BMO Sr. Economist Jennifer Lee joins Yahoo Finance Live to discuss the road ahead for the Fed, inflationary pressures, anticipating a recession, and the outlook for the economy.

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#yahoofinance #foodprices #inflation…(read more)

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Rising food prices have become one of the main factors supporting global inflation, according to leading economists. The increase in food prices has been attributed to a myriad of factors including climate change, supply chain disruptions, and the ongoing COVID-19 pandemic.

Agricultural products are essential to the global economy and the recent surge in food prices has had a significant impact on consumers and businesses. According to the United Nations Food and Agriculture Organization (FAO), global food prices rose for the 12th consecutive month in May 2021, reaching their highest level since September 2011. This steady rise in food prices has raised concerns about its potential impact on inflation rates worldwide.

Economists point to several reasons for the increase in food prices. Changes in weather patterns, such as droughts, floods, and extreme temperatures, have affected crop yields and disrupted agricultural production. These challenges have been further exacerbated by the ongoing effects of climate change, which has led to increased volatility in food production and distribution.

Additionally, supply chain disruptions caused by the COVID-19 pandemic have further contributed to rising food prices. Lockdowns and restrictions have disrupted the movement of goods and labor, leading to shortages and higher costs in the production and transportation of food products.

The impact of rising food prices extends beyond the cost of groceries for consumers. Inflationary pressures from higher food prices can also lead to increased production costs for businesses, potentially leading to higher prices for other goods and services in the market.

Economists have emphasized the importance of addressing the underlying factors driving food price inflation in order to mitigate its impact. Efforts to address climate change and promote resilience in the agricultural sector are critical in ensuring long-term stability in food production. Additionally, policymakers must work to alleviate supply chain disruptions and support the recovery of the global economy from the effects of the pandemic.

As global inflation continues to be influenced by rising food prices, the need for coordinated action to address these challenges becomes increasingly urgent. The effects of inflation are far-reaching and have implications for individuals, businesses, and governments around the world. By addressing the underlying causes of rising food prices, it is possible to mitigate the impact on global inflation and ensure the stability of the global economy.