Latest news with #Bessent
Business Times
8 hours ago
- Business
- Business Times
Bessent suggests Powell should leave Federal Reserve board in May
[WASHINGTON] US Treasury Secretary Scott Bessent suggested that Federal Reserve chair Jerome Powell should step down from the central bank's board when his term as chair is up in May 2026. 'Traditionally, the Fed chair also steps down as a governor,' Bessent said on Tuesday (Jul 15). 'There's been a lot of talk of a shadow Fed chair causing confusion in advance of his or her nomination. And I can tell you, I think it'd be very confusing for the market for a former Fed chair to stay on also.' Powell's term as a Fed governor does not end until January 2028, leaving it possible for him to remain at the central bank, and to participate in monetary policymaking, even after his tenure as the chair comes up next May. Powell has repeatedly declined to answer questions on whether he might stay on as a governor. That reticence has complicated the decision-making for US President Donald Trump and his aides as they look to revamp Fed leadership next year. 'There's a formal process that's already starting' with regard to identifying the nominee to become the next Fed chair, Bessent also said. 'There are a lot of good candidates inside and outside the Federal Reserve.' Asked whether Trump has asked Bessent himself to serve as Fed chair, the Treasury chief said: 'I am part of the decision-making process.' He noted that 'it's President Trump's decision, and it will move at his speed'. Inflation trend Treasuries dropped after Bessent's remarks, with two-year yields hitting a session high of 3.93 per cent. The Bloomberg Dollar Spot Index pared losses and was little changed as at 8.25 am in New York. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Unless Powell makes clear he will vacate his board position, Trump has one scheduled opening to fill next year, with governor Adriana Kugler reaching the end of her term in January. Bessent said last month that one potential timeline would have a Fed chair name emerge in October or November, ahead of that January opening on the board. Trump has made clear that he wants Powell's successor to be someone who favours lowering interest rates. He has repeatedly blasted the Fed chair for standing fast on rates since he took office, after lowering them last year. Central bank policymakers have said they are worried the president's tariff hikes will push up inflation, and prefer to gather more information before opting to resume rate reductions. The latest reading on inflation is due on Tuesday morning, with the June consumer price index. Bessent said that he had not looked at the release in advance of his appearance on Bloomberg, but said: 'I wouldn't put too much emphasis on one number.' He pointed to the recent trend of inflation numbers that show fears about a 'substantial price level rise' have not been substantiated. Building flap 'They have had some big forecasting errors,' with regard to the economy, Bessent said of the Fed. 'And this may be one' as well, he added. Even so, Bessent highlighted that Trump has said 'numerous times he is not going to fire Jay Powell'. Among the likely contenders to succeed Powell as chair are former Fed governor Kevin Warsh and Trump's current National Economic Council director, Kevin Hassett, along with Bessent himself. Investors have also focused on current Fed governor Christopher Waller, who Trump appointed to the board in his first term and who has been open to the idea of lowering rates as soon as this month. Pressure on Powell has risen further this month, with a number of Republicans attacking him over cost overruns in the refurbishment of two historic buildings controlled by the Fed. Some have used the issue to argue it gives the president legal cause for dismissing the Fed chief. Hassett, when asked in an ABC News interview Sunday whether the president has the authority to fire the Fed chair, said: 'That's a thing that's being looked into. But certainly, if there's cause, he does.' Bessent, asked about Hassett's remarks, pointed again to Trump's comments that he was not looking to fire Powell. BLOOMBERG
Time of India
13 hours ago
- Business
- Time of India
Scott Bessent says Jerome Powell should leave Fed board in May '26
NEW YORK: US Treasury Secretary Scott Bessent suggested that Federal Reserve Chair Jerome Powell should step down from the central bank's board when his term as chair is up in May 2026. "Traditionally, the Fed chair also steps down as a governor," Bessent said in an interview with Bloomberg Television Tuesday. "There's been a lot of talk of a shadow Fed chair causing confusion in advance of his or her nomination. And I can tell you, I think it'd be very confusing for the market for a former Fed chair to stay on also." Powell's term as a Fed governor doesn't end until January 2028, leaving it possible for him to remain at the central bank - and to participate in monetary policymaking - even after his tenure as the chair comes up next May. Powell has repeatedly declined to answer questions on whether he might stay on as a governor. That reticence has complicated the decision-making for President Donald Trump and his aides as they look to revamp Fed leadership next year. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like The Top 25 Most Beautiful Women In The World Articles Vally Undo "There's a formal process that's already starting" with regard to identifying the nominee to become next Fed chair, Bessent also said. "There are a lot of good candidates inside and outside the Federal Reserve." Asked whether Trump has asked Bessent himself to serve as Fed chair, the Treasury chief said, "I am part of the decision-making process." He noted that "it's President Trump's decision, and it will move at his speed." Live Events Treasuries dropped after Bessent's remarks, with two-year yields hitting a session high of 3.92%. The Bloomberg Dollar Spot Index pared losses and was little changed as of 7:55 a.m. in New York. Unless Powell makes clear he'll vacate his board position, Trump has one scheduled opening to fill next year, with Governor Adriana Kugler reaching the end of her term in January.
