Economy

Fed vs. inflation
Analysis: Fed waits out tariffs – and who pays the bill

In yesterday's Fed statement and interest rate path, there was a lot of uncertainty about both the economy and interest rates. But one thing was clear: Higher prices are on the way. It is still unclear how much of that cost will fall on consumers, at least if Fed Chairman Jerome Powell is to be believed, writes Bloomberg in an analysis.

The summer will therefore be dedicated to learning more about tariffs and if the market is to be believed, the first cut will take place in September. But there is a clear threat of an early fall cut: If inflation ticks up again. This is what the Wall Street Journal's Nick Tamiraos writes.

If inflation rises, the labor market will have to hit hard for the Fed to cut anyway. There are already some macroeconomic signs that the tariffs have reached the economy, but so far the data can be interpreted as the glass being both half full and half empty.

How inflation develops depends on who is sitting with the black Peter, that is, the customs bill, at the end of the companies' supply chains.

"According to Powell, someone has to pay - either it will be everyone, or just one," writes Tamiraos.

Swedish inflation
The inflation rate is predicted to reach the two percent target

Inflation expectations have fallen and more analysts now believe that the Riksbank will reach the inflation target of 2 percent. This is shown by a new survey from Origo Group on behalf of the Riksbank, according to TT.

Expectations for CPIF inflation are now at 2 percent in one, two and five years - a decrease from 2.3 percent in March.

EU-China relations
Rare earth metals are said to be in focus at summit

The EU will focus on access to rare earth metals at the summit with China in July, sources told Reuters. The EU is said to want to see the abolition of licensing requirements or permits for longer periods, as well as a distinction between the EU and the US in China's trade policy.

The meeting in Beijing, which will be attended by EU President Ursula von der Leyen and European Council President Antonio Costa, will also address tariff-related issues.

After Donald Trump's tariff shock on April 2, China has introduced export controls for the critical minerals also towards the EU and other countries.

The tariff crisis Trump's tariff policy
Sources: EU leans towards accepting a tariff rate of 10 percent

EU officials have increasingly begun to accept that a tariff rate of 10 percent for "reciprocal tariffs" is the starting point if a trade deal is concluded between Europe and the US, people with insight into the negotiations told Reuters.

According to US Commerce Secretary Howard Lutnick, a lower percentage than that is ruled out. And since the US has started to collect revenue from its global tariffs, it has become more difficult to negotiate down the level, according to the sources.

– 10 percent is a tough nut to crack. We are pressuring them, but now they are starting to get money, an official told the news agency. 

Canada threatens to raise steel tariffs against the US

Canada will raise its retaliatory tariffs against US steel tariffs if trade talks with the Trump administration stall, the government said in a statement.

On July 21, Canada will adjust tariffs on steel and aluminium products "to levels consistent with the progress made in the broader trade agreement with the US," it said.

– We will take the time we need to negotiate the best deal for Canada - but no more, Prime Minister Mark Carney said in the statement.

The US raised steel tariffs to 50 percent in early June, while Canada's current retaliatory tariffs are at 25 percent. A preliminary deadline in the talks has been set for mid-July, writes Bloomberg. 

The Tiktok twists
Trump extends Tiktok's deadline for the third time

Donald Trump has extended the deadline for Tiktok's owner Bytedance to find an American buyer by another 90 days, the president writes on Truth Social. This means that Trump has given the popular Chinese video app a three-time reprieve in the wake of Congress banning it for security reasons.

The new deadline will therefore be September 17.

Donald Trump confirmed earlier this week that he would likely extend the deadline.