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What is the greatest legacy of ROI-Powell? McGeever: Becoming Fed's Defender-in Chief
Jerome Powell is about to preside over what will almost certainly be his final Federal Reserve policy meeting. The debate rages on the merits and place of this eight-year tenure in the pantheon of the 113 year-old institution. A few notable stumblings aside, his economic standing is solid. He is a strong defender of Fed independence. He wasn't the only one who thought that rising inflation in 2022 was "transitory". Many policymakers from around the world shared his view. The Fed's inflation target of 2% is still above and rising. Critics also point out that the Fed balance sheet has doubled to a record-breaking $9 trillion under his leadership, as the central banks fired their policy bazookas in order to support the economic recovery after the pandemic. Some critics claim that the Fed was too aggressive with its quantitative easing, and too slow in reversing it. However, the effects are difficult to quantify. Powell has vehemently denied the charge that the Fed's interest rate cuts were political in nature. Powell is a highly regarded Fed official, and his decisions were made in the midst of a global pandemic as well as a technological revolution, trade wars, and actual wars. His legacy as a champion of Fed independence is even more impressive. STANDING UP AGAINST PRESSURE This legacy is partially due to circumstances. The number and intensity of President Donald Trump's personal attacks on Powell and the leadership of the Fed are unprecedented. Powell has been criticized in hundreds of public and social media comments for failing to lower interest rates fast enough. Trump threatened to fire Powell repeatedly. There was also an indictment that has since been rescinded relating to Powell's testimony regarding renovations at the Fed Headquarters, the Eccles Building, in Washington. Last time a Fed chair was under such intense pressure, it was over 50 years ago when President Richard Nixon heavily relied on Arthur Burns to maintain a loose monetary policy. Powell isn't the only one who refuses to submit to presidential authority. William McChesney Martin Jr. defied Lyndon Johnson to not raise interest rates. But McChesney Martin didn't have to deal with a daily barrage of public criticism or threats of criminal charges. Powell has mostly refused to respond Trump's barbs. But on two occasions, both in front of the camera, he responded in ways that are sure to be long remembered. VIRAL VIDEOS It was almost comical. Both men wore white hard hats and stood next to each other in front of the media at the Fed headquarters. Powell, in apparent disbelief at Trump's criticism of the renovation cost, told him that his figures were incorrect. The scene was both awkward and unintentionally humorous. The tone of the second event was far more serious. The Fed released an extraordinary video message on January 11 in which Powell responded to the Department of Justice's threat of indictment. He said he thought it was because the Fed refused to "bow down" to Trump's demand for lower interest rates. Powell, in a somber tone, said: "It's about whether or not the Fed can continue to set rates based on economic and evidence-based conditions or if monetary policy is instead dictated by political pressures or intimidation." Trump has publicly criticized many prominent figures from business and politics. Few people have responded, particularly in the business and public policy world. Why did Powell refuse? Powell may have resisted because he is an institutionalist, and believes in the independence of the central bank. He's also a Republican who has been around for a while but respects the Washington bipartisan machine. He also seems to have the support of the public. Gallup's December poll showed Powell to be the most popular U.S. politician among 13 policymakers and legislators in the survey. Powell received a 44% rating of approval. Powell also scored highest among Independents. DEFENDER-IN-CHIEF Some things are inarguable when discussing Powell's legacy. As Powell's presumed replacement Kevin Warsh acknowledged last week, America is now?close to full employment. Powell can't claim all the glory. It is fair to say that the Fed, under his leadership, helped secure this outcome, which most policymakers, on a macro-level, would welcome. In July 2023 with interest rates at 5% I wrote a piece suggesting that if the U.S. had a "soft landing" - with no recession and?inflation close to target - in 2024, but only a mild decline with historically low unemployment, "Powell could lay claim to being the most effective Fed chief in the history." This scenario was largely realized, and he became the Fed's top defender. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. Follow ROI on LinkedIn and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets seven days a weeks.
