Economy

The Fed vs Inflation
Experts: Fed should cut on Wednesday - why wait?

Few expect a cut from the Fed at Wednesday's interest rate announcement. But more and more voices are beginning to be heard who believe that it would be the best.

Friday's PCE inflation was another dovish piece of the puzzle as the Fed's favorite gauge showed the lowest inflation in three years. Even the usual CPI numbers have started to point in the right direction, notes Yahoo Finance.

- In fact, I find it difficult to see any reason to keep the interest rate where it is, says Wilmington Trust's chief economist Luke Tilley to the site.

Goldman Sachs chief economist Jan Hatzius also asks why one should wait seven weeks if there are already reasons to reduce.

He believes that monthly inflation is volatile and if it turns out that it rises temporarily in August, it may be inconvenient to lower it in September.

Should the Fed cut on Wednesday, it would be one of the biggest surprises of the year. According to the CME Fed Watch Tool, only 5 percent believe in a July cut, while 96 percent believe in a cut in September.

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The change of power in Great Britain
Rich Brits expected to get higher taxes: "Bankrupt and broken"

Newly appointed Chancellor of the Exchequer Rachel Reeves will paint a gloomy picture of Britain's finances in a speech on Monday, writes Bloomberg.

According to a government statement, Reeves will describe a country that is "bankrupt and broken", with crises and chaos in housing, health, water, education, defence, transport and migration.

The new Labor government promised during the election campaign that no major tax increases were planned. But now the message is that the administration after taking office has realized that the financial problems are worse than feared. According to a report, there is a hole in the state finances of the equivalent of SEK 278 billion.
The Daily Telegraph writes that Reeves is expected to prepare the country for increased taxation of the rich. According to Bloomberg, there is speculation that higher taxes for capital gains and inheritance

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Cowboy NFTs Reportedly Made Trump U-turn on Crypto

NFTs of Donald Trump as a superhero and a cowboy. That is one of the reasons why the presidential candidate has now become a crypto supporter, people with knowledge of the matter told Bloomberg.

During his presidency, Trump was not a fan of crypto, but in the run-up to this fall's election, he has made a U-turn. Partly it is to attract a new voter base, but also because the ex-president "fell in love" with the flattering pictures of himself.

According to the data, the NFTs became a gateway to a wider interest in alternative investments and the crypto industry.

- The NFTs are what made Trump meet the crypto supporters for the first time, says Blockchain Association's Kristin Smith.

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The EU's plan against Trump: "A partner, not a problem"

Brussels is drawing up a two-step plan to deal with a scenario where Donald Trump wins the US election. According to the Financial Times, the EU plans to first offer a quick deal to buy more US goods and then raise targeted tariffs if Trump faces punitive tariffs against the union.

Trump has previously said he wants to impose punitive tariffs of at least 10 percent against the EU if he wins. This could reduce the Union's exports to the US by 150 billion euros annually. EU employees therefore see the tactic of using "carrot and whip" as the best.

- We have to show the US that we are a partner and not a problem, says an EU source to the newspaper.

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Trump wants to make the US the biggest in crypto - bitcoin rises

After Donald Trump this weekend once again clarified his new, crypto-friendly agenda for the presidential election, the price of bitcoin reaches its highest level since mid-June. That's what Bloomberg writes.

On Monday, bitcoin rose 2.5 percent and traded for just over $69,300.

At a bitcoin conference, Trump stated that he wants to make the United States the "crypto capital of the world."