International News 22/04
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The latest inflation data has led to the Fed's interest rate cut signal becoming less clear.
The latest inflation data indicates that the likelihood of a Federal Reserve rate cut this year is diminishing. In a recent statement, Fed Chairman Jerome Powell indicated that the central bank will wait longer to cut interest rates. This shift in strategy deviates from the previous plan to cut rates in the first half of the year.
At the end of last year, the inflation rate declined rapidly. However, Powell does not anticipate any further progress in US inflation. He noted that policymakers may require additional time to gain confidence in inflation growth meeting the Fed's 2% goal. Powell stated that if price pressures persist, the Fed could keep rates steady for as long as necessary. He emphasised the strength of the labour market and the progress of inflation so far, suggesting the need for further restrictive policy based on evolving data and outlook. Powell's remarks mark a shift in his message, which comes after three consecutive months of inflation exceeding analysts' forecasts. This indicates that Fed officials do not see any signs of a rate cut at present.
Singapore's non-oil domestic exports in March declined by 20.7%.
Singapore's non-oil domestic export (NODX) figures for March 2024 showed a 20.7% decline compared to the same month in the previous year, according to official data released by Enterprise Singapore. The decrease was mainly driven by a decline in non-electronic products, including pharmaceuticals. On a monthly seasonally adjusted basis, NODX fell by 8.4%. These figures indicate a challenging economic environment for Singapore, as export numbers continue to decline. The decline in NODX is concerning, as it reflects a decrease in the demand for Singaporean goods in the global market. This could have a negative impact on Singapore's overall economic growth and may require the government to implement measures to boost export numbers and support industries affected by the decline.
Microsoft has announced a US$1.5 billion investment in the United Arab Emirates AI company G42.
Microsoft Corp. has announced plans to invest $1.5 billion in G42, the leading artificial intelligence company in the United Arab Emirates. This investment follows G42's agreement with the US government to end any cooperation with China. The negotiations between the US government and G42 resulted in G42 disengaging from China and switching to American technology. The investment in G42 aligns the Middle Eastern company with the US government's objective of limiting China's access to AI technology. As part of the agreement, Microsoft's President Brad Smith will join G42's board of directors, and G42 will utilise Microsoft's Azure cloud for its AI applications. Smith stated that Microsoft received strong encouragement from the US government to proceed with this partnership, emphasizing the importance of the relationship between the two countries and the need to advance G42 and Microsoft to the forefront of technology.