Swiss Inflation Unexpectedly Quickens, Offering SNB Some Respite
Consumer prices rose 0.2% from a year ago in July, beating economist expectations for another increase of 0.1% as happened a month earlier.
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Yahoo
6 minutes ago
- Yahoo
Trump set to announce replacement for Fed Gov Kugler this week. The Fed chair in waiting?
President Trump said he plans to name a replacement this week for Federal Reserve governor Adriana Kugler, whose unexpected resignation set for this Friday offers the president an opportunity to put in place a successor for Fed Chair Jerome Powell. 'I have a couple of people in mind,' President Trump told reporters Sunday night. 'I'll be announcing that probably over the next couple of days.' Kugler's term as a governor was set to expire on Jan. 31. She has served as a Fed governor since Sept. 13, 2023, and will return to Georgetown University as a professor this fall. Kevin Warsh, a former Fed governor, and Kevin Hassett, the current chair of the President's Council of Economic Advisors, are thought to be at the top of the list for the next Fed chair and thus possible nominees to replace Kugler. Treasury Secretary Scott Bessent, who is leading the search for Powell's replacement and is also a potential contender, has already sketched out a scenario where the White House appoints someone to fill Kugler's seat who can then be in the running to succeed Powell next May. The White House also hopes that Powell decides to leave the Fed Board of Governors when his chairmanship is up, which would open up a second seat that Trump can fill. Powell has not yet said whether he intends to do that; his term as a Fed governor is not up until 2028. Read more: How much control does the president have over the Fed and interest rates? Warsh already has a lot of experience navigating the central bank. He served as Fed governor from 2006 until 2011 and became former Fed Chair Ben Bernanke's liaison to Wall Street during the chaos of the 2008 financial crisis. He is also a known figure to Trump, who interviewed him for the Fed chair post eight years ago before deciding on Powell. Trump appointed Powell to be Fed chair in 2018 at the direction of then-Treasury Secretary Steven Mnuchin. Former President Joe Biden reappointed Powell in 2022. Warsh has been critical of the Fed as of late. He has suggested that the Fed could look through increases in inflation from tariffs because it would be a one-time increase in prices. He's also argued that the costs involved in renovating the Fed's headquarters represent one of several examples of how the Fed "has lost its way" and that the American people "need a reformer to fix" the institution and rebuild its credibility. "Frankly, it's about breaking some heads," he said on Fox Business last month, calling for "regime change." Back in April, Warsh gave a speech in Washington, D.C., in which he said that the Fed's "current wounds are largely self-inflicted" and called for a "strategic reset" to ease a loss of credibility and damage to the Fed's standing. Hassett, meanwhile, already has a close relationship with Trump, given that he advises the president on economic policy and also served in the first Trump administration. Read more: How jobs, inflation, and the Fed are all related Earlier in the year, Hassett said he was more focused on the 10-year Treasury yield (^TNX) than on any quick monetary policy changes at the Federal Reserve. While the Fed can influence short-term bond yields and long-term bond yields, longer-term bond yields are influenced by many factors outside the Fed, and it is the yield on the 10-year Treasury that influences mortgage rates. But lately, Hassett has been more blatant, saying there's no reason why the Fed shouldn't be cutting rates now, something the president has repeatedly hammered the central bank to do. The president will likely watch whoever he appoints to the open Fed governor position to see how they perform and whether they'd be a successor for Powell, whose term ends next May. Though Fed governors Chris Waller and Michelle Bowman are also jockeying for the position of Fed chair, in part by dissenting at last week's Fed policy meeting in favor of cutting rates by 25 basis points, rather than holding rates steady. The opportunity for the White House to fill Kugler's seat earlier than expected comes as Trump applies pressure on Powell and the Fed board to lower rates by as many as 3 percentage points. Whoever the president appoints, it is the Federal Open Market Committee, which is composed of 19 members, that makes the decision, not just the Fed chair, and the new chair will have to contend with the committee. Jennifer Schonberger is a veteran financial journalist covering markets, the economy, and investing. At Yahoo Finance she covers the Federal Reserve, Congress, the White House, the Treasury, the SEC, the economy, cryptocurrencies, and the intersection of Washington policy with finance. Follow her on X @Jenniferisms and on Instagram. Click here for in-depth analysis of the latest stock market news and events moving stock prices Sign in to access your portfolio
Yahoo
6 minutes ago
- Yahoo
Rolex, luxury watchmakers brace for Trump's tariffs on Swiss imports
