SkyBridge, founded by Anthony Scaramucci, plans to raise $50 million for its Unicorn Recovery Fund with an expected closing on April 30, according to the email to investors.SkyBridge declined to comment. More
(Reuters) – A look at the day ahead in Asian markets from Jamie McGeever.An interest rate decision from South Korea takes center stage in Asia on Thursday, in the midst of a widespread selloff in risk assets on growing fears that the Fed will keep U.S. interest rates higher for longer to quell inflation.Asian stocks are on course for their fourth down week in a row, the MSCI World index and the S&P 500 are eyeing their biggest weekly fall this year, and U.S. breakeven inflation rates are sailing up to 2.50% and beyond. One quirk of rising global inflation fears, however, was a 3% slide in oil on Wednesday, as traders bet that high consumer prices will sap growth and demand. A lower oil price, of course, is disinflationary, and base effects right now also mean that Brent crude is 17% cheaper today than it was a year ago. Light at the end of the inflation tunnel? Graphic: Brent oil – year-on-year change https://fingfx.thomsonreuters.com/gfx/mkt/klpygngerpg/OilYY.png Minutes from the Fed’s Jan. 31 to Feb. 1 policy meeting showed that most rate-setters voted to slow the pace of tightening. But in an interview with CNBC on Wednesday, St. Louis Fed chief James Bullard reiterated his view that rates must be raised to 5.25% to 5.50% to get inflation down this year.Central banks in Asia and elsewhere are getting caught in the Fed’s – and the dollar’s – slipstream. The Bank of Korea is expected to leave interest rates on hold at 3.50% on Thursday, and leave it there for the rest of the year, according to a Reuters poll. Economists surveyed reckon the BOK’s longest tightening cycle on record is over despite still high inflation. Graphic: South Korean economy & markets https://fingfx.thomsonreuters.com/gfx/mkt/egpbyoynwvq/SK1.jpg However, Korean policymakers may be forced to talk tough and say they stand ready to raise rates again.Anything other than that could lead the won to slip further from its two-month low against the dollar, which would only intensify domestic inflationary pressures and perhaps force the central bank to act again later in the year.Consumer price inflation in January was 5.20%, well over double the central bank’s 2.00% target and unlikely to return there for at least another year, economists reckon.Meanwhile, inflation figures from Hong Kong and Singapore will also be released on Thursday, as well as Thai trade and Taiwanese industrial production data.Here are three key developments that could provide more direction to markets on Thursday:- South Korea interest rate decision- Fed’s Bostic and Daly speak- U.S. Q4 GDP (second estimate) (By Jamie McGeever; Editing by Josie Kao) More
“Our job is clear: our job is to make sure we restore price stability, which is truly the foundation of a strong economy,” Williams said at a conference hosted at the bank.He noted that with global supply chains still disrupted, goods prices may not continue their recent decline, and inflation in core services excluding housing continues to be far too high, driven by too much demand relative to supply. More
Federal Reserve officials thought they needed to do more to cool the economy even before a series of strong data releases in recent weeks.Federal Reserve officials believed that they needed to do more to slow the economy and wrestle painfully rapid inflation back under control as of their meeting early this month, minutes from the gathering showed.The notes, released on Wednesday, showed that “all participants” continued to believe that rates needed to rise by more, and that “a number” of them thought that monetary policy might need to be even more restrictive in light of easing conditions in financial markets in the months prior.“Participants generally noted that upside risks to the inflation outlook remained a key factor shaping the policy outlook,” the minutes said. “A number of participants observed that a policy stance that proved to be insufficiently restrictive could halt recent progress in moderating inflationary pressures.”The takeaway is that policymakers were still intently focused on wrestling inflation back under control even before a spate of recent data releases showed that the economy has maintained a surprising amount of momentum at the start of 2023. In the weeks since the Fed last met, inflation data have exhibited unexpected staying power, and a range of data points have suggested that both the job market and consumer spending remain robust. A release on Friday is expected to show that the Fed’s preferred inflation indicator climbed rapidly on a monthly basis in January, and that consumption grew at a solid pace.That creates a challenge for Fed officials, who had been hoping that their policy changes last year would slowly but steadily weigh on the economy, cooling demand and forcing companies to stop raising prices so quickly. If demand holds up, businesses are more likely to find that they can continue to charge more without driving away their customers.Inflation F.A.Q.Card 1 of 5What is inflation? More
