The Federal Reserve System (FRS) has raised the interest rate on federal funds (federal funds rate) by 75 basis points, now its range is 2.25-2.5% per annum, according to a communiqué of the Federal Committee for Operations on open market (FOMC) following the results of the July meeting.
The decision coincided with the forecasts of economists and market participants and was adopted unanimously by all 12 voting members of the FOMC. The Committee met in full force for the first time in recent years.
Thus, the Fed raised the rate by 75 bp. following the results of the second meeting in a row and noted that he expects to continue the course of tightening monetary policy, which will be expressed in an increase in rates and a decrease in the volume of assets on the balance sheet of the central bank.
The regulator’s management noted the weakening of production indicators and spending in the US economy, and at the same time pointed to a strong growth in the number of jobs in recent months, while maintaining low unemployment.
“Inflation remains elevated, reflecting the supply-demand imbalance caused by the pandemic, rising food and energy prices, and broader price pressures,” the document said.
The war in Ukraine creates “additional upward pressure on inflation and negatively affects global economic activity,” Fed officials said.
As previously reported, US consumer price growth accelerated to 9.1% in June from 8.6% in May, hitting a 40-year high.
“FOMC aims to achieve maximum employment and inflation at 2% in the long term,” – the message says.
“In evaluating the appropriateness of monetary policy, the FOMC will continue to monitor the impact of incoming information on the economic outlook. The Fed is ready to adjust its approach to monetary policy, if necessary, if risks arise that could hinder the achievement of FOMC goals,” the communiqué says. take into account a wide range of information, including data from the health sector, labor market conditions, inflationary pressures and inflation expectations, developments in financial markets, as well as international developments.”
American financial markets reacted moderately to the results of the Fed meeting, as they were largely taken into account in current quotes. The Dow Jones stock index by 21:16 Moscow time increased by 0.4%, while the Standard & Poor’s 500 rose by 1.44%, and the Nasdaq Composite – by 2.65%. The yield on 10-year US government bonds is still close to 2.77%.
SE NNEGC Energoatom is ready to put into operation all 15 power units of 4 Ukrainian nuclear power plants next winter, company president Petr Kotin said on Ukrainian radio on Wednesday.
“We are ready to launch all 15 power units from the Energoatom generation side,” Kotin said.
At the same time, he explained that the largest in Ukraine and occupied by Russian invaders, the Zaporozhye nuclear power plant, is currently operating at half capacity due to damage to power lines.
“Everything will depend on the end of hostilities. If we liberate the Zaporozhye nuclear power plant and resume the operation of the damaged lines, then we will be able to work with all six power units at the ZNPP,” the head of Energoatom said.
At the same time, according to him, the remaining nine power units in the territory controlled by Ukraine will be ready to operate at full capacity.
“We are optimistic about these events and the fact that we will pass the heating season,” the president of NAEK stressed.
As reported, Energoatom used the practice of operating 15 power units in January-February this year, which caused ambiguous comments from experts regarding the optimal loading of the energy system in terms of the structure of generating capacities.
However, in the upcoming heating season 2022-23. The launch of the maximum number of NPP power units can be facilitated by an increase in electricity exports to the EU countries by the end of 2022 to approximately 1,000 MW.
Agroholding MHP, the largest producer of chicken meat in Ukraine, in January-June 2022 reduced chicken production by 3% compared to the first half of 2021 – to 346.04 thousand tons, while its sales – by 12%, to 338.6 thousand tons, the holding company reported on the London Stock Exchange on Wednesday.
It is noted that in the second quarter of 2022, the agricultural holding, in the context of the Russian military invasion, reduced chicken production by 11% compared to March-June last year – to 170.4 thousand tons, and by 3% compared to the first quarter of 2022. At the same time, the volume of chicken meat sales in the second quarter of 2022 amounted to 140.6 thousand tons, which is 23% lower than the same period last year, but 1.6% higher than sales in the first quarter of this year.
According to the exchange message, in January-June 2022, chicken sales on the domestic market decreased by 6% compared to the first half of 2021 – to 134.7 thousand tons, while supplies to foreign markets – by 17%, to 157.9 thousand tons. At the same time, in the second quarter of 2022, chicken sales in Ukraine amounted to 67.9 thousand tons, decreasing by 6% compared to the second quarter of 2021, but increasing by 1.6% compared to the first quarter of 2022. In turn, chicken meat exports in the second quarter of 2022 fell by 37% by the second quarter of 2021, and by 23% by the first quarter of 2022, to 68.55 thousand tons.
Thus, the share of chicken exports in January-June of this year decreased by 4 percentage points (p.p.) against January-June 2021 to 52% from 56%, while in March-June 2022 this figure decreased to the same period last year by 11 percentage points – up to 48% from 59%.
In addition, MHP poultry farms in the EU in January-June 2022 produced 37.4 thousand tons of poultry meat, which is 5% more than in the first half of 2021, and in the second half of 2022 – 19.6 thousand tons (+ 1% compared to the same period in 2021).
The average price of chicken meat in January-June 2022 increased by 24% year-on-year, to $1.93/kg, while in March-June it increased by 22% compared to the same period last year, to $2.03/kg.
According to MHP, in the first half of this year, the agricultural holding increased sales of culinary products by 76% compared to the first half of last year – up to 6.97 thousand tons, including in the second quarter of 2022 it sold 4.1 thousand tons of these products ( +54% compared to the second quarter of 2021).
