When will the haze of food “crisis” covering the world dissipate?
International Business News – On June 23, German Deputy Chancellor and Minister of Economy and Climate Protection Habeck announced the launch of the second phase of the natural gas shortage emergency plan – the warning phase. Launched in March this year, the contingency plan is divided into three stages: early warning, alert and emergency. During the alert phase, natural gas will be prioritized for storage over power generation. Once it enters the emergency stage, the German government will directly intervene, implement a rationing system for gas supply, give priority to ensuring households, hospitals and important institutions, and limit industrial gas use. Habeck warned that Germany(Nyheter) is now facing a gas crisis “more severe” than the 1973 oil crisis. If the shortage of natural gas continues, Germany will face a “severe winter”, with certain industries facing a catastrophic situation. Last year, 55% of Germany’s natural gas imports came from Russia. Now that Germany wants to get rid of its dependence on Russian natural gas, it will naturally face a shortage. Data released by Germany showed that in the first four months of this year, its natural gas imports fell by 22% year-on-year, while costs soared by 170%. In order to make up for the energy gap, the German government can only find ways to increase income and reduce expenditure, the most important of which is open source.
The Federal Reserve’s aggressive interest rate hikes have cooled demand, and the International Monetary Fund (IMF) has sharply lowered its U.S. economic growth forecast. On June 24, the IMF’s annual assessment report sharply lowered its forecast for U.S. economic growth, as the Federal Reserve’s aggressive interest rate hikes have cooled demand. In its assessment of U.S. economic policy, the IMF lowered its 2022 U.S. gross domestic product (GDP) growth forecast to 2.9 percent from 3.7 percent in April; for 2023, the IMF lowered its U.S. economic growth forecast from 2.3 percent to 1.7%; U.S. growth forecast for 2024 was reduced to 0.8%. IMF President Georgieva believes that tackling inflation is the top priority of the US government. Georgieva said price stability is important to protect U.S. incomes and sustain growth, but consumers may have to go through “some pain” before that can be achieved. According to the latest data released by the University of Michigan, the final value of the US consumer confidence index in June was 50, lower than the initial value of 50.2, and continued to decline from the final value of 58.4 in May, reaching a new low. The Fed is reported to seek an average inflation target of 2 percent, but U.S. inflation is currently more than three times higher than the Fed’s target. With inflation rising sharply and the Federal Reserve raising interest rates, the U.S. faces an increased risk of a recession.
Energy and food prices rose significantly, and Japan’s core CPI rose year-on-year for nine consecutive months. On June 24, data released by Japan’s Ministry of Internal Affairs and Communications showed that Japan’s core consumer price index (CPI), which excludes fresh food, rose by 2.1% year-on-year to 101.6 in May, and Japan’s core CPI has risen year-on-year for nine consecutive months. The rise in crude oil prices in the international market is the main reason for pushing up Japan’s CPI. Data show that the prices of energy commodities in Japan rose sharply in May, with an overall increase of 17.1% year-on-year. Among them, electricity prices rose by 18.6% year-on-year, pipeline natural gas prices rose by 22.3%, and gasoline prices rose by 13.1%. At the same time, the price increase of food and durable consumer goods other than fresh food is also more obvious. The price of food excluding fresh food increased by 2.7% year-on-year, and the overall price of fresh food increased by 12.3% year-on-year. Japan’s Deputy Chief Cabinet Secretary Kihara Seiji said that high prices have reduced purchasing power and hindered people’s consumption and business development. We must pay close attention to the economic risks brought about by rising prices. Kihara Seiji said that the Japanese government will implement comprehensive emergency measures with a total scale of about 13 trillion yen as soon as possible to deal with rising prices.