Powell: 'Crosscurrents' are weighing on the economy, so Fed will 'act as appropriate' - CNBC

Business investments across the U.S. have slowed recently as uncertainties over the economic outlook linger, Federal Reserve Chair Jerome Powell said Wednesday in prepared testimony to the House Financial Services Committee.

"Inflation has been running below the Federal Open Market Committee's (FOMC) symmetric 2 percent objective, and crosscurrents, such as trade tensions and concerns about global growth, have been weighing on economic activity and the outlook," Powell said in his testimony, reiterating the central bank will "act as appropriate" to sustain the current economic expansion.

The Fed chief also noted that business investment has slowed down "notably," adding the outlook has not improved in recent weeks. Powell will deliver his testimony at 10 a.m. ET and answer questions from lawmakers.

Powell's prepared testimony appeared to confirm the market's rate-cut expectations. Stock futures turned positive after the remarks were released. The Dow Jones Industrial Average was headed for a gain of more than 100 points at the open.

"There is a risk that weak inflation will be even more persistent than we currently anticipate," Powell added, further bolstering the case for a rate cut.

"Overall growth in the second quarter appears to have moderated," Powell said in the prepared remarks. "Many FOMC participants saw that the case for a somewhat more accommodative monetary policy had strengthened. Since then, based on incoming data and other developments, it appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook."

Jerome Powell testifies before the Senate Banking, Housing and Urban Affairs Committee on his nomination to become chairman of the U.S. Federal Reserve in Washington, November 28, 2017.

Joshua Roberts | Getty Images

The U.S. and China have been engaged in a trade war for more than a year. Late last month, the two countries agreed to restart trade negotiations in an effort to end the spat. Meanwhile, data from overseas — especially in Europe — are showing weakening economic activity.

Powell noted the economy "performed reasonably well" in the first half of 2019, with consumer spending rebounding in the second quarter after being weak in the first quarter.

Powell's testimony comes after the Fed opened the door to cutting rates at its previous monetary policy meeting in June.

Markets cheered the central bank's remarks, with stock indexes reaching all-time highs last week. Traders are also pricing in a 100% probability of a rate cut before the end of July, according to the CME Group's FedWatch tool.

— CNBC's Jeff Cox and Patti Domm contributed to this report.

Subscribe to CNBC on YouTube.

Let's block ads! (Why?)

https://www.cnbc.com/2019/07/10/powell-crosscurrents-are-weighing-on-the-economic-outlook-so-fed-will-act-as-appropriate.html

2019-07-10 13:18:47Z
52780328813959

Eat Smart kale salad bags recalled due to possible listeria contamination - CityNews

Eat Smart brand kale salad bags are being recalled due to possible listeria contamination.

The Canadian Food Inspection Agency says the 794-gram salad bags with best before dates of July 17 are being recalled in six provinces — Ontario, Quebec, New Brunswick, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island.

The agency says the recall was triggered by test results and it is conducting a food safety investigation, which may lead to the recall of other products.

It says food contaminated with listeria may not look or smell spoiled but can still make people sick.

It says symptoms of illness can include vomiting, nausea, persistent fever, muscle aches, severe headache and neck stiffness, and pregnant women, the elderly and people with weakened immune systems are particularly at risk.

The agency says there have been no reported illnesses associated with the salad.

Click here for more information on the recall.

from Business - Latest - Google News https://ift.tt/2XUY1Da
via IFTTT
July 10, 2019 at 04:01PM

Gold Prices Spike Above $1400 As Fed's Powell Highlights Growing Economic Uncertainty - Kitco News

(Kitco News) - Gold prices have pushed back above $1,400 an ounce reacting to dovish comments from Federal Reserve Chair Jerome Powell that signals looser monetary policy.

In his testimony before the U.S. House Committee of Financial Services, Powell highlighted growing risks to the U.S. economy.

