company with ties to Ukraine, “I would militate rather strongly to unwind my exposure.”
There could also be other indirect effects on the economy, including rattling consumer confidence.
Households are sitting on cash stockpiles and probably could afford higher prices at the pump, but climbing energy costs are likely to make them unhappy at a moment when prices overall are already climbing and economic sentiment has swooned.
“The hit would be easily absorbed, but it would make consumers even more miserable, and we have to assume that a war in Europe would depress confidence directly too,” Ian Shepherdson at Pantheon Macroeconomics wrote in a Feb. 15 note.
Another risk to American economic activity may be underrated, Mr. Obstfeld said: The threat of cyberattack. Russia could respond to sanctions from the United States with digital retaliation, roiling digital life at a time when the internet has become central to economic existence.
“The Russians are the best in the world at this,” he said. “And we don’t know the extent to which they have burrowed into our systems.”
Products are displayed at a Levi Strauss store in New York, U.S., March 19, 2019. REUTERS/Shannon Stapleton/File Photo
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Jan 26 (Reuters) – Levi Strauss & Co (LEVI.N) forecast annual sales and profit above analysts’ estimates after topping quarterly results on Wednesday, bolstered by higher prices and strong demand for its jeans and jackets, sending its shares up 8% after the bell.
People shopping for casual outdoor clothing as pandemic restrictions eased and a resurgence in retro fashion styles such as high-rise and loose-fitting jeans have buoyed demand for the company’s denims.
The Signature and Levi’s 501 jeans maker said it expects revenue between $6.4 billion and $6.5 billion in fiscal year 2022, compared with analysts’ estimates of $6.37 billion, according to Refinitiv IBES data.
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The robust demand has, however, coincided with increased production and shipping costs, forcing companies to raise prices to offset the inflationary pressures.
Levi plans to raise prices further in 2022 and beyond, Chief Executive Officer Chip Bergh said on a call with analysts, adding that demand outstripped supply in the quarter due to supply chain snarls.
Lower promotions, more full-price selling and the reopening of its European and Asian markets also lifted the Denizen brand owner’s sales in the reported quarter.
Compared to pre-pandemic levels, Asia net revenue was flat in the three months ended Nov. 28, recovering from a 23% slump reported in the third quarter.
Net revenue rose 22% to $1.69 billion in the fourth quarter, edging past analysts’ estimate of $1.68 billion.
Excluding items, Levi earned 41 cents per share, a cent above expectations.
Holiday season sales came in above its expectations, the company said, in contrast to downbeat estimates from retailers including Lululemon Athletica Inc (LULU.O) and Abercrombie & Fitch Co (ANF.N). read more
San Francisco-based Levi expects adjusted full-year profit per share between $1.50 and $1.56, compared with estimates of $1.52.
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Reporting by Deborah Sophia in Bengaluru; Editing by Vinay Dwivedi and Sriraj Kalluvila
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ROME — Early this month, Silvio Berlusconi sat at a dining room table in his mansion with his girlfriend, more than a half-century younger, and an old political ally. As they feasted on a pumpkin souffle and truffle tagliatelle, the 85-year-old Italian former prime minister and billionaire made hours of phone calls, working his way down a list of disaffected lawmakers he hoped to persuade to elect him president of Italy next week.
“‘We are forming the Bunga Bunga party and we want you with us,’” Christian Romaniello, a lawmaker formerly with the anti-establishment Five Star Movement, recounted Mr. Berlusconi as saying, referring to the sex-fueled bacchanals that Mr. Berlusconi has deemed merely “elegant dinners.” According to Mr. Romaniello, Mr. Berlusconi then added, “‘But I’ll bring the ladies.’”
The Italian presidency, the country’s head of state, is a seven-year position usually filled by a figure of unimpeachable integrity and sobriety whose influence flows from moral authority. The current holder, Sergio Mattarella, is a quiet statesman whose brother was murdered by the mob. Another contender is Mario Draghi, the prime minister and a titan of European politics who has led the country to a period of unusual stability.
