Latest news with #PCE
Arab News
10 hours ago
- Business
- Arab News
As US inflation edges up, Trump renews criticism of Fed chief, calling him ‘stubborn'
WASHINGTON: The US Federal Reserve's preferred inflation measure logged a mild uptick Friday while spending weakened, triggering another tirade by President Donald Trump against the central bank chair for not cutting interest rates sooner. 'We have a guy that's just a stubborn mule and a stupid person,' Trump told an event at the White House, referring to Fed Chair Jerome Powell. 'He's making a mistake.' With Powell's term as Fed chief coming to an end next year, Trump hinted at his choice of successor: 'I'm going to put somebody that wants to cut rates.' The president's remarks came after government data showed the personal consumption expenditures (PCE) price index climbing 2.3 percent last month from a year ago in May. This was in line with analyst expectations and a slight acceleration from April's 2.2 percent increase, but still a relatively mild uptick. Excluding the volatile food and energy sectors, the PCE price index was up 2.7 percent, rising from April's 2.6 percent uptick, the Commerce Department's report showed. But consumer spending declined, after Trump's fresh tariffs in April dragged on consumer sentiment. PCE dropped by 0.1 percent from the preceding month, reversing an earlier rise. While Trump has imposed sweeping tariffs on most US trading partners since returning to the White House in January — alongside higher rates on imports of steel, aluminum and autos — these have had a muted effect so far on inflation. This is in part because he held off or postponed some of his harshest salvos, while businesses are still running through inventory they stockpiled in anticipation of the levies. But central bank officials have not rushed to slash interest rates, saying they can afford to wait and learn more about the impact of Trump's recent duties. They expect to learn more about the tariffs' effects over the summer. 'The experience of the limited range of tariffs introduced in 2018 suggests that pass-through to consumer prices is intense three-to-six months after their implementation,' warned economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics in a note. They flagged weakness in consumer spending, in part due to a pullback in autos after buyers rushed to get ahead of levies. And spending on services was tepid even after excluding volatile components, they said. 'There has also been a clear weakening in discretionary services spending, notably in travel and hospitality,' said Michael Pearce, deputy chief US economist at Oxford Economics, in a note. This reflects 'the chilling effect of the plunge in consumer sentiment,' he added. Between April and May, the PCE price index was up 0.1 percent, the Commerce Department report showed. As a July deadline approaches for higher tariff rates to kick in on dozens of economies, all eyes are also on whether countries can reach lasting trade deals with Washington to ease the effects of tariffs. For now, despite the slowing in economic growth, Pearce said risks that inflation could increase will keep the Fed on hold with interest rates 'until much later in the year.'
Malay Mail
11 hours ago
- Business
- Malay Mail
Trump slams US Fed chair Powell as ‘stubborn mule' after mild inflation rise and consumer spending dip
WASHINGTON, June 28 — The US Federal Reserve's preferred inflation measure logged a mild uptick yesterday while spending weakened, triggering another tirade by President Donald Trump against the central bank chair for not cutting interest rates sooner. 'We have a guy that's just a stubborn mule and a stupid person,' Trump told an event at the White House, referring to Fed Chair Jerome Powell. 'He's making a mistake.' With Powell's term as Fed chief coming to an end next year, Trump hinted at his choice of successor: 'I'm going to put somebody that wants to cut rates.' The president's remarks came after government data showed the personal consumption expenditures (PCE) price index climbing 2.3 percent last month from a year ago in May. This was in line with analyst expectations and a slight acceleration from April's 2.2 percent increase, but still a relatively mild uptick. Excluding the volatile food and energy sectors, the PCE price index was up 2.7 percent, rising from April's 2.6 percent uptick, the Commerce Department's report showed. But consumer spending declined, after Trump's fresh tariffs in April dragged on consumer sentiment. PCE dropped by 0.1 percent from the preceding month, reversing an earlier rise. While Trump has imposed sweeping tariffs on most US trading partners since returning to the White House in January — alongside higher rates on imports of steel, aluminium and autos — these have had a muted effect so far on inflation. This is in part because he held off or postponed some of his harshest salvos, while businesses are still running through inventory they stockpiled in anticipation of the levies. But central bank officials have not rushed to slash interest rates, saying they can afford to wait and learn more about the impact of Trump's recent duties. They expect to learn more about the tariffs' effects over the summer. 