Washington Post

EXCLUSIVE Fed’s Bullard favors ‘frontloading’ rate hikes now, with wait-and-see stance in 2023

>>> Don’t Miss Today’s BEST Amazon Deals!<<<<

WASHINGTON, Oct 14 (Reuters) – A “hotter-than-expected” September inflation report doesn’t necessarily mean the Federal Reserve needs to raise interest rates higher than officials projected at their most recent policy meeting, St. Louis Fed President James Bullard said on Friday, though it does warrant continued “frontloading” through larger hikes of three-quarters of a percentage point.

In a Reuters interview, Bullard said U.S. Consumer Price Index data for September, which was released on Thursday, showed inflation had become “pernicious” and difficult to arrest, and therefore “it makes sense that we’re still moving quickly.”

After delivering a fourth straight 75-basis-point hike at its policy meeting next month, Bullard said “if it was today, I’d go ahead with” a hike of the same magnitude in December, though he added it was “too early to prejudge” what to do at that final meeting of the year.

Register now for FREE unlimited access to Reuters.com

If the Fed follows through with two more 75-basis-point hikes this year, its policy rate would end 2022 in a range of 4.50%-4.75%.

In what were tempered remarks for one of the Fed’s most hawkish voices recently, Bullard said that at that point he would let further increases rest on incoming data.

“I do think 2023 should be a data-dependent sort of year. It’s two-sided risk. It is very possible that the data would come in a way that forces the (Federal Open Market) Committee higher on the policy rate. But it’s also possible that you get a good disinflationary dynamic going, and in that situation the committee could keep the policy rate and hold it steady,” Bullard said a day after the U.S. government reported that consumer price inflation remained above 8% last month.

The possibility of a fifth larger-than-usual increase in December is “a little more frontloading than what I’ve said in the past,” he added.

But the trajectory mapped out by Bullard would still leave the target policy rate at the median level that Fed officials projected last month they would need to reach – evidence of a broad consensus at the central bank around at least a temporary stopping point after a year in which they have ratcheted rate expectations steadily higher.

Even if some of Bullard’s colleagues want to reach that point in smaller interim steps and not until early next year, Bullard said he regards faster increases as warranted because the U.S. labor market remains strong, and “there’s just not much indication that we’re getting the disinflation that we’re looking for.”

Though some investors and economists expect the Fed will need to lift its policy rate even further, to 5% or higher, Bullard said, “I wouldn’t predict that now … If that happens it will be because inflation doesn’t come down the way we’re hoping in the first half of 2023 and we continue to get hot inflation reports.”

The level he has penciled in for the end of the year is adequate, he believes, to lower the Fed’s closely-watched core personal consumption expenditures inflation index to below 3% next year, a long way back to the central bank’s 2% target.

‘SOFT LANDING’

Bullard said that despite the sense of turbulence in financial markets, there was “still a fair amount of potential for a soft landing,” with the United States likely to avoid a recession and companies reluctant to lay off workers who have been hard to hire during the post-pandemic economic reopening.

Warnings about recession risk may be distorted in part by inflation itself, Bullard said, with short-term bond yields driven higher than longer-term ones not for lack of faith in the economy, an “inversion” of the yield curve that shows investors betting on a recession, but because of the premium charged for the inflation taking place now.

Volatility in markets is to be expected when rates rise, he said, but may settle after a period of adjustment.

“It’s the transition that throws everybody for a loop,” Bullard said. But after that, the economy “could grow just as fast at the higher interest rates,” he said.

Asked about the sense that overseas events, such as the tension between the Bank of England and the current British government, may risk broader financial problems, Bullard said that his regional bank’s index of financial stress showed it to be low.

Compared to the sorts of serious market seizures seen during the financial crisis in 2008 or the start of the COVID-19 pandemic in early 2020, “I don’t think we’re in a situation where global markets are facing a lot of stress of that type.”

Register now for FREE unlimited access to Reuters.com

Reporting by Howard Schneider; Editing by Dan Burns and Paul Simao

Our Standards: The Thomson Reuters Trust Principles.