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Silver, zinc sales help boost Grupo Mexico profit 57% in first quarter
The mining and transportation conglomerate, Grupo Mexico, reported on Tuesday a 57% increase in profits in the first three months of the year compared to the same period last year. This was largely due to an increase in sales of silver and zinc. The group's net profit was $1.71 billion. The group's revenues grew 33%, to $5.57 Billion. This was above the $5.53 Billion estimate by LSEG analysts. The core earnings (earnings before interest, taxes, depreciation, and amortization) for the quarter ending March increased by nearly 50%, to $3.31 billion. Grupo Mexico is controlled by Mexican billionaire German Larrea and ranks as one of the world's biggest copper producers in terms of volume. Copper production in the first quarter was 258,138 tons, down by 2.8% from a year ago. This is mainly due to lower output in Peruvian mines. However, this was partly offset by increased production in mining units in Mexico, and the United States. In the first quarter 2026, silver and zinc production increased by 11,1% and 2,0%, respectively. The company has also maintained its target of achieving production of 1,03 million tonnes by 2026. The company said it was still reviewing its plans to?double mine production? and vertically integrate U.S. Asarco's mining unit with a smelter? and refinery? Grupo Mexico's?Southern Copper is developing Tia Maria, which is one of the largest mines in Peru and the third-largest copper producer in the world. The stalled project will begin operating in the third quarter 2027 according to a statement from the?conglomerate. The project has been completed to a 32.5% level. Local opposition to the mine, Peru's largest and most controversial development, is based on water usage and environmental concerns.
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Brown-Forman, the owner of Jack Daniel's and Pernod Ricard, has ended merger talks with Pernod Ricard.
Pernod Ricard & Brown-Forman announced that they had ended their merger talks after failing to reach mutually satisfactory terms. Last month, the companies announced that they had been in talks about a possible merger. This would have combined the second largest spirits producer in the world with the largest American whiskey producer. Sazerac American spirits group, which has brands such as Corazon Tequila and Svedka Vodka, emerged this month as a potential new bidder for Brown-Forman. Pernod Ricard said Tuesday that it remains confident and focused on its operating model and strategy, backed by a strong team of committed employees across the Group. Brown-Forman's shares fell about 5% during extended trading. The company said that it intends to focus its efforts on "strategic priorities" and "operational priorities", including "unlocking the future growth of our geographic footprint." DECISION WAS MUTUAL Pernod's spokesperson said that the decision was made "mutually" and in the best interest of the shareholders. The spokesperson explained that the decision was a "combination" of factors relating to economics and debt structure, not a single issue. Sources said that the family who controls Jack Daniel's preferred a sale to the French distiller rather than the competing proposal from Sazerac. Sources told us last week that the proposed terms of the Pernod merger, which would have included both cash and stock, allowed the Brown family to maintain a significant stake in the combined company and to have some influence. The Brown family has controlled Jack Daniel's since 1870. Sources familiar with the situation said that Sazerac, which is controlled by the Goldring family?, offered Brown-Forman $15 billion or $32 per stock. Industry advisors said Sazerac’s?approach? would require a cash?offer? and greater leverage, forcing the Brown family's control to be relinquished. Reporting by Aishwarya Venugopal, Abigail Summerville, and Emma Rumney, in London, and editing by Sriraj Kalluvila and David Gregorio.
