U.S. Economic News
July 10, 2019
U.S. News
The Financial Times reports that Federal Reserve Chairman Jerome Powell solidified the case for cutting interest rates in his testimony to Congress that referenced global economic uncertainty and persistently weak inflation. Given the strength of the current labor market, many economists view the Fed’s consideration of rate cuts as an ‘insurance’ policy against a potential slowdown, resulting in just one or two cuts instead of an extended easing cycle. FT
According to the Wall Street Journal, prices for iron ore—the main ingredient in steel—have soared by more than 68% in 2019 as ore supplies stagnate despite booming steel production in the U.S. and China. Chinese steel companies’ profits have fallen 18% this year due to rising ore costs, while U.S. companies leave furnaces idle as profit margins shrink. WSJ
Bloomberg reports that the European Commission has downgraded its 2020 euro-area GDP projection to 1.4% from 1.5% and lowered its inflation forecast to just 1.3%. The latest figures reflect more pronounced weakness in the eurozone economy and fading hopes for a rebound in the second half of 2019. Bloomberg