Howard Schneider

Thomson Reuters

Covers the U.S. Federal Reserve, monetary policy and the economy, a graduate of the University of Maryland and Johns Hopkins University with previous experience as a foreign correspondent, economics reporter and on the local staff of the Washington Post.

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<

Bank of England governor has ‘meeting of minds’ with Hunt

>>> Don’t Miss Today’s BEST Amazon Deals!<<<<

Summary
Companies

Bailey says he talked to new finance minister on Friday
‘Very clear and immediate meeting of minds’ on fiscal challenge
Rates likely to rise by more than thought in August – Bailey
Recent bond-buying not about targeting yields

WASHINGTON, Oct 15 (Reuters) – Bank of England Governor Andrew Bailey said there was an “immediate meeting of minds” when he spoke with finance minister Jeremy Hunt about the need to fix the public finances after the tax cut plans of Hunt’s predecessor unleashed market turmoil.

Bailey, speaking in Washington where British officials attending International Monetary Fund meetings have been put on the spot about the crisis engulfing the country, said he had spoken to Hunt on Friday after he replaced Kwasi Kwarteng.

“I can tell you that there was a very clear and immediate meeting of minds between us about the importance of fiscal sustainability and the importance of taking measures to do that,” Bailey said.

Register now for FREE unlimited access to Reuters.com

“Of course there was an important measure taken yesterday,” he said at an event where he also hinted at a big interest rate rise by the central bank next month.

Prime Minister Liz Truss, seeking to save her term in office which is barely a month old, said on Friday that Britain’s corporation tax rate would increase, reversing a key pledge made during her bid for Downing Street.

Hunt said earlier on Saturday that some taxes might have to rise and others might not fall as much as planned, signalling a further shift away from Truss’s original plans.

Bailey, speaking at an event organised by the Group of Thirty, which comprises financiers and academics, welcomed the role that Britain’s independent budget watchdog would have in assessing the budget plan that Hunt will publish on Oct. 31.

The Office for Budget Responsibility was not tasked with weighing up the impact of Kwarteng’s “mini-budget” which set off a slump in the value of the pound and government bonds when he announced it on Sept. 23.

“Flying blind is not a way to achieve sustainability,” Bailey said.

Truss criticised the BoE during her leadership campaign, saying she wanted to set a “clear direction of travel” for the central bank. BoE officials pushed back at those comments saying their independence was key to managing the economy.

‘STRONGER RESPONSE’ WITH RATES

Bailey said the BoE might raise interest rates by more than it previously thought because of the government’s huge energy bill support – which could lower inflation in the short term but push it up further ahead – and whatever it decides to do on tax cuts and spending.

“We will not hesitate to raise interest rates to meet the inflation target,” Bailey said. “And, as things stand today, my best guess is that inflationary pressures will require a stronger response than we perhaps thought in August.”

The BoE raised rates by half a percentage point in August – at the time its biggest increase in 27 years – and then did so again in September with inflation around 10%, far above the BoE’s target of 2%.

It is due to announce its next decision on Nov. 3 and many investors think it will either raise them from their current level of 2.25% to 3% or possibly 3.25%.

In the shorter term, the BoE will be keeping a close eye on how financial markets behave on Monday after it ended its emergency bond-buying programme on Friday.

Bailey said the now-completed intervention was “not about steering market yields towards some particular level, but rather preventing them from being distorted by market dysfunction”.

He said the BoE had acted after the violent market moves which exposed the “flaws in the strategy and structure” of a lot of pension funds.

The intervention was different to the much bigger and longer-running bond-buying that the BoE undertook during the coronavirus pandemic and earlier as a monetary policy tool.

“In these difficult times, we need to be very clear on this framework of intervention,” Bailey said.

Register now for FREE unlimited access to Reuters.com

Reporting by Howard Schneider in Washington and William Schomberg in London; Additional reporting by Michael Holden in London; Editing by David Clarke

Our Standards: The Thomson Reuters Trust Principles.

