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Biden is expected to choose Fed chief soon; Fed officials point to limits to central bank role on climate change

By on November 15, 2021 0

Good day. President Biden is expected to decide as early as this week whether he will appoint Federal Reserve Chairman Jerome Powell or Governor Lael Brainard for a four-year term as head of the central bank from next February. Given that Ms Brainard’s views on inflation and interest rates have been similar this year to Mr Powell’s, policy continuity seems likely no matter who is chosen. Meanwhile, some regional Fed officials are working to recalibrate expectations of what the US central bank might do regarding climate change issues.

Now on to today’s news and analysis.

Top news

Biden weighs choice of Jerome Powell or Lael Brainard as Fed chairman

President Biden met with Jerome Powell and Lael Brainard separately for talks on November 4, and he was joined in the Oval Office for those meetings with only one other adviser, National Economic Council director Brian Deese, according to people close to the case. Each meeting was scheduled for an hour, although Ms Brainard’s was slightly over time, one of those people said. Some people familiar with the case said Ms Brainard’s reunion went better than expected.

Regional Fed leaders point out limits to Bank’s role on climate change

Some Federal Reserve officials, like Fed Chairman Jerome Powell, don’t seem to believe the central bank is playing a leading role in tackling climate change issues.

American economy

Slow return of workers to their prime threatens recovery

About 1.4 million adults 25 to 54 years younger are working or looking for work than in the month before the pandemic, and their labor force participation rate was 81.7% in October, up from 82 , 9% in February 2020.

Resignation record fuels tight labor market

The so-called quit rate – a measure of workers leaving their jobs as a percentage of total employment – was 3% in September, a record high, according to Labor Department data on Friday, a sign of workers’ confidence in the work market.

As workers quit in droves, closer scrutiny of who quits

High inflation prompts Biden to focus message on rising prices

Stubbornly high inflation is endangering the Democratic Party’s legislative agenda and political fortunes, putting pressure on the White House and prompting it to underline its efforts to fight rising costs.

What does inflation mean for businesses? For some, greater benefits

Inflation spurts up market scum

Rising inflation pushes gold to five-month high

Democrats try to heal loopholes, pass $ 2 trillion spending bill

House Democrats return this week in a bid to pass a roughly $ 2 trillion climate and social spending agenda, amid party friction some lawmakers say is the worst ever ‘they have seen since their time in Congress.

Centrist Democrats await cost analysis of $ 2 trillion bill

Key developments around the world

Japan’s economy contracts, hit by supply chain issues

The Japanese economy contracted between July and September due to a drop in exports caused by supply chain constraints and declining consumer spending during the Covid-19 state of emergency.

China’s social mobility has stalled

China’s extraordinary economic rise has made the country believe that almost anyone can succeed if they work hard – a key part of Xi Jinping’s “Chinese Dream”. For more and more Chinese, however, this is no longer true.

Governments Accept Stronger Emissions Commitments, Questions Loom

More than 190 countries reached a deal at the UN summit that aims to accelerate the reduction of greenhouse gas emissions around the world, but leaves big questions about how they will materialize in the next decade.

COP26 paves the way for international carbon trading

Overview of financial regulation

Bitcoin creator Satoshi Nakamoto could be exposed in Florida lawsuit

In a lawsuit in Florida, the family of a deceased man are suing their former business partner for control of the assets of their partnership, a cache of around one million bitcoins, equivalent to around $ 64 billion today, owned by the creator of bitcoin.

Beijing Stock Exchange launched with big day one gains

The Beijing Stock Exchange opened on Monday, marking the start of a platform that China hopes will funnel funds to innovative small businesses as it tightens its grip on companies seeking to be listed overseas .

Forward-looking indications

Monday (every hour ET)

10:45 am: De Guindos from the European Central Bank delivers a speech at Euro Finance Week in Frankfurt

Tuesday

Time N / A: National Bank of Hungary issues policy statement

8:30 a.m .: US Department of Commerce releases October retail sales

9:15 am: Federal Reserve releases October US industrial production

11:10 am: Lagarde of the European Central Bank speaks in an interview on stage

12 p.m .: Atlanta Fed’s Bostic, Kansas City Fed’s George, Minneapolis Fed’s Kashkari and Richmond Fed’s Barkin speak at a virtual racism and economy event hosted by regional Fed banks; Schembri of the Bank of Canada speaks on labor market and monetary policy to the Canadian Business Economics Association

2:55 p.m.: Philadelphia Fed’s Harker speaks at fintech conference hosted by his bank

8:20 p.m.: Lagarde from the European Central Bank gives a video message on women in basic sciences during the Friends of IHES event

Remark

Faced with soaring inflation, the Fed runs out of excuses

Inflation has not been temporary and has accelerated, and is high even relative to pre-pandemic prices, so it’s not just about catching up with last spring’s deflation, writes James Mackintosh . It’s no longer just a tight set of supply chains disrupted by Covid, he says. The Fed can always say that inflation will be transient, not as temporary as hoped, but that it will go away on its own. Investors are still buying the story, but there is a growing risk that the Fed will have to act much more aggressively.

Inflation expectations could be a Freudian slide for the Fed

Whether or not an inflationary spiral occurs, central banks would be unwise to over-read expectations, which will continue to rise if inflation remains high, rather than focusing on labor market reports, writes Jon Sindreu .

The job market has no slack in sight

Until Covid-19 is under control and people are no longer worried about going to work, it’s hard to make assumptions about the continued tightening of the labor market, writes Justin Lahart.

China’s coal dependence runs deeper than the economy

Getting China to act faster on coal appears to remain a geopolitical as much as an environmental and economic issue, frustrating those hoping for more decisive action against fuel, writes Nathaniel Taplin.

Base points

U.S. consumer confidence fell in early November to its lowest level in a decade as high inflation weighed on Americans’ moods and concerns about the virus eased. The preliminary estimate of the consumer confidence index released Friday by the University of Michigan fell from 71.7 in October to 66.8, below the 72.5 forecasts of economists surveyed by the Wall Street Journal. (Dow Jones Newswires)

The eurozone’s trade surplus narrowed more than expected in September, as import growth continued to outpace that of exports, data from the European Union’s statistical agency showed on Monday.

Chinese factory activity and consumer spending were surprisingly strong in October, according to official monthly figures released on Monday, although further signs of weakness in the real estate sector highlighted concerns about the outlook for the world’s second-largest economy.

Consumer prices in India rose year-on-year in October at a slightly faster pace than in September due to rising food prices, according to preliminary government data showing the consumer price index. consumption rose 4.48% in October compared to the previous year after rising 4.35% in September. The inflation rate is in line with the Reserve Bank of India‘s target of 2% to 6%. (DJN)

The rapid rise in prices in Brazil, caused in part by shipping problems that increase the cost of inputs, is hitting coffee producers in the country, according to the coffee exporting group Cecafe. He said on Friday that coffee exports fell more than 23% in October from a year earlier due to logistical bottlenecks affecting most of the world. (DJN)

 

(END) Dow Jones Newswires

November 15, 2021 09:33 ET (14:33 GMT)

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