Federal Reserve official Hammack offered a nuanced view on the U.S. economy, describing it as "really healthy" despite persistent inflationary pressures. Concurrently, Germany is reportedly moving to remove the Chinese AI application DeepSeek from app stores due to alleged EU data law violations, while the cryptocurrency market is seeing accelerated institutional adoption of Ethereum.
Fed's Hammack on Inflation, Rates, and Economic Health
In recent remarks, Fed's Hammack indicated that while the economy is "really healthy," inflation has made progress towards the Fed's target but remains "still too high" and "not yet under control." This assessment underscores the need for monetary policy to "stay restrictive." Hammack explicitly stated there is "no imminent need to cut rates," and that the Fed is "pretty close to where the neutral rate is." Hammack goes into every Fed meeting with an "open mind" regarding policy decisions.
Uncertainty and Tariff Impacts Weigh on Investment
Hammack also highlighted significant uncertainty weighing on investment, noting that "many business plans" are "on pause" amidst this environment. The impact of tariffs is being observed "in discrete places," though Hammack admitted, "we don't know what tariff impact will be" more broadly. This uncertainty extends to the broader economic outlook, with Hammack stating, "we don't know if economy will boom later this year."
The "Great Debate" Within the Fed
These varying economic signals contribute to what Hammack described as a "great debate over economy" among Fed officials. Despite the current healthy assessment, Hammack affirmed that "if Fed sees economy weaken of course Fed will respond."
Germany Targets Chinese AI App DeepSeek Over Data Concerns
In a separate development, Germany is reportedly preparing to remove the Chinese AI app DeepSeek from its app stores. This action, according to DPA, is due to alleged violations of EU data laws. This move signals increasing scrutiny by European regulators over data privacy and the operations of foreign technology companies within the bloc.
Ethereum's Institutional Adoption Accelerates
On the cryptocurrency front, institutional adoption of Ethereum (ETH) is accelerating, with financial news service CNBC reporting that BlackRock (BLK) is leading this charge. This indicates growing mainstream acceptance and integration of digital assets into traditional financial portfolios.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.