Latest news with #monetarypolicy


NHK
3 hours ago
- Business
- NHK
US treasury secretary says Trump may appoint new Fed chair around October
US Treasury Secretary Scott Bessent says President Donald Trump may appoint Federal Reserve Chair Jerome Powell's successor in October or November. Trump indicated he will soon announce his choice to succeed Powell, whose term ends in May of next year. Bessent's remark came in an interview with US business channel CNBC on Friday. The president nominates the chair of the Federal Reserve from among the seven members of its Board of Governors. The term of one of them ends in January of next year. Bessent indicated Trump's nomination of the new chair may come in October or November, taking into consideration the time needed to obtain congressional approval if Trump is to appoint the nominee to the outgoing board member's seat. When asked about himself being a candidate, Bessent said, "I'll do what the president wants, but I think I have the best job in Washington." Bessent criticized the Fed's monetary policy, saying, "The Federal Reserve fell down on the American people in 2022, let the great inflation get away from them. They should have been hiking sooner." He indicated the Fed may once again make a mistake by delaying rate cuts, saying, "Studies have shown that people who fall down then tend to look at their feet, which makes them fall down more."


Zawya
a day ago
- Business
- Zawya
Dollar question hovers over top central bankers meeting in Sintra
FRANKFURT - A million-dollar question will hang over the world's top central bankers when they meet in Sintra, Portugal, next week: Is the monetary system centred on the U.S. currency beginning to unravel? The central bank heads of the United States, the euro zone, Britain, Japan and South Korea will also have a chance to give their views on how global trade tensions and war in the Middle East are affecting the outlook for inflation and growth at the European Central Bank's annual get-together. But with inflation seemingly under control in most countries, the much deeper issue likely to permeate their discussions is: Could U.S. President Donald Trump's protectionist and unpredictable economic policies bring an end to the system that has ruled global finance for 80 years? "Like everybody else, they are struggling to figure out what kind of world we're heading into," said BNP Paribas chief economist Isabelle Mateos y Lago, who will also attend the forum in the picturesque hill town near Lisbon. "They've probably realised we're not going to get any answers anytime soon. And so the question is: How do you run monetary policy in that kind of environment?" Investors will hope to get some clues when Fed chair Jerome Powell, ECB President Christine Lagarde and the governors of the central bank of Japan, Britain and South Korea sit down for a panel discussion at the ECB's Forum on Central Banking on Tuesday. Among them, Powell will probably be in the hottest seat. He has been under intense pressure from Trump to cut interest rates but he has so far resisted. Any sign that the Fed's independence from the White House is under threat could erode the dollar's status as the world's currency of choice for trading, saving and investing. With his position bolstered by a recent U.S. Supreme Court ruling, Powell is likely to stick to his guns. But he faces an increasingly divided Federal Open Market Committee. Trump may also name Powell's successor well before his term expires next May, potentially undermining Powell's message. "A successor perceived by the market to be more open to accommodating Trump's damaging the independence of the Fed in setting policy," economists at Investec wrote. These fears have driven the dollar down to an almost four-year low of $1.17 against the euro in recent months. EURO'S MOMENT? ECB President Christine Lagarde will be in a relatively novel position for any chief of the euro zone's central bank: promoting the single currency as a bastion of stability. While her predecessor Mario Draghi faced speculation about a collapse of the euro until only a few years ago, Lagarde is capitalising on the dollar's woes to promote "euro's moment". If pessimism about the single currency proved overdone a decade ago, economists -- and Lagarde herself -- are adamant the European Union has its work cut out if it is to elevate the euro from its status as distant second in the global currency chart. The EU, still more a confederation of states than anything resembling a union, is widely seen as needing greater financial, economic and military integration before it can challenge the dollar's status. A net 16% of 75 central banks surveyed by OMFIF said they plan to increase euro holdings over the next 12 to 24 months, making it the most in-demand currency but still far less popular than gold. "I'm more optimistic about what's happening in Europe than I've been in a long time, but there's no guarantee of success," BNP Paribas' Mateos y Lago said. The central bankers of South Korea, Japan and Britain are likely to face some tricky questions of their own. The Bank of Japan is becoming increasingly cautious about raising interest rates -- despite some internal qualms and sticky food-price inflation -- due to the expected impact of U.S. tariffs. The Bank of Korea, which had been fearing a flood of cheap Chinese goods, could be forced to end its current easing cycle due to a sudden upswing in the property market. The Bank of England, where three of nine policymakers voted for a cut earlier this month, is also trying to work out whether signs of a slowdown in the labour market will ease still-strong inflation pressures from fast pay growth. "You start to see a lot more division in terms of voting and amongst the economists," KBRA's European Macro Strategist Gordon Kerr said. "I think everybody just needs to be paying attention and be ready to react."


Bloomberg
a day ago
- Business
- Bloomberg
China's Central Bank Says Economy Is on Positive Track But Challenges Persist
China's economy is showing positive signs and confidence is building, but challenges such as insufficient domestic demand and deflationary pressure persist, according to the country's central bank. The People's Bank of China, in a statement after its quarterly monetary policy committee meeting, said it will adopt a flexible approach to policymaking, taking into account both domestic and international conditions. Monetary policy will remain 'moderately loose,' with the aim of maintaining stable economic growth and prices within a reasonable range, it said.


Reuters
a day ago
- Business
- Reuters
China's central bank pledges to speed up policy response to economic conditions
BEIJING, June 27 (Reuters) - China's central bank said on Friday that it would adjust the pace and intensity of policy implementation in response to domestic and global economic and financial conditions. The world's No.2 economy has faced pressure this year due to U.S. President Donald Trump's imposition of tariffs on Chinese products and persistent deflationary pressure at home. "The external environment has grown increasingly complex and challenging, with weakening momentum in global economic growth, rising trade barriers, and diverging economic performance among major economies," the People's Bank of China (PBOC) said in a summary of its quarterly monetary policy committee meeting. The economy "still faces difficulties and challenges such as insufficient domestic demand, persistently low price levels, and multiple hidden risks," the bank said. "It is suggested that the intensity of monetary policy adjustments be increased, and the forward-looking, targeted and effective nature of monetary policy adjustments be enhanced," it added. The central bank said it will guide financial institutions to step up credit supply, and push for the lowering of overall social financing costs. It also pledged to enhance the resilience of the foreign exchange market, to guard against the risk of exchange rate overshooting, and to keep the yuan exchange rate "basically stable at a reasonable and balanced level." On the beleaguered property market, the bank said it will increase efforts to revitalise existing commercial housing and land inventory, and continue to consolidate the "stable momentum" in the sector.


Zawya
a day ago
- Business
- Zawya
China central bank pledges to adjust policy pace based on internal, external economic conditions
China's central bank said on Friday that it would adjust the pace and intensity of policy implementation based on internal and external economic and financial situations. The People's Bank of China, in a summary of a quarterly meeting held by its monetary policy committee, said that it would guide financial institutions to step up credit supply, and push for lowering of social financing costs. (Reporting by Yukun Zhang, Ethan Wang and Kevin Yao. Editing by Jane Merriman)