The cost of living across the British Isles remained high last month but left hope that the rate of acceleration was slowing.

Annual consumer price growth rose an in-line 9.1% in May, one-tenth higher than April’s reading. On the month, CPI increased 0.7% to also match estimates but come in sharply lower than the 2.5% in April. The annual core reading of 5.9% was slightly lower than 6.0% forecast and the 6.2% in the previous month.

Office for National Statistics chief economist Grant Fitzner said, “Continued steep food price rises and record high petrol prices were offset by clothing costs rising by less than this time last year and a drop in often fluctuating computer games prices.” (Continue Reading – LiveSquawk)

The Federal Reserve will deliver another 75-basis-point interest rate hike in July, followed by a half-percentage-point rise in September, and won't scale back to quarter-percentage-point moves until November at the earliest, according to economists polled by Reuters.

Last week the Fed hiked the federal funds rate by three-quarters of a percentage point, its largest rate increase since 1994, after official data just a few days earlier showed inflation unexpectedly rose despite expectations it had peaked. (Continue Reading - Reuters)

The probability of the world economy succumbing to a recession is nearing 50% as central banks tighten monetary policy and demand for goods weakens, according to economists at Citigroup Inc.

Supply shocks continue to push up inflation and drive down growth, while central banks are now hiking interest rates vigorously and consumer demand for goods is softening, the economists led by Nathan Sheets said in a report on Wednesday. (Continue Reading – Bloomberg)

Companies are reviewing their hedging strategies in light of the strong U.S. dollar, which is denting the value of overseas earnings. The strength of the currency also is making some American products less competitive overseas, forcing businesses to look for ways to cut costs as they struggle to maintain margins.

The dollar in recent months has appreciated significantly against other currencies as weaker global economic growth drives investors toward safe havens. Steps by the Federal Reserve to tighten its monetary policy and increase interest rates also support the dollar. (Continue Reading – WSJ)