Then there is Mr. Berlusconi, who despite his recent bad health, waxen appearance and weakened political standing, is making an unabashed push to win a career-culminating position that he hopes will wash away decades of stains — his allies say unjustly thrown mud — and rewrite his legacy.
mob links and bribing lawmakers; the tax fraud conviction; the ban from office; the sentence to perform community service in a nursing home; his use of his media empire for political gain; his use of the government to protect his media empire; the wiretapped conversations of his libertine party guests regaling the Caligulan extent of his bunga bunga debaucheries; his close relationship with the Russian president, Vladimir V. Putin, who gifted Mr. Berlusconi a large bed; his appraisal of Barack Obama as “young, handsome and sun tanned”; his comparing a German lawmaker to a concentration camp guard; his second wife’s divorcing him for apparently dating an 18-year-old.
It’s an unorthodox résumé.
Mr. Berlusconi’s conflicts of interest, judicial problems and past behavior made him less than an excellent candidate, said Emma Bonino, a veteran Italian politician and civil rights activist who once ran for the office herself. “I don’t think he would give a good image of our country in the world,” she said.
Mr. Berlusconi declined to comment for this article. But he and his team of longtime advisers are selling him as a moderate, pro-European champion of democracy and can-do capitalism. “I think Silvio Berlusconi can be useful to the country,” Mr. Berlusconi, speaking of himself in the third person, said in October.
In usual fashion, he is using all the levers at his disposal to reach the requisite majority of 505 votes in the secret balloting for the presidency among lawmakers that starts on Monday.
read the headline) and published an insert on his qualities (“hero of liberty”). Weeks ago, lawmakers opening their mailboxes found a photograph of Mr. Berlusconi, arms up and bathing in adoration, on the cover of an anthology of his speeches.
the great-grandfather has remained the father figure of the center-right, which now has — if united — the largest bloc of lawmaker electors in Parliament and a strong desire to choose the next president.
But Mr. Berlusconi’s insistence has caused a major headache for Matteo Salvini, the leader of the nationalist League party, both at work and at home. Mr. Salvini’s girlfriend is the daughter of Denis Verdini, one of Mr. Berlusconi’s closest advisers, who is publicly applying pressure — from house arrest after his conviction in a bankruptcy fraud case — to elect Mr. Berlusconi.
After years of promising Mr. Berlusconi that he would back his candidacy for president, Mr. Salvini sent a stinging message to Mr. Berlusconi this week, saying that, “We must verify if Berlusconi has the numbers before the start of voting next week.” Mr. Salvini indicated that he had somebody else in mind.
Giorgia Meloni, the hard-right leader of Brothers of Italy, the third party in the center-right alliance, spoke on Tuesday of the possibility of Mr. Berlusconi’s stepping aside, prompting speculation that he might drop out.
the cover of Espresso magazine.
For all Mr. Berlusconi’s seeming unsuitability to fill the role of head of state, his allies argue that Italians elected him multiple times, that political considerations motivated the magistrates who hounded him for decades and that he was a self-made and brilliant businessman who built an empire.
But his outsize appetites and self-interested use of power fueled a backlash that seeded and grew the enormous anti-establishment Five Star Movement, co-founded by the comedian Beppe Grillo, who once derided Mr. Berlusconi as a “psychotic dwarf.”
Five Star took power in 2018 as Italy’s leading party, and Mr. Berlusconi’s support dwindled. He took a back seat to the rising nationalists, first Mr. Salvini and then Ms. Meloni, and railed against Five Star as incompetent good-for-nothings and a threat to democracy. He mocked their trademark universal welfare plan as a joke. He called their power structure communist.
Five Star has since imploded and scattered members into a mixed group of lawmakers desperate to avoid new elections that would almost certainly cost them their jobs and pensions. Mr. Berlusconi has explicitly promised to keep the legislature going as president, has called the universal income plan good for the poor and showered gifts on former rivals.
Luigi Di Maio, the Five Star leader who once refused to join any government with Mr. Berlusconi, this Christmas accepted a centuries-old oil painting of Venice from the mogul’s collection, according to a person close to Mr. Di Maio, who declined to comment.
As Mr. Berlusconi worked the phones alongside his girlfriend, who is also a member of Parliament in his political party, he sat next to Vittorio Sgarbi, one of his former ministers and a lawmaker and television personality who is well liked by many Five Star members.
When Mr. Sgarbi called Mr. Romaniello, the former Five Star lawmaker, who was interrupted while making Carnevale masks with his two small children, he jokingly introduced Mr. Berlusconi as “a Grillo-following friend.”
