Economy

“We’ve been cooperating with other countries, as well as the Bank of Japan and other government agencies,” Mimura said when asked about recent financial market routs at an event hosted by the Nikkei Business magazine.He also stressed that there have been no major changes in Japan’s economic fundamentals, saying that the Japanese economy is likely to recover modestly.When asked specifically about current foreign exchange rates, Mimura said he doesn’t have specific levels in mind. “We’re focused on volatility, as excessive volatility raises uncertainties for businesses,” he said.”It’s desirable for currencies to move in a stable manner reflecting economic fundamentals,” he added.The yen has faced high volatility in recent weeks. It fell on Wednesday after an influential Bank of Japan official played down the chances of a near-term rate hike, though it remained far above its 38-year low of 161.96 per dollar hit in early July. More

The agreement at a Maryland store, the first to unionize, raises wages roughly 10 percent over three years and guarantees benefits and severance pay.Workers at the first unionized Apple Store in the country ratified a labor contract with the tech giant on Tuesday, after a year and a half in which bargaining appeared to stall for long stretches and union campaigns at other stores fell short.After the union announced the outcome, Apple said it did not dispute the result and was pleased to have an agreement.The contract, covering about 85 workers at a Towson, Md., store who voted to join the International Association of Machinists and Aerospace Workers in June 2022, will provide a typical worker with a raise of roughly 10 percent over the next three years.The workers will also effectively receive the same benefits as those in nonunion stores — a point of contention since the company introduced new benefits that excluded union stores in the fall of 2022 — as well as guaranteed severance pay.“We are giving our members a voice in their futures and a strong first step toward further gains,” the store’s bargaining committee said in a statement after reaching a deal with the company. “Together, we can build on this success in store after store.”The contract talks had appeared to bog down over equal access to the benefits that other stores receive, and over a nationwide change in Apple’s scheduling and availability policy for part-time workers. The union said the policy change would have forced roughly half a dozen Towson workers to quit because of conflicts with other commitments.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

“Inflation continues to slow down but the path to the two percent target remains bumpy this year,” Rehn said.He added the rate cuts would help the eurozone economy recover, in particular the “fragile” industrial growth and subdued investments. (Reporting Essi Lehto, editing by Anne Kauranen) More

In a note to clients Wednesday, the firm argues that “any kind of policy response before the election would require a crisis atmosphere.”The note emphasizes that while a downturn, especially a recession, could profoundly influence next year’s fiscal policy debate, the current economic conditions do not yet warrant immediate bipartisan action.Piper Sandler states: “Even if there is a broad consensus the economy is likely headed into recession, it’s hard to imagine a bipartisan policy response making its way through Congress before the election.”They highlight that both Donald Trump and congressional Republicans are unlikely to support pre-election voter checks, requiring more than just a stock market correction to provoke a congressional response.President Biden has actively pursued unilateral actions, though many have faced legal challenges. Piper Sandler analysts are skeptical about the available measures he can deploy without congressional support.They foresee that “if the economy does fall into recession over the next six months, it could have a big impact on next year’s agenda.”A key driver for next year’s fiscal package is the scheduled expiration of the Trump tax cuts. However, Piper Sandler says a recession could introduce new variables affecting the fiscal policy landscape.The firm’s note recalls the extension of the Bush tax cuts during President Obama’s term as a response to the great financial crisis, suggesting a recession could similarly raise the likelihood of a more stimulative economic policy response.Piper Sandler concludes that while Trump has proposed several new tax cuts, these would likely have a better chance of enactment if the economy enters a recession. More