'Clear weakening' 'The experience of the limited range of tariffs introduced in 2018 suggests that pass-through to consumer prices is intense three-to-six months after their implementation,' warned economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics in a note. They flagged weakness in consumer spending, in part due to a pullback in autos after buyers rushed to get ahead of levies. And spending on services was tepid even after excluding volatile components, they said. 'There has also been a clear weakening in discretionary services spending, notably in travel and hospitality,' said Michael Pearce, deputy chief US economist at Oxford Economics, in a note. This reflects 'the chilling effect of the plunge in consumer sentiment,' he added. Between April and May, the PCE price index was up 0.1 percent, the Commerce Department report showed. As a July deadline approaches for higher tariff rates to kick in on dozens of economies, all eyes are also on whether countries can reach lasting trade deals with Washington to ease the effects of tariffs. For now, despite the slowing in economic growth, Pearce said risks that inflation could increase will keep the Fed on hold with interest rates 'until much later in the year.' — AFP
Miami Herald
14 hours ago
- Business
- Miami Herald
S&P 500 hits record high after $10 trillion rally
Wall Street traders dodged a flurry of tariff headlines to drive stocks to all-time highs, capping a week that saw a cooling in Middle East risks and signs the U.S. economy is holding up amid subdued inflation. A rally in Treasuries stalled. The dollar advanced. A surge in equities after April's tariff-fueled meltdown drove the S&P 500 to its first record since February, with the gauge closing above 6,170. Tech megacaps led gains, with Nvidia Corp. approaching the $4 trillion mark and Alphabet Inc. up almost 3%. President Donald Trump touted progress on trade deals with a few countries, naming agreements with China and the UK, while saying he was ending discussions with Canada. The loonie slid. Trump in April put tariffs on dozens of American trading partners on pause for three months a week after declaring them, when investors panicked over the possibility they could trigger a global recession. An over $10 trillion surge in the S&P 500 from the edge of a bear market has defied Wall Street expectations, underscoring conviction that the economy is withstanding policy uncertainty. 'U.S. equities have continued to recover from the tariff induced selloff in March and April,' said David Lefkowitz at UBS's Chief Investment Office. 'We think the recovery makes sense, considering that most large-cap companies should weather the tariffs reasonably well.' Treasury Secretary Scott Bessent signaled there may be some extensions to wrap up major pacts by Labor Day. European Commission President Ursula von der Leyen told EU leaders behind closed doors she was confident a deal could be reached before the deadline, according to people familiar with the matter. And China confirmed details of a trade framework with Washington. On the economic front, consumer sentiment rose sharply in June to a four-month high and inflation expectations improved notably. Data also showed that while the core personal consumption expenditures price index rose slightly more than expected, the pace was seen as consistent with tame price pressures that will allow the Federal Reserve to resume its rate cuts later this year. 'A window of opportunity is more likely to open at one of the final three policy meetings of the year - in September, October or December - when the impact of tariff increases on inflation becomes clearer,' said Gary Schlossberg at Wells Fargo Investment Institute. Fed Chair Jerome Powell told lawmakers this week that he expects inflation to pick up in June, July and August as tariffs become increasingly reflected in consumer prices, though he added if that prediction fails to materialize, the U.S. central bank could resume rate reductions sooner rather than later. Money markets continued to project at least two Fed cuts by the end of this year. Wagers on a third reduction could gain momentum if next Thursday's jobs report is weak. To Bret Kenwell at eToro, the latest PCE reading showed that inflation is still not spiraling out of control. However, it did snap a three-month streak of lower year-over-year readings, while last month's figures were revised higher. 'Today's inflation report shouldn't be enough to give markets a significant scare, but it probably dashes the slim hopes investors had for a July rate cut,' Kenwell said. 