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The risks of the Federal Reserve moving too far with interest rate hikes, and slowing the economy more than necessary, have become “more balanced” with those of not moving high enough to control inflation, Fed Chair Jerome Powell said on Friday in remarks reaffirming the central bank’s intent to be cautious in its upcoming monetary policy decisions.

Noting that a key measure of inflation averaged 2.5% over the six months ending in October, near the Fed’s 2% target, Powell said it was clear that monetary policy was slowing the economy as expected with a benchmark overnight interest rate “well into restrictive territory.”

“The full effects of our tightening have likely not yet been felt. The forcefulness of our response to inflation also helped maintain the Fed’s hard-won credibility, ensuring that the public’s expectations of future inflation remain well-anchored,” Powell said in remarks at Spelman College in Atlanta. “Having come so far so quickly, the (Federal Open Market Committee) is moving forward carefully, as the risks of under- and over-tightening are becoming more balanced.”

Powell reiterated, as his colleagues have in recent weeks, that it was still too early to declare the Fed’s inflation fight finished, with prices rising 3.0% annually by the measure the central bank uses to set its target.

Prices as of October were up 3.5% when stripped of food and energy costs, a measure the Fed sees as a better guide of inflation’s trend.

“We are prepared to tighten policy further if it becomes appropriate to do so,” he said.

But his remarks also reflected increased confidence that the current 5.25%-5.50% policy rate may well be adequate to complete the job.

The Fed meets on Dec. 12-13 and is expected to leave its benchmark rate unchanged for the third meeting in a row.

Powell also fielded questions after his speech in a conversation with Spelman College President Helene Gayle.

The Fed chief said policymakers still regard the uncertainty in the economic outlook to be “unusually elevated,” one factor in their insistence that rates may still need to rise.

But he also said that the broad outlines of the hoped-for “soft landing” seemed to be falling into place, with the job market still strong even as growth in spending and output slows and price pressures abate.

“My colleagues and I anticipate that growth in spending and output will slow over the next year, as the effects of the pandemic and the reopening fade and as restrictive monetary policy weighs on aggregate demand,” Powell said.

“The pace at which the economy is creating new jobs remains strong, and has been slowing toward a more sustainable level … Wage growth remains high, but has been gradually moving toward levels that would be more consistent with 2% price inflation over time, and real wages are growing again as inflation declines,” he said.

Shortly before Powell delivered his remarks, a key reading on the health of theUS manufacturing sectorshowed activity there remained subdued and factory employment declined.

The Institute for Supply Management’s Purchasing Managers Index has now indicated the sector has been in contraction for 13 straight months, the longest such run in more than two decades, as demand for goods continues to soften.

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Former Bank of England governor Mark Carney named prime minister of Canada – succeeding Justin Trudeau

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Former Bank of England governor Mark Carney named prime minister of Canada - succeeding Justin Trudeau

Former Bank of England governor Mark Carney has been named Canadian prime minister after winning the Liberal Party leadership race in a landslide victory.

Mr Carney, who also used to be the head of Canada’s central bank, emerged as the frontrunner in the contest as the country deals with the impact of tariffs imposed by US President Donald Trump.

He ended up winning 85.9% of the vote.

During his victory speech, he told the crowd: “Donald Trump, as we know, has put unjustified tariffs on what we build, on what we sell and how we make a living.

“He’s attacking Canadian families, workers and businesses and we cannot let him succeed and we won’t.”

Mr Carney said Canada would keep retaliatory tariffs in place until “the Americans show us respect”.

Mr Trump’s tariffs against Canada and his talk of making the country America’s 51st state have infuriated Canadians.

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The American national anthem has been repeatedly booed at NHL and NBA games.

“Think about it. If they succeeded, they would destroy our way of life… America is a melting pot. Canada is a mosaic,” Mr Carney added.

“America is not Canada. Canada will never ever be part of America in any way, shape or form.”

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‘You can’t take our country or our game’

The 59-year-old will replace Justin Trudeau, who has served as prime minister since 2015.

Mr Trudeau announced he was stepping down in January after facing calls to quit from a chorus of his own MPs.

The 53-year-old’s popularity had declined as food and house prices rose.

Mr Carney will now have to decide when to call a general election in Canada – which must take place on or before 20 October.

In 2013, he became the first non-UK citizen to run the Bank of England since it was founded in 1694.

His appointment was popular in Britain after Canada recovered from the 2008 financial crisis faster than many other countries.

Read more:
Trudeau steps down with his popularity in shreds
Canadian PM criticises Trump over tariffs

During leadership debates, Mr Carney argued he was the only person prepared to handle Trump.

“I know how to manage crises,” he said.

“In a situation like this, you need experience in terms of crisis management, you need negotiating skills.”

The surge in Canadian nationalism has bolstered the Liberal Party’s chances in a parliamentary election.

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Donald Trump says Ukraine ‘may not survive’ war against Russia even if US support continues

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Donald Trump says Ukraine 'may not survive' war against Russia even if US support continues

US President Donald Trump has suggested Ukraine “may not survive” the war against Russia even if American support continued.

