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“For now, I would say that we will proceed carefully in line with this plan,” Mr Powell told the House Financial Services Commission on Wednesday. “We will avoid adding uncertainty to what is already an extremely challenging and uncertain moment.

Although it was too early to say how the war and heavy sanctions imposed by the West on Moscow would affect the US economy, he said there was a general urgency to continue tightening policy.

The S&P 500 rose 1.9 percent on Wednesday, a day after the index fell 1.6 percent. Yields on benchmark 10-year treasury bonds are particularly volatile. They rose to 1.862%, from 1.708% on Tuesday and 1.836% on Monday.

Mr Powell has effectively put an end to the debate among markets and other Fed officials over whether they will raise interest rates from zero this month by more than half a percentage point. At the same time, he laid the groundwork for the possibility of a half-point increase this summer, rejecting the idea that more traditional quarter-point increases represent a speed limit for the Fed.

Consumer prices rose 6.1 percent in January from a year earlier, according to the Fed’s preferred rate. With the exception of variable food and energy categories, so-called core inflation rose by 5.2%, close to a 40-year high. “This is strong, high inflation and it is very important that we overcome it, and that is exactly what we will do,” Mr Powell told lawmakers.

Mr Powell said his colleagues expected inflation to peak and fall soon. “To the extent that inflation is higher or more sustained than that, then we would be prepared to act more aggressively,” raising interest rates by half a percentage point in one or more meetings later this year. The Fed has not raised interest rates by half a point since 2000.

Mr Powell also said he expected the Fed to make “good progress” in preparing plans to shrink its $ 9 trillion asset portfolio, but that he would not finalize those plans at his March 15-16 meeting.

The global economy is recovering from a series of “supply shocks” in which shortages of goods or services raise prices. The textbooks call on central banks not to react to one-off price increases resulting from temporary factors such as natural disasters, but instead to focus on broader core inflationary pressures.

However, officials are beginning to worry about an overheated labor market with rising wages well above their pre-pandemic levels and the risk of consumers and businesses expecting higher prices to rise in the future, which encourages consistently higher inflation.

Fed officials last spring and summer attributed much of the rise in inflation to bottlenecks in the supply chain, which would not necessarily require a political response if these breakages were expected to resolve themselves in a few months. On Wednesday, Mr Powell suggested that high inflation was the result of a clash between both strong demand and supply constraints. The focus on demand is important, as raising the Fed’s interest rates could lead to a balance between supply and demand by slowing rents and broader economic activity.

Mr Powell said labor shortages were raising wages, and the Fed was watching closely for signs that the war in Ukraine would lead to even higher prices. The Fed will not have to raise interest rates so much, he said, if bottlenecks are eased and more workers return to the job market.

“Honestly, we have the tools and we will use them to control inflation, but as long as we get help from supply, it will make this job much easier,” he said.

His remarks underscore the challenge facing the central bank as it prepares to raise interest rates for the first time since 2018. During geopolitical turmoil, the Fed generally avoids taking steps that increase uncertainty. But as inflation exceeds its 2% target and the Ukrainian crisis threatens to push prices even higher, the Fed may feel more pressure to raise interest rates.

While Russia’s direct trade links with the US economy are not significant, Mr Powell pointed to the risk of unintended and downstream effects from rising prices for oil, natural gas and other goods for which Russia is a major exporter, including neon, palladium, wheat and manure. “Events like war will raise the price of oil and gas, and that will certainly affect prices,” he said.

Lawmakers have pressured Mr Powell over the Fed’s previous view that inflationary pressures would ease faster than last year. “I always thought there was a chance we could make a mistake and that if we made a mistake, we could turn around, and we made a turn and turned around pretty quickly,” he said last December. “But then the economy was really moving very, very fast.”

However, he said the labor market was strong enough for the economy to keep up. He said he hoped the economy could slow down enough to slow rising prices and wages without leading to a recession or period of high inflation, as seen in the 1970s – the so-called soft landing.

“We haven’t faced this challenge in a long time, but we all know the story and we all know what we have to do,” Mr Powell said. “I think it is more likely than not to achieve what we call a soft landing.

Later, when he was pressed whether the Fed’s response might have to be so strong that such a soft landing would be impossible, he said: “There are no guarantees in life. But that is our intention and what we propose to do. “

Write to Nick Timiraos at [email protected]

A JetBlue pilot was removed from the cockpit minutes before taking off from an airport in upstate New York on Wednesday and was found to have a blood alcohol level more than four times the legal flight limit, according to reports.

James Clifton, 52, took a breathalyzer after cops pulled him off a plane to Fort Lauderdale from Buffalo Niagara International Airport, a spokesman for the Niagara Frontier Transportation Authority told The Buffalo News.

The Orlando resident, Florida, was allegedly visibly drunk when he went through security before boarding the plane, prompting agents from the Transportation Security Administration to notify cops, the report said.

His blood alcohol content is 0.17 percent, which is twice the 0.08 percent limit for driving a car and four times the 0.04 percent BAC limit set for pilots under Federal Aviation Administration regulations, according to WIVB-TV.