According to the report, the sale of processed meat products (including sausages) by the agricultural holding in January-June 2022 decreased by 48% compared to January-June 2021 – to 8.3 thousand tons, and in March-June 2022 – by 73 % compared to March-June last year, up to 2.3 thousand tons.
According to the results of the first half of the period, the sale of semi-finished meat products decreased by 14% – to 7.4 thousand tons, while according to the results of the second quarter – by 24%, to 3.42 thousand tons.
MHP specified that in January-June 2022, sales of sunflower oil decreased by 11% compared to January-June last year, while in March-June 2022 they increased by 38% compared to March-June 2021, to 48.5 thousand tons. tons. At the same time, sales of soybean oil in the first half of 2022 decreased by 15%, and in the second quarter increased by 23% compared to the same periods in 2021, to 19.5 thousand tons and 9.2 thousand tons, respectively.
“In 2022, the company should sow about 335 thousand hectares of land in the grain crops segment. The harvesting campaign for winter rapeseed and wheat is on schedule, of which 70% and 25% are harvested, respectively. The yield of all winter crops is expected to be good and in line with the company’s expectations with taking into account the weather conditions. Spring crops (corn, soybean and sunflower) are in good condition,” the agricultural holding stated in an exchange message. MHP is the largest chicken producer in Ukraine. It is also engaged in the production of cereals, sunflower oil, meat processing products. On the European market, MHP supplies chilled half-carcasses of chickens, which are processed, including at its enterprises in the Netherlands and Slovakia. In February 2019, the agricultural holding completed the acquisition of the Slovenian company Perutnina Ptuj.
MHP generated $393 million in net profit in 2021 against a net loss of $133 million in 2020, while its revenue grew by 25% to $2.37 billion.
The founder, majority shareholder and head of the board of MHP is Ukrainian businessman Yuriy Kosyuk.
President of Ukraine Volodymyr Zelensky thanked the UK for expanding the sanctions list against Russian citizens and businesses for their involvement in the war in Ukraine.
“Today it became known that the UK has expanded the sanctions list against Russia, adding dozens of people and organizations. This is the right trend. I am grateful to the UK for its unwavering firmness in sanctions issues. This is an example that should be inherited by everyone else in the Western community,” he said in a video statement.
The European Union will be able to double the export of Ukrainian electricity this week, European Energy Commissioner Kadri Simson said at a press conference in Brussels on Tuesday after an informal meeting of EU energy ministers with their Ukrainian counterpart Herman Galushchenko on the sidelines extraordinary meeting of the EU Energy Council.
“If commercial electricity trading helps Ukraine offset some of the revenue losses, then this is the way forward. We are not waiting for any specific technical conditions to start trading. Trading is already underway,” she stated.
The European Commissioner recalled that the Ukrainian and Moldovan power transmission networks “were synchronized with the European one in record time.”
“I will continue to support the next step of a full-fledged electricity trade with Ukraine. The first commercial cross-border electricity exchange began at the end of June with Romania, and with Slovakia in July. At the moment, the trading capacity is 1,500 megawatts. But European transmission network operators meet on this week and will discuss doubling this amount,” Simson said.
In this regard, the European Commissioner opined that “by doing so, we will also be able to compensate for some of the production of capacities that here in the EU must be produced with gas, most likely gas from Russia.”
“These are mutually beneficial actions. But our cooperation in the future is not only electricity and gas, but you can expect that soon we will be ready to announce future cooperation in the field of clean gases, renewable gases. This is a market that will develop in Europe, and Ukraine has great opportunities to become our trading partner in the coming years,” she explained.
Simson also said that the EU-Ukraine High Level Energy Market Integration Panel will resume work in September, “accelerating the necessary reforms.” “This will be even more important, since Ukraine now has the status of an EU candidate with a clear European perspective,” the European Commissioner said.
In addition, she noted that Ukraine has the largest gas storage facilities in Europe. “And it’s in our joint interest to use them for security purposes,” Simson said.
For his part, Minister of Energy of Ukraine German Galushchenko noted that Ukraine has the ability to store more than 12 billion gas for European companies in its underground gas storage facilities “in fairly safe places.”
Galushchenko stressed that the Ukrainian gas transportation system could guarantee gas supplies at the level of those volumes that are transported to Europe through Nord Stream 1, “if the Russians close it.”
“Even during the war, we ensured the security of supplies of those volumes that go through the Ukrainian pipeline, and this was our obligation to our European partners. We are fulfilling this obligation,” the Minister of Energy stressed.
As for the export of Ukrainian electricity, according to him, today it is a direct replacement for Russian gas.
“Today we export 100 MW to Europe. But technically we could already increase it to 1.5-1.7 thousand MW, realizing that this can replace up to five to six billion cubic meters of Russian gas with Ukrainian electricity,” he said.
In addition, Galushchenko focused on the behavior of the Russian invaders at the site of the Zaporozhye nuclear power plant.
“What they are doing there is called nuclear terrorism. And therefore, we must be aware that in the 21st century, only one country can behave like a terrorist. And this is a matter of nuclear security. This is not only a matter between Ukraine and Russia, this is a question of the whole world,” the head of the Ministry of Energy stressed.
Ukraine’s government emergency response team CERT-UA, operating under the State Service for Special Communications and Information Protection, warns of the distribution of new dangerous emails with the subject “Final Payment”.
“Opening the archive will download malware and, as a result, steal data,” the message says.
CERT-UA links the attack to UAC-0041 (“Russian hacktivists”).
