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UBS analysts identified five long-term forces likely to keep global food inflation "structurally higher" above its pre-pandemic average of about 2.5%, crushing consumer hopes that price pressures will simply fade.

"While food inflation globally has fallen from the COVID peak, a new debate is emerging: is the c2.5% LT average obsolete?" London-based managing director and equity-research analyst Sreedhar Mahamkali asked in a note penned on Monday.

Mahamkali and his team outlined five long-term drivers of global food inflation:

1. Climate risk is global, although its intensity differs by geography and commodity. Academic research suggests climate change could add around 0.9 to 3.2 percentage points to annual global food inflation by 2035.

2. Weak farm profitability limits investment and supply responsiveness globally. The pressure is most visible where farms are small, fragmented or exposed to volatile inputs, although scale, subsidies and access to credit can provide greater protection in some markets.

3. Higher welfare standards are lifting costs in animal protein. UK and European poultry provide the clearest current evidence, but similar changes in stocking density, housing, biosecurity and traceability are emerging across several markets.

4. Labor costs are rising across the food chain. The effect is strongest in labour- intensive farming, processing, logistics, food service as well as the front-end retail, although productivity, automation and the availability of lower-cost labour produce meaningful regional differences.

5. Supply flexibility is constrained globally: some markets face limited land expansion and tighter standards, while others contend with underinvestment and climate vulnerability.

"We expect food-at- home to start regaining share from historical lows, suggesting higher spend in the Food Retail channel with potential tailwinds as we demonstrate with a UK case study. On the other hand, wallet share compression of the discretionary categories means food-away- from-home and non-food retail are more vulnerable," the analyst pointed out.

He expects food inflation to run above historical levels in the UK, Europe, Australia, Southeast Asia and China, while remaining broadly unchanged in the US and Latin America and declining in India:

The UK faces all five drivers, but a rational competitive landscape enables better pass- through, leaving it as the best-positioned retail market.

Europe too faces many of the pressures, but greater fragmentation dilutes pricing power. In the fragmented US, structural cost pressure is largely offset by competition, likely leaving inflation in line with history.

In Latam, Brazil is relatively insulated with moderate impacts from labour cost inflation, welfare standards and a better supply outlook aided by technology with the outlook the same as history.

By contrast, ASEAN sees a sticky underlying cost base and a potential El Niño in H2 suggesting sustained pressure. China is likely to see a gradual increase in food inflation as external cost pressures are effectively transmitted.

Higher operating costs persist in Australia with regulation/welfare standards leading to higher inflation with some costs likely absorbed by retailers. India is the exception, benefiting from policy intervention and productivity gains with lower inflation than in the past.

Visualizing: Food prices could keep rising faster than they did before Covid, remaining above the historical average of about 2.5% annual inflation. Several long-term pressures are making food permanently more expensive.

For the food inflation narrative to continue, the analysts outlined what they are tracking over the next six months:

Here are the winners and losers under different food inflation scenarios:

Five out of eight regions are likely to see higher inflation:

The era of cheap food may be ending. Food inflation could further ignite as other Wall Street desks warn about El Niño risk developing and Professional subscribers can read those notes here at our new Marketdesk.ai portal. 

Via The Cradle

The US Office of Foreign Assets Control (OFAC) lifted sanctions on Iraq's Fly Baghdad Airlines and two of its aircraft on Wednesday, clearing a carrier Washington had blacklisted in January 2024 over alleged support for Iran's Islamic Revolutionary Guard Corps (IRGC) Quds Force. 

The Baghdad-based carrier was delisted from the Specially Designated Nationals (SDNs) list under each of its three registered names, Fly Baghdad Airlines Company, Fly Baghdad, and Iraq Express.

Two Boeing 737 aircraft flown by the airline, carrying the tail numbers YI-BAF and YI-BAN, were removed from the list at the same time.

A US Treasury official, who spoke anonymously, told AFP that the airline had cleared the department's administrative reconsideration process.