KAMPALA (Reuters) -Uganda’s central bank reduced its key lending rate by 25 basis points to 10.00% on Wednesday, saying a recovery in the shilling currency had led to an improvement in the inflation outlook.The shilling hit a record low in late February, but has risen by more than 6% against the U.S. dollar since then, meaning there is less risk that a recent rise in inflation will prove to be persistent.Inflation rose to 4.0% year-on-year in July, still below the central bank’s 5% medium-term target but up from 2.8% in January.”The MPC (Monetary Policy Committee) noted that … the adverse impact of the past external shocks has abated and there has been some progress in moderating risks of inflation persistence,” Central Bank Deputy Governor Michael Atingi-Ego told a news conference.”The inflation projection has been revised slightly downwards relative to the June 2024 forecast … largely due to a lesser depreciated shilling exchange rate.”Atingi-Ego attributed the recent uptick in inflation to sectors such as passenger transport, accommodation, sports and recreation.He said the Bank of Uganda expected inflation to continue rising moderately in the next four months due to seasonal factors, but to stabilise around the target of 5% by the first quarter of 2025.At the bank’s last monetary policy meeting in June it expected inflation to only stabilise around 5% in the second half of next year.Atingi-Ego noted there had been a pickup in Uganda’s economic growth, which averaged 6.7% in annual terms in the last two quarters of fiscal year 2023/24 compared with 5.3% growth in the previous two quarters.The bank’s growth forecast for the 2024/25 fiscal year that started in July remains unchanged, at between 6.0% and 6.5%.”It was appropriate to reduce slightly the degree of monetary policy restrictiveness,” Atingi-Ego said. More

Companywide profit increased, the result of hit movies and streaming growth. But Disney said softening theme park demand “could impact the next few quarters.”In Disney’s seemingly never-ending game of corporate Whac-a-Mole, a new trouble spot has arisen: Americans — battered by years of high inflation — have less money to spend on amusement, imperiling growth at Disney theme parks.On Wednesday, Disney reported weaker-than-expected theme park results for the three months that ended on June 29. Revenue increased 2 percent from a year earlier, to $8.4 billion, while operating profit declined 3 percent, to $2.2 billion. Disney blamed a “moderation of consumer demand” that “exceeded our previous expectations,” along with higher costs. Disney said softening demand “could impact the next few quarters.”Disney added that it was “aggressively managing our cost base.”Theme parks have taken on much greater financial importance at Disney over the past decade. They have been the A.T.M.s that have paid for Disney’s costly expansion into streaming and picked up the slack for the company’s atrophying cable television business. Last year, Disney Experiences, a division that includes theme parks and cruise ships, contributed 70 percent of the Walt Disney Company’s operating profit, up from about 30 percent a decade ago.Robert A. Iger, Disney’s chief executive, has called theme parks and cruise ships “a key growth engine” for the company. Last year, Disney said it would spend roughly $60 billion over the next decade to expand its parks and to continue building Disney Cruise Line, double the amount of the previous decade. Josh D’Amaro, chairman of Disney Experiences, is expected to unveil an array of specific expansion projects on Saturday at a fan convention in Anaheim, Calif.But there are reasons to worry that the U.S. economy could be headed toward a recession. In addition, the global postpandemic surge in travel is largely over. Citing a “normalization” of demand, Comcast said last month that quarterly revenue at its Universal theme parks had fallen 11 percent, while pretax earnings plunged 24 percent.Mr. Iger has been trying to move Disney beyond a tumultuous period when activist investors sought to alter the company’s direction. One activist, Nelson Peltz, mounted a proxy contest for board seats this year and harshly criticized Disney’s streaming strategy, succession planning and lagging stock price. Disney fended off the attacks, but its share price has fallen 27 percent since early April.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

The National Association of Financial Market Institutional Investors (NAFMII) said in a statement the banks – all based in eastern Jiangsu province – “were suspected of manipulating prices and transferring benefits in the secondary market trading of treasury bonds”.The four banks are Changshu Rural Commercial Bank, Kunshan Rural Commercial Bank, Jiangsu Suzhou Rural Commercial Bank Co and Jiangnan Rural Commercial Bank, according to the statement. More