In an interview, Mr. Romaniello said that he was flattered by the call and added that friends contacted by Mr. Berlusconi also respected the former prime minister’s phone banking and “positive charisma.” But Mr. Romaniello said that he still considered himself, politically, “an adversary,” adding that Five Star had been born “as the antithesis of Berlusconi.” A phone call, he said, would not win his vote.
By Tuesday, even Mr. Sgarbi had bailed on Mr. Berlusconi and was urging him to be a kingmaker.
“I don’t think he can do it,” he said in an interview, saying that the duo had only persuaded about 15 lawmakers to back him, far short, even if he had a base of about 450 conservative supporters, to win the election. “It’s useless to try if you don’t have the numbers.”
On Wednesday, as Mr. Berlusconi’s lawyers in Milan successfully argued for a delay in a bribery trial related to his bunga bunga tribulations until after the presidential vote, his team snapped back and vowed that he would persist and, as always, speak for himself.
“I will not disappoint those who have trusted me,” Mr. Berlusconi said.
For the photographer Herlinde Koelbl, the end of Angela Merkel’s tenure as Germany’s chancellor isn’t just the end of a political era — it’s also the end of one of the longest-running art projects in world politics.
Since 1991, Ms. Koelbl has visited Ms. Merkel almost every year to take two portraits for a project, “Traces of Power,” that aimed to understand how politics changes people’s appearance and character.
“She was shy when I first photographed her, and a bit awkward,” Ms. Koelbl, 82, recalled in a recent telephone interview. “She told me, ‘I’m not used to being photographed all the time. I don’t know what to do with my arms and hands.’”
The photographer initially chose 15 politicians for the project, including established names like Gerhard Schröder, who went on to become Germany’s chancellor in 1998. Ms. Merkel, a former scientist, immediately stood out, not least for her lack of vanity.
For their early photos, Ms. Merkel wore no makeup and “didn’t seem to pay any attention to what she was wearing” unlike some of Ms. Koelbl’s other sitters. Fashion “just wasn’t important to her,” Ms. Koelbl said. “For her, what was important was what she was doing: the work.”
As Ms. Merkel gained confidence as a politician, she started to relax in front of the camera, Ms. Koelbl said. In 1998, she posed with her hands in a diamond shape for the first time — something that would become a trademark gesture.
Ms. Koelbl said she thought there was a simple reason behind her use of the diamond: Pushing her thumbs together forced her shoulders up, making her look engaged. “If you have to stand and listen for hours to speeches, you look very attentive, even when you’re not,” Ms. Koelbl said.
During the first eight years of the project, Ms. Koelbl also interviewed Ms. Merkel at length, asking probing questions about her political ambitions, as well as others that seemed more suited to therapy sessions.
In 1993, she asked Ms. Merkel how she coped when feeling rejected, and whether there were any childhood situations in which she had felt powerless. (Ms. Merkel replied by mentioning the day her parents had learned about the construction of the Berlin Wall and her mother broke down in tears. “I wanted to help them, to make them happy again, but I couldn’t,” she said).
Ms. Koelbl stopped “Traces of Power” in 1999, but after Ms. Merkel became chancellor in 2005 decided to return to photographing her. Ms. Merkel no longer had time for interviews, but agreed to sit for photos once a year until she left office, and the pictures were all published in a book this year.
The recent photos show Ms. Merkel as the politician so well-known today: wearing pants and blazers, staring calmly into the lens. But Ms. Koelbl insists that the leader’s appearance has kept changing over the years.
“In the beginning, she had very lively eyes,” Ms. Koelbl said, “and now she looks at you, but the liveliness is gone. The glow disappeared in her eyes.”
Ms. Koelbl insisted that the change didn’t mean that becoming chancellor was a bad thing. “I think that’s just part of the tribute you have to pay if you get this job,” she said.
“Unless we want to look like a museum, we had to change and change pretty radically,” he added.
For the past year, Ms. Wintour has been focused on the next step of the process: turning seven of Condé Nast’s biggest publications — Vogue, GQ, Wired, Architectural Digest, Vanity Fair, Condé Nast Traveler and Glamour — into global brands, each under one leader, cutting costs and streamlining the sharing of content across both print magazines and digital platforms.
“Instead of having 27 Vogues or 10 Vogues go after one story, we have one global Vogue go after it,” Ms. Wintour said. “So it’s more like a global newsroom with different hubs.”
