A look at the day ahead in U.S. and global markets from Samuel Indyk.
Super Bowl LVII was a finale for the ages, as star quarterback Patrick Mahomes led his Kansas City Chiefs to a dramatic 38-35 victory over the Philadelphia Eagles in Sunday’s showpiece.
Ahead of the match, one statistic that blew this Englishman’s mind was the sheer volume of chicken wings that were set to be consumed over Super Bowl weekend.
In a report released earlier this month, the National Chicken Council said Americans were expected to chow down on 1.45 billion chicken wings, an increase of 2% from last year, or the equivalent of 84 million wings.
That’s a total of four wings each for every man, woman and child, and enough to stretch from Kansas City’s Arrowhead Stadium to Philadelphia’s Lincoln Financial Field about 62 times.
So why the 2% increase in demand? Well, if you’re looking for deflation, chicken wings are the place to find it.
According to the United States Department of Agriculture, wholesale and retail wing prices are down double-digits from the same time last year, which National Chicken Council spokesperson Tom Super says is one cause for this year’s demand uptick.
“The two main reasons are more favorable prices and more people getting back to normal and gathering for the Big Game, whether at home or at a bar/restaurant,” Super said.
For markets and the Federal Reserve, one question might be whether a decline in the price of chicken wings is a forerunner for another easing of price pressures at Tuesday’s readout of U.S. consumer inflation data.
The report is expected to show consumer prices rose at an annual pace of 6.2% in January, down from 6.5% in December and well below June’s four-decade peak of 9.1%.
Inflation remains the driving force for markets and with price rises expected to have slowed again last month, the rally in stocks and bonds could resume after the hiccup following January’s staggeringly strong labour market data.
But if markets are set to be cheering an easing of price pressures, they might want to celebrate with something other than liquor, after December’s consumer price data showed the price of alcoholic beverages was up 5.8% from the same period a year earlier.
GRAPHIC: Is U.S. inflation calming? (https://www.reuters.com/graphics/GLOBAL-MARKETS/lbpggbynzpq/Screenshot%202023-02-09%20at%2022.50.48.png)
Key developments that may provide direction to U.S. markets later on Monday:
* U.S. results: FirstEnergy, Avis Budget, Palantir
* Auctions: Three- and Six-Month T-Bills
(By Samuel Indyk; Editing by Sharon Singleton)
