Diesel daze: inflation pressures, export bans, and midterms
USO•Rising diesel prices are adding to inflation pressures as President Donald Trump weighs a 90-day diesel export ban. US crude was up more than 3.5%, and the 10-year Treasury yield rose to about 5.26%.
1. Diesel and inflation
The article says higher diesel prices are contributing to inflation pressures because diesel is used to move goods and is a major cost for transportation companies. J.B. Hunt reported a net profit margin of just over 5% in its most recent quarterly report; transportation companies may absorb higher costs, pass them on, or do both.
2. Export ban under consideration
President Donald Trump is weighing a 90-day diesel export ban ahead of critical midterm elections. Oxford Economics’ Bernard Yaros said diesel prices are an upside risk to inflation and that a temporary export ban might add to that risk.
3. Markets at a glance
The main US indexes were lower, with the Nasdaq down more than 1%. Energy led S&P 500 sector gainers while communication services was weakest; the dollar gained, gold fell about 4%, and the Euro STOXX 600 rose about 0.3%.
