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WARSAW, Poland (AP) — Experts are working to come up with new export routes for millions of tons of grain stuck war-torn Ukraine but it will take time, a Polish government official said Monday.

Vast amounts of corn and other grains are stuck in Ukraine – one of the world’s largest grain producers – and cannot be exported because Russia has blocked the country’s ports.

Michal Dworczyk, the head of the Polish prime minister’s office said two major border crossings have been expanded and dedicated to cargo traffic only, while plans are in the works to standardize Ukraine’s tracks with European ones and to increase the export capacity of Poland’s sea ports.

“We are facing a very big challenge,” Dworczyk said. “We need to say it honestly, you do not solve such problems from one day to another… from one week to another.”

Dworczyk said that Poland was pleased with U.S. President Joe Biden’s offer earlier this month to build temporary grain silos along Ukraine’s borders, including with Poland. He said experts need to ascertain the type and location of the silos.

The idea is for grain to be transferred to the silos and then transported by vehicle to ports for export. “But it’s taking time,” said Dworczyk.

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WASHINGTON (Reuters) – U.S. President Joe Biden on Monday raised the tariff rate on certain Russian imports to 35% as a result of suspending Russia’s “most favored nation” trading status over its war in Ukraine, according to a proclamation issued by the White House.

The higher 35% duty applies to imports of “certain other products of the Russian Federation, the importation of which has not already been prohibited,” the proclamation said.

The Biden administration previously banned U.S. imports of Russian petroleum and energy products, fish, seafood, alcoholic beverages and non-industrial diamonds. An annex listing the products subject to the higher duty was not immediately available.

(Reporting by David Lawder and Tim Ahmann)

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By Lucia Mutikani

WASHINGTON (Reuters) – New orders for U.S.-made capital goods and shipments increased solidly in May, pointing to sustained strength in business spending on equipment in the second quarter, but rising interest rates and tighter financial conditions could slow momentum.

The nearly broad rise in orders reported by the Commerce Department on Monday occurred despite deteriorating business and consumer sentiment as well as heightened fears of a recession. The gains partly reflected higher prices. The Federal Reserve is aggressively tightening monetary policy to quell inflation.

“There’s some inflation behind the increase in orders, but, nevertheless, there are a lot of dollars flowing through the economy right now,” said Christopher Rupkey, chief economist at FWDBONDS in New York. “Businesses would not order new equipment if they thought consumers and other companies were looking to pull back their purchases.”

Orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, rose 0.5% last month. These so-called core capital goods orders gained 0.3% in April. Economists polled by Reuters had forecast core capital goods orders would climb 0.3%.

Those orders were up 10.2% on a year-on-year basis in May. Last month’s increase reflected a 1.1% rise in machinery orders. There was also strong demand for primary metals as well as computers and electronic products. But orders for electrical equipment, appliances and components fell 0.9%, while demand for fabricated metal products was unchanged.

Core capital goods https://graphics.reuters.com/USA-STOCKS/myvmnrxwxpr/corecapgoods.png

The better-than-expected increase in core capital goods orders underscored underlying strength in manufacturing, which accounts for 12% of the economy, despite weak factory surveys. A survey from S&P Global last week showed business confidence dove in June to the lowest level since September 2020.

Demand for goods remains strong even as spending is reverting back to services. Production also continues to be underpinned by businesses still rebuilding inventories, even as some major retailers like Walmart and Target have reported that they are carrying too much merchandise.

“We’ve seen two of the largest inventory builds on record in the past two quarters, but, taken in the context of still solid sales, inventories are not yet at a concerning level in our view,” said Tim Quinlan, a senior economist at Wells Fargo in Charlotte, North Carolina. “We take the rebuild in inventories as a signal that supply chain problems are slowly easing.”

Stocks on Wall Street were mixed. The dollar fell against a basket of currencies. U.S. Treasury yields rose.

STRONG SHIPMENTS

Core capital goods shipments increased 0.8% last month, matching April’s gain. Core capital goods shipments are used to calculate equipment spending in the gross domestic product measurement. Despite some boost from higher prices, shipments still showed strength after adjusting for inflation.

Business spending on equipment is on track to grow again this quarter, though at a slower pace than the 13.2% annualized rate notched in the January-March period.

Robust business investment in equipment helped to sustain strong domestic demand in the first quarter even as the economy contracted at a 1.5% rate, hit by a record trade deficit. Growth estimates for the second quarter range from as low as a 0.3% rate to as high as a 2.9% pace.

The Fed this month raised its policy rate by three-quarters of a percentage point, its biggest hike since 1994. The U.S. central bank has increased its benchmark overnight interest rate by 150 basis points since March.

“The unexpected strength won’t change anything for monetary policy except, perhaps, making the Fed just a smidgen more comfortable with their next rate hike decision,” said Will Compernolle, a senior economist at FHN Financial in New York.

Orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, advanced 0.7% in May after rising 0.4% in April.

They were lifted by a 0.8% gain in orders for transportation equipment, which followed a 0.7% increase in April.

Durable goods https://graphics.reuters.com/USA-STOCKS/jnvweobznvw/durablegoods.png

Motor vehicle orders climbed 0.5% after edging up 0.1% in April. Orders for the volatile civilian aircraft category fell 1.1%. Boeing reported on its website that it had received 23 aircraft orders in May, down from 46 in April.

Shipments of durable goods surged 1.3% last month after gaining 0.3% in April. Unfilled durable goods orders rose 0.3% and inventories increased 0.6%.

While manufacturing is showing resilience, higher borrowing costs are cooling the housing market.

A separate report on Monday from the National Association of Realtors showed its Pending Home Sales Index, based on signed contracts, rose 0.7% last month. The increase, however, only reversed a tiny portion of the prior six months’ declines, leaving contacts down 13.6% on a year-on-year basis.

Pending home sales https://graphics.reuters.com/USA-STOCKS/lgpdwbaekvo/phs.png

“Higher rates have been weighing significantly on the housing market and will continue to do so in the immediate future,” said Daniel Silver, an economist at JPMorgan in New York.

(Reporting by Lucia Mutikani; Editing by Toby Chopra and Paul Simao)

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By Rajendra Jadhav, Maximilian Heath and Nigel Hunt

MUMBAI/BUENOS AIRES/LONDON (Reuters) – It only took 24 hours last month for Prime Minister Narendra Modi’s government in India – the world’s second-largest producer of wheat – to shelve its plans to “feed the world”.

In April, Modi had said publicly that the world’s most populous democracy was ready to fill part of the gap left by Ukraine in global grains markets by increasing its wheat exports, following five consecutive record harvests. India traditionally exports only a modest amount of wheat, retaining most of its crop for domestic consumption.

On May 12, India’s Ministry of Commerce & Industry said it was preparing to send delegations to nine countries to export a record 10 million tonnes of wheat this fiscal year – sharply up the previous season.

But a barrage of alarming data changed all that.

First came a downward revision to India’s wheat crop in early May as a sudden heatwave hammered yields. Then data on May 12 showed inflation in the nation of 1.4 billion had jumped to a near eight-year high due to higher food and fuel prices, driven by the Ukraine war.

Alarmed by rising inflation, which had contributed to toppling the previous Congress party government in 2014, Modi’s office told the Ministry of Commerce on May 13 to put the “brakes on” wheat exports immediately, according to one government official, who asked not to be identified because of the sensitivity of the issue.

“This (inflation data) prompted the government to issue an order at midnight” imposing a ban on wheat exports, said a second source.

News of the ban by India, which is the only major wheat exporter at that time of year, drove Chicago wheat futures 6% higher after markets reopened on Monday.

Neither Modi’s office nor the Ministry of Commerce responded to a request for comment.

India is one of at least 19 countries that have introduced food export restrictions since the war in Ukraine sent prices soaring, hampering international trade flows for several agricultural products and sparking violent protests in some developing nations.

(For an interactive graphic, click here: https://tmsnrt.rs/3wZqRBV)

From Delhi to Kuala Lumpur, Buenos Aires to Belgrade, governments imposed restrictions, at a time when the economic damage caused by the COVID-19 pandemic, combined with factors such as extreme weather and supply chain bottlenecks, had already driven hunger across the globe to unprecedented levels.

The U.N. World Food Programme (WFP) said in April the number of people facing acute food insecurity – when their inability to consume adequate food puts their lives or livelihoods in danger – had already more than doubled since 2019 to 276 million in the 81 countries in which it operates, before the Ukraine conflict began.

The war – which disrupted exports from Russia and Ukraine, two agricultural powerhouses – was forecast to increase that number by at least 33 million, mostly in sub-Saharan Africa, it forecast.

Under World Trade Organization rules, members can impose export prohibitions or restrictions of foodstuffs or other products if they are temporary and required to relieve “critical shortages”.

India’s Commerce Minister Piyush Goyal told Reuters last month he had been in contact with the WTO and the International Monetary Fund (IMF) to explain that India needed to prioritise its own food security, stabilize domestic prices and protect against hoarding.

But export restrictions risk worsening the rise in global food prices: producing a domino effect as a deepening crisis prompts other countries to take similar steps, said Michele Ruta, the lead economist in the Macroeconomics, Trade & Investment Global Practice of the World Bank Group.

Many economists say the global food crisis is already more severe than the last one that peaked in 2008, which was driven by factors including droughts, global population growth, higher consumption of meat in major developing economies, and the increased use of crops to produce biofuels.

