Hello,
Here are the five things you need to know today:
UNITED STATES. In the rate hike’s wake, one number counts.
CANADA. EUROPE. The EU gets flexible on geometry.
CHINA. Health rumours plague summit preparations.
INDIA. PAKISTAN. A naval incident raises old ghosts.
LIBYA. Warring factions just can’t help themselves.
UNITED STATES. Gaslighting
In the rate hike’s wake, one number counts.
The Federal Open Market Committee unanimously agreed to raise rates by 25 basis points, though Chair Kevin Warsh said the move “cannot affect any individual price, whether it be oil prices”. Diesel hit a record average of $6.31 per gallon.
INTELLIGENCE. Donald Trump may still be calling for rate cuts (to “1% or less”), but even though high oil is a supply-side phenomenon (more set by a chairman in Iran), no central bank can afford to have this fuel wider inflation. And judging from the reaction in yields, markets think that rates are still too low. Diesel, however, may be more important than credit at this point in the cycle, with its impact yet to be felt through the price of transported goods and farming.
FOR BUSINESS. Diesel export bans, broached by Senator John Thune (of farm state South Dakota), may now be in prospect. And while this will just push the crisis elsewhere (in Germany, diesel is now €2.40 a litre, or $10 a gallon), it could stem Trump’s midterm losses. In the meantime, US troops are reportedly crewing tankers for the first time since World War II, even if claims that 18 million barrels subsequently left Hormuz yesterday are yet to be believed.
CANADA. EUROPE. Tiers for fears
The EU gets flexible on geometry.
Ursula von der Leyen said Canada would be the EU’s first “associate member” as Mark Carney visited Strasbourg. Trump threatened “serious tariffs” at the “hostile act”. Canada applied to join the UK-led Joint Expeditionary Force military pact.
INTELLIGENCE. That Carney seeks closer ties with Europe is no surprise. But