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FirstEnergy's profit increases on the back of higher rates and data-center demand
Utility FirstEnergy announced a 12.5% increase in its?first quarter profit on Tuesday. This was boosted by higher electricity rates and a growing demand from data centers that are power-hungry. The U.S. energy demand reached a'record' level in 2025. It is expected to continue increasing as technology companies ramp up their power consumption at rapidly-growing data centres. Some sites are using as much electricity as an entire city. As fossil fuels are shifted away from heating and transportation, households and businesses also use more electricity. Utilities want to raise electricity rates for customers in 2026, to help pay for infrastructure upgrades. Power grids are being strained due to extreme weather conditions and the growing demand from data centers and electrification. FirstEnergy has reaffirmed their 2026 core earnings guidance range of $2.62-$2.82 per share. This is supported by a $6 billion capital plan for 2026 that focuses on grid modernization, transmission reliability, and distribution upgrades. FirstEnergy's $36 billion capital plan for 2026- 2030 is up 30% from its previous plan. It will generate a 10% annual compounded rate of growth. The company reported quarterly revenue of $4.2 Billion, up from $3.7 Billion a year ago. The company posted a profit for the quarter ended March 31 of $405,000,000, or 70 cents per share. This compares to $360,000,000, or 62cents per share a year earlier. Reporting by Varun shay in Bengaluru, Editing by Tasim zahid
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Edison International reports steady profit growth despite rising electricity rates
Edison International beat the expectations for its first-quarter profits?on Tuesday as it benefited from higher electricity rates. U.S. Power Companies?are seeking a higher 'customer electricity rate,?driven by?surge in demand from AI-focused Data Centers, increased domestic production and extreme weather events such as wildfires. Southern California Edison, an Edison International subsidiary, reported a core profit of $1.65 per share in the first quarter, as it was able to benefit from?its final 2025 rate case decision. Rate cases are used by regulated utilities such as Southern California Edison to determine the charges customers pay for services like electricity, natural gases,?private water, and steam. According to the EIA report, U.S. electricity consumption is expected to continue to rise through 2027. This will be largely due to AI and crypto data centres, as well as an increase in electrification of homes, businesses and transportation. According to LSEG, Rosemead's utility reported adjusted earnings of 1.42 per share for the quarter ending March 31. This compares with analysts' estimates of $1.31 per shares. Edison was able to dismiss a shareholder suit that accused the company of misleading investors by overstating their ability to reduce wildfire risk in advance of the January 2025 Los Angeles-area fires. The utility company confirmed its adjusted profit guidance for 2026 of $5.90 to $6.20 per share. (Reporting and editing by Tasim Zaid; Anushka Chourasia)
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The central bank of Chile has maintained its benchmark rate as Middle East war risks increase
The central bank of Chile?maintained its benchmark interest rate on Tuesday at 4.5%?in an unanimous decision. This was in line with expectations, and it marked its third consecutive decision to maintain the rate. Chile's Central Bank said in a statement that the prolonged war in the Middle East is affecting forecasts of global inflation, economic activity and the risk that oil prices remain high. The decision of Tuesday follows two consecutive halts? in January and March. The bank noted that although oil prices futures still point down, the "prolongation" of the conflict increased the risk that prices would remain high. Prices have also settled higher than those predicted in the last month's report on monetary policy. The report also noted that the macroeconomic outlook is still subject to greater uncertainty than usual. The central bank pointed out that copper prices were also on the rise. Chile is the top producer in the world of red metal. Its uses are widespread and considered a bellwether for the economy. In March, Chile's inflation rate was 2.8% higher than a year ago, driven by higher transportation?costs, and a sharp increase in fuel prices implemented?by President Jose Antonio Kast's new government. Kast was hit by the measure that aimed to align domestic prices with soaring international rates early in his term and it sparked protests with police. After the fuel price hike, the 'central bank' raised its inflation forecast for 2026 to 3.6%, up from 2.9% previously, and cut its economic growth projection to 1.5% to 2.50%, down from an earlier range of 2%-3%.
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Kone nears $34 billion deal for rival TK Elevator, Bloomberg News reports
Bloomberg News cited people with knowledge of the situation as saying that Kone is close to a cash and stock deal for the purchase of TK Elevator. This would value the company at approximately 29?billion euro ($33.97billion), including 'debt. Reports indicate that the Finnish company has been putting the finishing touches on a contract with TK Elevator owners Advent and Cinven. An announcement is expected to be made as soon as Wednesday. The merger would make Schindler the second largest lift manufacturer in the world, surpassing OTIS. This would be one of the biggest deals in Europe this year, and also the largest takeover ever done by a Finnish company. We could not verify the information immediately. Kone TK Elevator and Kone did not respond immediately to comments. Advent and Cinven declined to comment. Last month, the head of Swiss lift manufacturer Schindler announced that it would contest any merger between Kone Elevator and TK Elevator in front of antitrust authorities. TK Elevator stated last month that it had not yet made a decision on its future direction, and an initial public offering (IPO), remained one of the options. Thyssenkrupp sold its elevator technology division, later renamed TK Elevator, for 17.2 billion euro in?2020 to a consortium of bidders, led by the private equity firms Advent, Cinven, and Germany's RAG Foundation. Kone made a 17 billion euro non-binding bid for TK Elevator in 2006, but later retracted the offer due to antitrust concerns.