Shortages at that time triggered protests across the globe, particularly in Africa where food represents a comparatively high proportion of household budgets.

Simon Evenett, professor of international trade and economic development at the University of St. Gallen, said the assurances in 2008 from international organizations to national governments that there was enough food to go around globally took some of the wind out of the sails of those pushing for export curbs.

“This time around that is harder to do as we do have a supply hit here in both Ukraine and Russia,” Evenett said, adding the size of summer harvests in major food producers would help determine how things develop in the second half of 2022.

Ukraine and Russia accounted for a combined 28% of global wheat exports, 15% of corn and 75% of sunflower oil in the 2020/21 season, according to U.S. Department of Agriculture data.

World food prices have stabilized at high levels in the past two months as harvests approach. However, there are already some worrying signs with drought in the United States set to reduce the size of the winter wheat crop while in France wheat crops were battered by hail, strong winds and torrential rains this month.

Dry weather in Argentina – the world’s sixth largest wheat exporter – has stalled planting of the crop and weighed down production forecasts for the 2022/23 season.

Moreover, the mood in the international forum’s such as G20 is now less collaborative after years of populism and heightened tension between major geopolitical players, Evenett said.

“This current situation in many ways is a lot more troubling than 2008 and look at what risks arose then to political stability,” he said. “We will have a very tense six to nine months ahead of us.”

FALLING DOMINOS

Some countries had already announced export curbs last year, given the tightness in global food supplies. But the dominos really started to fall following Russia’s invasion of Ukraine on Feb. 24, with global prices of both grains and vegetable oils soaring.

In March, Argentina increased taxes on its soybean oil and meal exports and has imposed a lower cap than last year for new wheat exports.

India’s ban on wheat exports came after Indonesia, the world’s top palm oil producer, had already restricted exports of palm oil – an essential ingredient in cooking and baking – from April 28 citing the need to ensure the country had “abundant and affordable supplies.”

India is the world’s biggest importer of palm oil and Indonesia is one of its most important suppliers. Indonesia lifted its ban on May 20.

Malaysia prohibited on May 23 the export of chickens from the beginning of this month after a global feed shortage exacerbated by the conflict in Ukraine disrupted poultry production and led to a sharp rise in prices for one of the country’s cheapest sources of protein.

The wave of export restrictions already affect nearly one-fifth of calories traded globally – that’s nearly double the impact of the last global food crisis of 2008, according to the International Food Policy Research Institute (IFPRI), a Washington-based think tank that aims to reduce poverty in developing countries.

“These types of measures tend to provoke some panicked behavior or hoarding from the buyers side…that accelerates the price spike,” said IFPRI researcher David Laborde Debucquet.

The European Union – which includes several of the world’s biggest food importers by value – is urging its trade partners not to enact protectionist policies.

“The European Union keeps its food exports going, and so should everyone else,” EU Commission President Ursula von der Leyen said in a speech this month.

ENSURING DOMESTIC SUPPLIES

Even before the war in Ukraine, Argentina’s government, battling domestic inflation now over 60%, took steps late last year to stem the rise in local food prices. It placed caps on exports of corn and wheat, adding to an earlier ban on shipments of beef.

After Russia’s invasion, it took additional steps, raising the taxes on shipments of processed soy oil and meal.

Argentina is the world’s biggest soybean oil and meal exporter, the second-largest global provider of corn and a key wheat exporter.

A source in Argentina’s Agriculture Ministry, who asked not to be identified because he was not authorized to speak to the media, said the government’s priority was to safeguard foodstuffs needed for domestic consumption.

The export limits established in late 2021 helped to shield domestic millers and consumers from the spike in international prices following the conflict in Ukraine, the source said.

But Gustavo Idigoras, head of Argentina’s CIARA-CEC chamber of grains processors and exporters, said that despite the export caps and additional taxes, the government had struggled to stem entrenched food price inflation in Argentina, which was already high before the Ukraine conflict.

In the Buenos Aires metropolitan area, the cost of bread has risen 69% in a year, meat 64% and vegetables 66%, forcing people to change their diets and seek cheaper deals.

Edith Elizabeth Plou, 39, a shopkeeper in Buenos Aires, had traveled miles from her home to come to the Argentine capital’s large Central Market to get cheaper prices for her groceries, which have spiked sharply over the last year.

“I work eight hours and the truth is that I often think about finding a second job to cover my expenses,” Plou said.

(Additional reporting by Sarah McFarlane in London; Editing by Daniel Flynn)

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By Leika Kihara

TOKYO (Reuters) -Many Bank of Japan (BOJ) policymakers saw stronger wage growth as key to sustaining the bank’s 2% inflation goal, according to a summary of opinions expressed at a June meeting, underscoring their resolve to maintain ultra-low interest rates.