'Further, it may give investors a bit of hesitation with stocks surging into record high territory as we near quarter-end.' Kenwell says that stocks can do pretty well in a mild-inflationary environment. 'The key will be a reassuring earnings cycle and a strong consumer as we go into the second half of the year,' he noted. Indeed, with earnings season just weeks away, stocks will get a major test. Wall Street sees profit growth of 2.8% year-over-year for the second quarter for the benchmark, according to data compiled by Bloomberg Intelligence. That would be the smallest jump in two years. The lackluster forecasts magnify concerns from some market watchers that valuations are stretched. The risk of a speculative stock bubble is increasing as expectations of rate cuts draw massive investment flows, according to Bank of America Corp.'s Michael Hartnett. Already this year, $164 billion has flowed into U.S. equities, on course for the third-largest annual inflow in history, he said, citing data from EPFR Global. Corporate Highlights -Nike Inc. said its yearlong sales decline is starting to ease, suggesting that Chief Executive Officer Elliott Hill's strategic moves are paying off. -Apple Inc. and Google's Android have been warned by a top German privacy regulator that the Chinese AI service DeepSeek, available on their app stores, constitutes illegal content because it exposes users' data to Chinese authorities. -Two years after Nvidia Corp. made history by becoming the first chipmaker to achieve a $1 trillion market capitalization, an even more remarkable milestone is within its grasp: becoming the first company to reach $4 trillion. -JPMorgan Chase & Co. shares have soared from an April low on a grab bag of positive developments, but to Baird analysts that's too far, too fast. They downgraded the lender to underperform from a neutral rating, giving the stock its second sell rating. -Shares of Boeing Co. are set to make gains as the company speeds up production of commercial aircraft and takes steps to move on from a series of crises in recent years, according to Rothschild & Co. Redburn, which raised the recommendation on the shares to buy. -Estee Lauder Cos. was raised to buy at HSBC, which sees the cosmetics company at the end of a downgrade cycle. -B. Riley Financial Inc. has sold its financial advisory services business GlassRatner to Canadian private equity firm TorQuest Partners, adding to a series of asset sales as the financial services firm deals with its woes. -Alibaba Group Holding Ltd. unveiled a new iteration of its artificial-intelligence technology that will make it easier for users to generate and modify images from texts and visuals, as the Chinese e-commerce giant continues its aggressive push into AI. Some of the main moves in markets: Stocks -The S&P 500 rose 0.5% as of 4 p.m. New York time -The Nasdaq 100 rose 0.4% -The Dow Jones Industrial Average rose 1% -The MSCI World Index rose 0.6% -Bloomberg Magnificent 7 Total Return Index rose 1.1% -The Russell 2000 Index was little changed Currencies -The Bloomberg Dollar Spot Index rose 0.1% -The euro was little changed at $1.1709 -The British pound fell 0.1% to $1.3709 -The Japanese yen fell 0.2% to 144.72 per dollar Cryptocurrencies -Bitcoin fell 0.8% to $106,926.43 -Ether fell 1.2% to $2,416.73 Bonds -The yield on 10-year Treasuries advanced three basis points to 4.27% -Germany's 10-year yield advanced two basis points to 2.59% -Britain's 10-year yield advanced three basis points to 4.50% Commodities -West Texas Intermediate crude fell 0.1% to $65.15 a barrel -Spot gold fell 1.7% to $3,270.92 an ounce Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Yahoo
15 hours ago
- Business
- Yahoo
US inflation edges up as Trump renews criticism of Fed chief
The US Federal Reserve's preferred inflation measure logged a mild uptick Friday while spending weakened, triggering another tirade by President Donald Trump against the central bank chair for not cutting interest rates sooner. "We have a guy that's just a stubborn mule and a stupid person," Trump told an event at the White House, referring to Fed Chair Jerome Powell. "He's making a mistake." With Powell's term as Fed chief coming to an end next year, Trump hinted at his choice of successor: "I'm going to put somebody that wants to cut rates." The president's remarks came after government data showed the personal consumption expenditures (PCE) price index climbing 2.3 percent last month from a year ago in May. This was in line with analyst expectations and a slight acceleration from April's 2.2 percent increase, but still a relatively mild uptick. Excluding the volatile food and energy sectors, the PCE price index was up 2.7 percent, rising from April's 2.6 percent uptick, the Commerce Department's report showed. But consumer spending declined, after Trump's fresh tariffs in April dragged on consumer sentiment. PCE dropped by 0.1 percent from