Business News

Fed’s Powell: Elevated inflation will likely delay rate cuts this year

WASHINGTON (AP) — Federal Reserve Chair Jerome Powell cautioned that persistently elevated inflation will likely delay any Fed rate cuts until later this year, opening the door to a period of higher-for-longer interest rates. “Recent data have clearly not given us greater confidence” that inflation is coming under control” and instead indicate that it’s likely to take longer than expected to achieve that confidence,” Powell said during a panel discussion. “If higher inflation does persist,” he said, “we can maintain the current level of [interest rates] for as long as needed.” His comments suggested that without further evidence that inflation is falling, the central bank will likely carry out fewer than the three quarter-point reductions its officials had forecast in March.

A top Federal Reserve official opens door to keeping rates high for longer

WASHINGTON (AP) — Federal Reserve Vice Chair Philip Jefferson suggested that the central bank’s key rate may have to remain at its peak for a while to bring down persistently elevated inflation. Jefferson said he expects inflation to continue to slow this year. But he omitted a reference to the likelihood of future rate cuts that he had included in a previous speech in February. Instead, he said his outlook is that inflation will cool even with the Fed’s key rate “held steady at its current level.” If elevated inflation proves more persistent than he expects, Jefferson added, “it will be appropriate” to keep rates at their current level “for longer” to help slow inflation to the Fed’s 2% target level.

Yellen says Iran’s actions could cause global ‘economic spillovers’ and warns of more sanctions

WASHINGTON (AP) — Treasury Secretary Janet Yellen is warning of potential global “economic spillovers” from rising tensions in the Middle East. She’s also pledging that the U.S. and its allies won’t hesitate to use their sanctions powers to address Iran’s “malign and destabilizing activity” in the region. Yellen made her remarks Tuesday as global finance ministers and central bankers gather for meetings in Washington this week to discuss the global economic challenges of the day. The annual gathering of the International Monetary Fund and World Bank is taking place as other ongoing conflicts, including Russia’s invasion of Ukraine, also threaten global financial stability.

New rules for Pregnant Workers Fairness Act include divisive accommodations for abortion

NEW YORK (AP) — Workers are entitled to time off and other job accommodations for abortions under the Pregnant Workers Fairness Act, according to finalized federal regulations published Monday. The regulations provide guidance for employers and workers on how to implement the law, which passed with robust bipartisan Congressional support in December 2022 but sparked controversy last year when the Equal Employment Opportunity Commission included abortions in its draft rules. The language means that workers can ask for time off to obtain an abortion and recover from the procedure. It also covers other pregnancy-related medical conditions like miscarriage, stillbirth and lactation.

Weedkiller manufacturer seeks lawmakers’ help to squelch claims it failed to warn about cancer

DES MOINES, Iowa (AP) — The maker of a popular weedkiller is turning to lawmakers in key states to try to squelch legal claims that it failed to warn about cancer risks. Bayer disputes such claims but already has paid about $10 billion to resolve them. Thousands of similar lawsuits remain pending. Bayer has supported legislation in Idaho, Iowa and Missouri that would shield pesticide and herbicide companies from failure-to-warn claims if they use labels approved by the federal Environmental Protection Agency. But legal experts warn it could have broader consequences — extending to any product liability claim or providing immunity from lawsuits of any kind. Critics say it could spread nationwide.

IMF: Outlook for world economy is brighter, though still modest by historical standards

WASHINGTON (AP) — The International Monetary Fund has upgraded its outlook for the global economy, saying the world appears headed for a “soft landing” — reining in inflation without much economic pain and producing steady if modest growth. The IMF now envisions 3.2% worldwide expansion this year, up a tick from the 3.1% it had predicted in January and matching 2023’s pace. It notes that the global expansion is being powered by unexpectedly strong growth in the United States, the world’s largest economy. The IMF expects the U.S. economy to grow 2.7% this year, an upgrade from the 2.1% it had predicted in January and faster than a solid 2.5% expansion in 2023.

Southern governors tell autoworkers that voting for a union will put their jobs in jeopardy

DETROIT (AP) — On the eve of a vote on union representation at Volkswagen’s Tennessee factory, Gov. Bill Lee and some other southern governors are telling workers that voting for a union will put jobs in jeopardy. About 4,300 workers at VW’s plant in Chattanooga will vote this week on representation by the United Auto Workers. Vote totals are expected to be tabulated Friday night. The election is the first test of the UAW’s efforts to organize nonunion auto factories nationwide. The governors said in a statement Tuesday that they have worked to bring good-paying jobs to their states. But they said a successful union drive will stop auto manufacturing growth and hurt workers. The UAW declined comment.

2023 was a record year for wind installations as world ramps up clean energy, report says

The world installed 117 gigawatts of new wind power capacity in 2023, a 50% increase from the year before, making it the best year for new wind projects on record, according to a new report by the industry’s trade association. The latest Global Wind Report, published Tuesday by the Global Wind Energy Council, explores the state of the global wind industry and the challenges it’s facing in its expansion. The increase in wind installations “shows that the world is moving in the right direction in combating climate change,” the report said.

Microsoft invests $1.5 billion in AI firm G42, overseen by UAE’s national security adviser

REDMOND, Wash. (AP) — Microsoft is investing $1.5 billion in a technology firm based in the United Arab Emirates and overseen by the country’s powerful national security adviser. Microsoft and the technology holding company G42 announced the deal Tuesday. As part of the agreement, Microsoft’s president, Brad Smith, will join G42’s board of directors. Microsoft said the deal “was developed in close consultation with both the UAE and U.S. governments.” G42 has previously said it would cut ties to Chinese hardware suppliers over American concerns it was too close to the Chinese government.

China’s economy grew 5.3% in first quarter, beating expectations, though weak spots remain

HONG KONG (AP) — China’s economy grew faster than expected in the first quarter of the year with help from policies and stronger demand, though signs of weakness persisted. The world’s second-largest economy expanded at a 5.3% annual pace in January-March, surpassing analysts’ forecasts of about 4.8%. Compared to the previous quarter, the economy expanded 1.6%. China’s economy has struggled to bounce back from the COVID-19 pandemic, with a slowdown in demand and a property crisis weighing on its growth. Policymakers have unveiled a raft of fiscal and monetary policy measures meant to boost the economy and financial markets. China has set an ambitious gross domestic product growth target of about 5% for 2024.