The summary of views voiced at the bank’s June 16-17 rate-setting meeting, published on Monday, showed one board member said sharp yen falls could hurt the economy by making it difficult for companies to set business plans, highlighting policymakers’ concern over the currency’s plunge to 24-year lows.

At the meeting, the BOJ stuck to its ultra-low interest rate policy and vowed to defend its cap on the 10-year bond yield with unlimited buying, bucking a global wave of monetary tightening in a show of resolve to focus on supporting a tepid economic recovery.

There was no trace in the summary – in which commenters are not identified by name – of any discussion by the BOJ board of raising interest rates to slow the pace of yen declines, with many stressing the importance of keeping monetary policy ultra-loose.

“A growing number of goods are seeing prices rise due to higher commodity costs and currency volatility. But it’s appropriate to maintain current monetary policy” as the price gains aren’t driven by strong demand, one member said.

According to another opinion expressed, “In order to achieve sustained wage hikes that can drive up demand, the BOJ must sustain its current monetary policy and underpin the economy.”

Several other commenters pointed to the need to stimulate the economy long enough to boost wage growth, which remains far more subdued in Japan than in other countries, the summary showed.

The growing policy divergence on interest rates between Japan and the rest of the world – where rate hike cycles are well under way – has pushed the yen to 24-year lows against the U.S. dollar, threatening to cool consumption by boosting already rising import costs.

Some market players had speculated the BOJ could give into market forces and tweak its yield cap policy in June, to allow Japan’s long-term interest rates to rise more.

(Reporting by Leika Kihara; Editing by Shri Navaratnam and Kenneth Maxwell)

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As workers at major companies increasingly move to unionize, the political environment for labor couldn’t be more ripe.

Perhaps nowhere is that more accurate than at the National Labor Relations Board, the agency that enforces the country’s labor laws and oversees union elections.

In the past year, the Biden-appointed top prosecutor Jennifer Abruzzo has been seeking to overturn precedent and revive decades-old labor policies that supporters say would make it easier for workers to form a union. To get her wish, Abruzzo must have buy-in from the five-member board, whose Democratic majority is expected to be sympathetic to her proposed changes. As for President Joe Biden, he has vowed to be ”the most pro-union president” in American history.

“In the past, there has been a focus on employer rights or employer interests. And I do not believe that comports with our congressional mandate,” Abruzzo said in an interview with The Associated Press.

The changes Abruzzo seeks come as workers at major companies, including Starbucks, Amazon and most recently, Apple, clinch union victories. But any shifts in the agency’s enforcement of labor law are likely to be reversed under a Republican administration and met with fierce resistance from employers in the federal courts.

Currently, the agency is in the crosshairs of Amazon, which has been arguing in an NLRB hearing that began last week that the union victory at one of its warehouses on Staten Island, New York, should be tossed out. The e-commerce giant claims labor organizers and the agency acted in a way that tainted the vote. In one of its 25 objections, the company zeros in on a lawsuit filed in March by the NLRB’s Brooklyn office seeking to reinstate a fired Amazon worker who was involved in the union drive.

Abruzzo has said she would “aggressively” seek such remedies during her tenure, and could even pursue cases when an employer has only levied threats against workers. The agency has repeatedly taken Starbucks to federal court since December, most recently on Tuesday when it asked a court to reinstate seven employees in Buffalo, New York that it says were illegally fired for trying to form a union. Abruzzo says she’s also been asking field offices to be on the lookout for other threats to workers.

John Logan, the director of labor and employment studies at San Francisco State University, said some of the changes Abruzzo is seeking include policy shifts labor scholars have wanted for years.

“We have a general counsel prepared to do things that have not been done in the past,” Logan said. “And also doing it in the context of a period of labor organizing that we haven’t seen for decades and decades.”

A career NLRB attorney for more than two decades, Abruzzo rose through the ranks of the agency to serve as deputy general counsel under former President Barack Obama. She briefly served as the acting general counsel and left the agency during the Trump administration for a stint at Communications Workers of America, one of the largest labor unions in the U.S. Last year, she was confirmed to her current role in the U.S. Senate along party lines.

Arguably, her most significant move since then has come in an NLRB case filed in April, where she asked the labor board to reinstate Joy Silk, an arcane legal doctrine that could dramatically change how unions typically form in the U.S.

Joy Silk, which was abandoned nearly 50 years ago, would compel companies to bargain with a union that secures majority support from workers through authorization cards rather than going through a protracted election process. Logan noted that Joy Silk essentially curtails an employers’ ability to wage long anti-union campaigns in the leadup to an election, when unions tend to lose support from workers.

A formal move towards Joy Silk is expected to be hotly contested by businesses and right-to-work groups who want private-ballot elections. Some experts say elections better capture how workers feel about a union. And the leadup to a vote typically gives companies time to make their case to workers as to why they should reject unionization, which is legal as long as employers follow labor law.

