Will a new PM be good news for investors?
Here at Cambridge, we rarely talk about UK politics in our deliberations on markets. That’s not because we’re not interested. Rather, it is because domestic politics have less of an effect on the broader global assets that we invest in on your behalf.
US Inflation Reduction Act reduces carbon emissions
Joe Biden has had a frustrating presidency. His ambitious fiscal plans have been repeatedly thwarted, both by Republican opposition and by those within his own party. So, it was something of a surprise that the commander-in-chief’s $700 billion climate, health and tax package passed through the US House of Representatives last Friday. Having already cleared the Senate, the so- called Inflation Reduction Act landed on the White House desk for Biden’s seal of approval last week.
China’s leaders get worried
China continues to buck the trend in global monetary policy. While the world’s major central banks are aggressively raising rates to fight runaway inflation, the People’s Bank of China (PBoC) surprised us all by easing policy last week. It delivered a 0.1%pt cut to the medium-term lending rate, increasing funding to some financial institutions. It also cut the seven-day reverse repo rate by the same amount, and then injected CNY 2 billion into the financial system. Even avid watchers of PBoC policy were caught off guard; a poll of economists last week showed none predicting the move.