Stagflation is the bitterest of economic pills: High inflation mixes with a weak job market to cause a toxic brew that punishes consumers and befuddles economists. Find out more about that and other COVID news here.
Sri Lanka’s prime minister says that he will quickly prepare an economic reform program and seek approval from the International Monetary Fund. Prime Minister Ranil Wickremesinghe says urgent action is needed because global inflation and the economic impact of Russia’s invasion of Ukraine could hurt the ability of countries to allocate enough aid to Sri Lanka. The country is facing its worst economic crisis in recent memory. Wickremesinghe says authorities have reached agreement on basic reform concepts with the IMF and that he plans to have the economic reform program ready within two weeks.
Stocks rose broadly in morning trading on Wall Street Thursday as investors cheered a strong set of quarterly results from Macy’s and other retailers. The S&P 500 rose 1.3% and is solidly in the green for the week following a choppy few days of trading. The gains have positioned the benchmark index for its first weekly gain after seven straight losses. The Dow Jones Industrial Average rose 1.3% and the Nasdaq rose 1.5%. The better-than-expected reports from retailers helped allay investors' worries about the sector, which took big losses last week after Target and Walmart reported dismal results. Bond yields were relatively stable.
Fewer Americans applied for jobless aid last week as the number of Americans collecting unemployment benefits remains near five-decade lows. Applications for unemployment benefits fell by 8,000 to 210,000 for the week ending May 21, the Labor Department reported Thursday. First-time applications are generally representative of the number of layoffs. American workers are enjoying historically strong job security two years after the coronavirus pandemic plunged the economy into a short but devastating recession. Weekly applications for unemployment aid have been consistently below the pre-pandemic level of 225,000 for most of 2022.
Turkey’s central bank kept its main interest rate unchanged for a fifth month running despite an annual inflation rate of nearly 70%. The bank said Thursday it would keep its policy rate “constant” at 14%. It argued inflation was driven by geopolitical developments and the “temporary effects of pricing formations.” The decision was in line with President Recep Tayyip Erdogan’s opposition to high borrowing costs in a bid to boost growth, investment and exports. The Turkish leader insists that high borrowing costs cause inflation. It's a position that contradicts established economic thinking.
Q: I am growing impatient with so many saying, “Wow, the value of your home has gone up so much,” without knowing the facts.
🎧 The Amber Heard-Johnny Depp case or inflation? Why people seem to focus on social issues rather than on solutions that could fix the problems they care about the most.
The Congressional Budget Office says that high inflation will persist into next year. This will likely cause the federal government to pay higher interest rates on its debt. The nonpartisan agency expects that the consumer price index will rise 6.1% this year and 3.1% in 2023. This forecast suggests that inflation will slow from current annual levels of 8.3%, yet it would still be dramatically above a long term baseline of 2.3%. The 10-year estimates do contain positive news as this year’s annual budget deficit will be $118 billion lower than forecast last year. That’s a byproduct of the end of pandemic-related spending and the solid job growth it helped to spur.
Top Maryland lawmakers say cutting a scheduled gas-tax increase of about 6 cents this summer won't solve the problem of high gas prices. House Speaker Adrienne Jones and Senate President Bill Ferguson said in a joint statement Wednesday that eliminating the inflation adjustment on gas would result in a loss of more than $200 million in funding to ensure the safety of roads and bridges. Ferguson and Jones say the state cannot have a reliable transportation network that regularly experiences failing conditions due to insufficient funding and deferred maintenance. The gas tax is set to rise from 36.1 cents to 42.7 cents a gallon on July 1.
Stocks rose in choppy trading on Wall Street Wednesday afternoon following the release of minutes from the Federal Reserve’s most recent interest rate policy meeting. The S&P 500 rose 0.6%, the Dow Jones Industrial Average rose 0.2% and the Nasdaq rose 1.2%. Retailers had some of the strongest gains after getting beaten down in recent days over concerns that soaring inflation was eating into their profits. Some of those concerns dissipated after the high-end department store operator Nordstrom reported higher sales and raised its profit forecast. The yield on the 10-year Treasury, which helps set mortgage rates, held steady at 2.76%.
The US budget deficit could shrink to $1 trillion this year from $2.8 trillion last year as federal spending on Covid-19 aid slows and the eco…
The risks to the global economy are leading to an increasingly gloomy view of the months ahead as corporate leaders, government officials and other VIPs gather at the World Economic Forum meeting in Davos, Switzerland. The issues range from soaring inflation, Russia’s war in Ukraine, squeezed supply chains, the threat of food insecurity around the world and the lingering COVID-19 pandemic. The head of the International Monetary Fund sought to dispel the gloom this week, saying a global recession isn’t in the cards but “it doesn’t mean it’s out of the question.” But Kristalina Georgieva acknowledged that it’s going to be a “tough year,” with one of the big problems surging food prices.
State Rep. Bee Nguyen is advancing to a runoff in the Democratic primary for Georgia secretary of state. It was too early to tell which of the other four Democrats she will face in the June 21 contest. Nguyen has served in the state House since winning a 2017 special election to succeed Stacey Abrams in a district that includes parts of DeKalb County just east of the Fulton County line and some parts of the city of Atlanta. She is also a vice chair of the state Democratic Party. Abrams is seeking the Democratic nomination for governor after narrowly losing the election to Republican Gov. Brian Kemp in 2018.