However, labor activists and pro-union experts argue some employers use the time to fend off organizing by any means necessary, including mandatory meetings in which they lay out all the reasons why workers should reject unionization.

Though the labor board has allowed employers to mandate such meetings for decades, Abruzzo argued in an April memo that it was based on a misunderstanding of employers’ speech rights and should be outlawed. She’s seeking to make the meetings voluntary for workers.

Rep. Virginia Foxx, the Republican leader of the House Committee on Education and Labor, slammed Abruzzo’s memo soon after it was released, calling it “a hyper-partisan love letter to unions.”

“Should the NLRB choose to overturn decades of precedent and silence job creators, the consequences will be disastrous,” Foxx said in a statement at the time.

But field offices are following suit. About a month after Abruzzo’s memo was issued, the NLRB office in Brooklyn said it found merit in a charge filed by the Amazon Labor Union that accused Amazon of violating labor law at one of its warehouses on Staten Island, New York, by holding mandatory meetings to persuade workers to reject the union, adding further bad blood between the company and the agency.

Mark Nix, the president of the National Right to Work Legal Defense Foundation, said it’s difficult to take Abruzzo’s quest for more workers’ rights seriously because she’s attempting to overturn a Trump labor board decision that made it easier for employers to suspend bargaining on a future contract when they know a union no longer has majority support.

Abruzzo has signaled it’s one of the many decisions she intends to undo from the Trump era, when cases were spearheaded by her predecessor Peter Robb, who was widely seen by organized labor and Democrats as favoring employers. Biden later fired Robb.

“The hypocrisy is off the charts when you think about the employee rights,” Nix said. “When she gets done with the job, she ought to apply for the lobbyist job at the AFL-CIO, because she’s going even farther than union officials have even imagined.”

Experts say it’s too early to know how successful Abruzzo might be in her efforts because the changes she’s seeking are still winding their way through the NLRB’s process. Logan, the labor expert, said she’s has been more aggressive than her Democrat-appointed predecessors, but still faces a steep challenge since changes she’s seeking are likely to be heavily litigated.

“Unfortunately, it’s not going to help workers right now,” he said.

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By David Randall

NEW YORK (Reuters) -With U.S stocks on track to mark their worst first half of the year in more than 50 years, investors are studying a range of metrics to determine whether the coming months could bring relief, or more of the same.

By any stretch, the first half of 2022 has been a challenging one for investors. The S&P 500 is down around 18% year-to-date, on track for its worst first half of any year since 1970, according to S&P Dow Jones Indices, as the Fed tightens monetary policy in its fight against the highest inflation in decades.

Bonds, which investors typically count on to counterbalance stock declines in their portfolios, have fared little better: The U.S. bond market, as measured by the Vanguard Total Bond Market Index fund, is down 10.8% for the year to date, putting it on pace for its worst performance in modern history.

With investor expectations fluctuating between continued high inflation and an economic downturn caused by a hawkish Fed, few believe the market’s volatility will dissipate anytime soon.

“We don’t expect the choppiness and volatility we’ve seen over the first half of the year to subside,” said Timothy Braude, global head of OCIO at Goldman Sachs Asset Management.

GAINS FOLLOWS PAIN?

Historical data paints a mixed picture of the trajectory markets may follow in coming months. On one hand, sharp falls in stocks have often been followed by steep rebounds: past years in which the S&P 500 was down at least 15% at the midway point saw the final six months higher every single time, with an average return of nearly 24%, according to data from LPL Financial on market declines since 1932.

The S&P 500 rallied more than 3% on Friday for its biggest one-day percentage rise since May 2020 as signs of slowing economic growth led investors to dial back expectations over how high the Federal Reserve will raise interest rates to rein in inflation. For the week, the index is up 6.4%.

One factor that may sustain that rally in the short term is quarter-end rebalancing, as institutional investors such as pension funds and sovereign wealth funds draw on record cash levels to bring allocations to stocks back in line with their targets.

That phenomenon could lift markets by as much as 7% over the next week, JP Morgan analyst Marko Kolanovic said in a note on Friday.

Meanwhile, several so-called contrarian indicators tracked by analysts at BoFA Global Research, including cash allocations and investor sentiment, are flashing buy signals, analysts at the bank said in a note.

Jack Janasiewicz, lead portfolio strategist and portfolio manager with Natixis Investment Managers Solutions, believes the second half of the year is likely to be better than the first. He is growing more bullish on equities, particularly shares of beaten-down big tech companies with strong balance sheets, such as Google-parent Alphabet Inc.

“There is a lot of bad news priced in on the economy,” he said. “We think the risk is to the upside.”

Investors holding on for an eventual turnaround, however, may be in for a stomach-churning ride.

