from Forbes Breaking News
Financial Repression is Back, as Euro Debasement Continues
by Thorsten Polleit
Mises.org
In June 2024, the European Central Bank (ECB) began lowering its key interest rate. Borrowing costs were reduced from 4.5 per cent to 2.5 per cent in March 2025—which, after accounting for the officially measured inflation, is almost zero per cent in real terms. The time when euro deposit holders could achieve a positive real interest rate was very brief.
What is the reason for the interest rate cuts? ECB decision-makers explain to the public that inflation is declining—in February, the rise in consumer goods prices in the euro area was 2.4 per cent—and that would justify lower interest rates. However, the real reason is something else.
The euro area economy can no longer deal with elevated interest rates. Many countries suffer from weak economic growth, especially Germany, the largest economy in the euro area, is literally in a downward spiral.
This is not surprising: The interventionist-socialist policies in many European countries, particularly in Germany, are suffocating, or rather destroying, the forces of economic growth.
U.S. Dollar, China, BRICS, Gold and the Global Power Rebalance
from King World News
Here is a look at the US dollar, China, CRICS, Gold and the global power rebalance.
Death of the US dollar
April 16 (King World News) – Gregory Mannarino, writing for the Trends Journal: This is certainly no secret; nations are actively sidestepping the U.S. dollar in international trade and financial agreements with more on the way. This is something that’s part of a larger global de-dollarization trend. This movement is gaining momentum as trust in U.S. fiscal policy and geopolitical influence continues to waver.
Powell Sees ‘Challenging Scenario’ for Fed if Trump Tariffs Stoke Inflation and Slow Growth
by Jennifer Schonberger
Yahoo! Finance
Federal Reserve Chairman Jerome Powell said Wednesday the central bank will “wait for greater clarity” before considering any interest rate adjustments as he expects President Trump’s tariffs to generate “higher inflation and slower growth.”
Those twin developments, he acknowledged during a Chicago speech, could create a major dilemma for the Fed — which is obligated to keep prices stable while also maximizing employment.
“We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension,” he said.
During a question-and-answer session that followed his speech, he admitted there is a “strong likelihood” that the economy will be moving away from both of the Fed’s goals for the “balance of the year, or at least not making much progress.”
Cool CPI Report Gives Federal Reserve Green Light to Crank Up Inflation
by Mike Maharrey
GoldSeek
The Federal Reserve just got the green light to crank up the inflation machine.
The Consumer Price Index (CPI) moderated in February and turned downright cool in March. Prices fell month-on-month, driven by much lower energy costs.
That cracks the door for the Fed to plausibly cut interest rates again sooner rather than later. And that open door could come in handy for the Fed with markets in chaos and recession worries heating up.
The March CPI Data
On an annual basis, the CPI came in at 2.4 percent, according to data from the BLS. That was down from 2.8 percent in February. The forecast was for a 2.6 percent annual price gain.
‘Term Premium’ Sends a Message. Inflation Isn’t What Bond Investors Fear Most.
by Karishma Vanjani
Barron’s
The yield on U.S. government debt maturing in 10 years slipped by 0.038 percentage point to 4.322% on Tuesday, calming down after marking its biggest weekly gain since the end of the 2001 recession last week. Sales of U.S. debt are pushing down prices and raising yields; yields and bond prices are inversely related.
Last week, Wall Street mainly blamed the surge on foreign central banks selling bonds and the unwinding of a complex, highly leveraged hedge fund strategy called the basis trade. Both were difficult-to-measure variables, partly because transactions by both groups are opaque.
What Should the Federal Reserve Do in the Face of Stagflation?
