In March, multiple economists and investors advocated for a reduction in the interest rate by the Federal Reserve.
According to Charles Hepworth, who serves as an investment director for GAM Investments,
The latest inflation measure favored by the Federal Reserve was recently published for December 2023, and it maintains the possibility of a rate decrease in March.
The projected increase in Core PCE for the month was 0.2%, which was consistent with the actual result. This brings the annual PCE inflation rate to 2.9%, which is in line with the Fed’s goal of 2%, something that hasn’t been seen in the past three years.
According to Kieran Clancy, a senior economist at Pantheon Macroeconomics, a consulting firm,
The bigger picture is that core goods inflation is now just above zero, core services inflation is falling and rent inflation is grinding lower, lagging private sector measures of rents for new tenants. The Fed’s inflation forecasts are stil too high – the December [summary of economic projections] shows core PCE inflation running above the 2% target until Q4 2026 – and will be revised down again in March, for the third successive quarter, giving the Fed the necessary hook on which to hang the first rate cut, either at that meeting or in May.
The UK’s automotive sector has expressed dissatisfaction with the breakdown of negotiations with Canada regarding a trade agreement to replace the previous arrangement with the EU before Brexit.
The agreement allowed for free trade with Canada, but it will expire in April and it is unlikely that a new agreement will be reached before then. The British agricultural industry supports the ongoing restrictions on importing hormone-treated beef, which is currently not permitted in the UK.
In addition, there is also news in the business sector:
The merger between Vodafone and Three’s British mobile networks will be carefully examined by the UK’s competition regulator.
Superdry has ended its relationship with their fourth financial leader in the span of five years as the company’s losses continue to increase at the struggling UK fashion brand.
The Telegraph’s top executive has resigned after serving for seven years, as the government plans to launch a second inquiry into potential public interest issues stemming from the Barclay family’s intricate agreement to transfer ownership of the publications to a consortium backed by the UAE.
According to reports, a court order has frozen or restrained assets worth approximately £75m belonging to Conservative peer Michelle Mone and her husband.
The stock of American chip producer Intel dropped following its announcement of lower projected profits.
The expectations of German consumers for February have significantly worsened, causing concern about the ongoing economic downturn in Europe’s leading producer.
You are able to keep up with the latest updates from various parts of the world through the Guardian’s live coverage.
Mitch McConnell reverses his stance against the Ukraine and border deal, which was previously influenced by Trump, in American politics.
As part of our coverage on Europe, we report on the protests by French farmers as the government prepares to unveil new policies.
According to Palestine, the recent ICJ ruling serves as a reminder that no state is exempt from the law, while Netanyahu asserts that Israel is engaged in a just war in response to the Middle East crisis.
During our reporting on the conflict between Russia and Ukraine, a previous head of NATO expressed that the Ukrainian people are fighting for our cause and we must take further action.
Thank you for joining us this week. Next week, we will be celebrating February!
Has the Federal Reserve indicated that it is appropriate to lower interest rates?
According to Andrew Hunter, a deputy chief economist at Capital Economics, a consulting firm, he mentioned that:
The data from December regarding income and spending show that core PCE inflation has been consistently meeting the Fed’s target of 2% for the past seven months. This reinforces the idea that there is no further need for disinflation and that the Fed has room to begin lowering interest rates soon, despite the economy’s strong growth.
The Federal Reserve lowers interest rates during its March meeting.
CME’s Fedwatch tool displays the predictions of market players on changes in interest rates as a way to measure their expectations. The graph below indicates that, for the March meeting, there is a 49.3% likelihood of a rate cut, while the remaining 50.7% believe the target range for the federal funds rate will remain steady at 5.25% to 5.5%.
The Fed’s interest rate policy-making committee, known as the federal open markets committee (FOMC), has a meeting scheduled for next week. However, it is widely believed that the Fed will not make any sudden changes at this meeting.
Economists and traders are preparing for a significant data point this week: the highly monitored measure of US inflation.