A study of bear markets over the last 150 years by Solomon Tadesse, head of North American Quant Strategies at Societe Generale, showed that stocks tend to bottom once they correct the “excesses” of the previous bullish period. That would entail the S&P 500 falling another 22% to 3,020, according to his research, which measures percentage declines during past crises of similar magnitude.

The market selloff is “an inevitable needed correction of the post-COVID excesses,” he said, describing a stimulus-fueled rally that saw the S&P 500 more than double from its March 2020 lows.

Skepticism on the sustainability of a market rebound extends to individual investors as well. A survey by the American Association of Individual Investors in the week ending June 22 found that 59.3% believe that the U.S. stock market will be bearish over the next six months.

Brian Jacobsen, senior investment strategist at Allspring Global Investments, believes a recent decline in bond yields may help tamp down volatility across markets, providing opportunities in areas such as emerging market equities and short-duration high-yield bonds.

For now, however, he remains cautious on the U.S. stock market.

“From a sector perspective, nothing screams safe,” he said.

Goldman Sach’s Braude, meanwhile, believes that inflation concerns and high commodity prices are likely to make the second half of the year as volatile as the first.

“There’s downside risk in stock and bond markets,” he said. “In an environment like this cash is king.”

(Reporting by David Randall; additional reporting by Ira Iosebashvili; editing by Grant McCool)

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WASHINGTON (AP) — Furious about surging prices at the gasoline station and the supermarket, many consumers feel they know just where to cast blame: On greedy companies that relentlessly jack up prices and pocket the profits.

Responding to that sentiment, the Democratic-led House of Representatives last month passed on a party-line vote — most Democrats for, all Republicans against — a bill designed to crack down on alleged price gouging by energy producers.

Likewise, Britain last month announced plans to impose a temporary 25% windfall tax on oil and gas company profits and to funnel the proceeds to financially struggling households.

Yet for all the public’s resentment, most economists say corporate price gouging is, at most, one of many causes of runaway inflation — and not the primary one.

“There are much more plausible candidates for what’s going on,” said Jose Azar an economist at Spain’s University of Navarra.

They include: Supply disruptions at factories, ports and freight yards. Worker shortages. President Joe Biden’s enormous pandemic aid program. COVID 19-caused shutdowns in China. Russia’s invasion of Ukraine. And, not least, a Federal Reserve that kept interest rates ultra-low longer than experts say it should have.

Most of all, though, economists say resurgent spending by consumers and governments drove inflation up.

The blame game is, if anything, intensifying after the U.S. government reported that inflation hit 8.6% in May from a year earlier, the biggest price spike since 1981.

To fight inflation, the Fed is now belatedly tightening credit aggressively. On June 15, it raised its benchmark short-term rate by three-quarters of a point — its largest hike since 1994 — and signaled that more large rate hikes are coming. The Fed hopes to achieve a notoriously difficult “soft landing” — slowing growth enough to curb inflation without causing the economy to slide into recession.

For years, inflation had remained at or below the Fed’s 2% annual target, even while unemployment sank to a half-century low. But when the economy rebounded from the pandemic recession with startling speed and strength, the U.S. consumer price index rose steadily — from a 2.6% year-over-year increase in March 2021 to last month’s four-decade high.

For a while at least — before profit margins at S&P 500 companies dipped early this year — the inflation surge coincided with swelling corporate earnings. It was easy for consumers to connect the dots: Companies, it seemed, were engaged in price-gouging. This wasn’t just inflation. It was greedflation.

Asked to name the culprits behind the spike in gasoline prices, 72% of the 1,055 Americans polled in late April and early May by the Washington Post and George Mason University’s Schar School of Policy and Government blamed profit-seeking corporations, more than the share who pointed to Russia’s war against Ukraine (69%) or Biden (58%) or pandemic disruptions (58%). And the verdict was bipartisan: 86% of Democrats and 52% of Republicans blamed corporations for inflated gas prices.

“It’s very natural for consumers to see prices rising and get angry about it and then look for someone to blame,’’ said Christopher Conlon, an economist at New York University’s Stern School of Business who studies corporate competition. “You and I don’t get to set prices at the supermarket, the gas station or the car dealership. So people naturally blame corporations, since those are the ones they see raising prices.’’

Yet Conlon and many other economists are reluctant to indict — or to favor punishing — Corporate America. When the University of Chicago’s Booth School of Business asked economists this month whether they’d support a law to bar big companies from selling their goods or services at an “unconscionably excessive price’’ during a market shock, 65% said no. Only 5% backed the idea.

Just what combination of factors is most responsible for causing prices to soar “is still an open question,’’ economist Azar acknowledges. COVID-19 and its aftermath have made it hard to assess the state of the economy. Today’s economists have no experience analyzing the financial aftermath of a pandemic.