Yahoo
15 hours ago
- Business
- Yahoo
Stocks Mixed as T-Note Yields Rise
The S&P 500 Index ($SPX) (SPY) is unchanged, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.55%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +0.51%. September E-mini S&P futures (ESU25) are up +0.02%, and September E-mini Nasdaq futures (NQU25) are up +0.57%. Stock indexes rallied early the session due to a favorable core CPI print of +0.2% m/m, but then faded as T-note prices fell and as expectations for a Fed rate cut in September were trimmed to 58% from 65%. The 10-year T-note yield is currently up +4.8 bp and the 30-year T-bond yield rose back above the 5% mark for the first time in 6 weeks. Palantir Just Launched Warp Speed for Warships. Does That Make PLTR Stock a Buy? This Analyst Just Doubled His Price Target on AMD Stock How High Can Nvidia Stock Go as Jensen Huang Heads to China? Get exclusive insights with the FREE Barchart Brief newsletter. Subscribe now for quick, incisive midday market analysis you won't find anywhere else. The Dow was undercut by negative breadth with 24 of the 30 stocks showing declines, led by Merck (MRK) and American Express (AXP). Today's CPI report received some favorable initial media attention due to the slightly weaker-than-expected +0.2% m/m increase in the core CPI, which was driven partly by lower car prices. However, there were some scattered signs of upside pressure from tariffs, and that pressure is expected to increase in the coming months. Also, both the headline and core CPI reports on a year-over-year basis rose from May. Specifically, the June US CPI rose +0.3% m/m, which was in line with market expectations, while the year-over-year figure of +2.7% was slightly worse than expectations of +2.6% and was up from May's +2.4%. The June US core CPI rose +0.2% m/m, which was slightly better than expectations of +0.3%. On a year-over-year basis, the June US core CPI was in line with expectations at +2.9% y/y but rose from May's +2.8%. Expectations for a -25 bp Fed rate cut were little changed for the July FOMC meeting but were trimmed to 58% for the September meeting from 65% on Tuesday. Federal funds futures prices are discounting the chances for a -25 bp rate cut at 3% at the July 29-30 FOMC meeting and at 58% at the following meeting on Sep 16-17. There was some positive trade news today after Treasury Secretary Bessent said that US-China trade talks are in a 'very good place' and that the US-China deadline is flexible and told market participants 'not to worry about August 12.' Mr. Bessent confirmed that the Trump administration has told Nvidia that a license for the sale of its advanced H20 GPU chips to Chinese firms will be granted and is 'all part of a mosaic' in the US-China negotiations. He also said he hopes to meet with Chinese Vice Premier He Lifeng in August. Stocks have been undercut by recent US trade news. Over the weekend, President Trump announced that the US will impose 30% tariffs on US imports from the European Union and Mexico, effective August 1. Mr. Trump said last Thursday that a 35% tariff on some Canadian products would take effect on August 1, up from the current 25%. Last week, Mr. Trump imposed a 50% tariff on copper imports, which will include semi-finished goods, and stated that drug companies could face tariffs as high as 200% on imports if they don't relocate production to the US within the next year. Today's July Empire manufacturing index report of 5.5 was stronger than expectations of -9.2, and was up from June's level of -16.0. The price of Bitcoin (^BTSUSD) is down -3% today due to some long liquidation pressure following the recent rally on hopes for more favorable crypto regulation from Washington. The US House Committee on Ways and Means plans to hold an oversight subcommittee hearing on July 16 entitled, 'Making America the Crypto Capital of the World,' which may lead to more crypto-friendly regulations. The markets this week will focus on any fresh news on tariffs or trade deals. On Wednesday, June PPI final demand is expected to ease to +2.5% y/y from +2.6% in May, and June core PPI is expected to ease to +2.7% y/y from +3.0% y/y in May. Also, on Wednesday, June manufacturing production is expected to fall by -0.1% m/m. Finally, on Wednesday, the Fed will release its Beige Book. On