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US inflation slows in November in smallest spike in year

| By AFP | Beiyi Seow |

US consumer inflation eased in November, according to government data released Tuesday, bringing some relief to policymakers with the smallest annual increase in nearly a year.

Officials are closely eying the monthly inflation report for signs that painfully high consumer prices are definitively moderating at last, as surging costs of living force households to dip into their savings.

The consumer price index (CPI), a closely-watched measure of inflation, jumped 7.1 percent from a year ago, down from 7.7 percent in October, according to Labor Department figures.

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But the overall number is still about three times the pre-pandemic pace.

Prices ticked up 0.1 percent from October to November, a smaller-than-expected increase after a prior 0.4 percent jump, the latest data showed.

President Joe Biden reacted with cautious optimism about the US economy, saying the figures gave “a reason for some optimism for the holiday season and I would argue for the year ahead.”

Core prices, which exclude the volatile food and energy segments, rose 0.2 percent in November, down from a 0.3 percent pick-up in October.

“The index for shelter was by far the largest contributor to the monthly all items increase, more than offsetting decreases in energy indexes,” the Labor Department said in a statement.

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Food inflation nudged up as well, underscoring the financial squeeze that households are still experiencing.

While an improvement from before, the data likely reinforces official views that costs remain far too high, and US central bankers are poised to push on in their quest to cool the world’s biggest economy.

The Federal Reserve has raised the benchmark lending rate six times this year in hopes of lowering demand, walking a fine line between reining in prices and triggering a recession.

The lower inflation figure is likely to fuel optimism for easing in the Fed’s aggressive campaign as its policy-setting committee starts a two-day meeting Tuesday that is widely expected to culminate in a smaller rate hike.

Right direction

Consumer inflation remains much higher than the Fed’s longer-term goal of two percent, even as prices are “moving in the right direction,” said economist Rubeela Farooqi of High Frequency Economics Tuesday.

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But “further sustained improvement” over the coming months could allow the Fed to slow its pace of rate hikes more, she added.

While goods prices are decelerating, they still contribute heavily to CPI changes and a reversal of the trend will take time, she warned in an earlier analysis.

James Knightley of ING told AFP that while the asking price for rents appears to be falling in many cities, most people are still paying “considerably more” than last year.

Analysts have also been watching price increases in services, given that quickly rising wages feed into this segment and “continue to run hot,” he noted.

“This is clearly an area of concern for the Fed,” he said.

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International

Israel compares the protests in Columbia at the UN with a passage from Nazi Germany

Israel’s representative to the UN, Gilad Erdan, compared on Wednesday the pro-Palestinian protests at Columbia University (New York), where 109 detainees took place on Tuesday night, with ‘The Night of Broken Glass’, a series of lynchings and combined attacks against the Jewish population coordinated by Nazi Germany in 1938.

“Those who resorted to Nazism at the time, are today breaking windows, attacking Jewish students and asking to be expelled from the university campus. The images we have seen in Columbia remind us of ‘The Night of the Crystals’,” said the diplomat at the plenary of the General Assembly on Wednesday, where the recent U.S. veto on the entry of Palestine as a full member was discussed.

On April 19, the United States vetoed in the Security Council the resolution that opened the door to the entry of Palestine as a full member of the UN, of which it is now only an observer.

With his words, Erdan referred to the moment when a group of pro-Palestinian students demonstrating on the Columbia campus broke several windows of the emblematic Hamilton Hall building and entrenched themselves inside.

“The anti-Semites did not manage to annihilate us during the Holocaust, neither in 1948, nor in 1967 nor in 1978. Today they are trying again, not only with terrorism and war, but also using the UN,” he stressed, in his already recurring speech against the organization, which he accuses of being favorable to Palestine.

“The elite universities, alleged bastions of liberalism, have become the breeding ground for racism and the most horrible hatred,” he added, also asking that “letters on the matter” be taken against the faculties and the presidents of the centers.

The protests over the war in Gaza that began in Columbia almost two weeks ago have spread like wildfire through other centers in the United States, ending in the arrest of hundreds of students and becoming the most massive and widespread university protests since the Vietnam War in 1968.

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International

The Biden administration will forgive $6.1 billion in debt of art students

The U.S. Government announced on Wednesday that it will forgive more than 6.1 billion dollars in debt of about 317,000 students of the Art Institute, a large network of private schools spread throughout the country that had to close due to several crises.

