President Donald Trump's effort to remove a member of the Federal Reserve's Board of Governors comes amid his push to reshape the composition of the central bank's panel that makes interest rate decisions. Trump attempted to fire Fed Governor Lisa Cook for cause this summer, accusing her of mortgage fraud and marking the first time a president has ever attempted to remove a Fed governor from office in the central bank's 112-year history. Cook has denied wrongdoing and filed suit to block her firing, with th ...

Bank of England Monetary Policy Committee External Member Catherine Mann discusses the inflation situation in the United Kingdom and the central bank's decision to hold interest rates in September. "Policy is relatively loose compared to what the balance of inflation prospects is relative to activity," Mann tells Bloomberg Television. "I think rates being on hold is appropriate for the current period," she says ahead of the Women, Money & Power event in London. ...

Stock prices fell and Fed Chair Jerome Powell expressed caution with respect to further interest rate reductions on Tuesday.gettyStock prices fell and Fed Chair Jerome Powell expressed caution with respect to further interest rate reductions on Tuesday.The large-cap S&P 500 index fell 0.6% while the technology-focused Nasdaq Composite dipped nearly 1%. The Dow Jones Industrial Average, focused on blue-chip stocks, fell 0.2%. Powell’s conservative outlook contributed to a retreat from record-high stock price ...

Group 1 - Federal Reserve Chairman Jerome Powell indicated that there is "no risk-free path" for the central bank's next policy move due to elevated inflation and a weakening job market [1][2] - The Fed recently cut interest rates by 25 basis points and projected two more cuts of the same magnitude by year-end, reflecting a divided stance among policymakers regarding future monetary policy [2][4] - New Fed governor Stephen Miran suggested that benchmark interest rates should be around 2 percentage points lower than the current range of 4% to 4.25%, arguing that current rates are too restrictive and could exacerbate unemployment [3][4] Group 2 - The Fed's dual mandate requires balancing inflation control with maximizing employment, creating a complex environment as inflation remains above the 2% target while the labor market shows signs of weakness [4][6] - The Personal Consumption Expenditures index, the Fed's preferred inflation measure, is currently at 2.9%, with new data expected to be released soon [6] - Powell emphasized that the current policy stance is "modestly restrictive" and that the Fed will adapt its approach based on new economic data and the evolving balance of risks [7]

Core Viewpoint - The Swiss National Bank (SNB) is expected to maintain its policy rate at zero through 2026 due to stable inflation and a steady currency, as indicated by a majority of economists in a recent Reuters poll [1][3][6]. Interest Rate Outlook - The SNB currently has the lowest interest rate among major central banks, and while inflation is gradually increasing, it remains low, making it unlikely for rates to go negative again [2][3]. - A significant majority of economists (over 80%) anticipate that rates will remain unchanged for the rest of the year, with 21 out of 25 predicting the rate will still be at 0.00% by the end of 2026 [6]. Economic Indicators - Inflation in Switzerland was recorded at 0.2% last month, well within the SNB's target range of 0%-2%, and is expected to average 0.2% for the year and 0.6% in 2026 [5][6]. - The Swiss franc has appreciated only 0.4% against the euro since the beginning of the year and is projected to depreciate by more than 2% over the next 12 months [5]. Central Bank Strategy - SNB Chairman Martin Schlegel has expressed concerns about the "undesirable side effects" of negative rates, suggesting a preference for maintaining the current rate [3]. - The SNB retains the option to intervene in the foreign currency market to manage any significant appreciation of the Swiss franc, which is viewed as a more favorable strategy than introducing negative rates [7].

Core Viewpoint - The proposal for Treasury Secretary Scott Bessent to simultaneously serve as the Federal Reserve Chair has been suggested by Steve Bannon, although the White House has dismissed this idea as not being considered [2][4]. Group 1: Proposal Details - Steve Bannon proposed that Scott Bessent should take over as Federal Reserve Chair while retaining his position as Treasury Secretary, at least until after the midterm elections [3]. - Bannon believes that Bessent could manage both roles temporarily and then step down from Treasury to focus on the Federal Reserve [3]. Group 2: Context and Background - There is no direct historical precedent for a Treasury Secretary also serving as Fed Chair, although prior to the Banking Act of 1935, the Treasury chief was an ex-officio member of the Fed's Board of Governors [5]. - Janet Yellen is noted as a former Fed Chair who later became Treasury Secretary, but her terms were not concurrent [5]. - Bessent is currently leading the search for Powell's successor, with 11 candidates reportedly in consideration, although he has expressed contentment with his current role [6].

