US Federal Reserve officials concluded earlier this month that the central bank should soon moderate the pace of interest-rate increases to mitigate risks of overtightening, signalling they were leaning towards downshifting to a 50 basis-point increase in December.
“A substantial majority of participants judged that a slowing in the pace of increase would likely soon be appropriate,” according to minutes from their November 1-2 gathering released on Wednesday in Washington.
While Fed chairman Jerome Powell said during his post-meeting press conference that rates will probably ultimately go higher than officials’ September forecasts indicated, Wednesday’s report gave a more nuanced take: “various” officials — a descriptor not commonly used in the minutes — had concluded that rates would ultimately peak at a higher level than previously expected.
In another revelation, Fed staff told officials during the gathering that their assessment of the risks of a recession had grown to almost 50-50. That was the first such warning since the central bank began raising rates in March.
US stocks and treasuries rallied while the dollar fell following the report, as investors took a dovish message from the minutes.
At the meeting, officials raised the benchmark rate 75 basis points for a fourth straight time to 3.75 per cent to 4 per cent, extending the most aggressive tightening campaign since the 1980s to combat inflation at a 40-year high.
Ellen Meade, a former Fed Board economist who researched communication, said the word “various” is a rarely used term deployed when ambiguity is needed.
“If the minutes had said ‘several’ people thought the terminal rate would be higher — that’s not a strong message,” she said. “So they needed to fuzz it up.”
Investors expect the Fed to raise rates by 50 basis points when they meet on Dec 13 and 14 and see rates peaking around 5 per cent by mid-2023. Mr Powell has a chance to influence those expectations in a speech in Washington scheduled for November 30.
Strategically, Ms Meade expects Mr Powell to continue to lean against easing financial conditions and somewhat resilient economic data.
“They have been expecting the economy to have slowed a bit. It has but not as much as they have been expecting,” said Ms Meade, who is now a research professor at Duke University’s economics department. “They can’t stop the rate increases until they see some measured evidence that the economy is slowing.”
Officials discussed the effects of lags in monetary policy, and how soon cumulative tightening would begin to affect spending and hiring. A number of Fed officials said a slower pace of rate increases would allow the central bankers to judge progress on their goals.
“The FOMC [Federal Open Market Committee] minutes reveal a surprisingly strong dovish tendency on the committee as well as at the staff level. There is widespread agreement within the committee to slow the pace of rates hikes — a view championed by vice chairwoman Lael Brainard, in our view — but little conviction on how high rates should go,” Anna Wong, chief US economist at Bloomberg, said.
“The uncertain lags and magnitudes associated with the effects of monetary policy actions on economic activity and inflation were among the reasons cited regarding why such an assessment was important,” the minutes said.
The Fed said in its policy statement that rates would continue rising to a “sufficiently restrictive” level, while taking account of cumulative tightening and policy lags.
Officials in September saw rates reaching 4.4 per cent by the end of this year and 4.6 per cent in 2023. They will update those quarterly forecasts at their meeting in December.
Since the November gathering, economic data have shown modest growth with some signs of slowing inflation amid still strong demand for labour. Employers added 261,000 jobs last month and the unemployment rate rose slightly to 3.7 per cent, though it remains very low on a historic basis.
Financial conditions have also eased since the early November rate increase, with lower yields on government 10-year notes and higher US equity markets.
“The big picture remains in our view that the Fed intends to slow down in order to allow more time for lags to operate and cumulative tightening to date to show up in the data,” Evercore ISI’s head of central bank strategy Krishna Guha wrote in a note to clients.
“The hawkish talk from Mr Powell in the press conference and many Fed officials subsequently is intended to provide air cover for the slowing to take place without an excessive easing of financial conditions.”
KILLING OF QASSEM SULEIMANI
Killing of Qassem Suleimani
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
Auron Mein Kahan Dum Tha
Starring: Ajay Devgn, Tabu, Shantanu Maheshwari, Jimmy Shergill, Saiee Manjrekar
Director: Neeraj Pandey
Rating: 2.5/5
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
UAE currency: the story behind the money in your pockets
The story of Edge
Sheikh Mohamed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, established Edge in 2019.
