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Inflation will stay at 6% to 9% until 2024, Fed's rate hikes won't stop that now – Steve Hanke – Kitco NEWS

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The U.S. Federal Reserve hiked the Fed Funds rate by 25 basis points on Wednesday, the first rate hike since 2018.

While this move was largely anticipated, the markets still rallied on the news; both the stock markets and safe haven assets like gold rose. The dollar fell slightly.

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Steve Hanke, professor of Applied Economics at Johns Hopkins University told David Lin, anchor for Kitco News, that the stock markets interpreted this news as quite dovish.

Additionally, gold rallied because the gold market understands that this 25 basis point hike won’t be enough to combat inflation, which is likely to remain in the 6% to 9% range until 2024.

“[Inflation] is definitely not transitory,” he said. “[People] are still droning on about supply chain problems, and the fact that those have not been fixed as fast as people thought they would be fixed, and that is the reason that inflation has been dragging on longer than people thought.”

Hanke stressed that the narrative that inflation has been caused by supply chain problems is simply false. Rather, inflation is caused by an increase in the money supply.

For more information on how inflation will affect the gold price, watch the video above.

Follow David Lin on Twitter: @davidlin_TV

Follow Kitco News on Twitter: @KitcoNewsNOW

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Ottawa expands price caps to Russian petroleum products to reduce revenues

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OTTAWA — The federal Finance Department says Canada is joining its fellow G-7 countries plus Australia to expand caps on Russian oil to include seaborne petroleum products from that country.

The department says the maximum price for seaborne Russian-origin petroleum will be US $100 per barrel for “premium-to-crude” products as of Sunday, and US $45 for “discount-to-crude” products.

It says in a press release the new caps build on a Russian crude oil price limit announced in December, adding both moves will weaken President Vladimir Putin’s ability to fund the war against Ukraine.

The Department of Finance says the caps will be enforced by prohibiting buyers who do not abide by the price caps from obtaining services from companies in the G7 or Australia.

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It says the price cap mechanism has been designed to reduce Russian revenues while recognizing the importance of stable energy markets and minimizing negative economic effects.

Finance Minister Chrystia Freeland says Russian oil revenues have already declined since the first price cap took effect and the additional price caps “will be another blow to Putin’s war chest.”

This report by The Canadian Press was first published Feb. 4, 2023.

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This story was produced with the financial assistance of the Meta and Canadian Press News Fellowship.

 

The Canadian Press

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Adani crisis ignites India contagion fears, credit warnings – Al Jazeera English

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  1. Adani crisis ignites India contagion fears, credit warnings  Al Jazeera English
  2. Indian tycoon Adani hit by more losses, calls for probe  CP24
  3. Adani Flagship Shelves $122 Million Bond Plan After Market Rout  BNN Bloomberg
  4. How Adani selloff stacks up against the biggest stock collapses  Deccan Herald
  5. Adani response to Hindenburg report: Embattled corporations invoking nationalism, or national sentiment, is not unheard of  The Indian Express
  6. View Full Coverage on Google News

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Jobs report is a 'fairytale scenario' for markets, economist says – Yahoo Finance

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Jobs report is a ‘fairytale scenario’ for markets, economist says  Yahoo FinanceView Full Coverage on Google News

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