Asian stock markets are mixed after Wall Street sank on weak U.S. housing sales and a profit warning by a prominent social media brand. Shanghai and Seoul advanced while Tokyo and Hong Kong declined. Oil prices rose more than $1 per barrel to stay above $110. Wall Street’s benchmark S&P 500 index lost 0.8% after the profit warning Tuesday by Snapchat’s parent company spooked investors into dumping social media stocks. Construction stocks fell after U.S. home sales plunged in April. Investors are on edge about the impact of interest rate hikes in the United States and other Western economies to cool surging inflation, as well as Russia’s war on Ukraine and a Chinese economic slowdown.
Stocks fell in morning trading on Wall Street Tuesday, weighed down by a big decline in tech heavyweights over concerns about persistently rising inflation and its impact to their bottom lines. The S&P 500 index fell 2.1%, the Dow Jones Industrial Average fell 1.1% and the Nasdaq fell 3.6%. A stark profit warning from Snapchat's parent company spooked investors into dumping the stocks of major social media companies. Snap's stock price sank 39%, while Facebook's and Google's parent companies also fell sharply. Retailers and banks also fell broadly. The yield on the 10-year Treasury fell significantly, to 2.75%.
Across Britain, food banks and community food hubs that helped struggling families, older people and the homeless during the pandemic are now seeing soaring demand. Skyrocketing energy and food bills are pushing millions deeper into financial hardship, and increasing numbers cannot afford to buy groceries. The cost of food and fuel in the U.K. has risen sharply since late last year, with inflation reaching the highest level in 40 years. In April, millions of families saw their annual energy bill jump by 54%, and another energy price hike is expected in October. Britain's Conservative government has been criticized for not doing enough to ease the crisis.
Americans on the cusp of retiring are facing a tough choice as they watch their nest eggs shrink: Stay the course or keep working. A stock market slump this year has taken a big bite out of investors’ portfolios, including retirement plans like 401(k)s. The S&P 500, the benchmark for many index funds, is down about 17% since its all-time high in early January. The sharp reversal after a banner 2021 for Wall Street has been particularly unsettling for those who have been planning to retire sooner, rather than later, and banking on a healthier stock portfolio to help fund their post-work lifestyle.
Americans are becoming less supportive of punishing Russia for launching its invasion of Ukraine if it comes at the expense of the U.S. economy, a sign of rising anxiety over inflation and other challenges. That's according to a new poll from The Associated Press-NORC Center for Public Affairs Research. It finds that while broad support for U.S. sanctions has not faltered, the balance of opinion on prioritizing sanctions over the economy has shifted. Americans interviewed by the AP detail how they've had to cut back on driving and spending and want the White House to focus on domestic concerns, even as many people have sympathy for Ukraine.
The proposed changes to the district's school meal prices comes amid increasing food costs and inflation.
Stocks closed higher on Wall Street Monday following seven weeks of declines that nearly ended the bull market that began in March 2020. The S&P 500 rose 1.9%, the Dow Jones Industrial Average rose 2% and the Nasdaq rose 1.6%. Banks and technology stocks made some of the strongest gains. Concerns about inflation have been weighing on the market and have kept major indexes in a slump recently. The S&P 500 is coming off its longest weekly losing streak since the dot-com bubble was deflating in 2001. The yield on the 10-year Treasury, which helps set mortgage rates, rose to 2.86%.
Two high-level speakers at the World Economic Forum gathering say Afghanistan’s most urgent need is saving its economy from complete collapse. U.N. Development Program administrator Achim Steiner said Monday in Davos that “we cannot abandon 40 million Afghans simply on the principle of moral outrage.” The Taliban’s takeover of Afghanistan nine months ago and the hasty U.S. withdrawal of its troops triggered economic fallout. Some argue that aid to Afghanistan should be made conditional to ensure the protection of women’s rights. Pakistani Minister of State for Foreign Affairs Hina Rabbani Khar says that while her country views Taliban curbs to women’s rights as a threat, she asked what would happen to Afghans “in order to appease our conscience.”
President Joe Biden has launched a new trade deal with 12 Indo-Pacific nations aimed at strengthening their economies as he warns Americans worried about high inflation that it is “going to be a haul” before they feel relief. The president says he does not believe an economic recession is inevitable in the U.S. Biden spoke at a news conference in Toyko after holding talks with Japan’s Prime Minister Fumio Kishida. He acknowledged the U.S. economy has “problems” but said they were “less consequential than the rest of the world has.” He added: “This is going to be a haul. This is going to take some time."
With prices across the economy soaring at their fastest pace in decades, you might think Americans would tap the brakes on spending. Not so far. Consumers as a whole are showing surprising resilience, not only sustaining their spending but increasing it even after adjusting for inflation. That spending is helping allay concerns that a recession might be near. Yet there are signs that some people, especially in lower-income households, are starting to cut back. How long consumers as a whole continue to spend at healthy levels despite the pressures from inflation will be key to whether the U.S. can avoid a recession as the Federal Reserve raises borrowing rates.
Following CD rates in recent years has been a lot like watching paint dry at the bottom of a barrel: little perceptible change in rock-bottom …
In April, rent prices in the United States reached new heights, and experts say they will not stop there.