The flight, originally scheduled to leave Buffalo at 6:15 a.m., was delayed by four hours and 10 minutes, according to flight tracking site FlightAware.com. He arrived in Florida at 1:10 p.m. Wednesday, according to the site.

An NFTA spokesman did not answer a phone call from The Post on Friday. A JetBlue spokesman said the pilot had been suspended.

“The safety of JetBlue customers and crew is our first priority,” the spokesman told The Post. “We stick to everyone [Department of Transportation] rules and requirements for alcohol at all times and have a very strict internal zero tolerance policy.

“We are aware of the incident that took place this morning in Buffalo and are cooperating fully with law enforcement,” the spokesman added. “We are also conducting our own internal investigation.”

WASHINGTON, March 2 – Federal Reserve Chairman Jerome Powell, who is balancing high inflation in the United States against the complex new risks of a European ground war, said on Wednesday that the central bank would “carefully” raise interest rates at an upcoming meeting. in March, but will be ready to move more aggressively if inflation does not cool down as quickly as expected.

Powell called the Russian invasion of Ukraine a “change of game” that could have unpredictable consequences.

“Events are yet to come and we do not know what the real effect will be on the US economy,” Powell told the House Financial Services Committee during a monetary policy hearing overshadowed by the conflict in Europe.

But he said the Fed was now largely going as planned to raise its interest rate on federal overnight funds and reduce its balance sheet to curb inflation, which is currently the highest at 80 -the years of the last century.

Powell said he would support a quarter-point increase in interest rates at the Fed’s meeting on March 15-16, effectively putting an end to the debate on starting a post-pandemic round of raising interest rates by more than the usual half-point increase.

But the Fed chief said he was prepared to use larger or more frequent interest rate movements if necessary if inflation did not slow down and he may have to raise interest rates to restrictive levels above 2 over time. 5% – slowing economic growth, instead of just stimulating it less stably.

This is a fine difference, but a marker of Powell’s focus on inflation as a key battle for the Fed right now, a major concern that could undermine central bank confidence if it deteriorates, undermines household spending and distorts investment and decision-making. the costs of business and families.

The labor market, Powell noted in prepared testimonials, was “extremely tight,” and Fed officials said their goal of maximum employment had been effectively met. The pandemic’s impact on the economy appears to be waning and “demand is strong,” Powell said.

However, inflation has now tripled from the Fed’s 2% target and has become a major political concern for the Biden administration and members of Congress who came to Wednesday’s hearing, armed with anecdotes about voters paying more for basic goods or business delivery.

What Powell described as a clash between strong consumer demand and pandemic constraints on global product supply, “was not as transient as we had hoped … Other major economists and central banks around the world made the same mistake. That doesn’t excuse him, but we thought these things would be resolved long ago. “

RAMKRAN FROM CONFLICT IN UKRAINE

But even with the immediate focus on inflation, Powell’s testimony was shaped by the conflict in Ukraine and what it could mean for the United States and world economies in the coming weeks or even years.

Powell said that the Fed’s staff had begun to analyze various scenarios, but that too much remained unknown about an event whose full consequences could “be with us for a very long time.”

“The short-term consequences for the US economy of the invasion of Ukraine, the ongoing war, sanctions and the events that lie ahead remain very uncertain,” Powell said. “Implementing an appropriate monetary policy in this environment requires recognizing that the economy is developing in unexpected ways. We will have to be agile in responding to input and changing perspectives. “

“We will continue to be careful as we learn more about the effects of the war in Ukraine on the economy,” Powell said. “We expect inflation to peak and begin to decline this year. As inflation rises or is steadily higher … we would be prepared to act more aggressively by raising interest rates on federal funds by more than 25 basis points per meeting or meetings. “

The Fed has cut interest rates to the current near-zero level in 2020 to blunt the impact of the coronavirus pandemic. There is now widespread agreement that the current level of borrowing costs is out of phase with an economy that has recovered faster than expected from the health crisis.

Lawmakers have asked Powell about the effects of rising oil prices following Russia’s actions, the threat of cyberattacks and wider risks to the financial system, and even the impact on the fertilizer market.

“Everything we can do … we do it to protect ourselves from cyberattacks,” Powell said. “The bigger financial institutions are doing it. It’s hard to say what is possible, but we are on high alert and will continue to be.”

As for the financial markets, Powell said that so far they are “functioning well. There is a lot of liquidity there” and the existing Fed programs are helping.

Powell will appear before the Senate Banking Committee on Thursday. The head of the Fed must testify before these committees of the House of Representatives and the Senate twice a year as part of the central bank’s semi-annual monetary policy reviews.

Major US stock indexes traded sharply higher, expanding profits during Powell’s testimony, and bond yields rose. The US dollar has changed slightly against a basket of currencies of major trading partners. Interest rate futures traders began pricing with six rate hikes this year from five on Tuesday.

Powell, “prefers to keep the Fed’s options open … there was little rebuttal to expectations of current market interest rates, which fell after the Russian invasion,” said Paul Ashworth, chief US economist at Capital Economics.

Report by Howard Schneider and Lindsey Dunsmoor; Edited by Paul Simao and Andrea Ritchie

Our standards: ‘ principles of trust.