“Many FOMC participants saw that the case for a somewhat more accommodative monetary policy had strengthened,” he said in his opening statement, which was released 90 minutes before the hearing. “Since then, based on incoming data and other developments, it appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook. Inflation pressures remain muted.

Gold prices were under pressure ahead of the report and have quickly reversed those loses. August gold futures last traded at $1,408.80 an ounce, up 0.64% on the day.

Powell noted that the domestic economy had performed reasonably well during the first half of the year; however, he added that there are growing global “crosscurrents,” creating uncertainty for the rest of the year.

“Growth indicators from around the world have disappointed on net, raising concerns that weakness in the global economy will continue to affect the U.S. economy. These concerns may have contributed to the drop in business confidence in some recent surveys and may have started to show through to incoming data,” he said.

Powell also pushed back against growing criticism from the White House and President Donald Trump.

“Congress has given us an important degree of independence so that we can effectively pursue our statutory goals based on objective analysis and data. We appreciate that our independence brings with it an obligation for transparency so that you and the public can hold us accountable,” Powell said

Powell also laid some of the risks to the domestic economy at the feet of the U.S. government, in particular growing government debt.

“A number of government policy issues have yet to be resolved, including trade developments, the federal debt ceiling…” he said. “I remain concerned about the longer-term effects of high and rising federal debt, which can restrain private investment and, in turn, reduce productivity and overall economic growth. The longer-run vitality of the U.S. economy would benefit from efforts to address these issues.”

On inflation, Powell warned that there is a risk that weak consumer prices could be even more persistent than the central bank currently expects.

Although Powell was more dovish than expected, the expectation for a 50 basis-point cut by the end of the month remain low. Avery Shenfeld, senior economist at CIBC Capital Markets, said that Powell's comments did nothing to shift expectations for a July rate cut.

"The Fed Chair had a chance to disabuse markets of the notion that a July rate cut is sure thing, and he didn't take that opportunity," he said. "All told, nothing in here to warn markets against assuming a July cut is coming, and if tomorrows core CPI readings don't show a reheating, a July rate cut could be a lock."

from Business - Latest - Google News https://ift.tt/2Jr96DR
via IFTTT
July 10, 2019 at 07:36PM

Powell: 'Crosscurrents' are weighing on the economy so Fed will 'act as appropriate' - CNBC

Business investments across the U.S. have slowed recently as uncertainties over the economic outlook linger, Federal Reserve Chair Jerome Powell said Wednesday in prepared testimony to the House House Financial Services Committee.

"Inflation has been running below the Federal Open Market Committee's (FOMC) symmetric 2 percent objective, and crosscurrents, such as trade tensions and concerns about global growth, have been weighing on economic activity and the outlook," Powell said in his testimony, reiterating the central bank will "act as appropriate" to sustain the current economic expansion.

The Fed chief also noted that business investment has slowed down "notably," adding the outlook has not improved in recent weeks. Powell will deliver his testimony at 10 a.m. ET and answer questions from lawmakers.

Powell's prepared testimony appeared to confirm the market's rate-cut expectations. Stock futures turned positive after the remarks were released  The Dow Jones Industrial Average was headed for a gain of more than 100 points at the open. 

"There is a risk that weak inflation will be even more persistent than we currently anticipate," Powell added, further bolstering the case for a rate cut. 

"Overall growth in the second quarter appears to have moderated," Powell said in the prepared remarks. "Many FOMC participants saw that the case for a somewhat more accommodative monetary policy had strengthened. Since then, based on incoming data and other developments, it appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook."

Jerome Powell testifies before the Senate Banking, Housing and Urban Affairs Committee on his nomination to become chairman of the U.S. Federal Reserve in Washington, November 28, 2017.

Joshua Roberts | Getty Images

The U.S. and China have been engaged in a trade war for more than a year. Late last month, the two countries agreed to restart trade negotiations in an effort to end the spat. Meanwhile, data from overseas — especially in Europe — are showing weakening economic activity.