Thursday, June retail sales are expected to climb by +0.1% m/m and +0.3% ex-autos, and weekly initial unemployment claims are expected to climb by +7,000 to 234,000. Also, on Thursday, the July Philadelphia Fed business outlook survey is expected to climb +3.0 points to -1.0, and the July NAHB housing market index is expected to rise +1 to 33. On Friday, June housing starts are expected to climb +3.3% m/m to 1.298 million, and June building permits are expected to slip -0.6% m/m to 1.386 million. Also, the University of Michigan's US July consumer sentiment index is expected to climb +0.8 to 61.5. Earnings season began in earnest this week with a focus on big bank earnings results. Key earnings reports today include Blackrock, Citigroup, JP Morgan, NY Bank of Mellon, Wells Fargo, and State Street. Key earnings reports Wednesday include Bank of America, Goldman Sachs, Morgan Stanley, and United Airlines. Key reports Thursday include PepsiCorp, Abbott, US Bancorp, GE Fifth Third, and GE. Key reports Friday include Schwab and American Express. The consensus is for the S&P 500 companies to show Q2 earnings growth of +2.8% y/y, the smallest increase in two years, according to Bloomberg Intelligence. Also, only six of the eleven S&P 500 sectors are projected to post an increase in earnings, the fewest since Q1 of 2023, according to Yardeni Research. Overseas stock markets today are mixed. The Euro Stoxx 50 is down -0.31%. China's Shanghai Composite closed down -0.42%. Japan's Nikkei Stock 225 closed up +0.55%. Interest Rates September 10-year T-notes (ZNU25) today are down -13.5 ticks. The 10-year T-note yield is up by +4.8 bp at 4.481%. T-note prices being undercut by reduced expectations for Fed easing, as the market cut expectations for a rate cut at the September meeting to 55% from 65%. Also, the 10-year breakeven expectations rate today rose to a 4.75-month high and is currently up +1.5 bp at 2.419%. Also on the bearish side for US bond prices, the Trump administration's campaign against Fed Chair Powell continued today, fueling concern among bond vigilantes about the Fed's independence and the possibility of politically driven interest rate cuts that could be inflationary. US Treasury Secretary Bessent said that Fed Chair Powell should step down as a Fed Governor when his term as Chairman ends in May 2026, in line with tradition. Mr. Powell's term as a Fed Governor lasts until January 2028, well beyond the expiration of his term as Chairman in mid-May-2026. Mr. Bessent also stated that he is part of a formal process that has already begun to decide who President Trump will appoint as the new Chairman when Mr. Powell's term ends in May 2026, or earlier 'for cause,' based on attacks on how Mr. Powell has handled the renovation of the Fed's building in Washington. European government bond yields today are mixed. The 10-year German bund yield is down -1.9 bp at 2.710%. The 10-year UK gilt yield is up +2.2 bp at 4.622%. Swaps are discounting the chances at 2% for a -25 bp rate cut by the ECB at the July 24 policy meeting. US Stock Movers The Magnificent Seven stocks are trading higher today, except for Meta Platforms (META) and Tesla (TSLA). Apple (AAPL) Apple is up more than +1% after news that it reached a $500 million deal to buy rare-earth minerals from Pentagon-backed MP Materials Corp. In Tesla (TSLA) news today, the company opened its first India showroom. Also, Bloomberg reported that Tesla's top sales executive in North America, Troy Jones, has left the company after a 15-year stint. Chip stocks are doing well today after the Trump administration indicated that it will loosen US restrictions on chip sales to China. Advanced Micro Devices (AMD) is up more than +6%, and Nvidia (NVDA) is up more than +4% on the news. Arm Holdings (ARM) is up more than +3%. Cryptocurrency-exposed stocks are mixed today as bitcoin (^BTCUSD) fell -3% on some long liquidation pressure after posting a new record high on Monday. Riot Platforms (RIOT) is down more than -3%, and MicroStrategy (MSTR) is more than -1%, but Coinbase Global (COIN) is up +0.4%. BlackRock (BLK) is down more than -5% after it reported that long-term asset inflows were less than market expectations. JPMorgan Chase (JPM) is down -0.4% after it raised its full-year expense guidance. Copper miners