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Even Higher Inflation? Hmm … Maybe Not

Here’s where wholesale prices are off 25% from their peak

by Bob Stokes
Updated: December 08, 2022

Inflation on steroids -- Goodness knows that nearly everyone has been painfully aware of the supercharged rise in prices for goods during the past couple of years or so.

Some observers expect high inflation to persist. For example, here's a Nov. 10 Time magazine headline:

Why Experts Say High Inflation Isn't Going Away Anytime Soon, Even if the Worst Is Behind Us

Those experts might turn out to be right, however, the evidence suggests that high inflation may tamper down considerably faster than some observers expect -- if Germany is a representative example.

You may find these charts and commentary from our just-published December Global Market Perspective quite interesting:

GermanyPeakInflation

While consumer prices have indeed risen fast, cracks in the hyperinflation narrative have propagated even faster. In October, German business expectations were almost five standard deviations below normal and wholesale prices in Germany are off 25% from their peak, which occurred seven months ago. Producer prices dropped an astounding -4.2% in October, the sharpest monthly decline ever recorded.

By the way, retail prices tend to lag wholesale prices, so shoppers will likely see lower prices over the next few weeks.

Another sign that inflation has peaked is that freight rates, which had been rising, are now falling quite rapidly.

A Nov. 12 CNBC news item pinpointed a major reason:

The global shipping industry is facing a new problem--too many containers

On November 26, the cost to send a 40-foot container from Shanghai to Los Angeles touched $2,069, its lowest level since the early days of the pandemic. Europe's shipping benchmark is the route from Shanghai to Rotterdam, which now costs the same as it did in January 2020.

Our Global Market Perspective provides you with many more important insights about the economies in Europe, Asian Pacific, as well as the U.S. You'll also find coverage of 50-plus financial markets -- which is critical to know at this juncture.

The first step to access all these global financial insights is to click on the link below.

The NEW Global Market Perspective: Exclusive Financial Insights

Our just-published December Global Market Perspective provides you with critical financial insights that you simply will not find anywhere else.

A hallmark of Elliott Wave International's analysis is that it is truly independent -- independent from the crowd, independent from conventional thinking, independent from the prevailing sentiment of all financial markets -- whether that market happens to be stocks, bonds, precious metals, crude oil, natural gas, cryptocurrencies or forex.

In the 50-plus pages of the Global Market Perspective, you'll also find independent coverage of the major economies in the Asian-Pacific, Europe, as well as the U.S.

You can have the new December Global Market Perspective on your screen in moments by following the link below.

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