"FBA (Fly Baghdad Airlines) has demonstrated major changes to their operations such that their listing is no longer warranted," the official said.

The same official said the delisting is "not indicative of any shift in US policy toward the Government of Iran, the Islamic Revolutionary Guard Corps-Qods Force, any designated terrorist organization, or any person who supports or acts on behalf of any of these."

Not every restriction tied to the airline has been dropped. Basheer Abdulkadhim Alwan al-Shabbani, the Iraqi national identified as the company's owner when the sanctions were first imposed, remains blacklisted.

His entry was rewritten so that the designation now cites the IRGC Quds Force directly instead of Fly Baghdad.

Washington first designated the airline, its aircraft, and its owner in January 2024, alleging the company supported Iran’s Quds Force and allied groups in Iraq, Syria, and Lebanon.

The delisting comes amid a broader US sanctions campaign that continues to target Iran’s IRGC-linked logistics and aviation networks. 

There is some reporting that Treasury removed Iran-related sanctions from its website. A Treasury official tells me, “This is not indicative of any shift in U.S. policy toward the Government of Iran, the Islamic Revolutionary Guard Corps—Qods Force, any designated terrorist…

— Jacqui Heinrich (@JacquiHeinrich) August 5, 2026

Just last week, Washington sanctioned entities tied to Mahan Air, which it alleges helps move weapons, personnel and equipment for the IRGC Quds Force. 

The action also hit support firms in China, India and Russia that Treasury says served as the airline’s sales agents and logistics intermediaries.

As China races to modernize its armed forces, its strategy is increasingly centered on developing technologies that could offset America's traditional military advantages instead of matching the U.S. system for system, according to the South China Morning Post.

That philosophy dates back to Unrestricted Warfare, a book published in 1999 by former PLA strategist Qiao Liang. Rather than copying America's arsenal, Qiao argued China should focus on capabilities Washington lacks. Nearly three decades later, he says the concept still applies. Modern militaries, he said, are now "building weapons for the wars they expect to fight, rather than fighting wars with the weapons they possess."

With the People's Liberation Army approaching its 100th anniversary next year, Beijing is expected to unveil another round of modernization goals as it works toward Xi Jinping's objective of creating a "world class military" by 2049. Analysts say the focus has shifted beyond simply catching the United States. China wants to help define the next era of warfare through artificial intelligence, quantum technology, hypersonic missiles, laser weapons and autonomous systems.

That ambition is perhaps most visible in aviation. The public appearance of China's tailless sixth generation fighter prototypes has fueled speculation that Beijing could be setting the pace in next generation air combat. Military analyst Fu Qianshao called the development "a landmark event," arguing that China is no longer just following trends established by the United States and Russia.

SCMP writes that future battlefields, analysts say, will revolve around connected, intelligent systems rather than individual weapons. Piloted aircraft may direct fleets of drones, armored vehicles could become mobile command and sensing platforms, and combat operations will increasingly link forces across land, sea, air, space and cyberspace with artificial intelligence playing a growing role in decision making.

China is investing heavily across that spectrum. The PLA has accelerated work on advanced aircraft carrier technology, AI powered drone swarms, underwater autonomous vehicles, electronic warfare and high performance computing. Much of that development is supported through Beijing's military civilian fusion strategy, which combines military research with universities and private technology companies.

Among the most closely watched programs are hypersonic weapons, quantum communications and artificial intelligence. China is widely regarded as a leader in hypersonic missile development and has spent years building quantum communication networks that could strengthen secure military communications. AI is already being tested for intelligence analysis, battlefield planning and autonomous drone operations.

Chinese planners have also closely studied the wars in Ukraine and the Middle East, where drones have transformed modern combat. That has accelerated work on laser and microwave based air defense systems designed to defeat large drone swarms before they can reach their targets.

Even so, analysts caution that emerging technologies are unlikely to replace traditional military power on their own. Instead, they are expected to strengthen existing forces by making conventional ships, aircraft, missiles and ground units faster, more connected and more effective while introducing new opportunities and new risks.