are trading lower today after Morgan Stanley downgraded the sector's prospects due to expectations that 50% tariffs will lead to reduced US demand for copper products. Freeport McMoRan (FCX) is down more than -4%, and Southern Copper (SCCO) is down more than -3%. Earnings Reports (7/15/2025) Albertsons Cos Inc (ACI), Bank of New York Mellon Corp/The (BK), Blackrock Inc (BLK), Citigroup Inc (C), JB Hunt Transport Services Inc (JBHT), JPMorgan Chase & Co (JPM), Omnicom Group Inc (OMC), Pinnacle Financial Partners In (PNFP), State Street Corp (STT), Sun Communities Inc (SUI), Wells Fargo & Co (WFC). On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on 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
Yahoo
16 hours ago
- Business
- Yahoo
Bessent Tells Markets Not to Worry About China Tariff Deadline
(Bloomberg) -- Advocates Fear US Agents Are Using 'Wellness Checks' on Children as a Prelude to Arrests LA Homelessness Drops for Second Year Treasury Secretary Scott Bessent suggested the deadline for a US-China tariff truce slated to end next month is flexible, saying that talks between the world's largest economies are in a 'very good place' ahead of an expected meeting in coming weeks. 'I tell market participants not to worry about Aug. 12,' Bessent said Tuesday on 'Bloomberg Surveillance,' referring to the end of a 90-day reprieve that was announced May 12. The remarks may ease investor concern that commerce between the two nations faces further disruption if tariffs return to their damaging pre-truce levels in less than a month. Bessent's perceived confidence in stable relations with Beijing also reinforces his role as a counterweight to the China hawks advising Trump. The Treasury chief, who has taken the leading role in Washington's negotiations with China, said that he hopes to meet with his counterpart Vice Premier He Lifeng soon, possibly in a third country, either before or after the Chinese leadership hold a meeting early next month. 'We're still working on it,' he said. 'The Chinese leadership has a big conclave at the beginning of August. We're trying to work out whether that could be in a third country either before or after that conclave.' Market Rally The S&P 500 has rallied 26% from an April low to a record high as investors grew more confident that the US will negotiate lower tariff rates with trading partners than those announced April 2. The domestic economy, meanwhile, remains solid with underlying inflation largely staying in check. A report on June consumer prices, released after the Bessent interview, showed product categories more exposed to tariffs indicate that companies are starting to pass higher import costs on to households. The dollar remains lower since the initial April announcement, while longer-dated Treasury yields are higher. The greenback has been hit particularly hard, with Bloomberg's gauge of the currency down more than 8% this year. Bessent and his fellow US trade negotiators previously met with Chinese officials in Geneva in May, where they agreed to reduce their overall tariffs rates on each other. They held more talks in June in London, where they reached an understanding on easing export controls on semiconductors and so-called rare earths. The US government has recently assured chip maker Nvidia Corp. that licenses for sales of its advanced H20 GPU to Chinese firms would be granted, the company said in a blog post. In the Bloomberg TV interview, Bessent confirmed that development and said the granting of such licenses was among the offerings from the Trump administration in its talks with China. 'You might say that that was a negotiating chip that we used in Geneva and in London,' he said. 'It was all part of a mosaic. They had things we wanted. We had things they wanted, and we're in a very good place.' --With assistance from Annmarie Hordern, Jonathan Ferro, Lisa Abramowicz, David Goodman and Farah Elbahrawy. (Adds markets in fifth paragraph) Thailand's Changing Cannabis Rules Leave Farmers in a Tough Spot The New Third Rail in Silicon Valley: Investing in Chinese AI 'The Turbulence Is Brutal': Four Shark Tank Businesses on Tariffs 'Our Goal Is to Get Their Money': Inside a Firm Charged With Scamming Writers for Millions Will Trade War Make South India the Next Manufacturing Hub? ©2025 Bloomberg L.P.