Powell noted the economy "performed reasonably well" in the first half of 2019, with consumer spending rebounding in the second quarter after being weak in the first quarter.

Powell's testimony comes after the Fed opened the door to cutting rates at its previous monetary policy meeting in June.

Markets cheered the central bank's remarks, with stock indexes reaching all-time highs last week. Traders are also pricing in a 100% probability of a rate cut before the end of July, according to the CME Group's FedWatch tool.

—CNBC's Jeff Cox and Patti Domm contributed to this report.

Subscribe to CNBC on YouTube.

Let's block ads! (Why?)

https://www.cnbc.com/2019/07/10/powell-crosscurrents-are-weighing-on-the-economic-outlook-so-fed-will-act-as-appropriate.html

2019-07-10 12:30:40Z
52780328813959

Powell speaks; UK pound under pressure; Markets wait - CNN

Investors will scrutinize his remarks for evidence that the Fed will cut rates when it meets later this month, and if so, by how much. A strong jobs report for June has weakened the case for a big move.

Lawmakers may also press Powell on the Fed's independence in light of repeated criticism from President Donald Trump.

Trump has recently said the central bank was acting like a "stubborn child" for refusing to pursue easy money policies and tweeted that the Fed "doesn't know what it is doing."

Powell has pushed back, defending the institution and its insulation from "short-term political interests."

The central banker will appear before the House Financial Services Committee at 10 a.m. ET. The Fed also releases minutes from its June meeting at 2 p.m. ET.

2. Pound under pressure: The pound is hovering near a two-year low against the US dollar as the race to replace Prime Minister Theresa May produces fresh anxiety about Brexit.

Boris Johnson, the frontrunner to succeed May, has warned that he could take the United Kingdom out of the European Union on October 31 without a deal that protects trade.

Analysts at Bank of America Merrill Lynch said in a note Wednesday that the odds of leaving without a deal have shot up — though it still isn't their base expectation.

"We think persistent uncertainty is the most appropriate forecast," they said.

Britain's economy grew 0.3% in May, according to data released Wednesday. That eases the pain of a 0.4% decline in April, but does little to change the picture of a weak economy overall and possible negative growth in the second quarter.

Want more markets? Watch CNN's "Markets Now" digital live show Wednesday at 12:45 p.m. ET.

3. Markets in wait: Markets lack direction ahead of Powell's remarks.

US stock futures point lower. The Dow is set to fall 40 points, or 0.2%. The Nasdaq and S&P 500 are set for similar losses.

European markets opened mixed. Britain's FTSE 100 rose 0.1%, while France's CAC 40 and Germany's DAX slipped.

Hong Kong's Hang Seng rose 0.3%, but the Shanghai Composite and Japan's Nikkei shed 0.2%.

The Dow Jones industrial average closed down 0.1% on Tuesday. The S&P 500 increased 0.1%, and the Nasdaq was rose 0.5%.

Before the Bell newsletter: Key market news. In your inbox. Subscribe now!

4. Coming this week:
Wednesday — US oil inventories; Fed minutes; Bed Bath & Beyond (BBBY) earnings; Powell testifies in the House
Thursday — US inflation rate; China balance of trade; Delta (DAL) earnings; Powell testifies in the Senate
Friday — US producer prices

Let's block ads! (Why?)

https://www.cnn.com/2019/07/10/investing/premarket-stocks-trading/index.html

2019-07-10 11:18:00Z
52780328813959

Deutsche Bank is being slammed for paying $52 million 'golden parachutes' to fired execs — right after ma.. - Business Insider

Deutsche Bank is being slammed for handing out 'golden parachutes' while junior staff get the axeChinaFotoPress/Getty Images

• Deutsche Bank is being slammed for paying out millions to departing senior managers.
• A picture of two men thought to be fired Deutsche bankers went viral on Twitter, after they were photographed leaving the bank bags in hand. 
• It turns out they were fitting $1,800 suits for the German bank's directors, all while hundreds of staff were being fired. 
• Deutsche earlier this week announced a massive overhaul which would over the next few years cut 18,000 jobs.
• Read more stories on Markets Insider.

