Economy

Fed vs. inflation
Powell pressured ahead of speech: “Like Goldilocks with two bears and a bull”

Federal Reserve Chairman Jerome Powell is under heavy pressure from the Trump administration ahead of his speech at Jackson Hole later today, notes Bloomberg. The US president has tried several times to pressure the central bank to cut interest rates, but so far without success.
    
At the same time, disagreements are growing within the board, the news agency points out. Powell is expected to emphasize that the decision in September will be determined by upcoming data on employment and inflation. The market is sensitive: a lack of a cut could trigger a stock market crash, while a too-sharp cut risks being interpreted as the Fed losing its independent role and thus fueling inflation, says strategist Joachim Klement.

“It’s like Goldilocks with two bears and a bull,” he says.

The Euro Debate
EU's crypto spurt – accelerating work towards digital euro

The EU is increasing the pace of work towards a digital euro in order not to fall behind the US and China. This is reported by sources with insight to the Financial Times.

The US has adopted a new law regulating stablecoins – cryptocurrencies whose value is tied to government-guaranteed assets such as the dollar or government bonds. The EU is now considering building a digital euro on existing blockchain technology such as ethereum or solana, rather than developing its own solution.

The Riksbank is waiting with the e-krona until there is news about a digital euro.

Germany's growth
German economy shrank more than expected in the second quarter

Germany's GDP fell 0.3 percent in the second quarter compared to the previous three months, according to revised figures from the country's statistics authority. Bloomberg reports.

The decline was larger than the preliminary estimate of minus 0.1 percent and is mainly due to weaker industrial production and reduced investment. Household consumption also contributed less than expected.

The case is a setback for Europe's largest economy, which is grappling with the consequences of the war in Ukraine, weak global growth and structural problems. 

Elon Musk's X
Musk reaches settlement with former Twitter employees

The social media giant X, led by Elon Musk, has reached a preliminary agreement after former employees of the then Twitter sued the company for $ 500 million, writes Fox News.

They claimed that a severance pay plan from 2019 entitled the staff to higher compensation than what the company ultimately offered after Musk's takeover.

Now both parties announce that they have agreed to a settlement and asked that an upcoming court hearing be postponed to complete the agreement.

The financial terms of the settlement are not disclosed. About 6,000 employees were forced to leave Twitter after Musk's purchase in 2022, as part of a cost-cutting package.