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B. G., Opalesque Geneva:

Canada-based quantitative investment manager Auspice Capital Advisors believes that agflation and cost-push inflation could soon dominate and drive inflation back upwards.

Agflation, a portmanteau of the words "agriculture" and "inflation", describes the phenomenon when food prices rise more rapidly than the prices of other goods and services due to the growing demand for crops as both food and for use in biofuels. Cost-push inflation occurs when overall prices increase due to increases in the cost of wages and raw materials.

Last month, sugar reached ten-year highs, Robusta coffee futures reached 12-year highs, and cattle futures and orange juice futures made all-time record highs.

While broad-based inflation metrics remain elevated (US CPI 5%), they have softened substantially since the 40+ year peaks reached in 2022, says Auspice. While it is a positive for the consumer and the economy, Auspice believes this recent trend could come to an end. "We have seen this cycle before," the manager says:

1. After surpassing 6% in 1970, CPI dropped below 3% in 1972 before surging again to over 12% in 1974. 2. Inflation then......................

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