The National Labor Relations Board said severance pacts requiring confidentiality and nondisparagement violated a law on collective worker activity.The National Labor Relations Board has ruled that it is generally illegal for companies to offer severance agreements that prohibit workers from making potentially disparaging statements about the employer or from disclosing details of the agreement.The ruling by the board, which has a Democratic majority, overturns a pair of 2020 decisions, when the board was controlled by Republicans and found that such severance agreements were not illegal on their face. It continues the labor board’s worker- and union-friendly trajectory under appointees of President Biden.The earlier decisions held that the severance agreements were illegal only if accompanied by other circumstances making them suspect, such as the possibility that they were being used to cover up the illegal firing of employees who tried to form a union.Still, Anne Lofaso, a professor of labor law at West Virginia University, said the latest decision was limited to rights under the National Labor Relations Act, such as employees’ rights to draw attention to unsafe working conditions, or to engage in other activities that protect or benefit workers as a group.She said an employer could still offer workers a severance agreement requiring them to give up their right to sue over, say, race discrimination under the Civil Rights Act of 1964.In the ruling, issued Tuesday, the board said it was returning to longstanding precedent. The 2020 standard, it said, ignored the fact that a severance package with confidentiality or nondisparagement provisions could on its own “unlawfully restrain and coerce” workers’ labor rights.“It’s long been understood by the board and the courts that employers cannot ask individual employees to choose between receiving benefits and exercising their rights,” the board’s chairman, Lauren McFerran, said in a statement.Charlotte Garden, a professor of labor law at the University of Minnesota, said the 2020 approach had effectively tried to “narrow the rule to situations where an employer was trying to cover up their own previous unlawful activity and prohibit employees from talking about it.” The current ruling, she added, takes a broader view of when employees have the right to speak out.The case involved a Michigan hospital that permanently furloughed 11 union members during the pandemic. To receive severance benefits, they were required to sign an agreement that barred them from making statements that could disparage the hospital and from sharing the terms of the agreement.In furloughing the workers and offering them the agreement, the hospital also bypassed the union, depriving it of a chance to negotiate the terms, according to Tuesday’s ruling.In his dissent, Marvin Kaplan, the board’s lone Republican, argued that offering the severance agreement was illegal because the hospital circumvented the union, but not specifically because of its nondisclosure and nondisparagement provisions.Under Mr. Biden’s appointees, the labor board has moved relatively quickly to reinstate workers who it determines have been fired illegally. It has also issued rulings effectively expanding the financial remedies available to such workers and making it easier for a subset of employees within a workplace to unionize. More
Both Janice Eberly and Karen Dynan served as the chief economist at Treasury during Barack Obama’s presidency and are well regarded by current Treasury Secretary Janet Yellen, the paper said, citing unnamed sources familiar with the matter.President Joe Biden is weighing whom to appoint as vice chair at the Fed after bringing Lael Brainard from the central bank to be one of his chief economic advisers. Brainard, who had been on the Fed Board of Governors since 2014 and had been vice chair beginning last May, left the Fed in the last week.Eberly has a Phd in economics from Massachusetts Institute of Technology and is currently senior associate dean at Northwestern (NASDAQ:NWE) University’s Kellogg (NYSE:K) School of Management. Dynan’s doctorate in economics is from Harvard University, where she is a professor. She previously worked as an economist at the Fed for 17 years ending in 2009.The White House declined to comment but has previously said it expects to make a nomination soon.Last week, the Journal reported that Austan Goolsbee, another Obama administration veteran who took over in January as president of the Federal Reserve Bank of Chicago, was under consideration. On Wednesday, the paper said Goolsbee had faced resistance from some Democrats who have urged Biden to appoint a woman or person of color to the job. More
The producer price index rose 5.1% in January from a year earlier, while it had climbed 5.8% in December, according to the Bank of Korea. It was the slowest annual rise since March 2021.The annual rate continued its slowing trend for a seventh straight month, after hitting a near 14-year high of 10.0% in June 2022.The index rose 0.4% over a month, however, after two straight months of declines, driven mostly by higher utility costs. More