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Business Standard
19 hours ago
- Business
- Business Standard
Formal process to replace Fed Chair Powell underway: US Treasury Secy
US Treasury Secretary Scott Bessent has said that Federal Reserve Chair Jerome Powell should consider leaving the central bank entirely once his term as chair ends in May 2026, and that the process to find his successor is already underway. 'Traditionally, the Fed chair also steps down as a governor,' Bessent told Bloomberg Television on Tuesday. 'There's been a lot of talk of a shadow Fed chair causing confusion in advance of his or her nomination. And I can tell you, I think it'd be very confusing for the market for a former Fed chair to stay on also.' Given Powell's term as a governor of the Fed continues until January 2028, he could technically remain at the bank and continue influencing monetary policy decisions. However, he has avoided confirming whether he intends to stay on. This uncertainty has added complexity to the task ahead for US President Donald Trump and his advisers, who are preparing for a leadership change at the central bank next year. Market reaction, upcoming vacancy Bessent's remarks appeared to unsettle financial markets. Yields on two-year US Treasury notes climbed, hitting a session high of 3.92 per cent after the interview aired. Unless Powell announces he will vacate his board seat, Trump will have only one planned vacancy to fill in 2026. That would come when Adriana Kugler's term on the Federal Reserve's Board of Governors ends in January. Bessent mentioned last month that a potential timeline could see a new Fed chair nominee announced by October or November, ahead of Kugler's term ending. Search for a new Fed Chair underway 'There's a formal process that's already starting' to identify the next chair, Bessent said. 'There are a lot of good candidates inside and outside the Federal Reserve.' Asked whether Trump had approached him personally to take on the role, the Treasury Secretary responded: 'I am part of the decision-making process.' He added: 'It's President Trump's decision, and it will move at his speed.' Trump seeks rate-cut friendly successor President Trump has signalled that he wants Powell's replacement to support cutting interest rates. Since returning to office, he has repeatedly criticised Powell for maintaining higher rates, after previously pushing for cuts during his earlier presidency. While Trump pushes for looser monetary policy, Federal Reserve officials have been more cautious. They've warned that Trump's tariff hikes could fuel inflation and prefer to wait for clearer economic signals before resuming any rate cuts. Bessent on inflation forecast The latest consumer inflation report — the June Consumer Price Index — is due on Tuesday morning. Bessent said he had not seen the data ahead of his Bloomberg interview but urged against reading too much into a single figure. 'I wouldn't put too much emphasis on one number,' he said, referring to the CPI data. He also noted that recent inflation trends suggest that concerns about a significant rise in prices may not be justified. 'They've had some big forecasting errors,' Bessent said of the Fed's past projections. 'And this may be one' as well, he added. Still, he pointed out that Trump has made his stance clear: 'Numerous times he is not going to fire Jay Powell.'
