Fed Tapering, Climate Change and Inflation, Juneteenth: Eco Day

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Welcome to Friday, Americas. Here’s the latest news and analysis from Bloomberg Economics to help you start the day:

  • After the Fed’s big headlines this week, attention has turned back to the timing of tapering, alongside confusion over why the Fed’s dot plot -- a quarterly display of its rate forecasts -- was the tool that signaled it was ready to start ending its emergency pandemic stimulus
  • The inflation scare is getting fresh momentum from the climate-change battle and the huge economic transformation underway
    • The Bank of Japan surprised investors by joining other central banks with a measure to combat climate change that shows it already has an eye on the issues facing a post-Covid world
  • Venezuelan President Nicolas Maduro has a message for Joe Biden: It’s time for a deal
  • China is hoping for the U.S. to remove punitive tariffs on its goods, with a commerce ministry researcher arguing it’s in America’s best interest to do so as worries over inflation mount
    • Even though China is putting the brakes on credit expansion in the economy, that doesn’t have to signal slower growth in the economy or demand for commodities. That’s because the traditional link between credit and growth is not as strong as it once was
    • China’s Yantian Port says it will be back to normal by the end of June, but just as it took several weeks for ship schedules and supply chains to recover from the vessel blocking the Suez Canal, it may take months for the cargo backlog in southern China to clear while the fallout ripples to ports worldwide
  • The European Union added the U.S. to its so-called “white list” meaning Americans can travel to the region without facing restrictions on arrival
  • The sudden arrival of Juneteenth as a federal holiday is causing something of a headache for government administrators and private businesses

    • While some private companies had already put arrangements in place to treat the day as a holiday, the federal mandate means more employees will likely ask for the day off in future
    • Wall Street banks and financial exchanges are also trying to figure out how to deal with the change at such short notice, with the decision on whether to make it a market holiday set to be taken after this year’s occurrence
  • Governments and companies are beginning to take note of the need to understand the economic implications of menopause
  • Three years after heralding an end to authoritarian rule and plans to open up Ethiopia’s economy to foreign businesses, Prime Minister Abiy Ahmed is alienating allies and frightening off investors

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