Switzerland is bracing for a big tariff hike on its exports, and its watch industry could take the brunt if President Trump hits Alpine nations with an enhanced 39% tariff for its exports, slated to start on Aug. 7. The Swiss watch industry employs thousands of artisans at various watchhouses that pump out millions of wristwatches and clocks each year. The industry also employs thousands in corporate and retail roles too. In 2024, Swiss watch exports hit $29.5 billion, second only to manufactured items like pharmaceuticals and chemical products, with the US being Switzerland's main trade partner. A tariff at these levels could crush demand for new Swiss watches. 'A 39% markup could make even a stainless-steel Submariner at retail jump from $10,000 to nearly $14,000,' secondhand dealer Bob's Watches CEO Paul Altieri said to Yahoo Finance. Read more: What Trump's tariffs mean for the economy and your wallet Altieri noted that Bob's Watches' demand for pre-owned models is on the rise, with buyers hoping to avoid the tariff price surge. Indeed, watch prices have already been rising in the US when Swiss exports were hit hit a 10% tariff earlier this year. Morgan Stanley and its data partner WatchCharts found that prices for luxury watchmakers like Patek Philippe (up 6.9%), Audemars Piguet (up 6.7%), and Richemont's ( Vacheron Constantin (up 6.5%) have risen the most in its second quarter industry report. And these tariff-fueled price hikes won't just be situated in the US but will likely affect global customers too, argued watch trading site Subdial, which runs an online watch marketplace and releases its own watch index with Bloomberg. 'If they increase prices in the US only, we may see a knock on effect in other markets. It seems more likely that brands will increase prices across all geographies (so as to maintain pricing parity, an important principle within luxury), and just accept lower margins on US stock on account of tariffs,' a spokesperson for Subdial said. Price hikes will push more of these buyers to the secondhand market, where the selection is vastly wider and deals can be found, the Subdial spokesperson added. The big watch houses and retailers aren't saying much at the moment about where prices are headed. Swiss-based Swatch Group ( is the largest watch producer in the world and counts brands like Omega, Blancpain, Breguet, and, of course, Swatch, in its portfolio. A spokesperson for the group said the company would not comment at this time. Geneva-based Rolex, which is estimated to produce over a million luxury watches a year, is in the tariff crosshairs. A Rolex spokesperson did not respond to Yahoo Finance when sought for comment. Watches of Switzerland (WOSG.L) is one of Rolex's top retail partners and operates certain 'monobrand' Rolex-only boutiques. 'We note the announcement of the proposed new US tariff rate on imports from Switzerland due to come into effect on 7th August and will continue to work closely with our brand partners to mitigate any potential impact,' the company said in a statement to Yahoo Finance. Mitigating the impact in this case likely means passing on tariff costs to customers and/or absorbing a small percentage. And this is because the effect of full passage to customer would be huge. For Rolex and Watches of Switzerland, the tariff effects may not be as severe since they operate their own certified pre-owned (CPO) watch programs. Last year Rolex bought Bucherer, the jewelry and luxury watch retailer that operates the Tourneau chain in the US. New watch buyers could shift to these CPO programs and still keep revenue flowing. But as Bob's Watches points out, used prices are climbing in sympathy as demand rises. Interestingly, Trump's tariffs on the Swiss could actually hurt his own business interests. Last year, Trump licensed his name for a range of Trump-branded watches, with models dubbed 'Fight Fight Fight" and 'Mugshot suit,' as well as a $100,000 Swiss-made tourbillon movement watch in solid 18K gold. Pras Subramanian is the lead autos and wealth reporter for Yahoo Finance. You can follow him on X and on Instagram. Click here for in-depth analysis of the latest stock market news and events moving stock prices Errore nel recupero dei dati Effettua l'accesso per consultare il tuo portafoglio Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati Errore nel recupero dei dati
CNN
9 minutes ago
- CNN
Trump threatens to ‘substantially' raise tariffs on Indian goods as it continues to buy Russian oil
President Donald Trump said on Monday that he will 'substantially' raise tariffs on India because it's still buying Russian oil. 'India is not only buying massive amounts of Russian Oil, they are then, for much of the Oil purchased, selling it on the Open Market for big profits,' the president posted on his social media network, Truth Social. 'Because of this, I will be substantially raising the Tariff paid by India to the USA.' But India pushed back, saying it is being unfairly targeted by the United States and European Union for importing oil from Russia. Tariffs are taxes directly paid by importers, though countries exporting goods could indirectly get harmed, as higher prices tend to drive demand down, leading countries to buy more from other countries with lower tariffs or to increase domestic production. Last week, Trump threatened a minimum 25% tariff on goods coming from India, set to take effect at the end of this week. Indian goods are currently subject to a 10% minimum rate. Trump did not specify what new tariff rate goods from India could be charged if it continues to purchase Russian oil. The Indian Ministry of External Affairs said the country began importing from Russia because traditional supplies were diverted to Europe after the start of Russia's war on Ukraine. 'India's imports are meant to ensure predictable and affordable energy costs to the Indian consumer. They are a necessity compelled by (the) global market situation,' a statement posted on social media from the ministry's spokesperson Randhir Jaiswal read. India said both the US and the EU were also 'indulging in trade with Russia.' 'In this background, the targeting of India is unjustified and unreasonable. Like any major economy, India will take all necessary measures to safeguard its national interests and economic security,' the statement said. Trump's tariff threat comes as he's upped the pressure on Russia's Vladimir Putin l to reach a ceasefire with Ukraine within days, shortening his prior deadline.
