Aurelia Butler

The announcement comes as a slew of automakers and charging equipment makers choose Tesla’s charging design on concerns of losing out on customers if they offer only the Combined Charging System (CCS) design, which is backed by automakers like Volkswagen (ETR:VOWG_p) and Hyundai Motor. Ford, General Motors (NYSE:GM) and ChargePoint are among the companies that have signed up for Tesla’s charging design in the past few weeks.”Volkswagen Group and its brands are currently evaluating the implementation of the Tesla North American Charging Standard (NACS) for its North American customers,” Volkswagen said.Electrify America, Volkswagen’s EV charging network unit, has more than 850 charging stations with about 4,000 chargers in the United States and Canada. During the NACS transition, Electrify America will continue to offer the widely used CCS connector.Tesla, meanwhile, has expanded beyond its connectors to include CCS at some of its U.S. charging stations as the Biden administration seeks to provide billions in subsidies to expand charging networks.Tesla’s Superchargers account for about 60% of the total number of fast chargers in the United States, according to the U.S. Department of Energy.The companies’ decisions for NACS transition have shaken up the EV charging industry that likely was drifting towards the rival CCS connection, with the help of federal subsidies. Separately, Polestar has signed an agreement with Tesla to make available its charging network to the customers of the Swedish electric vehicle maker in the United States and Canada. More

The Fed lent banks $3.2 billion via its discount window as of Wednesday, unchanged from June 21. It lent $103.1 billion from its Bank Term Funding Program, from $102.7 billion on June 21. Fed “other credit” tied to the government wind down of failed banks stood at $168.3 billion, from June 21’s $172.3 billion. Altogether, lending via the three programs stood at $274.7 billion from $278.2 billion the week before. More

NEW YORK (Reuters) -Several parts of the U.S. Treasury yield curve are reaching deeper levels of inversion, a sign that bond investors are increasingly worried about an economic slowdown as the Federal Reserve looks set to raise interest rates further.An inverted yield curve occurs when yields on shorter-dated Treasuries rise above those for longer-term ones, reflecting bets that the central bank will need to cut rates to buoy an economy hurt by higher borrowing costs.The yield curve’s inversions deepened in June after Fed Chair Jerome Powell indicated that the central bank would likely raise rates two more times this year. Powell on Wednesday reiterated that two more hikes this year were likely, including an increase widely expected next month.”Keeping rates higher for longer increases the chance that we move into a downturn,” said Janet Rilling, a senior portfolio manager and the head of the Plus Fixed Income team at Allspring Global Investments. “So it is a logical reaction from investors that they would then expect, at some point, that the Fed’s going to have to be more aggressive in cutting.”Stronger-than-expected economic data on Thursday backed expectations that the Fed will keep interest rates higher for longer. Treasury yields- which move inversely to prices – moved up, with 10-year and two-year yields hitting their highest since March 10 and 9, respectively, while some curve inversions intensified. Yields on five year Treasuries were as many as 24.5 points above those on 30-year Treasuries on Thursday, the most inverted that portion of the curve has been since March, according to Refinitiv data. The spread between one- and 30-year Treasury yields was as wide as 153 basis points on Wednesday, its biggest gap since 1981. It narrowed slightly on Thursday to 152 basis points. And the closely watched part of the curve that plots yields on two-year Treasuries against 10-year yields – a relatively reliable indicator of upcoming recession – inverted further, hitting nearly -107 basis points in intra-day trade on Thursday, close to the -108 bps level it touched before the March banking turmoil, in its turn the deepest since 1981.That part of the curve has been inverted since July.”Yield curves inverting … have a very good track record of predicting recessions, but their track record in terms of a timing tool for recession is not so good,” said Huw Roberts, head of Analytics at Quant Insight.”When it comes to timing, what is more important is the re-steepening of the curve because obviously that is when the Fed is starting to respond to the threat of recession and starts cutting rates,” he said.The inversions are deepening amid conflicting economic signals. Key areas of the U.S. economy, including housing and labor, have proven resilient despite higher rates.Data on Thursday showed weekly claims for unemployment insurance fell by the most in 20 months last week, and the final print for first quarter Gross Domestic Product was 2.0%, higher than last month’s 1.3% reading and above expectations. At the same time, however, signs of stress are piling up.A recent Fed study showed the number of companies in financial distress was higher than during most previous tightening episodes since the 1970s, concluding that restrictive policies may contribute to a “marked slowdown in investment and employment in the near term.” More