The announcement of the Department of Education indicated that the benefit will be for students who enrolled in any of the headquarters of the Institute of Art between January 1, 2004 and October 16, 2017, just before the network of design schools lost its accreditation and began their problems to maintain its activity, which ceased in 2023.

“The Department determined that that institute and the owning company Education Management Corporation made false statements to potential students about employment possibilities, salaries and services in that period,” the statement said.

In October 2017, the company sold the remaining headquarters and all the still existing properties of the Art Institute, under a different owner, ceased operations in September 2023.

“For more than a decade, hundreds of thousands of hopeful students took loans to attend the Institute of Art and received little in return,” said the Secretary of Education, Miguel Carmona.

“We have to continue protecting borrowers from predatory institutions, and work for an education system that is affordable for students and taxpayers who pay taxes,” the official added.

Today’s announcement comes when the presidential election is less than 29 weeks away and Joe Biden’s government faces a wave of protests in universities against the support that the United States gives to Israel in its war in Gaza.

In June 2023, in a decision supported by the six conservative magistrates, the Supreme Court of Justice ruled that Biden’s Executive had exceeded his powers with a plan for the cancellation of about $400 billion in student debt.

That plan would have benefited more than 43 million people, according to the Government’s calculations. Since then, Biden has approved measures that have been canceling or reducing the debts of different segments of the indebted population.

Through adjustments in debt relief programs, the Department of Education has eliminated debts for a total of almost 160 billion dollars incurred in the university education of 4.6 million people, according to the official statement.

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International

Blinken praises a truce proposal and Netanyahu gets stuck in his rejection at the end of the war

US Secretary of State Antony Blinken again praised today in Israel the latest proposal for a truce in Gaza that is still being studied by the Palestinian Islamist group Hamas, while Israeli Prime Minister Benjamin Netanyahu insisted on his rejection of a definitive ceasefire in the Strip.

Blinken, who is embarking on his seventh visit to the region since the outbreak of war, on October 7, met today with Netanyahu in Jerusalem and hours earlier with the Israeli president, Isaac Herzog, to whom he reiterated his commitment to achieve a truce agreement “now” that will return the hostages and improve the humanitarian situation in Gaza.

“We are determined to achieve a ceasefire that will take the hostages home, and to achieve it now. And the only reason why that would not be achieved would be because of Hamas. There is a proposal on the table. And as we have said, no delays, no excuses. The time is now,” Blinken said, according to a statement from the Israeli president’s spokesman.

In addition, Herzog reiterated that Israel complies with international law and expressed its rejection of the International Criminal Court (ICC), due to the possibility of it issue arrest warrants for alleged war crimes against three senior Israeli officials, including Netanyahu, according to the newspaper Haaretz on Monday.

“I appeal to all our allies and friends to reject such attempts” from the ICC, asked Herzog, who also assured that the “immediate return of the hostages” should be “the highest priority” of the international community.

Blinken also had words today for the relatives of the hostages, and before a group of Israeli protesters who were asking in front of his hotel in Tel Aviv for a truce agreement to be reached, he insisted that the only thing missing is for Hamas to say yes.

“At the moment there is a very strong proposal on the table, Hamas needs to say yes, it is necessary for him to carry it out,” Blinken said according to a statement from his Office.

“We will not rest, we will not stop until you meet with your loved ones, so please stay strong, keep the faith, we will be with you every day until we achieve it,” Blinken told the demonstrators.

In the meeting with Netanyahu in his office in Jerusalem, the Israeli Prime Minister told Blinken that he will not accept an agreement if it includes the end of the war in Gaza, which has already caused the death of more than 34,500 Palestinians, 72% women and children, according to the Gaza Ministry of Health.

At the meeting, Netanyahu warned that if Hamas does not renounce its demand for a permanent ceasefire, there will be no agreement and Israel will invade the town of Rafah, where 1.4 million people are crowded, said the Israeli media Walla, who cited Israeli and American officials.

One of the demands of the Palestinian group would be that in a second phase of the agreement, Israel would commit to ending its offensive in the Strip, something that, according to the source, Netanyahu is opposed.

The Israeli proposal, which is currently studying Hamas, includes Israel’s intention to discuss during a second phase of the agreement “the return of a sustainable calm” in the Gaza Strip, a formula that, as the media itself points out, does not include an explicit commitment to the end of the war.

After 208 days of war, the Gaza Strip is in a state of devastation, with 80% of its population forcibly displaced, water scarcity and an extreme lack of food, which has pushed about 210,000 people on the verge of famine in the north, in addition to a growing proliferation of diseases.

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