Rivian has increased the estimated prices of its electric pickup R1T and electric SUV R1S this week by up to 20 percent, as reported TechCrunch. The company applies the new ratings to the new orders and changes them for reservation holders who do not yet have a car in production.

This is the first significant change in pricing that Rivian has revealed since the opening of orders, and while customers place pre-orders, all stated “prices are subject to change as they approach production”, no one seems ready for such a big change . Potential buyers of electric cars are accustomed to fluctuations in the prices of Tesla cars, but in this case the prices are usually locked from the moment they place their orders.

The news of the price increase came with Rivian’s announcement of the possibility of pre-ordering a dual-engine configuration for both the R1T and R1S, along with a smaller “standard” battery pack valued at 260 miles.

The R1T’s four-engine configuration with 314 miles started at $ 67,500, but now that price will only provide you with a two-engine configuration and a standard battery pack – which won’t be available until 2024. Engine configurations now start at $ 79,500 for the R1T and $ 84,500 for the R1S (initially $ 70,000).

According to Jiten Behl, Rivian’s chief growth officer, the rise in prices is due to global chip shortages and supply chain problems:

“Like most manufacturers, Rivian is facing inflationary pressures, rising component costs and an unprecedented shortage and slowdown in the parts supply chain (including semiconductor chips). This increase in costs and complexity due to these challenging circumstances necessitates an increase in the prices of the R1T and R1S models we offer today – prices that were originally set in 2018. This solution will allow us to continue to offer competitive products that maintain high standards. for the quality, productivity and capabilities that our customers expect and deserve from Rivian. Along with adjusted prices for our current offerings, we are also announcing options for twin-engine AWDs and standard batteries for the R1T and R1S, which will provide customers with a wider choice as part of our expanding portfolio of options, upgrades and accessories. ”

People who have ordered the truck are not happy with the price increase. Many customers have gone to Reddit to share that they have canceled or are planning to cancel their orders. Rivian’s tweet The announcement of the new two-engine configuration has nearly 400 responses, including many customers sharing the disappointment of the price increase from $ 12,000 to $ 20,000 compared to their existing pre-orders.

Even YouTubers Zack Nelson Jerry Rigg Everything and Quinn Nelson from Snazzy Labs turned to Twitter on the subject. Both were early fans and bookkeepers of Rivian’s R1T truck, but now they’re talking about feeling like they’ve been lured and shifted. Quinn wrote on Twitter that five months ago, Rivian people told him they were confident in car prices. “Things haven’t changed that much in five months – certainly not 20 percent. “They lied to me, clients and investors,” Quinn wrote.

A trader works on the trading floor on the last day of trading before Christmas on the New York Stock Exchange (NYSE) in Manhattan, New York, USA, December 23, 2021. REUTERS / Andrew Kelly

NEW YORK, March 2 – The battered shares of Russia’s Van Eck ETF (RSX.Z) are attracting a surge of interest from traders and making comparisons to last year’s madness in so-called memes.

Designed to track the performance of the MVIS Russia Index (.MVRSXTR), the ETF has fallen 65% in the past two weeks as Russia’s invasion of Ukraine and Western sanctions spark a huge movement in country-related assets.

Its sharp decline has boosted ETF’s stock and options trading, much of which is due to retail investors, analysts said.

As the price of the ETF fluctuated sharply – it fell by as much as 15% before recovering to trade up to 6% during the day – the volume of trading in ETF shares jumped to 27 million by 14:30 (1930 GMT) , or about twice the average daily amount, according to Trade Alert.

ETF options were even busier, with 211,000 traded contracts, or four times the expected volume.

Garrett DeSimone, head of OptionMetrics, said some of the volume appears to be boosted by traders trying to profit from the heightened stock volatility.

“These high levels of volatility are exceptional, making the VanEck Russia ETF behave like meme stocks,” he said.

“Retail definitely seems to have its fingerprints on RSX options trading today,” DeSimone said.

Sentiment was mixed, with some traders betting on a quick recovery, while others hoped for a continued decline in shares based on the choice of traded options contracts.

The closure of Russian markets for the third day in a row created another challenge for the ETF’s valuation, which led to a deviation of the trading price far from its net asset value (NAV) – or the value of each ETF share based on its share of the underlying asset fund, analysts said.

On Monday, ETF shares ended the day with a 178% premium over its NAV, according to VanEck.

“This makes stock trading much more speculative,” said Todd Rosenblut, head of ETF and mutual fund research at CFRA Research.

Report by Saqib Iqbal Ahmed; Edited by Ira Yosebashvili and Jonathan Oatis

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The shares of Snowflake Inc. were broken in a long trade on Wednesday after the software company predicted that product sales would slow this year.

snowflake snow,
+ 0.57%
reported fourth-quarter losses of $ 132.2 million, or 43 cents a share, on sales of $ 383.8 million, after losing 70 cents a share on revenue of $ 190 million a year ago. Analysts had expected an average earnings of 3 cents per share of sales of $ 373 million, although many analysts seem to be modeling for adjusted earnings that the software company does not provide.