#import-driven-inflation

#import-driven-inflation

"Fresh food and perishables are almost like the canary in the coal mine," when energy prices go up, according to Vidya Mani, an associate professor at the University of Virginia's Darden School of Business.

High energy prices are kryptonite for the housing market. Affordability, especially for those first-time home buyers, is now an elusive dream until oil prices come down and interest rates come down.

Jet fuel tends to be an airline's biggest expense. An analysis by the International Air Transport Association showed that, for the week ending March 27, the weekly average price of jet fuel has skyrocketed 116.8 per cent compared to the previous year's average.

U.S. financial markets experienced a volatile week, largely influenced by geopolitical developments in the Middle East and fluctuations in energy prices. Investor sentiment was driven primarily by external events rather than domestic fundamentals.

The US dollar returned to the upside as geopolitical fears rebounded after US President Trump's address to the nation. The rhetoric fuelled risk aversion and flows toward the dollar while oil prices surged.

"Oil prices are higher again this morning, but Treasury yields are lower as the risks to economic growth begin to take precedence over the risks to inflation," Oxford Economics said in a note on Monday.

Weak performance in several service sectors offset gains in retail and wholesale trade, reinforcing concerns about the pace of economic recovery. Japan relies heavily on oil imports from the Middle East, making it particularly sensitive to disruptions in the region.

Gold has been on a tear as the dollar is under pressure, raising questions about global confidence and market risk. The US economy and markets are unmatched in size. The dollar is the king of currencies, and US treasuries are often considered a safe-haven asset. But, investors appear to be reassessing that. This has weighed down on the greenback and cooled the stock markets.