Money
Afghan banks are running out of currency as cash squeeze tightens
Banks in Afghanistan are running out of money following the Taliban’s recent rule to government
Banking firms are now pleading with the Taliban to release more funds otherwise they’ll be forced to close their doors.
The Afghan cash squeeze threatens to upend the country’s already battered economy which has been largely dependent on hundreds of millions of dollars shipped by the United States to the central bank in Kabul which then makes its way to the Afghani people through banks.
The Taliban has been in charge of the nation for a month and many fear the cash squeeze will lead to inflation.
Bankers fear fewer dollars could inflate the cost of food or electricity and make it harder to afford imports, spelling further misery for Afghans.
Although the cash crunch has lasted weeks, the country’s banks have in recent days repeatedly underlined their concerns to the new government and central bank according to reports.
Since the fall of the Afghanistan government, banks have already pared back services and imposed weekly $200 payout limits amid a run on savings.
Reports claim that there has been constant long queues outside branches as people try to get hold of dollars.
The hobbling of the central bank, whose foreign reserves were frozen after the Taliban took charge, could also hamper efforts of the international community to support Afghans
Commercial banks have appealed to the central bank in recent days to free up the supply of U.S. currency, however they are pending to receive an answer to those requests.
Money
Fed cuts rates, signals more potentially ahead
Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings
Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings
– The Federal Reserve cut interest rates by a quarter-point to address job market concerns.
– Officials expect at least two additional rate cuts by year-end amid ongoing economic uncertainties.
Fed Chair Jerome Powell noted a significant shift in the labour market, highlighting “downside risk” in his statements.
The recent rate cut, supported by 11 of 12 Fed voters, aims to recalibrate an economy facing uncertainties from policy changes and market pressures.
Policy Dynamics
The decision comes amid intense political scrutiny, with President Trump openly criticising Powell’s reluctance to lower rates.
Despite the controversy, Powell asserts that political pressures do not influence Fed operations.
The current benchmark federal-funds rate now sits between 4% and 4.25%, the lowest since 2021, providing some reprieve to consumers and small businesses. Economic forecasts indicate ongoing complexities, including inflation trends and the impact of tariffs on labour dynamics, complicating future policy decisions.
Money
Fed faces unusual dissent amid leadership uncertainty
Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up
Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up
– This week’s Federal Reserve meeting faces unusual dissent as Chair Powell approaches his term’s end.
– Analysts predict dissent over expected rate cuts due to political pressures from Trump-appointed officials.
The situation is further complicated by the recent swearing-in of Trump adviser Stephen Miran to the Fed’s board, following a Senate confirmation.
Analysts believe Powell may encounter dissent on an expected quarter-percentage-point rate cut from both Trump-appointed officials and regional Fed presidents concerned about inflation.
Potential Dissent
Trump has urged significant rate cuts and for the board to challenge Powell’s decisions.
Some analysts predict dissenting votes from Miran and other Trump appointees in favour of larger cuts. Federal Reserve veterans express concerns that political motivations may undermine the institution’s integrity, with indications that greater dissent could become commonplace.
Money
RBA plans to ban credit card surcharges in Australia
Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards
Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards.
– The RBA plans to ban surcharges on debit and credit card transactions, supported by consumer group Choice.
– Major banks oppose the ban, warning it could lead to higher card fees and reduced rewards for credit card users.
The Reserve Bank of Australia (RBA) intends to implement a ban on surcharges associated with debit and credit card transactions. Consumer advocacy group Choice endorses this initiative, arguing that it is unjust for users of low-cost debit cards to incur similar fees as credit card holders.
The major banks, however, are opposing this reform. They caution that the removal of surcharges could prompt customers to abandon credit cards due to diminished rewards.
A final decision by the RBA is anticipated by December 2025.
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