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business Friday 15 January 2021

Powell signals Fed will keep aiding economy with bond buying

By CHRISTOPHER RUGABER suries, increasing the yield “will remain appropriate for
AP Economics Writer on the 10-year Treasury quite some time.”
WASHINGTON (AP) — Fed- note in the past week to Some regional Fed bank
eral Reserve Chair Jerome about 1.1%, up from 0.9%. presidents have signaled
Powell sought Thursday to The speculation was fueled that any reduction in bond
tamp down any concerns by comments from several purchases is probably a
that the Fed might soon regional Fed bank presi- long way off. Eric Rosen-
withdraw some of its sup- dents, including Raphael gren, president of the Bos-
port for the U.S. economy Bostic of the Atlanta Fed ton Fed, said in an inter-
and stressed that any such and Robert Kaplan of Dal- view with The Associated
pullback would be signaled las. Bostic said last week Press that “we are still very
far in advance. that he was “hopeful that far from full employment....
During an online discussion in fairly short order we can Right now, we’re still in a
hosted by Princeton Uni- start to recalibrate” the recessionary economy,
versity, from which Powell bond purchases. Bostic is a and we need to get out of
earned his undergraduate Federal Reserve Chairman Jerome Powell testifies before a voting member of the Fed’s that.”
degree, the Fed chair said House Financial Services Committee hearing on Capitol Hill in policymaking committee Fed officials want to avoid
the recovery of the econ- Washington, Wednesday, Dec. 2, 2020. this year. Members of the a repeat of what became
omy from the pandemic Associated Press Federal Reserve’s Board known as the “taper tan-
recession “is far from our know,” Powell said. “We will home and car buyers. At of Governors, who carry trum,” one of the Fed’s
goals.” The Fed had said communicate very clearly the same time, the central particular weight on rate worst communications
after its last policy meet- to the public and we’ll do bank is keeping its bench- decisions, have stressed blunders. It occurred in
ing last month that it would so well in advance before mark short-term rate at a that any tapering of bond 2013 under Chairman Ben
continue to buy $120 billion actively considering any record low near zero to purchases won’t occur for Bernanke, who suggested
in bonds each month until tapering of asset purchas- help support the economy. months at least. One of that the Fed might soon
the economy made “sub- es.” The bond purchases Powell’s remarks Thursday them, Richard Clarida, said start reducing the bond
stantial further progress” are intended to hold down follow recent speculation last Friday that he thought purchases it was engaging
toward the Fed’s goals of longer-term interest rates to in financial markets that the the purchases would likely in at that time in the wake
maximum employment encourage consumers and Fed might start reducing its continue at least into next of the Great Recession.
and stable 2% inflation. businesses to borrow and bond purchases as early as year. And Lael Brainard, Bernanke’s remarks caught
“When that happens spend. Lower rates on 10- this year, sooner than was another governor, said investors by surprise and
— and we can see that year Treasurys, for example, previously expected. Inves- Wednesday that the cur- triggered a spike in interest
clearly — we’ll let the world reduce borrowing costs for tors have been selling Trea- rent level of bond buying rates.q

Connecticut probing Amazon’s e-book deals with publishers

By DAVE COLLINS are facing similar probes
Associated Press by federal and local of-
HARTFORD, Conn. (AP) — ficials into whether their
Connecticut authorities business practices are ille-
are investigating whether gally squashing competi-
Amazon’s e-book deals tion and harming consum-
with certain publishers ers.
are anticompetitive and Amazon has become the
violate antitrust laws, state dominant force in print
Attorney General William book sales and e-book
Tong said Thursday. sales in the U.S. The com-
Tong released only a few pany accounts for over
details of the probe. He half of all print book sales
said the state attorney and more than 80% of e-
general’s office has previ- book sales, according to
ous taken action against research cited in an Oc-
Apple and e-book publish- tober report by the anti-
ers to protect competition trust committee of the U.S.
in the marketplace. House Judiciary Commit-
“Our office continues to tee.
aggressively monitor this Tong’s office issued a sub-
market to protect fair poena to Amazon in 2019 In this Aug. 20, 2020 file photo, Connecticut Attorney General William Tong speaks to the
competition for consum- requesting documents media during a watch party for the Democratic National Convention, at Dunkin’ Donuts Park,
ers, authors, and other e- about the company’s in Hartford, Conn. Associated Press
book retailers,” Tong said dealings with five book
in a statement. publishers: HarperCollins ency Project and shared publishers Thursday. the market. Apple fought
The investigation is part of Publishers, Hachette Book with The Wall Street Jour- In a previous antitrust in- the findings all the way to
the widening scrutiny by Group, Penguin Random nal, which reported on the vestigation of electronic the U.S. Supreme Court,
state and federal govern- House, Simon & Schuster investigation Wednesday. books, Apple was found to which rejected the ap-
ment agencies of possible and Macmillan. A copy Simon & Schuster declined have conspired with pub- peal in 2016 and let stand
anticompetitive practices of the subpoena was ob- to comment. Messages lishers to raise e-book pric- a lower court ruling that
by giant tech companies. tained by the nonprofit in- seeking comment were es in an effort to challenge found Apple violated anti-
Google and Facebook vestigative Tech Transpar- left with the other four Amazon’s dominance of trust laws in 2010.q