News updates for 03 July

Author

Desmond Lim
July 03, 2024

  1. Some progress in inflation in the US

Federal Reserve Chair Jerome Powell expressed satisfaction with the progress on inflation, noting significant improvement but emphasized the need for more confidence before considering interest rate cuts. Speaking at a central banking forum in Portugal, Powell highlighted that recent inflation readings indicate a return to a disinflationary path but stressed the importance of avoiding premature policy loosening. He acknowledged the balance of risks between moving too soon or too late and clarified that the Fed is cautious about undoing progress. Powell did not specify dates for potential rate cuts, maintaining focus on economic conditions rather than political influences.

  1. Tesla’s better than expected Q2 delivery report

Tesla shares surged 10% after the company reported second-quarter vehicle production of 410,831 and deliveries of 443,956, surpassing analyst expectations. Despite a 4.8% year-over-year decline, deliveries rose 14.8% from the first quarter. The stock closed at $231.26, down 7% for the year. Tesla's lineup includes Model Y, Model 3, Cybertruck, Model X, and Model S. First-quarter deliveries had dropped 8.5%, impacted by factory shutdowns, shipping delays, and increased competition. Tesla's efforts to boost sales include discounts and incentives, such as a zero-interest loan in China. Analysts express concerns over demand and price cuts affecting margins, with investor attention now on the upcoming earnings report and a marketing event for a new robotaxi design .

  1. Google’s surging demand for energy

Google's emissions have surged nearly 50% since 2019 and 13% year over year in 2023, as reported in its 2024 environmental report. The increase is primarily due to higher energy consumption in data centers and supply chain emissions driven by AI advancements. Google’s total data center electricity consumption grew 17% in 2023. Despite its data centers being 1.8 times more energy efficient than typical ones, the challenge of rapidly implementing renewable energy remains. Google is committed to mitigating AI's environmental impact through optimization and efficiency. Similarly, Microsoft reported a 30% rise in carbon emissions since 2020 due to data center construction.