Portugal Continues Easing Limits on Power Imports From Spain
The April 28 blackout left Portugal and Spain without electricity for hours, hitting public transport, telecommunications systems and other services. Portuguese Energy and Environment Minister Maria da Graca Carvalho said on May 2 that as a precaution Portugal was at that time not trading electricity with Spain and was being supplied entirely with power produced within the country.
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CBS News
2 hours ago
- CBS News
Trump tariffs have delayed interest rate cuts, Federal Reserve Chair Jerome Powell says
Federal Reserve Chair Jerome Powell said Tuesday that the U.S. central bank has held off on lowering interest rates this year because of President Trump's tariffs. Speaking at a gathering of central bankers in Portugal, Powell said "I think that's right" in response to a moderator's question about whether the Fed would have cut its benchmark rate if not for the U.S. imposing steep tariffs on key trading partners. "In effect, we went on hold when we saw the size of the tariffs, and essentially all inflation forecasts for the United States went up materially as a consequence of the tariffs," Powell said. "So we didn't overreact — in fact, we didn't react at all. We're simply taking some time." Powell said that tariffs have yet to have much of an impact on the U.S. economy, but reiterated his view that the levies could lead to higher inflation later this summer. The White House did not immediately respond to a request for comment. Trump administration officials say steeper tariffs are necessary to reinvigorate the U.S. manufacturing sector; ensure fair trade with other countries; and advance other domestic policy priorities, such as curbing the flow of unauthorized immigrants and fentanyl into the U.S. President Trump has repeatedly lashed out at Powell this year over the Fed's decision to keep interest rates level. In June, Mr. Trump publicly mused over whether to fire him, although many legal experts say it's not clear he has the constitutional authority to do so. The president said in a post Monday on Truth Social, his social media platform, that Fed officials "should be ashamed of themselves" for not moving sooner to ease interest rates. Although Powell chairs the central bank, interest-rate decisions are set jointly by the Federal Open Market Committee, a 12-member panel of Fed officials. The Fed on June 18 opted to hold the federal funds rate — what banks charge each other for overnight loans — steady for a fourth straight meeting. Powell on Tuesday said the Fed continues to monitor the effect of tariffs on economic growth and inflation. "As long as the economy is in solid shape, we think the prudent thing to do is to wait and see what those effects might be," Powell said, alluding to the tariffs. Powell, whose term as Fed chair ends on May 15, 2026, also sought to underline the importance of insulating central bankers from political pressure. "We're trying to deliver macro stability, financial stability, economic stability for the benefit of all the people," he said at the European Central Bank forum. "If we're going to do that successfully, we need to do it in a completely nonpolitical way, which means we don't take sides, we don't play one side against the other, we stay out of issues that are really not our bailiwick."
Yahoo
2 hours ago
- Yahoo
Powell says the Fed would have cut rates this year if it weren't for tariffs
The Federal Reserve would likely have lowered interest rates this year if it weren't for President Donald Trump's significant policy changes, Chair Jerome Powell said Tuesday. 'I do think that's right,' he said at a central banking forum in Sintra, Portugal, when asked if the Fed would have cut rates by now. The Fed hasn't lowered interest rates at all this year: Central bankers broadly expect Trump's tariffs to have some effect on the US economy and they've said that they want to see how the dust settles first before resuming rate cuts. But the Fed's wait-and-see approach hasn't sat well with Trump, who has repeatedly lashed out against Powell for not yet lowering rates, describing him as a 'numbskull' and a 'moron.' On Monday, Trump posted on his social media platform a note in his handwriting slamming Powell for keeping interest rates higher than dozens of other nations, writing that he 'cost the USA a fortune' and that he continues 'to do so.' White House press secretary Karoline Leavitt said the note was delivered to the Fed that same day. Trump hasn't been the only one calling for rate cuts. Two of Powell's colleagues — Fed Vice Chair for Supervision Michelle Bowman and Fed Governor Christopher Waller — have recently broken rank and said the central bank could consider a rate cut as soon as July. But neither of them has gone as far as to call for the supersized rate cuts Trump has demanded. Both have said rate cuts still depend on how mild any tariff-induced inflation turns out to be. Still, a rate cut in July seems unlikely and would be difficult for the Fed to defend. Investors estimate a 81% chance of the Fed holding rates steady at its July 29-30 meeting, according to futures, compared with a 19% chance of a quarter-point rate cut. Powell in his Sintra panel noted that most Fed officials expect to lower rates at some point later this year, depending on what happens with inflation and the labor market. 'A solid majority of (Fed officials) do expect that it will become appropriate later this year to begin to reduce rates again,' Powell said. When asked if July would be too soon for a rate cut, Powell said 'he can't say' but that he 'wouldn't take any meeting off the table or put it directly on the table.' European Central Bank President Christine Lagarde — who has publicly backed Powell's apolitical, data-driven approach to policymaking — praised the Fed leader on Monday, noting that he 'epitomizes the standard of a courageous central banker.' She was on the panel with Powell Tuesday. So far, Powell has avoided commenting on Trump's attacks, including on Tuesday when he was asked if Trump's harsh public comments make it difficult to conduct monetary policy. Powell said that 'I'm very focused on just doing my job.' Lagarde was asked how she would handle Trump's criticism if she were in Powell's position, to which she responded: 'I think we would (all) do exactly the same thing as our colleague, Jay Powell, does. The same thing.' Conference attendees clapped after Lagarde's comment. 'We're trying to deliver macro stability, financial stability, economic stability for the benefit of all the people,' Powell said. 'If we're going to do that successfully, we need to do it in a completely non-political way, which means we don't take sides. We don't play one side against the other. We stay out of issues that are really not our bailiwick.' Sign in to access your portfolio
Yahoo
3 hours ago
- Yahoo
Fed latest: What Powell said about this year's rate cuts
Federal Reserve Chairman Jerome Powell said on Tuesday that the Fed would have cut interest rates by now were it not for President Trump's tariffs. Yahoo Finance Senior Reporter Jennifer Schonberger joins Market Domination with Josh Lipton to discuss Powell's recent comments. To watch more expert insights and analysis on the latest market action, check out more Market Domination here. Federal Reserve chair Jerome Powell, speaking in Portugal on Tuesday, told a gathering held by the European Central Bank that the US Central Bank may have changed their plans for the fight against inflation if not for the president's trade deals. Yahoo! Finance's Jennifer Schonberger has more. Hey there, Josh. Fed chair J. Powell didn't take a rate cut off the table for the Fed's next policy meeting later this month. And as you said, said that if it weren't for tariffs, the Fed would already be cutting rates. and on the data and um we we are going meeting by meeting. I mentioned um, you know, how I'm thinking about that, but I wouldn't take any meeting off the table or put it directly on the table. It's going to depend on how the how the data evolve. Powell noted that a quote "solid majority" of the Fed's interest rate setting committee thinks it will be appropriate to begin lowering interest rates at some point later this year, explicitly saying in the remaining four interest rate setting meetings, which would include the next meeting in July. When asked if the Fed would begin already cutting rates had it not been for tariffs, Powell had this to say. I think that's right. We're, in effect, we went on hold uh when we when we saw the size of the tariffs and where and essentially all all inflation forecasts for the United States went up materially as a consequence of the tariffs. Powell reiterated that the Fed has not seen much of an impact yet from tariffs on inflation, noting that the central bank expects to see, quote, "some higher readings on inflation", but that officials are prepared to learn, and that inflation could be higher, lower, later, or sooner than expected. Powell has roughly 10 months left in his term as chair. And when asked what keeps him awake at night, he says he wants to turn over an economy to his successor that is in good shape. Asked whether he would remain on as a Fed governor after his term ends as Fed chair next May, Powell said "I don't have an answer for you today." Josh. Thank you, Jen.
