Market Recap: Inflation Surges, Cocoa Prices Soar, and Wholesale Costs Rise

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chocolate prices rising

Market Recap: Inflation Surges, Cocoa Prices Soar, and Wholesale Costs Rise

SPY
S&P 500

Last Week: -1.04%
YTD: 7.60%
1 Year: 32.63%

DIA

Dow Jones Industrial Average

Last Week: -0.73%
YTD: 3.16%
1 Year: 23.87%

ONEQ
NASDAQ

Last Week: -1.82%
YTD: 6.25%
1 Year: 38.73% 

Russell 2000

Last Week: -1.22%
YTD: 0.85%
1 Year: 19.98% 

Large Growth

YTD: 8.95%
1 Year: 42.73% 

Large Value

YTD: 5.26%
1 Year: 22.14%

Consumer Prices Rise

The consumer price index, which measures the prices of goods and services, increased 0.4% for the month and 3.2% from this time last year. The monthly number came in on target with expectations, while the 12-month figure came in slightly higher than forecasted. The main increase came from energy prices, which increased 2.3%. Food costs were flat, while shelter costs climbed 0.4%. With inflation sticking around, the Fed likely won’t decrease interest rates until at least summer and maybe even longer.

Cocoa Prices Skyrocket

Cocoa prices have nearly doubled due to a lack of supply and an abundance of demand. Chocolate prices for consumers are starting to see a huge increase as a result. The main cocoa-growing region is near the equator in Western Africa. Cocoa crops have been hit hard with diseases, and extreme weather has put a strain on the existing plants. This region produces over 75% of the world’s cocoa supply. Our next major holiday, Easter, is a sizeable chocolate-consuming holiday, and we will likely see another significant price increase. There seems to be no end in sight with a lack of new planting to replenish growing demand and battered plants.

Wholesale Inflation

The producer price index, which measures the pipeline costs for raw, intermediate, and finished goods, rose 0.6% for the month. This was double the expected rise. The year-over-year increase was 1.6%, the biggest jump since September 2023. Retail sales increased less than expected, coming in at 0.6%. This sent most major U.S. stock indices lower last week. The PPI is considered a leading indicator for inflation, as it determines costs early in the supply chain that will later be felt by consumers. This is a key inflation measure used by the Fed and will help them determine when to start lowering interest rates.

  • Alex Wolfe

    Alex is a Certified Financial Planner™. He brings nearly a decade of experience working with individuals, families, and business owners. Prior to working for Base Wealth Management, Alex worked for Fidelity Investments and an independent wealth management firm in Venice, FL. Through many years of practice, he specializes in helping clients navigate their financial goals through comprehensive financial planning. He received his bachelor’s degree in economics from Texas A&M University.

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2022 Tax Document Information

As a Base Wealth Management client, you should receive your paper tax documents via mail in the coming weeks. Or, if you previously had an online account with Pershing’s NetX360, you should be able to access your 2022 tax documents through that portal. 

If not, or if you experience any issues, please reach out to Tim O’Brien (tim.obrien@intervestintl.com).

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