Economists, including former PIMCO CEO Mohamed El-Erian, believes the central bank should prioritize tackling inflation.
by Shreyas Sinha
Observer
President Trump’s tariff announcements have simultaneously raised inflation expectations and dampened economic prospects—so much so that former New York Fed President Bill Dudley wrote that “stagflation is now America’s best-case scenario.” Stagflation, the combination of high inflation and slow growth, is among the most difficult for the Federal Reserve to manage: contractionary policy may tame inflation but slows growth further, while expansionary moves risk fueling inflation without the guarantee of boosting the economy. Every option, in effect, becomes a double-edged sword.
The central bank is meeting on May 7 to determine its next step on interest rates. Currently, markets expect rates to stay the same after the May meeting but a 60 percent chance of a 25 basis-point cut in June, according to the CME Group’s FedWatch. Such expectations reflect “how they have been trained repeatedly by the Fed to expect looser financial conditions the minute there are any signs of unusual market volatility,” the economist Mohamed El-Erian wrote in a Bloomberg op-ed last week.
U.S. Import Prices Ease, but Tariffs Casting Shadow Over Inflation
by Reuters
Kitco
WASHINGTON, April 15 (Reuters) – U.S. import prices unexpectedly fell in March, pulled down by decreasing costs for energy products, the latest indication that inflation was subsiding before President Donald Trump’s sweeping tariffs came into effect.
Import prices dipped 0.1% last month, the first decline since September, after a downwardly revised 0.2% gain in February, the Labor Department’s Bureau of Labor Statistics said on Tuesday. Economists polled by Reuters had forecast import prices, which exclude tariffs, would be unchanged following a previously reported 0.4% increase in February.
EUR/USD Outlook: Major Bullish Breakout Supported Stagflation Risk in the U.S.
The narrowing of the Germany Manufacturing PMI to U.S. ISM Services PMI spread suggests that Germany’s growth prospects have improved relative to those of the US.
by Kelvin Wong
Market Pulse
Since our last analysis, the price actions of the EUR/USD have rallied towards 1.0940 on 17 March before it staged the expected minor corrective pull-back to retest the key 200-day moving average acting as a support at 1.0730 (printed an intraday low of 1.0733 on 27 March) as highlighted.
Thereafter, the EUR/USD resumed its bullish impulsive up move sequence with a rally of 6.9% to hit a 52-week high of 1.1474 on last Friday, 11 April, on the backdrop of the uncertainty surrounding the implementation of US reciprocal and sectoral-based trade tariffs.
Is “De-Dollerization” On the Table? BRICS Summit Approaches as Trade War Simmers.
by Brandon Smith
Alt Market
For many years now I have been talking about the growing global economic divide between East and West. This volatile opposition between the BRICS nations and the US is not a product of the Trump era. It has been decades in the making with a myriad of complex working parts and numerous US trading partners have been preparing for the fallout as far back as 2008.
At the same time behind the scenes there have been malicious influences at play: Special interests within the Davos community have been working diligently to undermine the US economy and the dollar. But what is the ultimate aim of this agenda?
In 2018 I published an article titled ‘World War III Will Be An Economic War’ – In it I outlined the basic mechanics of the East vs West paradigm and how banking institutions like the IMF and BIS were positioning to take advantage of the chaos.
Technical Scoop: Possible Reversal, Golden Roars, Pummeled Dollar
by David Chapman
GoldSeek
Another wild volatile week but stock markets ended up after hitting new 52-week lows. A reversal? A technical temporary bottom is most likely in and it should be helped further with the announcement that smartphones and computers are exempt from the punishing tariffs on China. It’s an ever-changing world of tariffs. What’s on one minute is off the next.
There was so much going on that we are not putting out our usual full report this past week. We highlight the past week. A number of charts are provided, any one of which could be considered the chart of the week.
With markets tanking It sparked margin calls for big funds and the instrument of choice to dump was bonds. Bond yields rose sharply. Not what the Trump administration wants. So another reversal in the tariff wars as they announced a 90-day pause for everyone but China. Stock markets roared. But bonds stayed up as rumors came foreign central banks could be dumping U.S. bonds as well. Bond yields were down because of fear of recession.