Howard Schneider

Thomson Reuters

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<

Report: Steve Bannon Expected To Face New Criminal Charge In New York

By Associated Press

and Newsy Staff
September 7, 2022

Bannon is expected to face charges for duping donors who gave money to fund a wall along the U.S. southern border, according to The Washington Post.

Steve Bannon, a longtime ally of former President Donald Trump, said Tuesday that he expects to be charged soon in a state criminal case in New York City.

Bannon, 68, plans to turn himself in on Thursday, according to a person familiar with the matter. The person insisted on anonymity to discuss an ongoing investigation.

The Washington Post, citing anonymous sources, reported that the state criminal case would resemble an earlier attempted federal prosecution, in which Bannon was accused of duping donors who gave money to fund a wall on the U.S. southern border.

That federal case ended abruptly, before trial, when Trump pardoned Bannon.

The Manhattan district attorney’s office declined comment late Tuesday.

In a statement, Bannon said District Attorney Alvin Bragg “has now decided to pursue phony charges against me 60 days before the midterm election,” accusing the Democratic prosecutor of targeting him because he and his radio show are popular among Trump’s Republican supporters.

“The SDNY did the exact same thing in August 2020 to try to take me out of the election,” Bannon said, referring to his arrest months before Trump’s reelection loss.

Federal agents pulled Bannon from a luxury yacht off the Connecticut coast and arrested him on charges he pocketed more than $1 million in wall donations.

“It didn’t work then, it certainly won’t work now,” the former White House strategist said. “This is nothing more than a partisan political weaponization of the criminal justice system.”

Bannon, who had pleaded not guilty, was dropped from the federal case when Trump pardoned him on his last day in office in January 2021.

Two other men involved in the “We Build the Wall” project pleaded guilty in April. They had been scheduled to be sentenced this week, but that was recently postponed to December. A third defendant’s trial ended in a mistrial in June after jurors said they could not reach a unanimous verdict.

A president can only pardon federal crimes, not state offenses, but that doesn’t mean state-level prosecutors have carte blanche to try similar cases.

In 2019, then-Manhattan District Attorney Cyrus Vance Jr. brought state mortgage fraud charges against Trump’s former campaign chairman Paul Manafort in what was widely seen as an attempt to hedge against a possible pardon.

But a judge threw the case out on double jeopardy grounds, finding that it was too similar to a federal case that resulted in Manafort’s conviction. (Manafort was later pardoned by Trump.)

While Manafort’s New York case was pending, New York eased its double jeopardy protections, ensuring that state-level prosecutors could pursue charges against anyone granted a presidential pardon for similar federal crimes.

Bannon’s case differs because he was dropped from the federal case in its early stages. In most cases, double jeopardy is only a factor when a person has been convicted or acquitted of a crime.

In another case not covered by Trump’s pardon, Bannon was convicted in July on contempt charges for defying a congressional subpoena from the House committee investigating the Jan. 6 insurrection at the U.S. Capitol. He is scheduled to be sentenced in October and faces up to two years in federal prison.

Additional reporting by The Associated Press.

Source: newsy.com

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<

Report: Seized Mar-A-Lago Documents Contained Nuclear Secrets

By Associated Press

and Newsy Staff
September 7, 2022

Documents confiscated from former President Trump’s property included a foreign government’s nuclear capabilities, according to The Washington Post.

A bombshell report from The Washington Post reveals that some of the documents the FBI seized during its raid of former President Trump’s Mar-a-Lago resort contained top-secret nuclear information that many senior government officials don’t even have clearance to view.

According to The Post, a document describing a foreign government’s nuclear capabilities was among top-secret information seized by the Justice Department. It’s unclear exactly which foreign power the document is referring to.

FBI agents who searched the former president’s Florida home last month recovered hundreds of documents taken from the White House, some of which included sensitive government secrets.