In an interview with Fox News channel’s ‘Sunday Morning Futures’, Mr Trump was asked about his controversial decision to pause support for Kyiv as it fends off Russia’s full-scale invasion.

Mr Trump, who had a disastrous meeting with Mr Zelenskyy at the White House last week, was asked about a warning from Polish President Andrzej Duda “that without American support, Ukraine will not survive”.

Asked if he was “comfortable” with that outcome, the US president said: “Well, it may not survive anyway.

“But we have some weaknesses with Russia. You know, it takes two,” Mr Trump added.

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Donald Trump. File Pic: Reuters

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It comes as Mr Zelenskyy will visit Saudi Arabia for a Monday meeting with Crown Prince Mohammed bin Salman, while Ukrainian diplomatic and military representatives will meet with a US delegation on Tuesday.

More on Donald Trump

Mr Trump’s latest remarks come amid global concern over the souring relationship between Ukraine and the US, which alongside the EU has been Kyiv’s main backer in its defence against Russia’s three-year land, air and sea invasion.

The US paused military aid and the sharing of intelligence with Ukraine this month after a meeting between Mr Trump and Mr Zelenskyy on 28 February descended into acrimony in front of the world’s media.

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Mr Trump ordered the pause as he attempts to put pressure on Mr Zelenskyy to negotiate a ceasefire deal with Russia.

Mr Trump has privately made it clear to aides that a signed minerals deal between Washington and Kyiv will not be enough to restart aid and intelligence sharing with Ukraine, Sky News’ US partner network NBC reported earlier on Sunday.

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How are Americans feeling after nearly 50 days of Trump?

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Rating Donald Trump’s second term so far

‘Trump bump’ turns to a Trump slump

The 78-year-old president is said to want the deal signed, but also wants to see a change in Mr Zelenskyy’s attitude towards peace talks.

Officials have told NBC News that Mr Trump also wants Mr Zelenskyy to make some movement towards holding elections in Ukraine and possibly stepping down as his country’s leader.

Mr Zelenskyy said in a recent interview he would be ready to step down as Ukraine’s president if it meant his country would become a NATO member and find peace.

That came after he was branded a “dictator” by Mr Trump as Ukraine had not held fresh elections – despite laws prohibiting it during wartime.

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Donald Trump says Ukraine ‘may not survive’ war against Russia even if US support continues

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Donald Trump says Ukraine 'may not survive' war against Russia even if US support continues

US President Donald Trump has suggested Ukraine “may not survive” the war against Russia even if American support continued.

In an interview with Fox News channel’s ‘Sunday Morning Futures’, Mr Trump was asked about his controversial decision to pause support for Kyiv as it fends off Russia’s full-scale invasion.

Mr Trump, who had a disastrous meeting with Mr Zelenskyy at the White House last week, was asked about a warning from Polish President Andrzej Duda “that without American support, Ukraine will not survive”.

Asked if he was “comfortable” with that outcome, the US president said: “Well, it may not survive anyway.

“But we have some weaknesses with Russia. You know, it takes two,” Mr Trump added.

Pic: Reuters
Image:
Donald Trump. File Pic: Reuters

Follow the latest updates on Donald Trump

It comes as Mr Zelenskyy will visit Saudi Arabia for a Monday meeting with Crown Prince Mohammed bin Salman, while Ukrainian diplomatic and military representatives will meet with a US delegation on Tuesday.

More on Donald Trump

Mr Trump’s latest remarks come amid global concern over the souring relationship between Ukraine and the US, which alongside the EU has been Kyiv’s main backer in its defence against Russia’s three-year land, air and sea invasion.

The US paused military aid and the sharing of intelligence with Ukraine this month after a meeting between Mr Trump and Mr Zelenskyy on 28 February descended into acrimony in front of the world’s media.

👉 Follow Trump 100 on your podcast app 👈

Mr Trump ordered the pause as he attempts to put pressure on Mr Zelenskyy to negotiate a ceasefire deal with Russia.

Mr Trump has privately made it clear to aides that a signed minerals deal between Washington and Kyiv will not be enough to restart aid and intelligence sharing with Ukraine, Sky News’ US partner network NBC reported earlier on Sunday.

Please use Chrome browser for a more accessible video player

How are Americans feeling after nearly 50 days of Trump?

Read more:
Rating Donald Trump’s second term so far

‘Trump bump’ turns to a Trump slump

The 78-year-old president is said to want the deal signed, but also wants to see a change in Mr Zelenskyy’s attitude towards peace talks.

Officials have told NBC News that Mr Trump also wants Mr Zelenskyy to make some movement towards holding elections in Ukraine and possibly stepping down as his country’s leader.

Mr Zelenskyy said in a recent interview he would be ready to step down as Ukraine’s president if it meant his country would become a NATO member and find peace.

That came after he was branded a “dictator” by Mr Trump as Ukraine had not held fresh elections – despite laws prohibiting it during wartime.

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