Federal Reserve's Role and Policy - The Federal Reserve is perceived to have become too powerful and political, with calls for fundamental changes to its operations [3][4][6] - There is a concern that restrictive interest rates imposed by the Fed inhibit access to capital for the private sector, particularly during economic transformations favoring small and medium-sized businesses [6][7] - The Fed's actions during financial crises, such as in 2008, are questioned, with a belief that it failed to foresee the crisis and that its independence is crucial for effective crisis management [10][11][17] Interest Rates and Economic Impact - The current low-interest-rate environment is debated, with suggestions that it may have persisted too long and that the Fed's role in managing interest rates is not appropriate for a free market economy [19][21][22] - The Fed's approach to monetary policy is criticized for exacerbating wealth and income inequality, leading to societal resentment [25] Banking Sector Dynamics - Banks are under pressure to maintain high reserves rather than lending, which affects their profitability and relationships with clients [8][9] - The profitability of banks is linked to their ability to manage cash reserves effectively, which complicates their willingness to adjust to changes in Fed policy [9] Political Influence and Independence - The politicization of the Fed is a concern, as political pressures can complicate its ability to act independently during crises [10][20] - Historical examples, such as Paul Volcker's actions in the 1980s, illustrate the challenges faced by central banks when political interests conflict with necessary economic measures [14][16]

Group 1: Market Reaction - Despite Fitch Ratings lowering France's long-term credit rating, the French stock market is showing positive movement, with investors anticipating policy announcements from major central banks this week [1] - The benchmark CAC 40 index increased by 95.78 points or 1.23%, reaching 7,921.02 [2] Group 2: Company Performance - Kering's stock rose more than 4%, while Thales increased nearly 4% [2] - STMicroElectronics and Societe Generale saw gains of 3.1% and 2.85%, respectively [2] - Other notable companies such as Credit Agricole, L'Oreal, LVMH, and Airbus experienced increases between 2% to 2.2% [2] - A broader range of companies including BNP Paribas, Bouygues, Stellantis, and TotalEnergies saw stock increases between 1% to 1.8% [2] Group 3: Economic Indicators - The euro area trade surplus decreased to EUR 12.4 billion in July from EUR 18.5 billion the previous year, although it was above June's level of EUR 8 billion [4] - Annual export growth slowed to 0.4% in July from 0.8% in June, while imports rose by 3.1% [4] - The decline in trade surplus was primarily attributed to chemicals and related products, which saw a surplus drop to EUR 17.4 billion from EUR 23.8 billion [5]

Core Points - The abrupt resignation of former Federal Reserve Governor Adriana Kugler on August 1, 2025, has left the financial community in shock and confusion, especially following her unexplained absence at a key meeting two days prior [1][2][4] - Kugler's resignation comes just months before her term was set to expire in January 2026, and she did not provide a reason for her departure in her resignation letter [2][3] - Following her resignation, questions arose regarding whether Kugler was pressured to resign, particularly in light of political tensions surrounding the Federal Reserve [4][5] Group 1: Resignation Details - Kugler was nominated by former President Joe Biden and confirmed in 2023, with her term originally set to last until January 2026 [2] - In her resignation letter, Kugler stated her resignation would be effective August 8, 2025, but did not elaborate on the reasons for her departure [2][3] - The Federal Reserve announced that Kugler would return to Georgetown University as a professor, although her faculty page does not indicate she will be teaching any courses this fall [3] Group 2: Political Context - Former President Trump suggested that Kugler's resignation was due to disagreements with the Fed's interest rate policies, referring to Fed Chair Jerome Powell as "Too Late" [4][21] - The political climate surrounding the Federal Reserve has intensified, with accusations of misconduct directed at other board members, including Lisa Cook, which may reflect broader political strategies [6][9] - Trump's administration has been actively seeking to influence the Federal Reserve's composition, with Kugler's resignation providing an opportunity to nominate a successor, Stephen Miran [17][18] Group 3: Real Estate and Ethics Concerns - Questions have been raised regarding Kugler's real estate records, with discrepancies noted between her financial disclosures and state tax records regarding her primary residence [11][12][15] - Kugler has stated that inconsistencies in her records were due to errors by county tax officials, and she has not been accused of any wrongdoing [13][16] - The scrutiny of Kugler's real estate records is part of a broader pattern of political attacks targeting Federal Reserve officials, particularly those associated with the Biden administration [16]

Economic Data Impact - Major economic data released this morning has negatively impacted trading futures, with the Dow dropping from +3 points to -180 points, the S&P 500 from -1 to -30 points, and the Nasdaq from +7 to -140 points [1] Producer Price Index (PPI) - Headline PPI increased by 90 basis points from 0.0% to +0.9% for July, with core PPI also rising by 90 basis points month over month [2] - Year-over-year headline PPI reached +3.3%, up from an upwardly revised +2.4% for June, while core PPI soared to +3.7% [3] Jobless Claims - Weekly Jobless Claims decreased by 3,000 to 224,000, remaining below 230,000 for six consecutive weeks [5] - Continuing Claims stood at 1.953 million, down 15,000 from the previous week, marking the 12th consecutive week above 1.9 million [6] Earnings Reports - Deere & Co. reported fiscal Q3 earnings of $4.75 per share, beating consensus estimates by 7.8%, but shares fell by 6% due to softer full-year guidance [8] - JD.com reported earnings of 69 cents per share, a 38% positive surprise, while Weibo exceeded estimates by 100% with earnings of 54 cents per share [9]