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Bank of Canada Holds Interest Rates Steady as Officials Grapple With Policy Dilemma
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- The Bank of Canada left its policy rate unchanged at 2.25% to balance risks from a weak economy and higher energy prices.
- The central bank expects inflation to be around 3% in coming months, at the high end of its 1% to 3% target range.
- Gov. Tiff Macklem said economic weakness and rising inflation create a dilemma, with spare capacity expected to persist.
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Bank of Japan Says Ueda Hospitalized, Will Miss Policy Meeting
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- Bank of Japan Gov. Kazuo Ueda was hospitalized for an infected liver cyst and will miss next week’s policy meeting.
- Ueda is expected to remain in hospital for about two weeks but will perform his duties remotely as needed.
- Deputy Gov. Ryozo Himino will serve as acting chairman, and Deputy Gov. Shinichi Uchida will conduct the press conference.
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Inflation Heated Up to 4.2% in May, as Energy Costs Continued to Bite
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- Consumer prices rose 4.2% in May from a year earlier, driven by higher energy costs from the Iran war.
- Core prices, excluding food and energy, rose 2.9% on the year.
- The Federal Reserve faces inflationary shocks from tariffs, energy costs, and AI investment, leading investors to expect rate hikes.
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EU’s Budget Watchdog Criticizes Energy-Spending Rule Change
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- The European Fiscal Board criticized a proposal to exempt government spending on reducing fossil fuel use from EU budget rules.
- The European Fiscal Board warned the exemption could lead to overspending, repeating mistakes from the 2022 energy shock.
- The European Commission proposed the exemption for spending on energy security, treating it like defense spending.
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China Is Propping Up the World Economy by Importing a Lot Less Oil
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- China’s crude oil imports fell by three million barrels a day in May to 7.8 million barrels a day, helping keep global oil prices below $100 a barrel during the Iran war.
- The import reduction stems from fewer gasoline car drivers, increased electric vehicle use, refiners cutting operations, and Beijing drawing down reserves.
- China’s reduced imports are causing feedstock shortages, potentially raising manufacturing costs, but commercial reserves could sustain cuts for six months.
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Jeanine Pirro’s Prosecutors Probe Big Banks for Alleged ‘Debanking’
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- The Justice Department sent subpoenas to major banks, including JPMorgan Chase and Bank of America, regarding alleged “debanking” of clients for political reasons.
- The subpoenas from the U.S. Attorney’s Office in Washington, D.C., escalate President Trump’s campaign to find evidence of discrimination against conservatives.
- The Office of the Comptroller of the Currency previously found early evidence of debanking by nine largest banks, affecting industries like oil and gas and firearms.
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Trump Regulator Proposes New Rules on What’s Allowed on Prediction Markets
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- The Commodity Futures Trading Commission proposed new rules for prediction markets, allowing most sports-related bets while seeking to avoid manipulation.
- The proposed rules would likely prohibit bets on war, terrorism, assassinations, player injuries and first-pitch gambling.
- The CFTC, under its Trump-appointed chair, has been broadly permissive to prediction platforms, despite bipartisan lawmakers proposing legislation to ban sports-related contracts.
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WSJ Pro Central Banking brings you news and analysis from a global team of reporters and editors at The Wall Street Journal and Dow Jones Newswires. Send your tips, suggestions and feedback to service@dowjones.com. An artificial-intelligence tool created these summaries, which are based on the text of the article and checked by an editor. Read more about how we use artificial intelligence in our journalism.
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