USA OUTLOOK OCTOBER 30 TO November 03, 2023

USA OUTLOOK WEEKLY NEWSLETTER OCTOBER 30 TO NOVEMBER 03

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OCTOBER 30, 2023

OCTOBER 31, 2023

Toyota pledges $8 billion more for US battery plant to rev up EV push

Toyota Motor (7203.T) said on Tuesday it would boost investment by $8 billion and add about 3,000 jobs at its electric-vehicle battery manufacturing plant in North Carolina, accelerating the Japanese automaker's push to electrify its lineup.

Photo: Reuters

Biden announces $1.3 billion to build new power lines, upgrade aging electric grid.

President Joe Biden announced Monday a $1.3 billion federal investment to build three new interstate power lines in an effort to upgrade the United States’ outdated electric grid and transition it to clean energy.

The company, which plans to have electrified options for all its models available by 2025, said the latest move will bring its total investment in the plant to about $13.9 billion and jobs to more than 5,000.

Legacy automakers such as Ford Motor (F.N) and General Motors (GM.N) have been racing to rampup their EV output and close the gap with market leader Tesla (TSLA.O), although both Detroitbased companies have scaled back their investment plans after reaching expensive new contract agreements with the United Auto Workers union.

The electric transmission lines will cross through six states: Arizona, Nevada, New Hampshire, New Mexico, Utah and Vermont.

The Southline Project will bring wind power generated in New Mexico to Arizona cities. The Twin States Clean Energy Link Project will connect Canada’s clean energy to New England and vice versa. The Cross-Tie project will deliver renewable energy from the West to the Midwest.

Together, the three transmission lines will aim to supply 3.5 additional gigawatts of energy to the U.S. grid, which equates to powering 3 million homes, according to the Department of Energy.

The investment is a part of the Biden administration’s larger effort to transition the U.S. to Source: a carbon-free power sector by 2035.

https://www.cnbc.com/2023/10/30/biden-investment-power-lines-aging-electricgrid.html

Photo: Acquire Licensing Rights Source: https://www.reuters.com/business/autos-transportation/toyota-invest-8-blnnorth-carolina-battery-plant-2023-10-31/

NOVEMBER 01, 2023

NOVEMBER 02, 2023

Wall Street indexes rally on bets of peak US interest rates, strong earnings

Wall Street's three main stock indexes rallied nearly 2% on Thursday on hopes that the U.S. Federal Reserve has reached the end of its interest rate hiking campaign and a batch of upbeat quarterly financial updates added to the bullish mood.

Photo: Reuters.

Fed keeps rates unchanged, Powell hedges on possible end of tightening campaign The Federal Reserve held interest rates steady on Wednesday as policymakers struggled to determine whether financial conditions may be tight enough already to control inflation, or whether an economy that continues to outperform expectations may need still more restraint.

Fed Chair Jerome Powell said the situation remained something of a riddle, with U.S. central bank officials willing to raise rates again if progress on inflation stalls, wary that a rise in market-based interest rates may begin to weigh on the economy in a significant way, and trying not to disrupt, any more than necessary, an ongoing dynamic of steady job and wage growth.

The Fed held interest rates steady on Wednesday as expected, and while Chair Jerome Powell left the door open to further tightening he also acknowledged the impact of a recent surge in bond yields on the economy.

The comments, viewed as hints that the central bank is done with its rate hikes, sent longer-dated U.S. Treasury yields tumbling, which supported stocks.

"Powell's comments in the presser yesterday were what everyone wanted to hear," said Justin Burgin, vice president of equity research at Ameriprise Financial in Troy, Michigan.

Burgin also pointed to better-than-expectated earnings reports. While the current-quarter guidance has been weaker than previously expected, Burgin said analysts are still forecasting growth.

In a press conference after the end of a two-day policy meeting, Powell said the better course of action for now, given the uncertainties, was to maintain the Fed's benchmark overnight interest rate in the current 5.25%-5.50% range, and see how job and price data evolve between now and the next policy meeting in December.

Source: https://www.investing.com/news/economy/fed-poised-to-hold-rates-steadydespite-economys-bullish-tone-3216637

Roughly 20 months into the Fed's aggressive tightening of monetary policy, Powell said it remained unclear whether overall financial

Photo: Acquire Licensing Rights Source: https://www.reuters.com/markets/us/futures-climb-bets-end-feds-rate-hikes2023-11-02/

NOVEMBER 03, 2023

Photo: Getty

The Fed announces 4th consecutive ‘jumbo’ interest rate hike of 75 basis points—here are 4 things that will be more expensive Struggling to dampen inflation, the Federal Reserve announced a widely expected fourth consecutive “jumbo” 0.75 percentage point rate hike on Wednesday.

While raising interest rates can slow inflation by making borrowing more expensive, and therefore less appealing, the move further increases debt costs for Americans already struggling with rising prices on pretty much everything, including necessities like food and rent.

The year-over-year inflation rate has remained stubbornly high, only slowing from a June peak of 9.1% to 8.2% as of September, according to Consumer Price Index data. That’s well above the central bank’s preferred inflation rate of 2%.

Fed Chair Jerome Powell has reaffirmed his commitment to lowering inflation with continued rate hikes in recent months. However, in August, he acknowledged that increasing the cost of borrowing will bring “some pain to households and businesses.”

Souce: https://www.cnbc.com/2022/11/02/fed-raises-borrowing-costs-with-another-jumbointerest-rate-hike.html