Powell’s Challenge, Biden Tax Increase, EM Rate Hikes: Eco Day

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

  • Federal Reserve Chair Jerome Powell could find himself in a tough spot this week, having to defend his ultra-easy monetary policy outlook amid a quickening economic recovery that’s ignited fears of inflation
    • Treasury Secretary Janet Yellen said U.S. inflation risks remain subdued as the Biden administration pumps $1.9 trillion in pandemic relief into the economy and a return to full employment comes into view
  • President Joe Biden is planning the first major federal tax hike since 1993 to help pay for the long-term economic program designed as a follow-up to his pandemic-relief bill, according to people familiar with the matter
  • Educated men with graduate and professional credentials are less likely to be in the labor force than ones with a B.A.
  • Alarm bells are starting to ring across emerging markets as countries brace for a new era of rising interest rates with Brazil and Nigeria among central banks seen hiking rates
  • U.S. stimulus and rising yields have sparked a readjustment across markets with an as-yet unclear impact on inflation and growth, said Banco de Mexico Governor Alejandro Diaz de Leon ahead of a key rate decision later this month
  • Lower-than-expected growth and inflation data on top of new Covid-19 restrictions are subduing interest rate hike expectations in Chile, and creating a trading opportunity among local Treasury notes
  • American rum distillers and French winemakers celebrated this month when the U.S. and European Union suspended tariffs on billions of dollars of each other’s exports. But for U.S. whiskey producers, the detente brought no relief
  • Finally, read our previews of what to watch this week

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