The Justice Department has since opened a criminal investigation focused on what it says were efforts by Trump over several months to obstruct the investigation into those documents.

Meanwhile, a federal judge on Monday granted a request by the former president’s legal team to appoint a special master to review those seized documents, temporarily halting the Justice Department’s use of the records for investigative purposes.

The decision by U.S. District Judge Aileen Cannon came despite the objections of the Justice Department, which said an outside legal expert was not necessary in part because officials had already completed their review of potentially privileged documents.

The appointment is likely to slow the pace of the department’s investigation but it is not clear whether it will have any significant effect on any investigative decisions or the ultimate outcome of the probe.

Additional reporting by The Associated Press.

Source: newsy.com

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<

Israeli Army: ‘High Possibility’ Soldier Killed Al Jazeera Reporter

By Associated Press
September 5, 2022

Al Jazeera journalist Shireen Abu Akleh was wearing a vest identifying her as press when she was killed while covering Israeli raids in the West Bank.

The Israeli army said Monday there was a “high possibility” that a soldier killed a well-known Al Jazeera journalist in the occupied West Bank in May, as it announced the results of its investigation into the killing.

In a briefing to reporters, a senior military official said a soldier opened fire after mistakenly identifying Shireen Abu Akleh as a militant. But he provided no evidence to back up the Israeli claim that Palestinian gunmen were present in the area and said no one would be punished. He also did not address video evidence showing the area to be quiet before Abu Akleh was shot.

The conclusions were the closest Israel has come to taking responsibility for her death and followed a series of investigations by media organizations and the United States that concluded Israel either fired, or most likely had fired, the deadly shot. But they were unlikely to put the matter to rest.

“He misidentified her,” the official said, speaking on condition of anonymity under military briefing guidelines. “His reports in real time … absolutely point to a misidentification.”

Abu Akleh was wearing a helmet and a vest identifying her as press when she was killed in May while covering Israeli military raids in the occupied West Bank.

The Israeli human rights group B’Tselem accused the army of carrying out a whitewash.

“It was no mistake. It’s policy,” the group said.

Al Jazeera’s local bureau chief, Walid Al-Omari, accused the army of trying to escape responsibility. “This is clearly an attempt to circumvent the opening of a criminal investigation,” he told The Associated Press.

The 51-year-old Palestinian-American had covered the West Bank for two decades and was a well-known face across the Arab world. The Palestinians, and Abu Akleh’s family, have accused Israel of intentionally killing her, and her death remains a major point of contention between the sides.

The official said the military could not conclusively determine where the fire emanated from, saying there may have been Palestinian gunmen in the same area as the Israeli soldier. But he said the soldier shot the journalist “with very high likelihood” and did so by mistake.

The official did not explain why witness accounts and videos showed no militant activity in the area, as well as no gunfire in the vicinity until the barrage that struck Abu Akleh and wounded another reporter.

He also did not say why the investigation had taken some four months, though he said the Israeli military chief asked for more information after an initial probe. The official said the investigation had been shared with the military’s independent prosecutor, who had decided not to launch a criminal probe. That means no one will be charged in the shooting.

Abu Akleh’s family criticized the investigation, saying the army “tried to obscure the truth and avoid responsibility” for the killing.

Rights groups say Israeli investigations of the shooting deaths of Palestinians often languish for months or years before being quietly closed and that soldiers are rarely held accountable.

Israel has said she was killed during a complex battle with Palestinian militants and that only a forensic analysis of the bullet could confirm whether it was fired by an Israeli soldier or a Palestinian militant. However, a U.S.-led analysis of the bullet last July was inconclusive as investigators said the bullet had been badly damaged.

An Associated Press reconstruction of her killing lent support to witness accounts that she was killed by Israeli forces. Subsequent investigations by CNN, the New York Times and the Washington Post reached similar conclusions, as did monitoring by the office of the U.N. human rights chief.

Abu Akleh rose to fame two decades ago during the second Palestinian intifada, or uprising, against Israeli rule. She documented the harsh realities of life under Israeli military rule — now well into its sixth decade with no end in sight — for viewers across the Arab world.

