Economy

Daly, in a webcast interview with the Wall Street Journal, added that the goal is a “soft landing” where inflation cools to 2%, the labor market stays healthy, and wages catch up with higher prices.She said the Fed needs to continue to lower the policy rate as inflation comes down, or risk allowing policy to become overly tight and hurt the labor market. The policy rate, after the Fed’s 50-basis-point rate cut last month, is now in the 4.75%-5% range; Daly on Monday said she estimates that a policy rate of around 3% would be a level that is neither tight nor loose but what economists call “neutral.” More

LONDON (Reuters) – Britain will lend Ukraine 2.26 billion pounds ($2.94 billion) as part of a much larger planned loan from the Group of Seven nations backed by frozen Russian central bank assets to help buy weapons and rebuild damaged infrastructure.Defence minister John Healey said the money donated by Britain would be solely for Ukraine’s military and could be used to help develop drones capable of travelling further than some long-range missiles.Healey said the use of Britain’s share of the G7 loan had been a feature of talks between Ukrainian President Volodymyr Zelenskiy and Prime Minister Keir Starmer in talks in London two weeks ago and G7 defence ministers in Italy over the weekend.Asked if Britain would allow Ukraine to use the money to buy British-made Storm Shadow missiles to hit targets deep inside Russia, Healey told reporters: “They are developing very heavily the use of even longer-range drones. They will work with us over how they use this money, and on the weapons they most need.”The G7 announced in June it would provide a $50 billion loan to help Ukraine, serviced by profits generated by about $300 billion in Russian sovereign assets immobilised in the West.The assets were frozen shortly after Russia launched a full-scale invasion of Ukraine in February 2022. Russia has repeatedly threatened retaliation to any use of frozen Russian assets to finance Ukraine, which it describes as illegal.Talks about the G7 loan are accelerating as Western countries want to secure funding to Ukraine due to concerns that if Republican presidential candidate Donald Trump wins the U.S. election next month, he could reduce support. The European Union, where the bulk of the Russian assets are blocked, has already agreed to provide 35 billion euros ($38 billion) as part of the bloc’s share. The British contribution is on top of the 12.8 billion pounds ($16.61 billion) it has already committed in support to Ukraine.Finance minister Rachel Reeves said the one-off loan would be released in tranches. ($1 = 0.7678 pounds)($1 = 0.9223 euros) More

Recruitment consultancy Robert Walters’ new monthly Global Jobs Index showed global vacancies dropped by 5% last month from August.Companies in Singapore, the United States, Britain, Australia, and Germany reported the biggest falls in vacancies, with firms citing low business confidence as a key factor. In some European countries which typically experience a seasonal jump in vacancies in September, firms reported a more muted increase than in previous years.”September’s decline in professional job roles globally is a departure from the usual surge of hiring activity we expect at this time of year, and is a direct reflection of the geopolitical tensions, economic outlooks, and industry-specific issues on the global jobs market,” said Toby Fowlston, chief executive of global talent solutions business at Robert Walters.The survey was based responses from 500 firms across professional sectors including health, real estate and construction, and energy and utilities.Fowlston said US firms were putting the brakes on hiring ahead of the Nov. 4 elections and potential policy shifts. Official data showed the US labour market added 254,000 jobs in September, the most since March.”The UK is experiencing increased uncertainty as businesses hold back on hiring in anticipation of the government’s budget announcement,” Fowlston added. Britain’s new Labour government will deliver its inaugural budget on Oct. 30 and finance minister Rachel Reeves has warned that some taxes will go up to plug what she called a 22 billion-pound ($28.64 billion) fiscal hole. Government sources have said Reeves is looking for tax rises and spending cuts to the tune of 40 billion pounds. The survey showed that on a quarterly basis, vacancies were 19% higher in the July-September period compared to the three months before.($1 = 0.7682 pounds) More