It brought together 25 state-owned and independent companies specialising in weapons systems, cyber protection and electronic warfare.
Edge has an annual revenue of $5 billion and employs more than 12,000 people.
Some of the companies include Nimr, a maker of armoured vehicles, Caracal, which manufactures guns and ammunitions company, Lahab
Global state-owned investor ranking by size
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United States
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China
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UAE
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Japan
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5
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Norway
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Canada
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Singapore
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Australia
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Saudi Arabia
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South Korea
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Zayed Sustainability Prize
Mohammed bin Zayed Majlis
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How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
Tips%20for%20holiday%20homeowners
%3Cp%3EThere%20are%20several%20factors%20for%20landlords%20to%20consider%20when%20preparing%20to%20establish%20a%20holiday%20home%3A%3C%2Fp%3E%0A%3Cul%3E%0A%3Cli%3E%3Cstrong%3ERevenue%20potential%20of%20the%20unit%3A%3C%2Fstrong%3E%20location%2C%20view%20and%20size%3C%2Fli%3E%0A%3Cli%3E%3Cstrong%3EDesign%3A%20furnished%20or%20unfurnished.%3C%2Fstrong%3E%20Is%20the%20design%20up%20to%20standard%2C%20while%20being%20catchy%20at%20the%20same%20time%3F%3C%2Fli%3E%0A%3Cli%3E%3Cstrong%3EBusiness%20model%3A%3C%2Fstrong%3E%20will%20it%20be%20managed%20by%20a%20professional%20operator%20or%20directly%20by%20the%20owner%2C%20how%20often%20does%20the%20owner%20wants%20to%20use%20it%20for%20personal%20reasons%3F%3C%2Fli%3E%0A%3Cli%3E%3Cstrong%3EQuality%20of%20the%20operator%3A%3C%2Fstrong%3E%20guest%20reviews%2C%20customer%20experience%20management%2C%20application%20of%20technology%2C%20average%20utilisation%2C%20scope%20of%20services%20rendered%3C%2Fli%3E%0A%3C%2Ful%3E%0A%3Cp%3E%3Cem%3ESource%3A%20Adam%20Nowak%2C%20managing%20director%20of%20Ultimate%20Stay%20Vacation%20Homes%20Rental%3C%2Fem%3E%3C%2Fp%3E%0A
Monster
Directed by: Anthony Mandler
Starring: Kelvin Harrison Jr., John David Washington
3/5
Mohammed bin Zayed Majlis
Classification from Tour de France after Stage 17
1. Chris Froome (Britain / Team Sky) 73:27:26"
2. Rigoberto Uran (Colombia / Cannondale-Drapac) 27"
3. Romain Bardet (France / AG2R La Mondiale)
4. Fabio Aru (Italy / Astana Pro Team) 53"
5. Mikel Landa (Spain / Team Sky) 1:24"
The years Ramadan fell in May
Killing of Qassem Suleimani
The years Ramadan fell in May
UAE squad
Esha Oza (captain), Al Maseera Jahangir, Emily Thomas, Heena Hotchandani, Indhuja Nandakumar, Katie Thompson, Lavanya Keny, Mehak Thakur, Michelle Botha, Rinitha Rajith, Samaira Dharnidharka, Siya Gokhale, Sashikala Silva, Suraksha Kotte, Theertha Satish (wicketkeeper) Udeni Kuruppuarachchige, Vaishnave Mahesh.
UAE tour of Zimbabwe
All matches in Bulawayo
Friday, Sept 26 – First ODI
Sunday, Sept 28 – Second ODI
Tuesday, Sept 30 – Third ODI
Thursday, Oct 2 – Fourth ODI
Sunday, Oct 5 – First T20I
Monday, Oct 6 – Second T20I
Zayed Sustainability Prize
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The Voice of Hind Rajab
Starring: Saja Kilani, Clara Khoury, Motaz Malhees
Director: Kaouther Ben Hania
Rating: 4/5
Isle of Dogs
Director: Wes Anderson
Starring: Bryan Cranston, Liev Schreiber, Ed Norton, Greta Gerwig, Bill Murray, Jeff Goldblum, Scarlett Johansson
Three stars
