Trump and his followers remain unappeased by Powell's peace offering, according to ALEX BRUMMER's analysis
In the economic landscape, several significant developments are unfolding across the globe.
In the United States, President Donald Trump has been vocal about his disapproval of Federal Reserve Chairman Jay Powell, and has been pushing for interest rate cuts. Trump's persistence has led him to seek the appointment of his own appointees to the Open Markets Committee of the Federal Reserve, and has also attempted to remove Lisa Cook from the board, alleging mortgage infringements. However, Cook has legally challenged the dismissal and remains in her position, as a court ruling has allowed her to stay on.
Meanwhile, Trump has been advocating for a reduction of three full percentage points in the key interest rate, citing the need to stimulate the economy. The Fed, however, has been reluctant to lower rates rapidly, despite the ongoing pandemic and its impact on prices. Recently, the Fed did deliver a quarter-of-a-percentage point interest rate cut, but Trump continues to agitate for more.
The impact of rising prices is being felt most acutely by working people in Britain, where food and alcohol prices have increased by 5.1%. This rise is the fastest rate among the G7 nations, and the Bank of England is closely monitoring the situation as it affects their decision on mortgage rates. In an effort to alleviate some of the burden, Chancellor Rachel Reeves is considering the removal of VAT from power bills.
In other news, the service sector inflation and wage bills are edging down, but not enough to justify a significant interest rate cut. This has led to concerns about the slow response of the Fed in lowering mortgage rates, which some argue is contributing to the stagnation in the housing market and the vanishing of employment.
Elsewhere, Unilever is planning a significant reorganisation, which could see the exit from the ice cream business. The resignation of co-founder Jerry Greenfield could potentially interfere with the proposed initial public offering plans.
In the world of DIY investing, platforms such as AJ Bell, Hargreaves Lansdown, interactive investor, InvestEngine, and Trading 212 are gaining popularity. These platforms offer a range of services for individuals looking to manage their own investments.
As always, these developments underscore the dynamic nature of the global economy and the ongoing challenges faced by central banks and governments in maintaining stability and growth.
