Food Costs Drive Up Inflation, Odds Of Rbi Rate Hike Rise

Food Stamp Debit Cards Failing To Work In 17 States

Worries over high inflation led new RBI chief Raghuram Rajan to surprise markets last month with an interest rate hike. Many analysts now expect him to raise interest rates by another 25 basis points on October 29, even after data showing economic growth in the June quarter hit a four-year low. “The pickup in inflation is testament to the lingering inflation risks and underscores the need for the RBI to keep its inflation guards up,” said Leif Lybecker Eskesen, Chief Economist for India & ASEAN at HSBC in a note. Federal bond yields posted their biggest advance in three weeks after the data firmed up expectations for a second consecutive rate hike in as many months. The benchmark 10-year government bond yield ended up 8 basis points on the day at 8.57 percent, its highest since September 23. Other data showed consumer prices rose 9.84 percent year-on-year in September, the fastest pace in three months. Economists in a Reuters poll last week had forecast an annual 9.60 percent rise in retail prices. India is not the only major emerging market wrestling with inflation and high food costs – China’s consumer inflation hit a seven-month high of 3.1 percent in September. But the pace of growth in food prices in India stood out, rising to an annual 18.40 percent last month, the fastest clip since July 2010 and triple the 6.1 percent rise seen in China. Inflation data comes on the heels of Friday’s disappointing industrial output numbers. Output grew a much-slower-than expected 0.6 percent in August, hurt by weak investment and consumer demand, dashing hopes of an economic rebound by the end of the year.

The manager put up a sign saying the EBT system was not in use. Colman, who receives the benefits, called an 800 telephone line for the program and it said the system was down due to maintenance, she said. “That’s a problem. There are a lot of families who are not going to be able to feed children because the system is being maintenanced,” Colman said. She planned to reach out to local officials. “You don’t want children going hungry tonight because of stupidity,” she said. Colman said the store manager promised her that he would honor the day’s store flyer discounts next week. Wasmer said the states affected by the temporary outage also included Alabama, California, Georgia, Iowa, Illinois, Louisiana, Massachusetts, Maryland, Mississippi, New Jersey, Oklahoma, Pennsylvania, Texas and Virginia. Ohio’s cash and food assistance card payment systems went down at 11 a.m., said Benjamin Johnson, a spokesman for the Ohio Department of Job and Family Services. Johnson said Xerox asked retailers to revert to a manual system, meaning customers could spend up to $50 until the system was restored. Illinois residents began reporting problems with their cards known as LINK in that state on Saturday morning, said Januari Smith, spokeswoman for the Illinois Department of Human Services. Smith said that typically when the cards aren’t working retailers can call a backup phone number to find out how much money customers have available in their account.

Food stamp glitch leads to Wal-Mart stampede

Police were called as entire shelves were being cleared out, until the glitch was fixed and low-income residents using the cards were no longer allowed to make purchases. From news station KSLA: “Springhill Police Chief Will Lynd confirms they were called in to help the employees at Wal-Mart because there were so many people clearing off the shelves. He says Wal-Mart was so packed, ‘it was worse than any black Friday’ that he’s ever seen. Lynd explained the cards weren’t showing limits and they called corporate Wal-Mart, whose spokesman said to let the people use the cards anyway. From 7 to 9 p.m., people were loading up their carts, but when the cards began showing limits again around 9, one woman was detained because she rang up a bill of $700 and only had .49 on her card. She was held by police until corporate Wal-Mart said they wouldn’t press charges if she left the food. Lynd says at 9 p.m., when the cards came back online and it was announced over the loud speaker, people just left their carts full of food in the aisles and left.” No arrests were made. “Just about everything is gone. I’ve never seen it in that condition,” Mansfield Wal-Mart customer Anthony Fuller told KSLA. More from InvestorPlace