Americans to see higher costs
NEW YORK: After years of low, low prices, fed by near-zero interest rates in a convalescing economy, Americans are waking up to costlier consumer living.
Everyday household staples like diapers, toothpaste, shampoo and dishwashing liquid – not to mention soft drinks, cookies, chocolate, cat litter and autos – have all started getting more expensive, a trend expected to continue early next year.
Announced by companies during the most recent earnings season, these price hikes have typically ranged from 2% to 10%. They also stand in stark contrast to the usually unending sales and promotions from major retailers like Walmart and Amazon.
The higher prices aim to pad revenues for companies like Apple, which has just raised sticker prices for its new MacBook Air laptops and iPads by 20% and 25%.
But for a growing number of businesses, they also represent a response to mounting transportation costs.
A stronger US dollar is similarly cutting into foreign earnings – while a tight labour supply is at last pushing up wages.
US auto giant General Motors
upped the average price of its SUVs, crossovers and pickups by US$800 (RM3,360), something the company ties to rising costs for steel and aluminium – commodities on which President Donald Trump slapped steep new import duties this year.
American manufacturers are now paying 8% more for aluminium than they did a year ago and 38% more for steel as local producers increase their prices.
The 10% duties Trump imposed in September on US$200bil (RM840bil) in Chinese goods are also a drag for importers.
Like GM, most businesses have tried to pass these costs on to consumers. Benno Dorer, chief executive at Clorox, told investors recently that “doing nothing at this point is not an option.”
Half of the company’s products will cost more next year.