Israeli police drew widespread criticism from around the world when they beat mourners and pallbearers at her funeral in Jerusalem on May 14. An Israeli newspaper reported that a police investigation found wrongdoing by some of its officers, but said those who supervised the event will not be seriously punished.

Jenin has long been a bastion of Palestinian militants, and several recent deadly attacks inside Israel have been carried out by young men from in and around the town. Israel frequently carries out military raids in Jenin, which it says are aimed at arresting militants and preventing more attacks.

Israel captured the West Bank in the 1967 Mideast war and has built settlements where nearly 500,000 Israelis live alongside nearly 3 million Palestinians. The Palestinians want the territory to form the main part of a future state.

Additional reporting by The Associated Press.

Source: newsy.com

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<

Ginni Thomas Emails Urged Electors To Overturn 2020 Election

By Associated Press
September 2, 2022

In her emails with lawmakers in Wisconsin and Arizona, Thomas argued that results giving Pres. Biden a victory in the states were marred by fraud.

The wife of U.S. Supreme Court Justice Clarence Thomas contacted at least two Wisconsin state lawmakers, including the chair of the Senate elections committee, urging them to overturn President Joe Biden’s 2020 election win in the tightly contested state, emails obtained Thursday by The Associated Press show.

Virginia “Ginni” Thomas, a conservative activist, also had sent messages to more than two dozen lawmakers in Arizona.

In her communications with lawmakers in both states, Thomas urged Republicans to choose their own slate of electors after the election, arguing that results giving President Biden a victory in the states were marred by fraud. Despite numerous reviews, lawsuits and recounts , no widespread fraud calling into question the results has been discovered in either state.

The emails received at the exact same time on Nov. 9, 2020, by Wisconsin state Sen. Kathy Bernier and state Rep. Gary Tauchen were first reported Thursday by The Washington Post. The AP obtained the email from Bernier, and the watchdog group Documented posted the email Tauchen received.

The emails were sent at almost the exact same time as the ones Thomas sent to lawmakers in Arizona.

Thomas did not immediately respond to a request for comment, made to the court Thursday.

Bernier, in a telephone interview with the AP, said she did not recall receiving the email from Thomas, which was one of thousands her office and other Wisconsin lawmakers received around that time. The message was sent over the FreeRoots platform that allows for mass mailing of prewritten emails. Bernier said she had no contact with Thomas aside from receiving the email.

“Please stand strong in the face of political and media pressure,” Thomas wrote in the emails received by the Wisconsin lawmakers. “Please reflect on the awesome authority granted to you by our Constitution. And then please take action to ensure that a clean slate of Electors is chosen for our state.”

Thomas also asks the Wisconsin lawmakers to meet with her, either virtually or in person, “so I can learn more about what you are doing to ensure our state’s vote count is audited and our certification is clean.”

Bernier said Thursday that she didn’t fault Thomas for sending the message, which she doesn’t recall reading at the time.

“Ginni is not a constituent, so therefore not top priority to respond to,” Bernier said. “And so I am sure we did not respond to her.”

Bernier, who has been outspoken in saying there was no widespread voter fraud in Wisconsin’s election that President Biden fairly won, said she had no issue with Thomas contacting her about the election.

“I don’t believe this is hair raising crazy stuff that everybody’s making it out to be,” she said of the Thomas email. “There were a lot of Republicans at the time that thought there was massive voter fraud. … I’m sure she would have preferred taking it back, especially after all of the evidence.”

Tauchen declined comment through a spokesperson.

Clarence Thomas was the only member of the Supreme Court who voted against the court’s order allowing the U.S. House committee investigating the Capitol riot on Jan. 6, 2021, to obtain Trump records that were held by the National Archives and Records Administration. The court voted in January to allow the committee to get the documents.

Ginni Thomas’s role in the plot to overturn the 2020 election won by President Biden is being looked at by members of the House committee investigating the riot. The committee asked her in June to sit for an interview.