Adeyemo and Mustafa also discussed the Palestinian Authority’s efforts to improve its anti-money laundering and countering the financing of terrorism regime, the department said. It added that Adeyemo “stressed the importance of preventing terrorists and violent extremists” from raising, using, and moving funds in the West Bank. The department said they also spoke about importance of the correspondent banking relationships between Israeli and Palestinian banks to the security and economic stability of the region. More

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(Reuters) – A look at the day ahead in Asian markets. Asian markets on Tuesday will be hoping to rebound from Monday’s fairly lackluster start to the week, with Japanese equities particularly well-positioned to move up a gear or two after the yen slid to its lowest level in nearly three months.The dollar leaped nearly 1% to 150.90 yen, its highest since Aug. 1. It was the most notable aspect of the greenback’s broad rise on Monday to its strongest level against a basket of major currencies in nearly three months.The yen’s correlation with Japanese stocks has turned deeply negative over the past month or so, meaning when the yen weakens stocks tend to rise, and vice versa.The simple rolling 25-day correlation between dollar/yen and the Nikkei 225 index is now the most inverse since 2005. On that basis, the yen’s latest dip should mean a leg up for the Nikkei, right?A buoyant dollar, however, is not good news for emerging markets, especially when accompanied by rising Treasury yields. And U.S. bond yields are rising.The 10-year yield rose 11 basis points to a three-month high of 4.19% on Monday. Inflation concerns? Debt and deficit concerns? Election concerns? Strong growth? Whatever the mix, it is a tightening of financial conditions that is often a red flag for emerging markets.According to Bespoke Investment Group, of the 35 times the Fed has cut rates since 1994, the increase of more than 50 bps in the 10-year yield after the most recent cut ranks as the third largest. Chinese markets have had a positive start to the week after the People’s Bank of China cut benchmark lending rates by 25 bps and after Beijing flagged new measures to support innovative tech companies.Export figures from Taiwan were a reminder, however, of China’s economic predicament. Export orders in September fell short of expectations due to faltering demand from top trading partner China. Tuesday’s calendar in Asia is light, with Hong Kong consumer inflation, South Korean producer price inflation and New Zealand trade the main highlights. Pipeline price pressures in South Korea appear to be cooling pretty rapidly. Annual PPI in August slumped to 1.6% from 2.6% in July – the steepest month-to-month fall since May last year – and monthly PPI has been negative in two of the last three months.The International Monetary Fund and World Bank October meetings get underway in Washington, with finance ministry and central bank officials from around the world descending on the U.S. capital to discuss economic and policy issues. There will be a flurry of press conferences, panel discussions and bilateral meetings over the coming days that will undoubtedly yield market-moving headlines.Here are key developments that could provide more direction to markets on Tuesday:- Hong Kong consumer price inflation (September)- South Korea producer price inflation (September)- Reserve Bank of New Zealand assistant governor Karen Silk speaks More

WASHINGTON (Reuters) – Higher prices are here to stay, which adds to economic pain also stemming from slow growth and high debt, the International Monetary Fund’s managing director, Kristalina Georgieva, said on Monday.”The pain we all feel because prices have gone up is here to stay, and a higher level of prices makes many people around the world quite angry too,” she said in a speech at the Bretton Woods Conference.”We are faced with this unforgiving combination of slow growth and high debt.”She said the world economy is performing reasonably well, but cautioned that concerns remain. “Trade is growing slightly slower than global growth,” she added.The IMF will update its global growth forecasts on Tuesday. While Georgieva did not specify, she said growth is expected to be above 3%.The IMF’s 2024 global real gross domestic product growth forecast is at 3.2% and for 2025 it stands at 3.3%.She added that climate risks are hurting some countries’ economic prospects.The IMF and World Bank annual meetings which started on Monday are expected to draw more than 10,000 people from finance ministries, central banks and civil society groups. Topics under discussion include ways to boost patchy global growth, deal with debt distress and finance the transition to green energy. More