The UK’s stubbornly high inflation has convinced senior policymakers at the European Central Bank to maintain their aggressive stance on raising interest rates to avoid being accused of failing to contain price pressures.Several members of the ECB’s rate-setting governing council told the Financial Times that recent criticism of the Bank of England over its struggle to bring down inflation had served as a cautionary tale during private discussions at their annual conference in Sintra, Portugal.“We have seen what happened in the UK and we don’t want the same thing to happen to us,” said a eurozone rate-setter. “It is better to sound a little more hawkish and be prudent about how fast inflation will fall than to be caught out by a negative surprise, which is a problem for a central bank.”The ECB’s concerns were underlined on Thursday when Germany reported that inflation had risen faster than expected, even as Spain became the first big eurozone economy to see inflation drop below 2 per cent in almost two years.The divergence between Germany’s 6.8 per cent rate for June, which was more than four times higher than the 1.6 per cent recorded by Spain, highlights the dilemma faced by the ECB over how to tame inflation.Franziska Palmas, an economist at research group Capital Economics, said: “June’s inflation figures from Germany won’t change the ECB’s hawkish resolve, even if core inflation, excluding energy and food prices, edges down in other countries.”Eurozone inflation is expected to drop to 5.6 per cent in June when fresh price data is released on Friday — still well above the ECB’s 2 per cent target but down from a peak of 10.6 per cent in October as energy and food prices have continued to fall.Another ECB governing council member said that if the bank kept raising rates and inflation fell faster than expected, “that could be considered a success”. But if inflation overshot its forecasts and the bank was forced to increase the pace of rate rises — as the BoE did — “we would be accused of failing”. Inflation in the UK stuck above forecasts at 8.7 per cent in May, significantly higher than the eurozone’s 6.1 per cent or the US rate of 4 per cent, piling pressure on both the BoE and the government. Core prices, excluding energy and food, hit 7.1 per cent, their highest level for 31 years.An Ipsos opinion poll published this month showed most Britons surveyed thought BoE decisions had contributed to the soaring cost of mortgages — with more pinning the blame on the central bank than on the government, Brexit or Russia’s full-scale invasion of Ukraine.“The UK situation is something we can learn from,” said a third ECB council member. “We need to project to the general public that we are acting with determination to avoid falling into the same boat as the Bank of England.” The ECB declined to comment.The BoE has been beset by communications challenges ever since UK inflation proved more persistent than in the US or eurozone. The BoE was forced by parliament this month to launch a review of its forecasting practices, with officials coming under increasing fire from politicians, the media and the public. But the ECB has said it will keep raising rates until underlying price pressures are clearly dropping, after raising its forecasts for price growth this month to reflect an expected 14 per cent increase in eurozone wages by 2025, which it thinks may push up prices in the labour-intensive services sector. Any easing of underlying pressures is unlikely to happen in June, when core eurozone inflation is expected to rise to 5.5 per cent this month, up from 5.3 per cent in May.

Some more dovish ECB council members worry more about the risk of raising rates too high and pushing the economy into an unnecessary recession rather than doing too little. “Not overreacting is a huge concern for every central bank,” Mário Centeno, the head of Portugal’s central bank, told Portuguese broadcaster RTP on Thursday.ECB president Christine Lagarde told the Sintra conference that it would raise rates again next month “barring a material change to the outlook” although she refused to be drawn on the chances of a further increase in September, as markets are betting is likely.The UK’s persistently high price growth forced the BoE to ramp up its rate rises with a half percentage point move to 5 per cent last week, having slowed down to quarter-point moves in March and May. BoE governor Andrew Bailey told the Sintra conference that UK rates were likely to stay higher than markets expected because, while falling energy prices were likely to bring down the headline rate, the core inflation rate was “much stickier”.With the UK’s labour force shrinking since the pandemic hit, Bailey said a “very tight” jobs market and high wage growth could keep price pressures elevated.Additional reporting by Chris Giles in London More