US inflation threatens to spoil Thanksgiving dinner

Rises in the key components of the Thanksgiving turkey dinner has made the price of feeding friends and relatives significantly higher this year © AP

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Good evening

The joy of the chance to reconnect over a Thanksgiving meal tomorrow is being tempered by US inflation concerns and a resurgence in Covid-19 infections across the States.

President Joe Biden has announced the largest release of stored oil in an attempt to drive down petrol prices and snuff out a crude market rally that his administration said poses a threat to the global economic recovery.

The president’s effort to drive down oil prices, which have doubled in the past year, may have backfired, however. Brent, the international crude benchmark, closed 3.3 per cent higher at $82.31 a barrel yesterday.

The oil expansion also seems to be in direct opposition to Biden’s talk about cutting carbon emissions. However, the president needed to be seen to do something, given that the increase in the cost of living for Americans will be obvious at family gatherings tomorrow.

Rises in the key components of the Thanksgiving turkey dinner has made the price of feeding friends and relatives significantly higher this year than it was in pre-pandemic 2019, according to an FT analysis.

Another sign of the impact of US inflation was yesterday’s announcement by Dollar Tree, the discount store chain known for its “Everything’s $1” slogan, that it would raise prices for most merchandise to $1.25.

It is not only the cost of living that is proving difficult to tame in the US. Health officials have warned that a fifth wave of Covid infections could overwhelm hospitals in the worst affected states.

Cases have been rising, even in states with high vaccination rates, such as Vermont and Maine. “We are preparing for the absolute worst,” said Andrew Jameson, an infectious disease doctor at Mercy Health Saint Mary’s hospital in Michigan, a state where daily Covid-19 case numbers have almost doubled since the start of November.

Latest news

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Need to know: the economy

Olaf Schulz will become Germany’s next chancellor after his Social Democratic party struck a coalition agreement with the Greens and liberals to govern Europe’s largest economy.

One of his government’s main priorities will be to tackle a sharp rise in Covid cases that is threatening to overwhelm Germany’s healthcare system. Authorities reported 66,884 new coronavirus infections over the past 24 hours — a record.

Latest for the UK/Europe

The EU has warned Italy to rein in government spending growth and pursue a “prudent” fiscal policy next year as the European Commission flags budget risks in high-debt economies, whose spending has increased during the pandemic.

Brussels has also softened its defence of Covid vaccine patents for companies developing the jabs, proposing that poorer countries be allowed to manufacture the vaccines. Valdis Dombrovskis, trade commissioner, who had opposed a plan to reduce IP protection, has now said he could support limited exemptions.

As infection rates surge in several European countries, the UK has been able to keep a lid on Covid hospitalisations through the success of its third-jab roll out.

Chart showing that Covid cases and deaths are rising fast in much of Europe, rapidly outpacing the UK

Daily Covid-19 caseloads per 100,000 citizens in the UK now rank behind more than 10 European countries, including Belgium and Greece, while the UK’s daily rate of Covid-related fatalities per 100,000 is 40 per cent below the EU average, according to an FT analysis of official data.

Global latest

The Turkish lira suffered a historic retreat yesterday after President Recep Tayyip Erdogan praised a recent interest rate cut and declared that his country was fighting an “economic war of independence”.

Column chart of Annual % change against US dollar showing Turkey's lira in historic retreat

The currency rallied somewhat today as the crown prince of Abu Dhabi visited Ankara for the first time in almost a decade and markets were buoyed by the prospect of Emirati investment.

But analysts have warned of increased dollarisation, hyperinflation and the rising cost of debt as a result of the actions of Erdogan, who has sacked three central bank governors since mid-2019 and is a life-long opponent of high interest.

Need to know: business

Lidl is to create 4,000 jobs in Britain and add 100 stores over the next four year to extend the reach of its low-cost bricks-and-mortar business model, which has been tested by a boom in online shopping during the pandemic.

Pascal Soriot, chief executive of AstraZeneca, came out fighting for his company’s Covid vaccine by linking the widespread use of the jab in the UK to the country’s relatively low hospitalisation rate compared with its European neighbours.

The World of Work

Call it French exceptionalism, but France has managed to avoid the workforce exodus seen in the US and UK in recent months. Instead France has posted its highest ever employment rates, according to the latest article in the FT series on how the pandemic has reshaped employment practices. Find out why French workers are not joining the “Big Quit”.

Covid cases and vaccinations

Total global cases: 258.2m

Get the latest worldwide picture with our vaccine tracker

And finally…

The eighties slogan jumper is back, but with more wholesome messages than the originals. If you are considering one as an alternative Christmas jumper or perhaps as a present for a loved one, Nicholas Foulkes of Weekend FT assesses the best of this genre of knits.

Feeling festive with Lord Ivar Mountbatten and his family, all wearing bespoke Huntsman sweaters © Nick Tydeman

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