Good day. The Federal Reserve will release its post-meeting policy statement today at 2 p.m. EST, along with new economic and interest rate projections. President Jerome Powell will follow with a press conference at 2:30 p.m., where he could explain the progress Fed officials have made on their plans to cut or cut the $ 120 billion in monthly bond purchases. central bank, which aim to strengthen economic recovery. Mr Powell has promised to provide advance notice of any reduction in bonds, and the Fed could use the policy statement to provide such an alert.

Now on to today’s news and analysis.

Top news

Fed meeting to focus on Taper schedule

Federal Reserve officials will look to strike a deal on Wednesday on how and when to start scaling back their large-scale bond buying efforts, which they launched at the start of the pandemic to stimulate the U.S. economy.

The central bank gave its first signal in July that officials were more confident the economy was hitting its targets. Since then, senior executives including Fed Chairman Jerome Powell have indicated they may start cutting or cutting those purchases this year.

Fed faces calls to dismiss officials for transactions they’ve made

Two advocacy groups said two Federal Reserve officials who traded stocks and other investments while setting monetary policy should lose their jobs, while a former Fed adviser said one of the men should be fired and the other should take time off pending an investigation.

The Derby Point of View: Trade Controversy Highlights Calls for Structural Changes at the Fed

By Michael S. Derby

The recently disclosed market activity of two leaders of regional Federal Reserve banks has not only spurred calls for further restrictions on trade by policymakers. It also renews attention to the long-standing desire of some central bank observers to change the very configuration of the Fed and its banks. Read more.

Key developments around the world

Delta variant expected to slow down but not derail global economic recovery

In its latest economic outlook, the Organization for Economic Co-operation and Development lowered its growth forecast for the global and US economies in 2021, the first downward revision since December of last year, when new infections increased.

BOJ sticks to ultra-easy monetary policy

As other major central banks move to cut back on asset purchases, the Bank of Japan has reiterated that it will buy Japanese government bonds with no upper limit. It kept its short-term interest rate target at minus 0.1% and its 10-year bond yield target around zero.

The Central Bank of Indonesia stands Pat

Indonesia’s central bank has kept its benchmark interest rate unchanged to preserve the stability of the rupee and support the country’s economic recovery. The seven-day repo rate was held at 3.50% on Tuesday, according to a Wall Street Journal survey of economists, and rates on demand deposits and loan facilities were kept at 2, 75% and 4.25%, respectively. (Dow Jones Newswires)

Sweden’s central bank sees key rate stay at zero

Sweden’s central bank said on Tuesday it still expects the policy rate on pensions to stay at 0% in the coming years, with updated forecasts showing the rate to remain unchanged throughout its forecast horizon which runs to the third quarter of 2024. The Riksbank also said it will also continue to buy securities this year, in line with earlier rulings, and expects its holdings of securities to remain more or less unchanged in 2022. (DJN)

Regulatory Storm in China Likely to Cause Greater Economic Damage

China’s high-profile crackdown on real estate developers, tech companies and other private companies is starting to weigh on business activity and heighten financial risks in the country, increasing the risk that Beijing’s campaigns will harm to the economy at large.

Overview of financial regulation

SEC Gensler Doesn’t See Cryptocurrencies To Last Long

Securities and Exchange Commission Chairman Gary Gensler said on Tuesday that he did not see much long-term viability for cryptocurrencies, stressing the importance of protecting investors in the market and putting it under scrutiny. regulatory oversight.

Banks oppose strict Basel rules targeting cryptocurrencies

The biggest US and European banks oppose tough new rules that would require them to set aside a dollar of capital for every dollar of bitcoin they own, a group of trade associations representing lenders at the largest said. global standard-setter of banking regulation.

US sanctions cryptocurrency exchange linked to ransomware criminals

The Biden administration blacklisted a Russian-owned cryptocurrency exchange for allegedly helping launder ransomware payments, an unprecedented move meant to deter future cyber extortion attacks by disrupting their primary means of profit.

Biden Pick for CFPB chief heads to Senate confirmation

Senate Majority Leader Chuck Schumer said on Tuesday he would begin a process to bring Rohit Chopra’s nomination to the Senate, which could lead to his confirmation as head of the Consumer Financial Protection Bureau as early as this week. next.

Home appraisals in black and Latin American areas more likely to fail

About 15.4% of single-family properties in predominantly Latin American census tracts and 12.5% ​​of homes in predominantly black areas valued below their contract price between 2015 and 2020, the researchers found. Freddie Mac. The rate in white neighborhoods was 7.4%.

Forward-looking indications

Wednesday (every hour ET)

Time N / A: Central Bank of Brazil issues policy statement; Bank of Japan issues policy statement

10 a.m .: National Association of Realtors publishes sales of existing homes in the United States in August

2 p.m .: US Federal Reserve releases policy statement and economic projections

2:30 p.m .: Fed’s Powell holds virtual press conference

Thursday

Time N / A: South African Reserve Bank issues policy statement; Bangko Sentral ng Pilipinas issues policy statement; Central Bank of the Republic of Turkey issues policy statement

3:30 am: Swiss National Bank publishes policy statement

4 a.m.: Norges Bank releases interest rate decision and monetary policy report

7 a.m .: Bank of England releases monetary policy summary and review

Remark

Evergrande is China’s economy in a nutshell

Shenzhen’s real estate conglomerate China Evergrande is China’s economy in miniature, as both have operated for decades on the principle that it’s worth borrowing to build, writes James Mackintosh.

What China must do to contain the fallout from Evergrande

It all depends on how quickly Beijing can bring together a coalition of developers to take on Evergrande’s contractual responsibilities or find another solution to avoid a disorderly sale of assets and a financial blow to its customers and suppliers, write Nathaniel Taplin and Jacky. Wong.

Research

Spending on roads and public transport is often based on optimistic forecasts

The researchers found that transportation planners often expect more people to use their road and transit projects than they ultimately do. Yet these optimistic forecasts become part of the justification for spending millions or billions of dollars on such projects.

Base points

Evergrande Group’s flagship real estate firm in China has said it will pay interest on an onshore bond, giving the heavily leveraged conglomerate more time to figure out what investors expect from a long and complicated restructuring.

The newly arrived ships add to a record flotilla waiting to unload cargo, expanding a fleet off the congested ports of Los Angeles and Long Beach that has become a glaring sign of the disruptions and delays disrupting supply chains global.

The Mexican economy will grow by 6.3% this year, the OECD said, raising its estimate from a previous forecast of 5% and aligning the forecast with that of the International Monetary Fund and above the estimate of 6.2% of the Bank of Mexico. (DJN)

Housing starts in the United States, a measure of residential construction, rose 3.9% in August from July to a seasonally adjusted annual rate of 1.615 million, according to the Commerce Department. Economists polled by the Wall Street Journal expected a 1% increase to an annual rate of 1.55 million. (DJN)

New home prices in Canada rose in August, continuing a series of gains that began in the spring of 2020, with an increase of 0.7% from July, Statistics Canada said. New housing prices rose 12.2% from the previous year. (DJN)

El Salvador President Nayib Bukele said his country bought $ 6.4 million worth of bitcoin after cryptocurrency prices fell this month. (Market observation)

(END) Dow Jones Newswires

September 22, 2021 08:49 ET (12:49 GMT)

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