Bloomberg – Jana Randow / German inflation jumps above 4%, highest in three decades
- German consumer prices are rising at the fastest pace in nearly three decades, fueled by supply bottlenecks and a series of temporary pressures accompanying the economy’s pandemic recovery.
- Inflation jumped to 4.1% in September, exceeding economists’ median estimate, according to data from the Federal Statistics Office. Energy alone was 14% more expensive than last year, when wide-ranging coronavirus restrictions curbed demand and prices.
- Europe’s largest economies — all experiencing strong growth following the end of lockdowns at the start of summer — are reporting a similar trend. France, Italy and Spain were among those with inflation rates far above 2% — the goal the European Central Bank aims to achieve sustainably for the euro area.
- Policy makers have insisted that the spike is largely transitory, reflecting statistical effects including changes to German sales taxes and the timing of summer sales that will disappear next year. Recently though, they’ve also highlighted the risk that material shortages and transportation logjams could produce more persistent price pressures that could ultimately lead to higher wages.
- Financial Times – Martin Arnold / German workers strike for higher pay as inflation surges
The New York Times – Jonathan Weisman and Emily Cochrane / House delays vote on infrastructure bill as Democrats feud
- President Biden’s trillion-dollar bipartisan infrastructure plan suffered a significant setback late Thursday night when House Democratic leaders, short of support amid a liberal revolt, put off a planned vote on a crucial plank of their domestic agenda.
- Democratic leaders and supporters of the bill insisted the postponement was only a temporary setback. The infrastructure vote was rescheduled for Friday, giving them more time to reach agreement on an expansive climate change and social safety net bill that would bring liberals along.
- But such a deal appeared far off, and the delay was a humiliating blow to Mr. Biden and Democrats, who had spent days toiling to broker a deal between their party’s feuding factions and corral the votes needed to pass the infrastructure bill.
- Given the distance between the party’s left flank and a few centrists on that larger bill, it was not clear when or even whether either would have the votes — and whether Mr. Biden’s economic agenda could be revived.
- Foreign Policy – Stephen M. Walt / Is Biden’s foreign policy failing?
- More than two thousand British gas stations were still dry on Thursday (30 September) due a shortage of truck drivers which was starting to disrupt deliveries to pharmacies, while farmers warned a lack of butchers could lead to a massive cull of pigs.
- In a chaotic week where fights broke out at gas stations and people filled up old water bottles with petrol, British ministers have repeatedly said the crisis was easing, though they ordered soldiers on Wednesday to start driving fuel tankers.
- Ministers have rejected accusations that the trucker shortage was caused by Britain’s withdrawal from the European Union, pointing to similar shortfalls elsewhere after COVID-19 lockdowns halted thousands of truck driver tests.
- Besides fuel and medicine, the farming industry warned that hundreds of thousands of pigs may have to be culled within weeks unless the government issues visas to allow more butchers into the country.
- The Economist / All of Europe is desperate for more lorry drivers
Bloomberg – Vanessa Dezem, Elena Mazneva and Anna Shiryaevskaya / European gas hit record 100 euros as energy crunch worsens
- European gas surged to a record 100 euros before retreating as the energy crunch deepened after China set the stage for a global fight for supplies — a move that threatens to derail the economic recovery.
- Benchmark futures traded in the Netherlands gained as much 2.3% on Friday, and then fell 3.1% in volatile trading. China ordered its state-owned energy companies to secure supplies for this winter at all costs, according to people familiar with the matter.
- Energy prices are rising form the U.S. to Europe and Asia as the economy recovers from the global pandemic and people return to the offices. Europe is struggling to secure enough gas and coal ahead of the winter.
- European storage sites are just under 75% full, the lowest level for this time of year in more than a decade. Inventory withdrawals typically start by the end of the month, depending on the weather.
- Politico – Pierre-Paul Bermingham / French PM vows gas price freeze and tax cuts to curb energy inflation
Further reading for the weekend:
- The Washington Post – Chico Harlan and Mia Alberti / Portugal has nearly run out of people to vaccinate. What comes next?
- Foreign Affairs – Jorge G. Castañeda and Forrest D. Colburn / Latin America needs a new social contract
- The Economist / We ask Michel Barnier: what is the future of Europe?
- Financial Times – John Reed and Pham Hai Chung / Vietnam abandons zero-Covid strategy after record drop in GDP