LONDON (Reuters) – The Federal Reserve may be a bit late cutting interest rates, but it’s not yet behind the curve in forestalling a U.S. recession.For all the wild financial swings and furious trading of the past week, markets have yet to price in a Fed monetary policy stance that would actively stimulate the economy at any point over the coming two-year cycle.While that could highlight investors’ lingering concerns about sticky inflation, it more likely reflects their doubts that some deep recession is in fact brewing. And what it indicates most clearly is that the Fed only has to lift its foot off the brake to keep the expansionary ride going.Markets were clearly spooked by the surprisingly sharp rise in the U.S. jobless rate last month – and further aggravated by the Big Tech stock shakeout. As volatility spiked, markets have raced to price a series of deep Fed rate cuts over the months ahead.Just one month ago, futures prices indicated that barely two quarter-point cuts were anticipated over the remainder of the year, but now they show expectations of twice that – some 115 basis points at last count on Tuesday.Most notable among a series of hastily revised forecasts, U.S. investment bank JPMorgan now projects that we will see two half-point cuts in both September and November, followed by a quarter-point cut in December.Not for the first time, this may seem a little overcaffeinated. And it certainly reflects the market volatility present right now in a holiday-thinned August.But what’s happened further out the curve is perhaps more instructive about what investors expect to see in the full easing cycle ahead.There’s little doubt now the Fed will start cutting next month: its signalling about that was crystal clear at last week’s meeting. But where the cutting stops is less obvious.Looking at futures and money market pricing on Monday, the so-called terminal rate over the next 18 months never got below 2.85%, even during the most extreme part of the day’s turbulenceThat’s a long way down from the current policy mid-rate of 5.38%. But it’s still above where Fed policymakers see the long-term ‘neutral’ rate – widely seen as their proxy for the fabled ‘R*’ rate that neither stimulates or reins in economic activity. That median long-run rate is currently 2.8% – after being pushed up 30 basis points by Fed officials this year.So, if anxious money markets don’t think the Fed will be forced to go below that, then the slowdown ahead can’t be expected to be that bad – despite all the hand wringing of recent days. At the very least, it suggests markets remain equivocal about recession and think the removal of policy ‘restriction’ may be enough by itself to hold the line.MEAN REALAnother way to look at it is to view the ‘real’ inflation-adjusted Fed policy rate, which is currently 2.5%. That’s the highest level in 17 years. It has risen steadily from zero since April 2023 as disinflation has set in.If the Fed’s full easing cycle turned out to be the 250 bps suggested by markets this week – and consumer price inflation were to remain as high as 3% through that period – then the real policy rate would merely return to zero at its lowest.Bear in mind that the average real policy rate over the past 15 years was -1.4%, so a reversion to zero is not suggesting the Fed is heading for anything like emergency mode.All conjecture? The Fed has a busy six weeks ahead to clear it all up.Fed officials speaking this week suggest they’re not too worried about recession yet but everything is still on the table policy-wise. They also insist that they will continue to have meeting-by-meeting assessments and that one month of data or market upheaval won’t change their minds unduly.Perhaps cryptically, San Francisco Fed chief Mary Daly said the central bank “is prepared to do what the economy needs when we are clear what that is.” Part of what set recession talk rumbling was the triggering last week of the so-called Sahm Rule, which posits that a 0.5 percentage point rise of the three-month average jobless rate over the low of the prior year typically presages recession.But even the rule’s author, ex-Fed economist Claudia Sahm, downplayed the latest trigger due to pandemic and weather- related distortions still plaguing the jobs data. And yet, with the labor market softening either way, the Fed still seems set for a September rate cut – a move that will also be accompanied by an update of policymakers projections, including that long-run neutral rate.And before then, the Kansas City Fed’s annual Jackson Hole symposium takes place on Aug. 22-24 – where longer-term Fed thinking tends to get sketched out in more detail.”It was a mistake that the Fed didn’t cut rates last week, but I don’t believe it will cause irreparable damage to the economy,” reckoned Invesco strategist Kristina Hooper. “This sell-off (in stocks) is a very emotional market reaction that is overestimating the potential for recession.”And the rates market may not even be pricing in recession at all.The opinions expressed here are those of the author, a columnist for Reuters.(This story has been refiled to correct a name in paragraph 26) More