Good day. Inflation next year could be much less than the 5.4%
rate at which the consumer-price index has risen over the past 12
months, says Mark Hulbert, a contributor to sister publication
Barron's. It's a rosy projection that comes from inflation models
with the best historical track records, according to a new study,
he writes. Meanwhile, The Wall Street Journal's Michael S. Derby
writes that two Federal Reserve governors have indicated the Fed
could move forward its timing for an interest-rate increase if
inflation doesn't start moderating relatively soon. That aggressive
talk on rates contrasts with the views of most other central bank
officials, including Chairman Jerome Powell.
Now on to today's news and analysis.
Why Inflation Will Probably Be Lower Than Many Fear
Focusing on the models with the best track records would seem to
be an obvious approach to the debate over whether inflation's
recent surge is transitory. But surprisingly few commentators have
done so. Many appear to have instead based their projections on
little more than intuitions and hunches, picking and choosing among
the myriad pieces of available economic data and anecdotal evidence
to find what supports their prior beliefs. Read more at
Derby's Take: As FOMC Meeting Nears, Two Fed Governors Issue
By Michael S. Derby
Federal Reserve governors are leading the way when it comes to
hawkish talk at the central bank about what may be needed to bring
high levels of inflation back under control. Read more.
U.S. Consumer Confidence Rose as Delta Covid-19 Wave Eased
The Conference Board's consumer confidence index increased to
113.8 in October from a revised 109.8 in September as Americans'
concerns over Covid-19 eased, according to the group's senior
director of economic indicators.
Home-Price Growth Holds at Record in August
The S&P CoreLogic Case-Shiller National Home Price Index,
which measures average home prices in major metropolitan areas
across the U.S., rose 19.8% in the year ended in August, unchanged
from the prior month.
Corporate Minimum Tax Resurfaces as Democrats Hunt for Money
Senate Democrats detailed a 15% minimum tax on large companies'
income, refreshing an earlier revenue proposal as they try to
generate enough money to pay for President Biden's social-spending
and climate-change agenda.
Billionaire Tax Faces Likely Constitutional Challenge
Democrats' plan to tax billionaires' unsold assets each year as
they gain in value faces a potentially significant obstacle: a
legal challenge, given the clear incentive for a taxpayer to spend
millions in legal fees to save billions on taxes.
How the Billionaires Income Tax Would Work
Key Developments Around the World
U.N. Finds Nations' Climate Plans Fall Short of Paris Accord
The world's emissions reductions plans would allow far more
global warming than targeted in the Paris climate accord, and some
of the biggest emitters, including the U.S., aren't on track to hit
their pollution targets, according to a UN report.
China's Energy Crisis Complicates Its Plans for Climate
Announcements Ahead of COP26
Australia Commits to Net-Zero Emissions by 2050, Shedding
Climate Outlier Status
Financial Regulation Roundup
U.S. Takes Bitcoin Mining Crown After China Crackdown
After a government crackdown in China, many miners are betting
on reliable access to energy and a more predictable regulatory
environment in the U.S. More than a third of the global computing
power dedicated to mining bitcoin is now drawn from machines in the
U.S., up from less than a fifth last spring, according to data from
the University of Cambridge.
Former Ghosn Aide's Trial Finishes With a Declaration of
The defense for former Nissan Motor executive Greg Kelly made
its final argument for their client's innocence, arguing that
prosecutors failed to prove key parts of the case involving former
chief Carlos Ghosn's compensation.
Swedish FSA Drops Swedbank Market Abuse Probe
Swedbank AB said that the Swedish Financial Supervisory
Authority has dropped its investigation into breaches of European
Union market abuse regulations at the bank.
Wednesday (all times ET)
Time N/A: Central Bank of Brazil releases policy statement
8:30 a.m.: U.S. Commerce Department releases September advance
economic indicators report; U.S. Commerce Department releases
September durable-goods data
10 a.m.: Bank of Canada releases interest-rate announcement and
monetary policy report
11 a.m.: Bank of Canada's Macklem holds press conference
Time N/A: Bank of Japan releases policy statement and quarterly
outlook report; Central Bank of Egypt releases policy statement
7:45 a.m.: European Central Bank releases policy statement
8:30 a.m.: European Central Bank's Lagarde holds press
conference; U.S. Commerce Department releases first estimate of
The Lowdown on the Third-Quarter Slowdown
The biggest question coming out of Thursday's U.S. GDP report
will be what comes next, because the supply-chain problems
affecting car makers and other industries continue to hold
businesses back, Justin Lahart writes.
Factory activity in the central Atlantic region of the U.S.
expanded in October, signaling business conditions improved,
according to the Federal Reserve Bank of Richmond. Its Fifth
District Survey of Manufacturing Activity's composite index rose to
12 from minus three in September. Economists polled by The Wall
Street Journal expected the indicator to come in at 5. (Dow Jones
Brazil's 12-month inflation rate rose in the 12 months through
mid-October after transportation and power prices continued to
increase, lifting consumer prices 1.20% from Sept. 16, the fastest
pace for any month in more than five years, and by 10.34% from a
year earlier, Brazil's Institute of Geography and Statistics said.
U.S. public-pension funding surged this year thanks to buoyant
financial markets, taking the aggregate funded ratio of the 100
largest U.S. public pension plans to 85% as of June 30, according
to actuarial company Milliman, marking what it said is a "stunning
improvement" from 70% in 2020. (MarketWatch)
Chinese industrial companies' profits rebounded in September,
ending a six-month slide in growth. Industrial profits climbed
16.3% in September from a year earlier, compared with a 10.1% rise
in August. In the first nine months of the year, profits grew 44.7%
from a year earlier, slowing from a 49.5% increase in
January-August period, as power shortages, rising commodity costs
and Covid-19 outbreaks weighed. (DJN)
Consumer sentiment in Germany is expected to strengthen in
November, due to increasing propensity to consume and declining
propensity to save, according to data from market-research group
GfK. Its forward-looking consumer sentiment index forecasts
confidence among households rising to 0.9 point in November from a
revised figure of 0.4 point in October. (DJN)
(END) Dow Jones Newswires
October 27, 2021 08:46 ET (12:46 GMT)
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