---

Deutsche's overhaul just seems to keep getting messier.

On the morning of the announcement that 18,000 jobs were being cut, the bank's managing directors were having suits fitted worth over $1,800. Adding to the sting, the Financial Times reported on Wednesday that some executives were paid £52 million in "golden parachute" severance packages. 

The Financial Times reported that the bank has spent more than €52 million on payouts to departing senior staff since May 2018. The FT said that is almost equal to the whole management board.

Gerhard Schick, head of lobby group Finance Watch Germany called the payments "inappropriate."

"Golden parachutes for failed managers while thousands of employees are losing their jobs just do not match," Schick told the Financial Times. 

Suited while employees get booted

It's a "Let them eat cake" moment for the bank, which was seen as being tone deaf to the gloom of junior staff when on Tuesday Financial News reported that a viral photo of what many thought were fired employees actually were tailors fitting out lavish suits for executives. 

The photo went viral on Twitter, and was used by The Financial Times, Guardian and Reuters as well as Business Insider. 

Ian Fielding-Calcutt and Alex Riley, who work for Fielding & Nicholson Tailoring, had been fitting suits for senior directors unaffected by the cuts. 

Fielding and Nicholson/ Twitter

Fielding and Nicholson/ Twitter

Fielding-Calcutt told Financial News: "Our timing was not great," and that he had been fitting suits for managing directors at the bank for more than a decade. 

He added: "Almost 30% of our business comes from investment bankers. I think a lot of the people getting laid off were traders of some sort, who don't wear suits, and so we just went ahead as normal with our clients who obviously weren't affected by the cuts."

The German bank's turbulent 14 months culminated in 18,000 jobs being cut across its offices from Sydney to New York.

Deutsche Bank's severance payments started with John Cryan, the former CEO getting nearly a €11 million pay off. After that six more board members left,  cashing in on at least €41 million according to the Financial Times. 

Let's block ads! (Why?)

https://www.businessinsider.com/deutsche-bank-slammed-paying-52-million-golden-parachutes-fired-execs-2019-7

2019-07-10 09:11:04Z
52780329211296

Dow futures slightly lower ahead of Fed Chair Powell's testimony - CNBC

U.S. stock index futures were slightly lower Wednesday morning, as market participants eagerly anticipated comments from the world's most powerful central banker.

At around 05:30 a.m. ET, Dow futures slipped 40 points, indicating a negative open of more than 41 points. Futures on the S&P and Nasdaq were both seen slightly lower.

Market focus is largely attuned to the testimony of Federal Reserve Chairman Jerome Powell, with investors anxious to learn whether he will confirm or confound expectations for U.S. policy easing this month.

Over the next two days, Powell is expected to talk about slowing economic activity and increased risks — showing that the Fed is ready to cut interest rates as needed.

However, Powell is also likely to keep the markets — and the White House — guessing about how soon and how deep the Fed intends to trim rates, when it meets at the end of July. The prevailing view, priced into the futures market, is for a 100% chance of a quarter point rate cut July 31.

Overnight, Atlanta Fed President Raphael Bostic said the U.S. central bank was debating the risks and benefits of letting the world's largest economy run "a little hotter."

On the data front, wholesale trade figures for May will be released at around 10:00 a.m. ET.

In corporate news, AngioDynamics and MSC Industrial Direct are both set to report their latest quarterly earnings before the opening bell.

AAR, Bed Bath & Beyond and PriceSmart are scheduled to release their corporate results after market close.

— CNBC's Patti Domm contributed to this report.

Let's block ads! (Why?)

https://www.cnbc.com/2019/07/10/stock-market-fed-chair-powells-testimony-in-focus-on-wall-street.html

2019-07-10 07:01:04Z
52780328813959