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Chapter 1: What is the main topic discussed in this episode?
News when you want it with Bloomberg News Now. I'm James Woolcock.
And I'm Caroline Hepker.
The U.S. has carried out further airstrikes on Iranian targets as hopes for an imminent deal continue to fade. As with its attacks earlier this week, a U.S.
Chapter 2: What recent actions has the US taken against Iranian targets?
official described the latest bombings as defensive. The U.S. says it shot down four one-way Iranian drones that were fired at a commercial ship and also struck another drone-launching unit near the Strait of Hormuz. The latest flare-up in hostilities came just hours after President Trump said that no single nation would control the vital waterway as part of any deal with Tehran.
Nobody's going to control it. We're going to watch over it. We'll watch over it. But nobody's going to control it. That's part of the negotiation that we have. They would like to control it. Nobody's going to control it. It's international waters and Oman will behave just like everybody else. So we'll have to blow them up. They understand that. They'll be fine.
President Trump speaking there as the U.S. Treasury says it has taken action against Iran's Persian Gulf Strait Authority, accusing it of launching a new attempt to monetize transit through the strait.
Elevated energy prices and inflation risks are complicating the outlook for central banks. As traders turn their focus to Thursday's US economic data, the Federal Reserve's favoured inflation gauge, the PCE price index, is expected to have increased to 3.8% in April. Now, that's well above the Fed's 2% target. Fed Governor Lisa Cook says that inflation is headed in the wrong direction.
After five years of above-target inflation, I am particularly attuned to the risk that elevated inflation will become embedded in price and wage setting behavior. As such, I am prepared to raise rates if the expected disinflation does not appear in a timely manner.
Likewise, I will continue to monitor labor market developments as well and would be prepared to adjust my policy stance downward should the labor market deteriorate.
Lisa Cook speaking there. As the Fed Vice Chair Philip Jefferson says that he expects inflation to cool later this year, though he warned that risks remain lifted to the upside. Meanwhile, Chicago Fed President Austin Gulby says that strong productivity spending could fuel inflation and require high interest rates.
Here in Europe, the outgoing vice president of the ECB says the central bank should consider the impact of the Iran war on the economy when setting rates next month. Luis de Guindos told Bloomberg that while inflation in the Eurozone responded quickly to surging energy costs, the effect on economic growth is less clear.
We have to take into consideration the impact on growth. I think that the data that we have received so far, inflation immediately reflects the evolution of energy prices. But I think that for growth, it's going to take a little bit longer. But if you look at soft indicators, sentiment indicators, I think that these indicators clearly point at an important impact on growth.
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Chapter 3: How is US inflation impacting economic forecasts?
In terms of those that reported earnings yesterday, This morning, you had the likes of John Samathi and SSE out today in the UK. Stock futures for the US are in the red. Yields rising across Europe and the US. Benchmark Germany is at 3%, so up two basis points as oil prices have spiked 2.5%, half of Brent crude futures.
Gold is down 1.5% and the Bloomberg Dollar Spot Index is stronger, a tenth of 1%.
That's news when you want it. With Bloomberg News Now, I'm James Walcock.
I'm Caroline Hepka and this is Bloomberg.