News

Japan’s Producer Price Index rose 2.9% yoy in June, easing from May’s 3.3% yoy pace and in line with expectations. The slowdown reflects a moderation in upstream price pressures, as firms begin to benefit from a firmer Yen. Yen-based import price index dropped -12.3% yoy from a year earlier, deepening from May’s -10.3% yoy fall […]

The post Japan’s PPI slows to 2.9% yoy in June, stronger Yen helps ease import costs appeared first on Action Forex.

The Wall Street Journal (gated) Fed watcher Nick Timiraos highlights division within the Federal Reserve on the path for inflation and rate cuts.

• Trump’s tariff hikes are fueling internal debate at the Federal Reserve over whether to delay or advance interest rate cuts, as policymakers weigh the inflationary impact against slowing growth.

• Fed Chair Jerome Powell has signaled a more flexible stance, suggesting the bar for cutting rates may be lower than it was earlier this year, especially if inflation softens or labor market data weakens.

• A rate cut isn’t expected at the upcoming meeting, but Powell has outlined conditions under which cuts could come by the end of summer—without waiting for dramatic economic deterioration.

• April’s surprise tariff increases disrupted earlier Fed plans to resume rate cuts, raising fears of a stagflation scenario with rising prices and slowing growth.

• In such an environment, Fed officials would likely need clearer signs of economic cooling to be confident that any inflation spike would be temporary.

This article was written by Eamonn Sheridan at www.forexlive.com.

Minutes from the FOMC’s June 17–18 meeting highlighted a notable divergence among policymakers on whether rate cuts are needed this year. “Most participant” still see at least one cut as likely, citing temporary tariff effects, stable inflation expectations, and signs of cooling in the labor market. “A couple” went further, indicating they would be open […]

The post Fed minutes reveal deep division on rate path appeared first on Action Forex.

Brazil plays a pivotal role in supplying the United States with essential commodities like coffee and orange juice. In 2023, Brazil accounted for approximately 35% of U.S. unroasted coffee imports, making it the largest single supplier. This dominance is attributed to Brazil’s vast production of high-quality Arabica beans, which are favored by American consumers. However, challenges such as drought conditions and reduced fertilizer use have impacted Brazilian coffee production, leading to increased prices and supply concerns in the U.S. market.

Similarly, Brazil is a major exporter of orange juice to the United States. Between October 2023 and January 2024, Brazil supplied 81% of U.S. orange juice imports, up from 76% in the previous season. This surge is largely due to declining domestic production in Florida, where citrus greening disease and extreme weather events have devastated orange groves. As a result, the U.S. has become increasingly reliant on Brazilian orange juice to meet consumer demand.

The United States’ dependence on Brazilian coffee and orange juice underscores the potential impact of trade policies and environmental factors on the availability and pricing of these everyday staples:

• Trump hits Brazil with a 50% tariff

You see, this is why you can’t have nice things, like Federal Reserve rate cuts.

When the big guy wants a rate cut but he keeps fuelling inflation.

This article was written by Eamonn Sheridan at www.forexlive.com.

France and the U.K. will now coordinate their nuclear deterrence strategies and respond jointly to major threats facing Europe. The agreement is expected to be formally signed on Thursday:

• The announcement, made during French President Emmanuel Macron’s state visit to the U.K., is intended to reassure European allies amid uncertainty over the U.S.’s long-term security commitment to the region.

• The move signals a shift toward greater European defence autonomy, positioning French and British nuclear capabilities as a collective deterrent for Europe.

• Although both countries are NATO members, their nuclear arsenals have traditionally been kept outside NATO’s collective defence obligations.

• Combined, France and the U.K. possess around 515 nuclear warheads, far fewer than the U.S. or Russia, but still sufficient to serve as a credible deterrent.

This article was written by Eamonn Sheridan at www.forexlive.com.