Week InReview

Friday | Apr 14, 2023

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Fed aftermath.

US equity futures and European stocks rose as investors weighed the path of Fed interest-rate increases for the rest of 2023. Minutes of the Fed’s March meeting signaled officials appear on track to extend their run of hikes when they meet next month, while staff advisers forecast a “mild recession” later this year. Economists see the most likely outcome as a quarter-point increase in May, followed by an extended pause. But the language in the minutes, coupled with some officials’ comments and a still-uncertain outlook for the impact of credit tightening on the economy, point to a rate path that m ay not be fully settled.

let's recap...

Photo: Graeme Sloan | Bloomberg

DOJ raises antitrust concerns over SEC stock market revamp plan

Top Justice Department antitrust officials are taking the unusual step of urging Wall Street’s main regulator to proceed with caution on a suite of proposals to overhaul the plumbing of equities markets. DOJ has asked the SEC to consider how the proposals will interact. Antitrust officials sent a comment letter to the SEC on the agency's plan. (Bloomberg Politics | Apr 13)

Dollar to keep cooling down no matter how hot US inflation runs

Currency traders may be looking forward to a far more relaxed time than other markets counterparts around Wednesday’s US inflation data amid expectations that any upside in price pressures would fail to sustain gains in the dollar. That’s because investors are convinced the Federal Reserve is close to the peak of its tightening cycle even in the most hawkish of scenarios. (Bloomberg Markets | Apr 12)

US inflation eased to 5% in March

US inflation eased in March to its lowest level in nearly two years, but underlying price pressures likely keep the door open for the Federal Reserve to consider another interest-rate increase at its May meeting. (The Wall Street Journal | Apr 12)

End may be in sight for global rate-hike cycle as Fed nears peak

Most global central banks may be either close to a peak or already done with interest-rate hiking, auguring a hiatus before possible monetary loosening comes into view. With the first signs of dents in economic growth now visible, and fallout from financial-market tensions lingering, any pause by the Federal Reserve after at least one more increase in May could cement a turn in what has been the most aggressive the world has seen in decades. (Bloomberg Economics - Central Banks | Apr 12)

IMF warns of ‘hard landing’ for global economy if inflation persists

The IMF has warned of a “hard landing” for the global economy if persistently troublesome inflation keeps interest rates higher for longer and amplifies financial risks. Although the fund left its overall economic forecasts largely unchanged from January in its latest World Economic Outlook, published on Tuesday, it stressed that signs of resilience alongside lower global energy and food prices masked a darker reality. (Financial Times | Apr 11) see also Yellen says vigilant to downside economic risks, but don't 'overdo the negativism' (Reuters | Apr 11)

the cyber cafe

FSB sets out a comprehensive approach to achieve greater convergence in cyber incident reporting

The Financial Stability Board published a report with recommendations to achieve greater convergence in cyber incident reporting. The interconnectedness of the global financial system makes it possible that a cyber incident at one financial institution (or an incident at one of its third-party service providers) could have spill-over effects across borders and sectors.

— Financial Stability Board

Company boards are bracing for new SEC cybersecurity regulations

Growing cooperation between corporate boards and chief information security officers has strengthened cyber defense as looming regulations could demand greater accountability. Publicly traded companies have spent the last year bracing for a proposed Securities and Exchange Commission rule that would require private companies to publicly report cyber incidents within four business days and detail companies' policies for responding.

— Axios

US weighs action against Russian cybersecurity firm

The US Commerce Department is weighing an enforcement action under its online-security rules against Kaspersky Lab, which has long faced accusations of posing a threat to the US. The action could become a test case for the Commerce Department’s growing role in policing threats online. They said the US might deploy the same rules against Chinese-controlled technologies, possibly including TikTok.

— The Wall Street Journal

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binge reading disorder

Illustration: LeBLUE

We must slow down the race to God-like AI

The question that often comes up: how far away are we from “artificial general intelligence”? AGI can be defined in many ways but usually refers to a computer system capable of generating new scientific knowledge and performing any task that humans can. Most experts view the arrival of AGI as a historical and technological turning point, akin to the splitting of the atom or the invention of the printing press. The important question has always been how far away in the future this development might be.

— Financial Times

How to be a better leader in the new workplace

The evolution of the role of the office in the future of work is still a hot topic — and rightly so. We are seeing a gradual reimagining of where, when and how we work. Research tells us what works — and what doesn’t — in terms of engaging staff, at home and in person

— Financial Times

People are sick and tired of all their subscriptions

For two straight quarters, cancellations have outpaced new subscriptions for digital memberships, food-of-the-month clubs and a host of other purchases. Streaming services have been particularly impacted, with cancellations for Netflix, Hulu, HBO Max, and others up 49% in 2022 from the previous year.  

— The Wall Street Journal

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