(Image: Tom Red/Private Media)
(Image: Tom Red/Private Media)

When the world's biggest retailer surprises markets with a significant downgrade, it demands attention -- including from monetary policymakers.

Walmart's after-hours downgrade, spanning the three months to June and for the rest of 2022, rattled markets: according to Walmart its gross margin would be "negatively impacted", with higher inflation identified as the key concern. The statement will echo in retailing across the globe because of the impact of high inflation on everyday products, especially food.

Paradoxically, Walmart said comparable store sales will be up around 6% in the quarter (which is better than the 5.5% peak forecast in May) -- but that's due to higher prices, not volumes.