Global markets are bracing for potential inflation due to rising energy costs, food shortages, and geopolitical uncertainty. A strong El Niño event could raise global food inflation by about 0.7%, according to JPMorgan.

Food Inflation Fears

The impact of food inflation will be felt most in Asia and Latin America, where households spend a larger share of their income on food. The United Nations Food and Agriculture Organization has warned of another wave of food inflation.

Consumer Checkup

Retail earnings will provide insight into the health of the U.S. consumer, showing whether spending remains resilient despite higher energy prices and geopolitical uncertainty. Walmart, Home Depot, Target, Lowe’s, and Deere will report their earnings, offering a glimpse into the effects of inflation on consumer spending.

Global Economic Trends

Japan’s GDP is expected to have expanded by 2% in the three months through June, despite the challenges posed by the Iran war and higher energy costs. The Bank of Japan may lift its policy rate by 25 basis points to 1.25% next month.

The price of gold has risen nearly 10% since late June, as investors seek safe-haven assets amid inflation concerns and geopolitical uncertainty. Central banks have also increased their gold purchases, with 289 metric tons bought between April and June.

UK Economy

The UK’s GDP beat expectations in June, thanks to hot weather, World Cup football, and stronger business investment. However, inflation eased to 2.6% in June, helped by a fall in energy prices after the U.S.-Iran ceasefire.

Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.