The core personal consumption expenditures (PCE) index, which has a catchy name, is the primary measure of inflation used by the Federal Reserve to consider monetary policy decisions. This means that unexpected changes can greatly impact financial markets.
In November, the core PCE inflation decreased by 0.1% compared to October. According to a survey of economists, the year-on-year measurement is predicted to drop from 3.2% to 3%.
If inflationary pressure decreases as expected, markets may adjust to a higher possibility of a rate cut in March.
According to Bob Savage, the leader of market strategy and insights at BNY Mellon, a financial institution, the central Personal Consumption Expenditures (PCE) measure was predicted to decrease to a level that would support the Federal Reserve’s decision to ease in March at 3%, which suggests a six-month average annualized rate of 1.9%, below their desired target.
The car manufacturing sector in the United Kingdom has issued a warning that car producers in Britain may be subject to tariffs for exporting to Canada due to the breakdown of trade negotiations between the two nations.
The UK’s car industry can freely trade with Canada without tariffs, thanks to a temporary extension of privileges granted by their previous membership in the EU. However, this tariff-free arrangement is set to expire in April unless a bilateral agreement is reached between the two countries.
Canada purchases a mere 1.3% of the United Kingdom’s car exports, which amounts to less than 8,000 cars. This is a relatively small portion of the overall trade market, which is largely controlled by the European Union and the United States. However, any potential tariffs could negatively impact the car manufacturers that rely on sales to Canada.
In a statement to Reuters, Mike Hawes, the CEO of the Society of Motor Manufacturers and Traders, stated:
If vehicles exported from the UK are unable to utilize parts and components from the EU to avoid extra tariffs, there is a possibility that tariffs may be reintroduced, potentially on top of taxes for luxury goods.
It is disheartening that trade talks between Canada and the UK have been suspended, as Canada is a crucial market for UK car exports. This decision may suggest that Canada does not value the high-quality automotive products produced by the UK, despite the strong relationship between our two nations.
Next year, the highly anticipated mass-produced version will finally be released. Musk expressed his enthusiasm for the upcoming model.
This will have a significant impact not only on the vehicle’s design, but also on the design of the manufacturing process.
Nevertheless, investors placed a greater emphasis on its profit margins, which have been experiencing strain due to heightened competition in the electric vehicle industry.
Tesla’s stock price experienced a significant increase during the COVID-19 outbreak due to large financial aid and a growing interest in eco-friendly technology. However, Musk himself cautioned in May 2020 that the stock was overvalued, yet it still surpassed $1 trillion in value in 2021, surpassing the combined worth of most other car companies.
In May 2020, Tesla’s stock was valued at under $55. However, on Thursday evening, the stock was valued at $182.6, resulting in a market capitalization of $572 billion for the company.
According to reports, a court order has frozen or restrained approximately £75m worth of assets belonging to Michelle Mone, a Conservative peer, and her husband.
The duo is under scrutiny from the National Crime Agency for suspected fraudulent activities involving medical equipment. According to the Financial Times, their assets, which have been frozen, consist of a six-bedroom townhouse in central London, a country estate on the Isle of Man, and 15 accounts with Coutts, C Hoare & Co and Goldman Sachs International.
According to a representative for Mone and Barrowman speaking to the FT, the court order was the outcome of a cooperative process involving discussions with the CPS.
This enables the broader operations and assets of the Barrowman family to function without any limitations or uncertainties.
Doug and Michelle did not oppose the request and were willing to provide these assets, allowing them to start proving their innocence at a faster pace.
The complete tale can be found at this link:
The individual who has been in charge of both the company and its parent company, Press Acquisitions, since 2017, has abruptly left the company and did not offer an explanation in the statement announcing their departure.
In a statement to internal employees, Hugh expressed his gratitude for being chosen to lead the group of titles that have made a significant impact on society and democracy. He has been instrumental in driving the Telegraph’s success, with over 1 million subscribers across print and digital platforms.
Hugh stated that the interest in owning TMG is evidence of its value. He will be succeeded by Anna Jones, the previous CEO of the UK publisher of popular magazines such as Cosmopolitan, Men’s Health, and Esquire.