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Livesquawk - Closing Wrap - Thursday 10.06
Closing Wrap - Thursday 10.06
Headlines
  • ECB Projects Brighter Outlook But Keeps ‘Steady Hand’ On Stimulus
  • ECB Said To Differ On Bond-Buying Need In Thin Summer Market
  • US Drops Sanctions On Iranian Oil Executive In Routine Step
  • OPEC Sticks To Forecast Of Oil Demand Surge In H2
  • Switzerland Plans Subsidies To Offset G7 Corporate Tax Plan
  • Romney, Senators Float First Change To Gas Tax Since 1993
  • Bank Of Canada Brushes Off Temporary Spike In Inflation
  • Biden, Johnson Chart Path For US-UK Ties
  • UK Agrees Annual Fishing Quotas With EU
  • China Passes Law To Counter Foreign Sanctions
  • FDA Extends Shelf Life Of Johnson & Johnson Covid-19 Vaccine
  • Amazon Faces Possible $425 Mln EU Privacy Fine
  • Citroen Charged With Consumer Fraud Over Dieselgate Probe
  • S&P Upgrades Amazon To AA From AA-; Cites Sustained Revenue
Commentary
ECB’s Lagarde Keeps Talk Of Tapering At Bay

The European Central Bank left its monetary policy and forward guidance unchanged as expected on Thursday but updated the economic projections. It confirmed its intention to continue its net asset purchases under the pandemic emergency purchase programme (PEPP) for a total of EUR1.85 tln until at least the end of March 2022.

 

On a day when the press conference coincided with the release of US inflation data, it was perhaps fortuitous ECB President Christine Lagarde kept on message.

 

“President Lagarde might not have minded having her thunder stolen by the US CPI number today, especially given what little new information she had to offer,” said Societe Generale’s Anatoli Annenkov.

 

Initial market reaction to the announcement was constrained with both 10-year Bund yields and the Euro relatively unmoved. (LiveSquawk - Continue Reading)

Inflation Spike Could Force Fed’s Hand On Tapering Asset Purchases

A key inflation gauge that revealed consumer prices rose at their fastest pace in decades last month could prompt the Federal Reserve to start laying the groundwork to begin curtailing its massive monetary support to the U.S. economy.

 

The Labor Department announced Thursday that the Consumer Price Index (CPI) surged 5% in May from a year prior, the fastest year-over-year jump since 2008. Excluding the volatile food and energy data, core inflation rose 3.8% from a year earlier, the quickest since June 1992.

 

The data could have significant implications for the U.S. Central Bank, according to Gary Pzegeo, head of fixed income at CIBC Private Wealth Management. 

 

“May’s CPI data could tip the scales toward an earlier tapering discussion, but should not cause alarm at the Fed,” Pzegeo said. “The release was above expectations, but underlying price trends confirm the known impact of base effects and bottlenecks the Fed has categorized as ‘transitory’ for the past several months.” (Fox Business - Continue Reading)

Romney, Senators Float First Change To Gas Tax Since 1993

Republican and Democratic senators said Thursday they were open to considering the first change in the national gasoline tax since 1993 to help fund a bipartisan infrastructure spending package they plan to propose to President Joe Biden.

 

Indexing the gasoline tax -- currently 18.4 cents-per-gallon -- to a measure of inflation has been discussed by a bipartisan group of senators working on a compromise plan, according to Mitt Romney, a Utah Republican who’s taken a leading role in those talks.

 

“It keeps it at the same value that it has today,” Romney said of indexing the tax.

 

Disagreement over how to pay for the biggest infrastructure bill in decades contributed to the breakdown in Biden’s direct talks with GOP senators led by Shelley Moore Capito earlier this week. The Focus of bipartisan negotiations has now shifted to the group including Romney, though some Democrats are eager to get moving on a go-it-alone strategy. (Bloomberg - Continue Reading)

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