Additional reporting by The Associated Press.

Source: newsy.com

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<

Ukraine Steps Up Strikes in the South

Credit…Iranian Army, via Associated Press

Iran delivered to Russia the first batch of two types of military drones this month as part of a larger order totaling hundreds of the aerial war machines, according to an Iranian adviser to the government and two U.S. administration officials who were not authorized to speak on the record.

American officials said Russia could deploy the Iranian-made drones in its war against Ukraine to conduct air-to-surface attacks, carry out electronic warfare and identify targets.

Iran has officially said that it would not provide either side of the conflict with military equipment but has confirmed that a drone deal with Russia was part of a military agreement that predated the invasion of Ukraine.

Over several days in August, Russian transport aircraft loaded the drone equipment at an airfield in Iran and subsequently flew to Russia, according to the two U.S. officials.But the first shipments of Iranian-supplied drones, the American officials said, have had mechanical and technical problems.

The drone shipment, and the mechanical problems, was earlier reported by The Washington Post.

Iran’s military deal with Russia is part of a larger strategy by the Islamic Republic to pivot toward forming strategic economic partnerships with China and security partnerships with Russia.

This shift, analysts say, accelerated after President Donald J. Trump exited the nuclear deal and imposed tough sanctions on Iran. European companies, fearing secondary sanctions by the United States, then ended nearly all business transactions and investments with Iran, prompting the country to look east and north.

“From Iran’s perspective, relations with the U.S. cannot be improved, and the Europeans are not powerful enough to protect Iranian interests,” said Sina Azodi, a nonresident fellow with the Atlantic Council, an international affairs research institute. “But Russia and China can help Iran counter the West.”

Russia, for its part, has found a welcome new ally in Iran to help it evade the sanctions imposed by much of the world after its invasion of Ukraine. President Vladimir V. Putin traveled to Iran in July to meet with the country’s supreme leader, Ayatollah Ali Khamenei, and other senior officials.

The two types of drones being provided to Russia are the Iranian-manufactured Mohajer-6 and Shahed series. Russian operators are receiving training on the drones in Iran, according to the Iranian adviser and American officials familiar with the transfer.

The Mohajer-6 has the capability to carry out surveillance and reconnaissance missions, and the Shahed series is considered among the most capable of Iran’s military drones, according to comments made by the Iranian military to local news media.

Iran is a pioneer in drone technology, with at least four decades of design and manufacturing experience, and it has been providing combat drones to military groups and proxy militia in Yemen, Iraq, Syria, Lebanon and Gaza.

Officials in Israel, the United States and some Sunni Arab countries like Saudi Arabia have said they are increasingly concerned that Iran’s advancing drone technology could destabilize the region and empower militias backed by Iran.

In the shadow war between Iran and Israel, Iranian drones have been involved in attacks on ships and have targeted U.S. military bases in Iraq and Syria. Israel has also attacked a secret facility in western Iran where hundreds of drones were believed to have been stored.

Iran has quietly ramped up its drone sales far beyond the region as it seeks to be a global player in the drone market. Iran has sold drones to Ethiopia, Sudan and Venezuela; in May, it inaugurated a joint drone-manufacturing factory in Tajikistan.

The United States has been warning since last month that Russia intended to receive drones from Iran. The Russian military is experiencing major supply shortages in Ukraine, in part because of sanctions and export controls, forcing Russia to rely on countries like Iran for supplies and equipment.

The terms of the Iran-Russia drone deal were not immediately clear. The adviser to the government said no money had yet been exchanged.

Iran’s foreign minister, Hossein Amir Abdollahian, will travel to Moscow on Wednesday to meet his Russian counterpart, Sergey V. Lavrov, to discuss the latest negotiations for a nuclear deal, Iran’s foreign ministry announced on Monday.

— Farnaz Fassihi and Julian E. Barnes

View Source

>>> Don’t Miss Today’s BEST Amazon Deals! <<<<