For many Americans, owning a car is a necessity, but the financial burden varies dramatically by state. In the least affordable places, annual vehicle expenses consume nearly one-quarter of the typical household’s income.

This map, via Visual Capitalist's Dorothy Neufeld, ranks every state by annual car ownership costs as a share of median household income, based on analysis from LendingTree of active auto loan holders. The estimates include financing, insurance, fuel, and maintenance.

The States Where Car Ownership Costs the Most

The table below ranks every state by annual car ownership costs as a share of median household income.

State	Total Costs	Median Household Income	% of Household Income
Louisiana	$14,894	$64,199	23.2%
Mississippi	$13,378	$62,242	21.5%
New Mexico	$14,115	$71,388	19.8%
Arkansas	$12,798	$65,378	19.6%
Alabama	$13,164	$70,171	18.8%
West Virginia	$11,951	$64,001	18.7%
Kentucky	$12,628	$67,925	18.6%
Oklahoma	$12,722	$69,633	18.3%
Florida	$14,546	$81,830	17.8%
Missouri	$13,235	$75,360	17.6%
Arizona	$14,860	$85,779	17.3%
Wyoming	$13,533	$79,511	17.0%
Texas	$14,139	$83,921	16.8%
Nevada	$14,341	$85,408	16.8%
Montana	$13,245	$79,309	16.7%
Georgia	$13,733	$84,205	16.3%
Tennessee	$12,350	$75,790	16.3%
Kansas	$12,941	$79,492	16.3%
Indiana	$12,269	$75,750	16.2%
South Carolina	$12,233	$76,161	16.1%
Michigan	$12,208	$76,202	16.0%
North Dakota	$12,766	$81,973	15.6%
Ohio	$11,574	$76,016	15.2%
Iowa	$11,992	$79,478	15.1%
North Carolina	$11,725	$77,854	15.1%
Nebraska	$12,133	$80,399	15.1%
South Dakota	$12,092	$80,931	14.9%
Wisconsin	$11,947	$81,570	14.6%
New York	$13,183	$90,341	14.6%
Idaho	$12,340	$85,442	14.4%
Pennsylvania	$11,735	$81,630	14.4%
Illinois	$12,549	$87,594	14.3%
Maine	$11,231	$80,469	14.0%
Oregon	$12,528	$89,709	14.0%
Delaware	$12,680	$92,145	13.8%
Rhode Island	$12,042	$87,903	13.7%
Colorado	$13,876	$102,229	13.6%
California	$14,325	$105,425	13.6%
Minnesota	$12,304	$91,706	13.4%
Vermont	$11,542	$87,088	13.3%
Alaska	$13,051	$100,705	13.0%
Washington	$13,558	$104,625	13.0%
Utah	$13,023	$101,750	12.8%
Virginia	$12,214	$96,941	12.6%
New Jersey	$13,708	$109,788	12.5%
Connecticut	$12,630	$101,109	12.5%
Hawaii	$13,193	$106,052	12.4%
Maryland	$13,314	$108,326	12.3%
District of Columbia	$13,205	$115,486	11.4%
New Hampshire	$11,418	$105,038	10.9%
Massachusetts	$11,745	$110,350	10.6%
???? U.S. Average	$12,841	$85,759	15.0%

Data is for active auto loan holders. Cost and income figures were adjusted to 2026 dollars.

Louisiana is the nation’s least affordable state for car ownership, with the typical household spending 23.2% of its income, or $14,894 annually, on vehicle expenses. By comparison, Massachusetts households devote just 10.6% of their income to car ownership.

Mississippi, New Mexico, Arkansas, and Alabama round out the top five, with households in each spending roughly one-fifth of their income on car ownership.

Why Car Ownership Is Less Affordable Across the South

The South dominates the least affordable rankings because many states combine relatively modest household incomes with high ownership costs.