The switch in focus from local to global has not gone down well everywhere. Tina Brown, the former editor of The New Yorker and Vanity Fair, filleted the plan as “suicidal” in an interview in August with The Times of London.
“Obviously there are some stories that work, particularly if you think about fashion, that’s a global language, and music, so there are stories that will work across all territories and then those that absolutely won’t,” Ms. Wintour said. “We’re very aware of that.”
Ms. Wintour is also ensuring that there are unlikely to be any more Anna Wintours — no more imperial editors in chief each with their own fiefs, a job Ms. Wintour herself helped create as a stylish but exacting gatekeeper of fashion and culture. The brands are now run by “global editorial directors,” most of whom are based in New York, with regional heads of content reporting to them.
“Before, you created stories for publication and it came out once a month and that was great,” she said, describing the old domain of an editor in chief. Now the global editorial directors and heads of content are working across platforms that include “digital, video, short and long form, social, events, philanthropic endeavors, membership, consumer, e-commerce,” Ms. Wintour said.
“You touch so many different worlds,” she added. “Honestly, who wouldn’t want that job?”
In the midst of the change at Condé Nast, plenty of people decided they didn’t.
ROME — In a wrenchingly familiar cycle of tracking first cases, pointing fingers and banning travel, nations worldwide reacted Monday to the Omicron variant of the coronavirus in the piecemeal fashion that has defined — and hobbled — the pandemic response all along.
As here-we-go-again fear and resignation gripped much of the world, the World Health Organization warned that the risk posed by the heavily mutated variant was “very high.” But operating once again in a vacuum of evidence, governments chose approaches that differed between continents, between neighboring countries, and even between cities within those countries.
Little is known about Omicron beyond its large number of mutations; it will be weeks, at least, before scientists can say with confidence whether it is more contagious — early evidence suggests it is — whether it causes more serious illness, and how it responds to vaccines.
In China, which had been increasingly alone in sealing itself off as it sought to eradicate the virus, a newspaper controlled by the Communist Party gloated about democracies that are now following suit as Japan, Australia and other countries gave up flirting with a return to normalcy and slammed their borders shut to the world. The West, it said, had hoarded vaccines at the expense of poorer regions, and was now paying a price for its selfishness.
announced that government employees, health care workers and staff and students at most schools must be vaccinated by Jan. 22.
tied to a single soccer team — and Scotland reported six, while the numbers in South Africa continued to soar.
Experts warned that the variant will reach every part of the world, if it hasn’t already.
The leaders of the world’s top powers insisted that they understood this, but their assurances also had a strong whiff of geopolitics.
President Xi Jinping of China offered one billion doses of Covid vaccine to Africa, on top of nearly 200 million that Beijing has already shipped to the continent, during an address to a conference in Senegal by video link.
The Global Times, a Chinese tabloid controlled by the Communist Party, boasted of China’s success in thwarting virus transmission, and said the West was now paying the price for its selfish policies. “Western countries control most of the resources needed to fight the Covid-19 pandemic,” it wrote. “But they have failed to curb the spread of the virus and have exposed more and more developing countries to the virus.”
told France Inter radio on Monday that variants would continue to emerge unless richer countries shared more vaccines. “We need a much more systemic approach,” she said.
“zero Covid” strategy.
China has steadfastly kept a high wall against visitors from the rest of the world. Foreign residents and visa holders are allowed in only under limited circumstances, leading to concerns by some within the business world that Covid restrictions were leaving the country increasingly isolated.
Visitors must submit to two-week quarantines upon arrival and face potential limits on their movement after that. Movements are tracked via monitoring smartphone apps, which display color codes that can signal whether a person has traveled from or through an area with recent infections, triggering instructions to remain in one place.
In other parts of Asia, people are less focused on eradicating the virus than just surviving it.
“This news is terrifying,” said Gurinder Singh, 57, in New Delhi, who worried about his shop going under. “If this virus spreads in India, the government will shut the country again, and we will be forced to beg.”
Reporting was contributed by Declan Walsh from Nairobi, Patrick Kingsley from Jerusalem, Carlos Tejada from Seoul, Sameer Yasir from Srinagar, India, Lynsey Chutel from South Africa, Aurelien Breeden from Paris, Elian Peltier and Monika Pronczuk from Brussels, Megan Specia from London, Christopher F. Schuetze from Berlin, Emma Bubola from Rome and Nick Cumming-Bruce from Geneva.