Australia's central bank keeps rates at 3.85%, stuns markets
Wrapping up a two-day policy meeting, the Reserve Bank of Australia said six members had voted to hold rates steady while three voted against, a rare split decision for the board.
Markets had been almost fully priced for an easing to 3.60% this week given core inflation had slowed to the mid-point of the RBA's 2% to 3% target range and consumer spending was proving weaker than expected. Uncertainty caused by U.S. tariffs also argued for a cut as insurance against a global slowdown.
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NBC News
43 minutes ago
- NBC News
Trump's tariff deadline delay brings hope, confusion to trade partners, businesses
WASHINGTON, (Reuters) - U.S. President Donald Trump's latest tariff delay provided some hope to major trade partners Japan, South Korea and the European Union that deals to ease duties could still be reached, while bewildering some smaller exporters such as South Africa and leaving companies with no clarity on the path forward. Trump's form letters to 14 countries informing them of planned tariff rates of 25% to 40% provided what he called a final warning on his 'reciprocal' tariffs, while pushing back Wednesday's previous deadline to August 1, a date he said on Tuesday was final, declaring: 'No extensions will be granted.' The move reflects Trump's frustration with trade negotiations that are proving lengthier and more complicated than the '90 deals in 90 days' that he expected, trade experts and administration officials say. The president, who announced on Tuesday a 50% tariff on imported copper and said long-threatened levies on semiconductors and pharmaceuticals were coming soon, said he has long favored simple tariffs over tedious trade talks that often involve red lines for some countries and their own requests for U.S. concessions. Japanese Prime Minister Shigeru Ishiba focused on the positive, saying his government would press ahead with negotiations toward a deal that 'benefits both countries, while protecting Japan's national interest.' Facing a 25% general U.S. tariff, Japan wants relief for its export-dependent auto industry from Trump's separate 25% automotive tariffs. It also has resisted demands for increased purchases of American rice. Japan, once viewed as an early favorite for a deal, faces an upper house election on July 20 and too many concessions could put Ishiba's ruling Liberal Democratic Party at risk. 'These countries are not folding. They're not giving him what he wants, so he's added another threat,' said William Reinsch, a former U.S. Commerce Department official who is a senior trade adviser at the Center for Strategic and International Studies. 'He's put a new number to it and extended the deadline.' South Korea, where President Lee Jae Myung has been in office less than a month, also pledged to intensify talks for 'a mutually beneficial result' while analysts warned he would not be 'a pushover' for Trump or put South Korea at a disadvantage to Japan. Stephen Miran, chairman of the White House's Council of Economic Advisers, told Fox News on Tuesday more deals were possible even before the end of this week, as long as countries made concessions deemed worthy by Trump. India, in particular, looked close to a deal, but prospects were less clear for smaller countries such as South Africa, Thailand and Malaysia, which face tariffs of 30%, 36% and 25%, respectively. South African President Cyril Ramaphosa pushed back on Trump's 30% tariff rate, calling it out of sync with an average 7.6% South African tariff rate. But he instructed his negotiators to 'urgently engage' with Trump's team on a framework first submitted by the South African side on May 20. The Trump administration's negotiating time may be eaten up with larger partners, such as the EU, which did not get a warning letter or a change to its prescribed 20% tariff rate, double the 10% baseline. Sources familiar with the EU talks have told Reuters a deal could involve carve-outs for aircraft and parts, medical equipment and alcoholic spirits. They say the EU also wants certain automakers to export to the U.S. at rates below the 25% auto tariff. Such a deal would be similar to a framework agreement with the United Kingdom that had carve-outs for autos, steel and aircraft engines. Final squeeze After announcing his global 'Liberation Day' tariffs of 11%-50% in early April, Trump quickly dialed them back to 10% for most countries amid bond market turmoil to buy time for negotiations to lower foreign tariffs and trade barriers. Ryan Majerus, another former U.S. Commerce official, said Trump's three-month pause had not produced the desired results, and now the president was seeking to maximize his negotiating leverage. 'They're going to pressure-test things and see how far they can go, particularly for countries where there hasn't been any movement in the talks,' said Majerus, who is a partner at Washington's King and Spalding law firm. Steadier markets and strong economic data give Trump some room to maneuver, but time is short and 'the more granular you get in negotiating these things, the tougher the sledding gets,' he added. The deadline extension provides no relief to companies that are trying to keep up with Trump's tariffs. Executives say the rapidly shifting tariff landscape has paralyzed decision-making as they try to adjust their supply chains and cost structures to avoid tariff-induced price hikes. 'No company can really prepare for this,' said Hubertus Breier, chief technology officer for Germany's Lapp Holdings, a family-owned maker of cables, wires and robotics for factories. 'We are already incurring losses simply because of the uncertainty of the daily changing situation.' Lapp has difficult choices — absorb additional costs or pass them on to customers. Assuming permanently higher prices and costs, however, could threaten its long-term existence, Breier added. DeMejico, a family business in Valencia, California with a plant in Mexico that builds traditional Spanish and Mexican-style furniture, is struggling to adapt to Trump's 50% tariffs on imported steel. Robert Luna, the company's president, said the firm is importing heavy steel latches, hinges and trim parts separately to simplify the tariff calculation process and installing them at its Los Angeles-area showroom. The tariffs and higher U.S. wage costs are already inflating prices, and DeMejico faces further cost increases on furniture if Trump hits Mexico with a reciprocal tariff, Luna said. 'It's hard to do anything about this as a small business owner, so I just try to be stoic and see what happens,' Luna said, adding: 'My biggest worry is just keeping the company alive.' Luna said he thought the Trump administration was 'setting up the foundation to train people to pay tariffs.'
Reuters
an hour ago
- Reuters
Mexico headline inflation seen easing in June with core rate climbing: Reuters poll
BUENOS AIRES/MEXICO CITY, July 8 (Reuters) - Mexican headline inflation likely eased in June after rising for four straight months, though core inflation is expected to have kept climbing, fueling bets the central bank will slow the pace of interest rate cuts, a Reuters poll showed on Tuesday. The median forecast from 17 analysts projected an annual headline inflation rate of 4.31% for June, down from 4.42% in May, though still above the official target of 3%, plus or minus one percentage point. In contrast, core inflation, often seen as a better gauge of price trends because it strips out highly volatile items, was estimated to have accelerated further to 4.22%, its highest level since April of last year. On a monthly basis, consumer prices were expected to have risen 0.27%, while core prices were forecast to increase by 0.38%, according to the survey. Official data will be released on Wednesday. At the end of June, the Bank of Mexico cut its benchmark rate by 50 basis points for a fourth consecutive time, continuing an easing cycle that began in 2024 after rates reached their highest level on record. However, in its latest statement, the central bank's board adjusted its forward guidance, dropping previous references to further 50 basis point cuts. Instead, it said it would continue to assess "additional cuts." Markets interpreted the change in tone as a signal that the central bank may slow the pace of monetary easing at its next meeting on August 7. A Citi survey published this week showed consensus among participants for a 25 basis point cut in August.
Reuters
2 hours ago
- Reuters
Trump Media seeks SEC approval for blue-chip crypto ETF
July 8 (Reuters) - Trump Media & Technology Group (DJT.O), opens new tab is looking to launch an exchange-traded fund that will invest in multiple crypto tokens, including bitcoin, ether, solana and ripple, a filing with the U.S. markets regulator showed on Tuesday.
