Taiwan Eases Rules to Help Insurers Cope With Currency Surge
Insurers will be allowed to use six-month average exchange rates when they calculate risk-based capital in their semi-annual reports, the Financial Supervisory Commission said in a statement. At present, insurers use the exchange rates of the final day of the reporting period.
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Yahoo
11 minutes ago
- Yahoo
Analysis-BOJ faces pressure to ditch obscure inflation gauge, clear path to tighter policy
By Leika Kihara TOKYO (Reuters) -Pressure is mounting within the Bank of Japan to ditch a vaguely defined gauge of inflation as worries about second-round price effects prompt some board members to call for a more hawkish communication of policy and a clearer path to future rate hikes. BOJ Governor Kazuo Ueda has justified going slow on rate hikes by explaining that "underlying inflation," which focuses on the strength of domestic demand and wages, remains short of the central bank's 2% target. The trouble is that there is no single indicator that gauges "underlying inflation", making it a target for critics who say the BOJ is overly reliant on an obscure reading to guide monetary policy despite both headline inflation and core measures exceeding its target for years. Now, even some members of the BOJ board - worried that second-round price effects were becoming embedded in pricing behaviour and public perceptions of future inflation - are calling for a change to the bank's communication to a more hawkish one that focuses on headline inflation, which hit 3.3% in June. "We're at a phase where we should shift the core of our communication away from underlying inflation to actual price moves and their outlook, as well as the output gap and inflation expectations," one member said, according to a summary of opinions at the bank's July policy meeting. Another member said the BOJ must put more emphasis on upside risks to prices, and consider tweaking its communication to one that is based on the view Japan will hit 2% inflation. Some members of the government's top economic council also warned this month the BOJ might be too complacent of mounting price pressure, a clear nudge to the central bank to steer a more hawkish policy path in the wake of growing public alarm over persistent inflation. "I'm worried that monetary policy is already behind the curve," one panel member was quoted as saying at a meeting last week, adding that prolonged price rises were already affecting people's livelihood and their inflation expectations. OCTOBER POLICY TILT? The BOJ exited a decade-long, radical stimulus programme last year and raised short-term interest rates to 0.5% in January on the view that Japan was on the cusp of sustainably hitting its 2% inflation target. While the central bank has signalled its readiness to raise rates further, the economic impact of higher U.S. tariffs forced it to cut its growth forecasts in May and complicated decisions around the timing of the next rate increase. With Japan having agreed on a trade deal with the U.S. in July, the BOJ has shed some of its gloom over the economic outlook. Of the BOJ's nine board members, Naoki Tamura, Hajime Takata and Junko Koeda have highlighted the risk of persistent rises in food prices leading to broader-based, sustained inflation. To be sure, there is no consensus within the board yet on whether a communication overhaul is needed, with one member quoted as saying in the summary that underlying inflation remained an "important concept in guiding policy." But the fact some members openly called for a tweak to the dovish communication highlights the board's growing attention to broadening inflationary pressure that may pave the way for rate hikes in coming months and into 2026, some analysts say. Annual core consumer inflation hit 3.3% in June, exceeding the BOJ's 2% target for well over three years, due largely to a 8.2% spike in food costs. Such price pressures led the board to revise up its core inflation estimates last month, and cast doubt on the BOJ's view that underlying inflation - measured by a mix of proxies such as public expectations of future price moves - has yet to reach 2%. The BOJ may gradually phase out the concept of underlying inflation from its communication, as it gears up for the next rate hike that could happen as soon as in October, said veteran BOJ watcher Naomi Muruguma. "I think many BOJ officials are beginning to realise that the idea doesn't fit quite well with reality," she said. "We might hear less of this concept when the timing of the next rate hike draws near." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
13 minutes ago
- CNBC
CNBC Daily Open: The U.S. inflation jump scare is not here — at least not yet
Waiting for tariff-induced price increases in the U.S. to show up can feel like watching an M. Night Shyamalan movie. July's consumer price index came in mostly benign. The headline annual rate of 2.7% was lower than the Dow Jones estimate of 2.8%. That said, the core figure was 0.1 percentage points more than expected, and the highest since February, before U.S. President Donald Trump unleashed his tariffs in April. "The tariffs are in the numbers, but they're certainly not jumping out hair on fire at this point," former White House economist Jared Bernstein, who served under Joe Biden, told CNBC. Things appear idyllic so far, but you know something's going to shock you out of your seats eventually — are the figures accurate, except that the decimal point should be shifted to the right? — which makes monitoring U.S. inflation a captivating experience. Jan Hatzius, Goldman Sachs' chief economist, in a Sunday research note estimated that the big reveal (when the U.S. consumer admits, "I see higher prices") could happen by October. (That could have placed him in Trump's crosshairs.) But markets hit record highs as investors saw the mild inflation numbers as a sign that the Federal Reserve has room to cut rates three times this year — or that tariffs might not drive prices that much higher. Maybe the original premise was wrong: As far as inflation goes, could we be in a happily-ever-after Disney flick, instead of a Shyamalan movie?U.S. prices in July rose less than expected. The consumer price index increased a seasonally adjusted 0.2% for the month, putting the annual figure at 2.7%. Economists polled by Dow Jones were expecting a 0.2% and 2.8% rise, respectively. The S&P 500 and Nasdaq Composite close at new highs. On Tuesday, July's tame CPI report pushed the indexes up 1.13% and 1.39% respectively. Asia-Pacific markets traded higher Wednesday, with Japan's Nikkei 225 also hitting a fresh record. Trump threatens Fed chair Powell with a 'major lawsuit.' In a post on Truth Social, the U.S. president said the potential proceedings would relate to Powell's management of the Fed's headquarters renovations. Perplexity AI offers $34.5 billion to buy Google's browser. The bid for Chrome, which came unsolicited, is higher than Perplexity's $18 billion valuation in July, but the firm said investors have agreed to back the deal. [PRO] Gold prices could reach $4,000, analyst says. Wall Street foresees another rally for the bullion after Trump confirmed that "Gold will not be Tariffed!" One strategist is so bullish on gold he thinks it could jump 14% from today's prices to break the $4,000 level. Is London's financial future evolving or eroding? London's reputation as a leading global financial center is increasingly in question, as it struggles to compete with the likes of New York, Hong Kong and Frankfurt. Brexit still hamstrings the economy, particularly through trade barriers, increased border costs and reduced productivity compared with staying in the European Union. Despite the challenges and setbacks, all is not lost. Business leaders say there is still hope and opportunity for London.
Bloomberg
13 minutes ago
- Bloomberg
Blackstone's Horizon Industrial Parks Is Said to Weigh India IPO
Blackstone Inc. -owned Horizon Industrial Parks is considering an initial public offering in Mumbai next year that could raise about $500 million, according to people familiar with the matter. The Indian company is in talks with banks about the proposed share sale and seeking an enterprise valuation of $4 billion, the people said, asking not to be identified because the information is private.