the preceding month, reversing an earlier rise. While Trump has imposed sweeping tariffs on most US trading partners since returning to the White House in January -- alongside higher rates on imports of steel, aluminum and autos -- these have had a muted effect so far on inflation. This is in part because he held off or postponed some of his harshest salvos, while businesses are still running through inventory they stockpiled in anticipation of the levies. But central bank officials have not rushed to slash interest rates, saying they can afford to wait and learn more about the impact of Trump's recent duties. They expect to learn more about the tariffs' effects over the summer. - 'Clear weakening' - "The experience of the limited range of tariffs introduced in 2018 suggests that pass-through to consumer prices is intense three-to-six months after their implementation," warned economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics in a note. They flagged weakness in consumer spending, in part due to a pullback in autos after buyers rushed to get ahead of levies. And spending on services was tepid even after excluding volatile components, they said. "There has also been a clear weakening in discretionary services spending, notably in travel and hospitality," said Michael Pearce, deputy chief US economist at Oxford Economics, in a note. This reflects "the chilling effect of the plunge in consumer sentiment," he added. Between April and May, the PCE price index was up 0.1 percent, the Commerce Department report showed. As a July deadline approaches for higher tariff rates to kick in on dozens of economies, all eyes are also on whether countries can reach lasting trade deals with Washington to ease the effects of tariffs. For now, despite the slowing in economic growth, Pearce said risks that inflation could increase will keep the Fed on hold with interest rates "until much later in the year." bys/jgc Sign in to access your portfolio
France 24
15 hours ago
- Business
- France 24
US inflation edges up as Trump renews criticism of Fed chief
"We have a guy that's just a stubborn mule and a stupid person," Trump told an event at the White House, referring to Fed Chair Jerome Powell. "He's making a mistake." With Powell's term as Fed chief coming to an end next year, Trump hinted at his choice of successor: "I'm going to put somebody that wants to cut rates." The president's remarks came after government data showed the personal consumption expenditures (PCE) price index climbing 2.3 percent last month from a year ago in May. This was in line with analyst expectations and a slight acceleration from April's 2.2 percent increase, but still a relatively mild uptick. Excluding the volatile food and energy sectors, the PCE price index was up 2.7 percent, rising from April's 2.6 percent uptick, the Commerce Department's report showed. But consumer spending declined, after Trump's fresh tariffs in April dragged on consumer sentiment. PCE dropped by 0.1 percent from the preceding month, reversing an earlier rise. While Trump has imposed sweeping tariffs on most US trading partners since returning to the White House in January -- alongside higher rates on imports of steel, aluminum and autos -- these have had a muted effect so far on inflation. This is in part because he held off or postponed some of his harshest salvos, while businesses are still running through inventory they stockpiled in anticipation of the levies. But central bank officials have not rushed to slash interest rates, saying they can afford to wait and learn more about the impact of Trump's recent duties. They expect to learn more about the tariffs' effects over the summer. 'Clear weakening' "The experience of the limited range of tariffs introduced in 2018 suggests that pass-through to consumer prices is intense three-to-six months after their implementation," warned economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics in a note. They flagged weakness in consumer spending, in part due to a pullback in autos after buyers rushed to get ahead of levies. And spending on services was tepid even after excluding volatile components, they said. "There has also been a clear weakening in discretionary services spending, notably in travel and hospitality," said Michael Pearce, deputy chief US economist at Oxford Economics, in a note. This reflects "the chilling effect of the plunge in consumer sentiment," he added. Between April and May, the PCE price index was up 0.1 percent, the Commerce Department report showed. As a July deadline approaches for higher tariff rates to kick in on dozens of economies, all eyes are also on whether countries can reach lasting trade deals with Washington to ease the effects of tariffs. For now, despite the slowing in economic growth, Pearce said risks that inflation could increase will keep the Fed on hold with interest rates "until much later in the year."