Insurance is one major factor. Louisiana and Florida, for example, consistently rank among the country’s most expensive states for auto insurance due to severe weather, litigation costs, and high accident claims.

Drivers in many Southern states also travel more miles each year, increasing spending on fuel, maintenance, and repairs.

America’s Most Affordable States for Car Ownership

Massachusetts has the nation’s lowest car ownership burden, with annual costs equal to 10.6% of median household income, or $11,745.

New Hampshire and Maryland also rank among the most affordable states, helping make the Northeast the country’s least financially burdensome region for car ownership. Higher incomes help keep costs manageable across much of the region, while extensive public transit may allow some households to drive less or own fewer vehicles.

These rankings show that car affordability depends on more than the cost of owning and operating a vehicle. Household income also plays a major role, meaning similar expenses can create very different financial burdens depending on where people live.

To learn more about this topic, check out this graphic on the cheapest car brands to own and maintain.

US forces "used up virtually all" of their precision, long-range missiles during the course of the Iran war, and during the earlier heavy US-Israeli campaign of Operation Epic Fury, Reuters reported Tuesday.

This has raised serious "concerns about the military's ?readiness for future conflicts," informed sources told the outlet. In particular it is the Army Tactical Missile Systems (ATACMS) and Precision Strike Missiles (PrSM) which are said to be running critically low.

"Washington has used virtually all of these weapons," two sources told Reuters, after several media reports and think tank studies had already sounded the alarm over dwindling missiles amid both the Iran war and in the years-long process of supplying Ukraine. Low Patriot defense missile supplies have also been a persisting issue in the headlines.

They are costly and time-consuming in terms of manufacturing replacements. For example a single ATACMS munition costs about $1 million.

One immediate consequence could be that if heavy bombardment of Iran starts up again, the US would have to conduct riskier piloted aerial bombings - instead relying on longer range precision strikes afforded by the land-based systems at safer distances.

And another, somewhat obvious consequence, is highlighted in the following: "But as ?the war drags on, the three people familiar with the matter expressed worry that the falling missile supplies could limit the U.S. ability to deter adversaries, including Russia and China."

The report added: "A fourth person ?familiar with the matter said that while Central Command — which oversees U.S. forces in the Middle East — has nearly used up the land-based missiles it had before the war began, it has been able to reload from U.S. military supplies elsewhere in the ?world."

President Trump has of late responded to these now widespread reports of badly depleted advanced munitions, explaining that "Our defense companies are, at this moment, making more munitions than they have ever made before, ?in addition to expanding their plants and equipment at record levels."

Additionally,  Secretary of War Pete Hegseth took to social media to refute the report, calling it false news.

“That banner is NOT TRUE, CNN. Shame on you,” the Pentagon chief said in a post on X. “We don’t hate the Fake News media enough.”

Hegseth was specifically referring to a CNN on-screen banner that read: “Sources: U.S. has used nearly 80% of key missile interceptors in Iran war, top commanders warn stockpiles dangerously low.”

However, the Reuters report has set off speculation that Trump's weekend backtracking on planned 'harder' Iran strikes could have been in part because the Pentagon has warned of waning supplies and capabilities regarding conventional way of doing long-range missile strikes.

We’re out of crucial defensive weapons systems, and now we’re out of crucial offensive weapons. Other than that, Sir, how’s the war going? https://t.co/qXNiSLHQho

— Mark Ames (@MarkAmesExiled) August 4, 2026

Critics of the decision to go to war in the first place have warned over this very scenario of exhausting Pentagon stockpiles. Those against this war of choice say that it's the opposite of America First - and that ultimately the war is about protecting Israel and not necessarily American security and interests.

The reality also is that in the opening days of Operation Epic Fury, the US seemed underprepared for the ferocity of the Iranian response. At least 13 American bases in the region were hit and damaged in just the opening weeks of the war, to the point that US forces across the region had to be moved back from front line Gulf areas, and energy sites across the region were pummeled and suffered billions of dollars in damage.