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Israeli attacks kill five people in south Lebanon including three rescuers
Five people were killed in two successive Israeli attacks on a building in southern Lebanon on Tuesday. Among them, three rescuers, who had gone to aid those injured in the initial attack. The Lebanese Civil Defense (a state-run rescue agency) spokesperson said that the three rescuers had been initially trapped beneath rubble after the second Israeli attack on the town Majdal Zoun, and later confirmed to be dead. Lebanese Army earlier said that two other?troops?were also injured in the second Israeli attack. The Israeli military didn't immediately respond to an inquiry for comment. LEBANESE PRIME MINISTER SAYS THE STRIKES ARE 'WAR CRIMES' Lebanese PM Nawaf Salm has condemned the strikes, calling them "a new and blatant crime committed by Israel." UN Human Rights office stated last month that Israeli strikes on civilians, including healthcare workers in Lebanon, may be considered war crimes. Since March 2, when the Iran-backed militant Hezbollah attacked Israeli positions, more than 2,500 people have been killed by Israeli?strikes in Lebanon. More than 100 medical personnel, 270 women, and 170 children are among the dead. Israel and Lebanon reached a ceasefire through U.S. mediation, which has resulted in a reduction of hostilities. However, Israel and Hezbollah continue to fight each other, accusing one another of violating this ceasefire. Israeli troops occupy a strip of southern Lebanon, and have warned residents not to return home. However, the Israeli 'air force' has continued to strike outside this strip, including in the town that was hit on Tuesday. Israeli strikes in southern Lebanon killed a 'Lebanese Journalist last week. Lebanese officials and press advocates said that 'continuing Israeli attacks prevented rescuers accessing the site, where the journalist was trapped under rubble. Hezbollah has continued its drone and rocket attacks on Israeli troops in Lebanon, as well as northern Israel. The Israeli military announced earlier on Tuesday that it had discovered and demolished Hezbollah tunnels in the southern Lebanon. Reporting by Maya Gebeily and Menna Alaya El-Din; Editing and production by Mark Porter and Daniel Wallis
Oil price drop ahead of ceasefire is a big bet for traders worth $950 million
Investors bet $950 million on oil falling in the hours leading up to the U.S.-Iran ceasefire announcement. This is the latest big wager made on the direction the world's largest traded commodity before President Donald Trump makes a major policy statement.
According to LSEG, investors sold a total of 8,600 lots on Tuesday at 1945 GMT. Around 2230 GMT, Trump announced a two-week Iranian ceasefire after stepping back from his threat to destroy "a whole civilisation". This caused crude futures to drop by 15% at the start Wednesday's official trading session.
It is not uncommon for traders to take large positions on the oil price, both rising and falling. This allows them to hedge large quantities of oil trade.
These deals are rarely made in large lots. Instead, traders use "sweeping orders" to cover multiple exchanges. They also ask brokers to run algorithmic trading for several hours to execute their order. After settlement, which occurs Monday through Friday at 1830 GMT, large orders are rarely executed. Investors made a similar bet on March 23 when they sold $500 million worth of oil futures 15 minutes before Trump announced that he was delaying attacks on Iran's energy infrastructure. This move stunned the markets and caused a 15% decline in crude prices. At 1945 GMT on Tuesday, 6,200 Brent futures were traded, which is roughly 1% of the volume of trading for the regular session. Around 2,400 WTI futures were also traded at this time.
CME Group, the exchange operator, declined to comment. ICE and Commodity Futures & Trading Commission, which oversees U.S. derivatives markets for commodities, didn't immediately respond to a?"request for comments".
Since the beginning of the war, trading volumes and volatility are at an all-time high. In the three years prior to the war, on average, 300,000 Brent crude futures were traded daily.
This amount has doubled over the past four weeks, as daily volumes are at record highs exceeding 1 million lots. That's equivalent to one billion barrels. (Reporting from Amanda Cooper, Alex Lawler, and Ahmad Ghaddar, in London; editing by ElisaMartinuzzi, Dmitry Zhdannikov, and Elaine Hardcastle.)
(source: Reuters)