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Powell Calls for Faster Global Vaccination; Bullard, Kashkari Indicate Fed Support Will Continue
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Good day. The gap in Covid-19 vaccination rates between wealthy and emerging-market countries, and its economic implications, became a major focus of global policy makers this week in a round of meetings arranged by the International Monetary Fund. Fed Chairman Jerome Powell flagged the global vaccination situation as a risk to progress. Meanwhile, regional Fed leaders James Bullard and Neel Kashkari indicated central bank support for the economy should stay in place as the pandemic continues, and minutes from the Bank of Mexico's latest policy meeting showed officials haven't ruled out further rate cuts.
Now on to today’s news and analysis.
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Powell Calls for Faster Global Vaccination
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Jerome Powell welcomed last week’s Labor Department report showing robust U.S. job creation in March. PHOTO: SUSAN WALSH/PRESS POOL
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The sluggish progress of Covid-19 vaccination outside the U.S. is a key threat to the economic outlook, Fed Chairman Jerome Powell said, echoing calls to address the widening disparity between rich and poor nations.
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“Viruses are no respecters of borders, and until the world really is vaccinated we’re all going to be at risk of new mutations.”
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— Fed Chairman Jerome Powell
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Bullard, Kashkari Indicate Strong Fed Support Will Stay in Place
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The leaders of the St. Louis and Minneapolis Fed banks both said it isn't yet time for the central bank to consider paring back its support for the U.S. economy.
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Fed May Expand Access to Reverse Repo Facility, Official Says
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The New York Fed is looking at expanding access to a facility used to influence short-term interest rates and implement monetary policy in a way that could bring smaller firms into the marketplace, the bank's Lorie Logan said.
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Key Developments Around the World
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U.S. Workers Slowly Pull Away From Jobless Benefits
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Workers are gradually moving away from unemployment assistance as a U.S. economic revival picks up speed, with initial filings for benefits holding near pandemic lows and the number of people receiving help dropping. Initial jobless claims increased by a seasonally adjusted 16,000 last week to 744,000, the Labor Department said. Claims are still well above the weekly average of around 220,000 in the year before Covid-19’s arrival.
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ECB's March Account Reveals Consensus on Faster PEPP Purchases
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The European Central Bank's accounts of the March monetary policy meeting revealed a broad consensus for a step-up in the monthly pace of asset purchases under the Pandemic Emergency Purchase Program, but it also revealed some risks, say Goldman Sachs analysts. The account also points to clear upside risks related to the fiscal stimulus package of U.S. President Joe Biden, as well as related to subdued underlying inflation in the eurozone that remains well below the ECB's inflation target, they say. (Dow Jones Newswires)
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Bank of Mexico Keeps Door Open for Further Rate Cuts
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Most Bank of Mexico board members see the possibility of more rate cuts to spur the recovery if future inflation conditions allow it, minutes to the bank’s March meeting showed Thursday.
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Financial Regulation Roundup
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SEC Seeks Clearer Disclosures to Investors of SPAC Deals
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A senior regulator warned companies going public through deals with special-purpose acquisition companies against issuing enticing but misleading statements about their growth.
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Regulatory Authorities Watching House Prices Carefully, RBA Says
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The Reserve Bank of Australia said Friday that it was alert to a sharp surge in house-price growth in recent months, adding that regulators are watching the situation closely.
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Chief of SEC Whistleblower Office Leaving Agency This Month
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The Securities and Exchange Commission’s whistleblower office is changing leadership amid a record-setting year for the regulator’s cash-for-tips program. Jane Norberg, chief of the office, will leave the agency this month after nine years with the unit, the SEC said. Emily Pasquinelli, the whistleblower office’s deputy chief, will take over as the unit’s acting chief.
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GameStop and Bitcoin Renewed a Push to Digitize the Stock Market
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Experiments in blockchain-based exchanges—with nearly instant, ‘round-the-clock trading—are gaining steam, but critics warn of volatility and risk.
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8:30 a.m.: U.S. Labor Department releases March PPI
10 a.m.: Dallas Fed’s Kaplan speaks virtually at Engage Undergraduate Investment Conference
12 p.m.: Dallas Fed’s Kaplan speaks virtually at Real Estate Roundtable event
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U.S. cities that emerged as beacons to job seekers and businesses during the pandemic were located far from the coasts.
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China's factory-gate prices jumped in March to the highest level in over two years, fueled by rising global commodity prices. The producer price index rose 4.4% in March from a year earlier, accelerating from a 1.7% rise in February and higher than a 3.6% increase expected by economists. (Dow Jones Newswires)
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Mexico's consumer-price index rose 0.83% last month, with the 12-month inflation rate up to 4.67% from 3.76% at the end of February, the National Statistics Institute said Thursday. It was the highest annual rate since December 2018. (DJN)
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Mexico produced 304,000 cars and light trucks in March, 13% more than in March of 2020 when output fell with the closure of assembly plants in the last week of the month to control the spread of the coronavirus. Exports in March of this year were down 13% from the year-earlier month, while domestic new-car sales rose 9.1%. (DJN)
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This newsletter is compiled by James Christie in San Francisco and Ed Ballard in London.
Send us your tips, suggestions and feedback. Write to:
Jon Hilsenrath, Michael Derby, Nell Henderson, Nick Timiraos, Jason Douglas, Paul Hannon, Harriet Torry, Kate Davidson, David Harrison, Kim Mackrael, Tom Fairless, Megumi Fujikawa, Michael Maloney, Paul Kiernan, James Glynn
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