Policymakers and analysts have been repeatedly blindsided by the path the economy has taken since COVID struck in March 2020: They didn’t expect the swift recovery from the downturn, fueled by vast government spending and record-low rates engineered by the Fed and other central banks. Then they were slow to recognize the gathering threat of high inflation pressures, dismissing them at first as merely a temporary consequence of supply disruptions.

One aspect of the economy, though, is undisputed: A wave of mergers in recent decades has killed or shrunk competition among airlines, banks, meatpacking companies and many other industries. That consolidation has given the surviving companies the leverage to demand price cuts from suppliers, to hold down workers’ pay and to pass on higher costs to customers who don’t have much choice but to pay up.

Researchers at the Federal Reserve Bank of Boston have found that less competition made it easier for companies to pass along higher costs to customers, calling it an “amplifying factor’’ in the resurgence of inflation.

Josh Bivens, research director at the liberal Economic Policy Institute, has estimated that nearly 54% of the price increases in nonfinancial businesses since mid-2020 can be attributed to “fatter profit margins,” versus just 11% from 1979 through 2019.

Bivens conceded that neither corporate greed nor market clout has likely grown significantly in the past two years. But he suggested that during the COVID inflationary spike, companies have redirected how they use their market power: Many have shifted away from pressuring suppliers to cut costs and limiting workers’ pay and have instead boosted prices for customers.

In a study of nearly 3,700 companies released last week, the left-leaning Roosevelt Institute concluded that markups and profit margins last year reached their highest level since the 1950s. It also found that companies that had aggressively raised prices before the pandemic were more likely to do so after it struck, “suggesting a role for market power as an explanatory driver of inflation.”

Yet many economists aren’t convinced that corporate greed is the main culprit. Jason Furman, a top economic adviser in the Obama White House, said that some evidence even suggests that monopolies are slower than companies that face stiff competition to raise prices when their own costs rise, “in part because their prices were high to begin with.’’

Likewise, NYU’s Conlon cites examples where prices have soared in competitive markets. Used cars, for example, are sold in lots across the country and by numerous individuals. Yet average used-car prices have skyrocketed 16% over the past year. Similarly, the average price of major appliances, another market with plenty of competitors, jumped nearly 10% last month from a year earlier.

By contrast, the price of alcoholic beverages has risen just 4% from a year ago even though the beer market is dominated by AB-Inbev and spirits by Bacardi and Diageo.

“It is hard to imagine that AB-Inbev isn’t as greedy as Maytag,’’ Conlon said.

So what has most driven the inflationary spike?

“Demand,’’ said Furman, now at Harvard University. “Lots of government spending, lots of monetary support — all combined together to support extraordinarily high levels of demand. Supply couldn’t keep up, so prices rose.’’

Researchers at the Federal Reserve Bank of San Francisco estimate that government aid to the economy during the pandemic, which put money in consumers’ pockets to help them endure the crisis and set off a spending spree, has raised inflation by about 3 percentage points since the first half of 2021.

In report released in April, researchers at the Federal Reserve Bank of St. Louis blamed global supply chain bottlenecks for playing a “significant role” in inflating factory costs. They found that it added a staggering 20 percentage points to wholesale inflation in manufacturing last November, raising it to 30%.

Still, even some economists who don’t blame greedflation for the price spike of the past year say they think governments should try to restrict the market power of monopolies, perhaps by blocking mergers that reduce competition. The idea is that more companies vying for the same customers would encourage innovation and makes the economy more productive.

Even so, tougher antitrust policies wouldn’t likely do much to slow inflation anytime soon.

“I find it helpful to think about competition like diet and exercise,” NYU’s Conlon said. “More competition is a good thing. But, like diet and exercise, the payoffs are long term.

“Right now, the patient is in the emergency room. Sure, diet and exercise are still a good thing. But we need to treat the acute problem of inflation.’’

___

AP Economics Writer Christopher Rugaber contributed to this report.

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BERLIN (Reuters) – Germany will allow the entry of foreign workers to fill staff shortages at the German airports as a temporary solution, Bild am Sonntag reported on Sunday, citing the interior, transport and labour ministers.

Airport operators across Europe, including Germany, have been struggling with staff shortages to handle the flow of passengers as demand for travel bounces back with the end of most COVID-19 restrictions.

Photos of travellers waiting in long lines at security check points at Duesseldorf airport earlier this week showed the scale of the shortage which has caused chaos during the holiday season.

The Interior, Labour and Transport ministries will start a joint campaign for brining temporary foreign employees to work at German airports, Bild said, adding that there was a shortage around 2,000 to 3,000 employees at the airports.

The campaign aims to bring a four-digit number of skilled workers from Turkey to Germany, who could be deployed for a few months from July.

Labour Minister Hubertus Heil said employers must pay collective wages and provide decent accommodation for a limited time.

“We want to rule out any form of social dumping and exploitation,” Heil was quoted as saying by Bild.

