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Food Prices on the Rise – Are Gold & Silver Next?

Food and fuel prices are on the rise, according to the U.S. Bureau of Labor Statistics. Despite the Federal Reserve’s incessant claims of non-existent inflation it was reported yesterday that overall core inflation rose 1.7% in the last 12 months, and that figure does not factor in food or energy prices.

The food index tallies prices for eggs, beef, poultry and similar goods, and that index rose 1.2% in March, marking the second consecutive monthly rise in food prices. Droughts have driven beef prices to all-time highs and many analysts believe the food index could rise more than 10.75% this year.

The energy index fell 0.1% last month but rose substantially in the three months prior as harsh winter conditions created more demand for gasoline, propane and kerosene. The index’s slight decline in March is not expected to appease inflation hawks as gains seen during the winter were virtually impossible to match in the warmer month of March, according to analysts. The energy index is on pace to rise more than 6% in 2014.

The rental property index also increased substantially last month. March saw a 0.3% gain in the rental index, which has grown 2.7% in the last 12 months as demand for new housing has slowed and consumers have opted to rent rather than buy.

With the government trying to keep a lid on food, energy and rent prices it is no surprise that gold and silver prices have been flat. Until inflation becomes flagrantly obvious or interest rates start to rise it could be slow going for precious metals, at least price-wise. In terms of safety there may be no better time than now to buy gold and silver.

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