Inflation Easing as Chicken-Rice Price to Come Down by End of Month + Bank of America

The widespread view that inflation is a multi-month, or even multi-year, problem may be wrong.

Crude oil, the source of much of the price pressure, has already dropped 18% in two months. Persistently high natgas prices remain a worry.

There may even be deflation as fossil fuel prices ease.

In Asia, chicken-rice prices are on the wane:

One food-industry source in Singapore told CarrZee the retail price of chicken rice — a staple dish in Singapore — was expected to drop substantially by the end of the month.

The photos below show how usual cheap prices are covered up, temporarily. The current high prices should be replaced by usual prices soon.

Malaysia is exporting chickens to Singapore again–but there would be a lag of a few weeks before consumers see the benefits, she said.

Supply chain pressures are easing, according to Bank of America research:

“While further moderation in manufacturing is important to highlight, fewer backlogs and decreased supplier delivery times suggest further alleviation of supply chain pressures.

“Interestingly, our transportation analysts have yet to find evidence in the high frequency data of any world trade slowdown, with bottlenecks below the peak of 1Q22.

“Our shipping trackers show July volumes remain robust in both China and the U.S. Taiwan military drills could cause some temporary congestion but this is likely to fade quickly.

“According to European Capital Goods analyst Alex Virgo, easing supply chains and higher inflation are leading to inventories building up across the system as companies create safety stocks of critical components.

“This inventory build, partially fueled by pricing, exceeds anything he has seen over the past 15 years.”

For BofA see:

Weekly market recap report, compiled by its Global Research team, focused around the latest facts and highlights.
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