(Reporting by Riham Alkousaa)

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(Reuters) -A growing number of companies, including JPMorgan Chase & Co, Amazon.com Inc, Tesla Inc, and Walt Disney Co are rolling out policies to offer benefits to U.S. employees who may need to access abortion services.

The U.S. Supreme Court on Friday took the dramatic step of overturning the landmark 1973 Roe v. Wade ruling that recognized a woman’s constitutional right to an abortion and legalized it nationwide.

Following is a partial list of companies that have offered their U.S. employees reproductive healthcare benefits including abortion coverage or travel benefits for out-of-state abortions.

Company Benefit(s) Offered

JPMorgan Chase & Co The company told employees it would pay for their travel to

states that allow legal abortions, according to a memo seen

by Reuters.

Citigroup Inc The bank has started covering travel expenses for employees

who go out of state for abortions because of newly enacted

restrictions in Texas and other states, becoming the first

major U.S. bank to make that commitment.

Goldman Sachs Group Inc Goldman Sachs Group Inc will cover travel expenses for its

U.S.-based employees who need to go out of state to receive

abortion or gender-affirming medical care starting July 1.

Meta Platforms Inc. Meta said in statement it intends to offer travel expense

reimbursements, to the extent permitted by law, for

employees who will need access to out-of-state healthcare

and reproductive services.

Yelp Inc The crowd-sourced review platform will extend its abortion

coverage to cover expenses for its employees and their

dependents who need to travel to another state for abortion

services.

Amazon.com Inc The second-largest U.S. private employer told employees it

will pay up to $4,000 in travel expenses yearly for

non-life threatening medical treatments, among them

elective abortions.

Levi Strauss & CO The apparel company will reimburse travel expenses for its

full- and part-time employees who need to travel to another

state for healthcare services, including abortions.

United Talent Agency The private Hollywood talent agency said it would reimburse

travel expenses related to women’s reproductive health

services that are not accessible in an employee’s state of

residence.

Tesla Inc Tesla’s Safety Net program and health insurance includes

travel and lodging support for its employees who may need

to seek healthcare services that are unavailable in their

home state, according to the company’s 2021 impact report.

(https://bit.ly/3beSOOQ)

Microsoft Corp Microsoft said it would extend its abortion and gender

affirming care services for employees in the United States

to include travel expense assistance.

Starbucks Corp Starbucks said it will reimburse U.S. employees and their

dependents if they must travel more than 100 miles from

their homes to obtain an abortion.

Netflix Inc Netflix said it will offer travel reimbursement for U.S.

employees and dependents who travel for cancer treatment,

transplants, abortion and gender-affirming care through its

U.S. health plans.

Mastercard Inc Mastercard said it will fund travel and lodging for

employees seeking abortions outside their home states from

June, according to an internal memo seen by Reuters.

Kroger Co Kroger said it will provide travel benefits up to $4,000 to

facilitate access to several categories of medical

treatments and a full range of reproductive health care

services, including abortion.

Uber Technologies Inc Uber said its insurance plans in the United States cover a

range of reproductive health benefits, including pregnancy

termination and travel expenses to access healthcare.

DoorDash Inc DoorDash said it will cover certain travel-related expenses

for employees who face new barriers to access and need to

travel out of state for abortion-related care.

Lyft Inc Lyft said its U.S. medical benefits plan includes coverage

for elective abortion and reimbursement for travel costs if

an employee must travel more than 100 miles for an

in-network provider.

Bank of America Corp The bank said it will reimburse employees and their

dependents for the cost of traveling to receive

reproductive healthcare, including abortions.

Deutsche Bank AG The bank said it is updating its U.S. healthcare policy to

cover travel costs for any medical procedure, including

abortion, that is not offered within 100 miles of an

employees’ home, according to a source familiar.

American Express Co American Express said it will cover travel and other

related expenses for employees and their dependents if they

need abortion or gender-affirming treatment that is not

available where they live.

Block The payments company said it will cover expenses for U.S.

employees who must travel more than 100 miles for abortions

starting July 1, a source familiar with the matter said.

Macy’s Inc Macy’s said it made the decision to expand its benefits

program to provide travel reimbursement for colleagues to

receive the medical care needed and will abide by existing

laws and legal standards.

Walt Disney Co Disney said the company’s benefits will cover the cost of

employees who need to travel to another location to access

care, including to obtain an abortion, it said.

Gucci Gucci said in May it will cover travel expenses of U.S.

employees who need access to health care not available in

their home state. The company also has said it will match

employee donations to Planned Parenthood.

(Reporting by Doyinsola Oladipo and Akash Sriram; Additional reporting by Chavi Mehta; Editing by Anna Driver, Rosalba O’Brien, Bill Berkrot and Daniel Wallis)

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