ISRAEL: Gaza Ceasefire Talks Stall Again, Israel Recalls Negotiators From Qatar

• "We're about to start the annual review, actually any day now, because that builds up to the announcement we'll make in September."
• "We'll go back over that question, and it is going to it is going to be more interesting this year, because we've had quite a sort of steepening of the yield curve, but then we've seen that, frankly, in all the major economies. So I don't put that down to quantity tightening, but I said to the Treasury Select Committee in the House Commons the other day, we are going to have to look at the interaction of these terms, because it is a slightly new territory that is. So that's a question we will have to come back to."
• "And I think that's the appropriate way to do it. The aim of quantitative tightening, of course, I would say, is in two parts. One is that we are bringing the level of reserves in the system down to the level that sort of, if you like, the sort of the level, the equilibrium level demanded by banks... We don't know what the equilibrium level of reserves is, but we ask the banks regularly, we have a range, and the top end of that range is about 550 So yeah, we're, we're about 130 off that at the moment, if that's the case of the top end. But if that's, I'm sounding overly precise there."
• "The second leg of quantitative tightening... is then to continue to, in a sense, change the Bank of England's balance sheet once we get to that equilibrium level of reserve, so that the assets on the other side from the from the reserve accounts, frankly, that we transfer the interest rate risk out into the into the market, not on our balance sheet, and not on the public balance sheet. So that's that will be the objective thereafter, because I don't think it's appropriate to have that on the on our balance sheet going forwards."

Chair Powell says that the main reason the Fed isn't cutting rates like its global peers, and despite softer incoming inflation data, is because inflation is forecast to pick up in "meaningful" fashion later this year (again this is a big difference in outlook with now-doves Waller and Bowman who are looking for cuts to resume as they don't see such an inflation pickup as their base case):

• "So the you're right that if you just look in the rear view mirror and look at the existing data that we've seen, you can make a good argument that that would call for us to be at a neutral level, which would be, you know, a couple of cuts, or maybe more, kind of thing. The reason we're not is the forecast by all Professional Forecasters that I know of on the outside and the Fed, do expect a meaningful increase in inflation over the course of this year."

Cleveland Fed’s Hammack (’26 voter) in a panel discussion along with ECB’s Lane and BoE’s Ramsden gives some additional color behind her view that she isn’t eyeing “imminent” rate cuts. 

• “I do believe that we are still modestly restrictive, and only very modestly restrictive.”
• “You know, there are a wide range of estimates for the neutral rate in the US that would range from 2% to 4.6% and so that's a pretty wide bucket.” [She said in prepared remarks that she saw estimated only “very modest cuts” required to get back to neutral]
• “I agree that the recent inflation readings that we've seen over the past few months have been very encouraging. I think it puts us in a core [PCE inflation] something like a 2.5 to 2.6 type number.”
• “But we have to remember is that that's the progress that we've made has been very slow. Yes, those newer numbers seem good, and we've seen some progress, particularly in the housing, services inflation category, which had been very sticky. And so it's good to see that we're making progress there.”
• “I cited the tariff impact in the steel industry because I think that's one of the cleanest tariffs that we have to look at. And when we look at that, you do see that that impact happened, but it's really over a three month period of time. You know, if you start with April 9 as the date that the tariffs were effective, we're still not quite three months on from when they've been in place. And so I think we do need more time to understand how those are going to play through in the data and what impacts they could have.”
• “Now, it could be that it's a one time price level shift that you know economic research would tell you we should look through. But it could be that, given the nature of the on, off, some of the shifts, some of the other policy dynamics, it could be that it's more persistent.”
• “And it could be that after four years of above target inflation, even though we continue to make good progress, that it could be more persistent to investors inflation expectations, and that's something that, to me, I think bears more watching Before we take action.”