WASHINGTON (Reuters) -Nearly all Federal Reserve policymakers rallied behind a decision to further slow the pace of interest rate hikes at the U.S. central bank’s last policy meeting, but also indicated that curbing unacceptably high inflation would be the “key factor” in how much further rates need to rise.In language that suggested a compromise between officials worried about a slowing economy and those convinced inflation would prove persistent, minutes from the Jan. 31-Feb. 1 meeting said policymakers agreed rates would need to move higher, but that the shift to smaller-sized hikes would let them calibrate more closely with incoming data.”Almost all participants agreed that it was appropriate to raise the target range of the federal funds rate 25 basis points,” with many of those saying that would let the Fed better “determine the extent” of future increases, said the minutes, which were released on Wednesday.At the same time, “participants generally noted that upside risks to the inflation outlook remained a key factor shaping the policy outlook,” and that interest rates would need to move higher and stay elevated “until inflation is clearly on a path to 2%.” Only “a few” participants outright favored a larger half-percentage-point increase at the meeting, or said they “could have supported” it.The Fed delivered a string of 75-basis-point and 50-basis point rate hikes in 2022 in its battle to curb inflation that had climbed to 40-year highs. The central bank’s policy rate is currently in the 4.50%-4.75% range. The minutes’ reference to inflation risks as a “key” to policy means recent data – showing less progress than hoped for – could mean a higher projected stopping point for the federal funds rate when policymakers issue new projections at the end of the March 21-22 meeting, said Omair Sharif, president of Inflation Insights.Recent inflation data and upward revisions to earlier figures means the “upside risks to inflation” cited by policymakers in the minutes “are clearly much higher today than they were when the (Federal Open Market) Committee last met,” Sharif said, referring to the central bank’s policy-setting committee. “The March dots will move higher,” with the median projected year-end policy rate perhaps pushed up to as much as 5.6%, compared with the median 5.1% “dot plot” projection in December. Bond yields rose following the release of the minutes and the U.S. dollar also advanced against a basket of currencies. A modest rally in U.S. stocks fizzled out.The yield on the 2-year Treasury note, the government bond maturity most sensitive to Fed policy expectations, rose about 4 basis points from its level before the release to about 4.69%. The S&P 500 index, up about 0.25% before the minutes came out, closed lower.Traders of futures tied to the Fed policy rate added to bets on at least three more quarter-percentage-point rate hikes at upcoming meetings, with contract pricing pointing to a top federal funds rate range of 5.25%-5.50%. RECESSION RISKThe minutes showed the Fed navigating towards a possible endpoint to its current rate increases, at once slowing the pace in order to more cautiously approach a possible stopping point while also leaving open just how high rates will ultimately rise in the event inflation does not slow.The readout of the meeting included particularly pointed back-and-forth references to sets of developments in the economy that contributed to a still large degree of uncertainty about where things are heading.While “some” participants saw an “elevated” likelihood of a recession in the United States this year, and pointed to a drop in consumer spending at the end of 2022, others noted that households continued to sit on excess savings and that some local governments had “sizeable budget surpluses” that could also help stave off a painful downturn.Business investment was “subdued” at the end of the year. Still, “a couple” participants at the last Fed policy meeting said businesses “appeared more confident” that supply bottlenecks had been eliminated, and that the global economic environment was improving and “could provide support to final demand in the United States.” The minutes said the labor market remained hot, with businesses – at least outside the tech sector – “keen to retain workers even in the face of slowing demand,” a factor that would help sustain household incomes and spending. ‘VERY TIGHT’ LABOR MARKETThe Fed’s Feb. 1 policy statement said “ongoing increases” in rates would still be needed, but shifted the focus from the pace of coming hikes to their “extent,” a nod to the fact that policymakers feel they may be approaching a rate that is adequate to ensure steady progress in reducing inflation.Data since the last meeting have shown an economy continuing to grow and adding jobs at an unexpectedly rapid pace, while making less progress back towards the Fed’s 2% inflation target. Inflation by the central bank’s preferred measure was running in December at two and a half times the target, with data for January due to be released on Friday. The minutes showed Fed officials still attuned to the risk they may have to do more in order to keep inflation falling, a hawkish tilt that may come into more precise view when policymakers issue new interest rate and economic projections at the meeting.”Participants concurred that the Committee had made significant progress over the past year in moving toward a sufficiently restrictive stance of monetary policy,” the minutes said, describing an economy that continued to grow amid a tight labor market.”Even so, participants agreed that, while there were signs that the cumulative effect of the Committee’s tightening of the stance of monetary policy had begun to moderate inflationary pressures, inflation remained well above the Committee’s longer-run goal of 2% and the labor market remained very tight.” More
