1960s Inflation Specter, Chip Woes, Fed Minutes: Eco Day

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

• The specter of 1960s inflation is haunting the U.S. economy today
  • The latest Fed meeting, scheduled to be released later today, cover a discussion which happened before the recent surprising economic data, but they will be read closely for any signs of rising inflation concerns
• Former U.S. Treasury Secretary Lawrence Summers said central banks are yielding to political pressure to emphasize climate change risk, when the main threat to financial stability comes from future pandemics
• The Senate will include $52 billion to bolster domestic semiconductor manufacturing in a broader bill to enhance U.S. competitiveness with China
  • Shortages in the semiconductor industry, which have already slammed automakers and consumer electronics companies, are getting worse
• Chile’s lower house of congress rejected a proposal for a wealth tax and higher corporate levies that had been criticized by investors
• Mexico’s deputy central bank governor Irene Espinosa said the country’s monetary easing cycle is over
• Canada’s housing prices are soaring as space to build them around the major cities is running out
• The euro-area faces elevated risks to financial stability as it emerges from the pandemic with high debt burdens and “remarkable exuberance” in markets as bond yields rose, the European Central Bank said

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