If inflation rates see a rise this week, Amazon’s Amazon Prime’s membership price hike could be hurting their stock rather than helping it.
Amazon Prime’s recent decision to raise its membership price to $119 may begin to hurt Amazon’s stock if inflation rates see a rise this week. This comes even though Amazon has been very much bowed to for its hand in the recent inflation drop that recent stock market investors consider a gift from above.
Back in April, Amazon had made the announcement that their Amazon Prime membership price will be making a massive jump from $99 to $119 per annum, effective on May 11th. The last price hike it announced was put in place in 2014, and the benefits of its membership have seen a massive expansion. Not only do members have access to its Amazon video & Music for free, they also get free shipping as several other discounts.
Amazon’s stock is currently just under its record high, rising 0.3$ last Monday.
The Upcoming Inflation
According to economists, the consumer price index is expected to be up by 2.2% in comparison to this time last year, and even a 0.2% rise in comparison to a couple of months prior. But some economists are saying that the inflation may be at an even bolder 2.3%.
They claim the recreation market shows a boom given Amazon Prime’s price hike and that the new & used cars, medical and rent categories will also play a part in the upcoming inflation rate.
If the inflation rate does go up, investors will be worried that Fed would also intend to ramp up its rates as well. They have been clear in their message that they plan to ramp up their prices in the face of even the slightest inflation hike. Because of this, Wednesday afternoon will be expecting another Fed rate increase and further inflation.