European Central Bank makes largest-ever interest rate hike
FRANKFURT, Germany (AP) — The European Central Bank has made its largest-ever interest rate increase to combat record inflation that is squeezing consumers and pushing the 19 countries that use the euro currency toward recession. The bank’s 25-member governing council raised its key benchmarks by an unprecedented three-quarters of a percentage point Thursday. The ECB joined the U.S. Federal Reserve and other central banks in the global stampede of rapid rate hikes. Russia’s war in Ukraine has fueled inflation in Europe, with Russia sharply reducing supplies of cheap natural gas used to heat homes, generate electricity and run factories. That has driven up gas prices by 10 times or more.
Truss: UK to cap domestic energy prices, end fracking ban
LONDON (AP) — British Prime Minister Liz Truss says her Conservative government will cap domestic energy prices for homes and businesses to ease the cost-of-living crisis. She also says she will approve more North Sea oil drilling and lift a ban on fracking to increase the United Kingdom’s domestic energy supply. Truss told lawmakers Thursday that the two-year “energy price guarantee” means average household bills will be no more than 2,500 pounds a year for heating and electricity. Bills had been due to rise to 3,500 pounds pounds a year beginning in October, triple the costs of a year ago. Critics say that means taxpayers will have to foot the bill, instead of energy companies that are seeing windfall profits.
Powell: Higher rates unlikely to cause deep US recession
WASHINGTON (AP) — The last time the Federal Reserve faced inflation as high as it is now, in the early 1980s, it jacked up interest rates to double-digit levels — and in the process caused a deep recession and sharply higher unemployment. On Thursday, Chair Jerome Powell suggested that this time, the Fed won’t have to go nearly as far. “We think we can avoid the very high social costs that Paul Volcker and the Fed had to bring into play to get inflation back down,” Powell said in an interview at the Cato Institute, referring to the Fed chair in the early 1980s who sent short-term borrowing rates to roughly 19% to throttle punishingly high inflation.
Stocks slip on Wall Street, remain on track for weekly gains
NEW YORK (AP) — Stocks turned lower in shaky trading, but major indexes held on to their gains for the week. The S&P 500 fell 0.5% Thursday afternoon after swinging between gains and losses earlier. The Dow Jones Industrial Average and the Nasdaq also fell. Interest rates policies were in sharp focus for investors as the European Central Bank made its largest-ever rate increase, in line with moves from the U.S. Federal Reserve and other central banks to fight inflation. Meanwhile Fed Chair Jerome Powell reaffirmed the Fed’s commitment to keep rates high “until the job is done” in getting inflation under control.
Retailers pull lobster from menus after ‘red list’ warning
PORTLAND, Maine (AP) — Some retailers are taking lobster off the menu after an assessment from an influential conservation group that the seafood poses too much of a risk to rare whales and should be avoided. Seafood Watch, which rates the sustainability of different seafoods, said this week it has added the American and Canadian lobster fisheries to its “red list” of species to avoid. The organization said in a report that the fishing industry is a danger to North Atlantic right whales. Thousands of companies follow the group’s recommendations, and HelloFresh and Blue Apron are among those to say it will stop selling lobster.
Cheaper electric vehicles coming despite high battery costs
WARREN, Mich. (AP) — Auto companies are rolling out more affordable electric vehicles that should widen their appeal to a larger group of buyers. That’s despite rising battery costs. The latest EV came Thursday from General Motors, a Chevrolet Equinox small SUV. It has a starting price around $30,000 and a range-per-charge of 250 miles, or 400 kilometers. You can get range of 300 miles, or 500 kilometers, if you pay more. GM won’t release the exact price of the Equinox EV until closer to the date it goes on sale, about this time next year. But the SUV is at the low end of Edmunds.com’s list of prices for electric vehicles sold in the U.S. The average cost of an EV is now around $65,000.
Report: Clean energy jobs grow, but wages lag fossil sector
BERLIN (AP) — A new report has found that clean energy now provides more employment than the fossil fuel industry, reflecting the shift that efforts to tackle climate change are having on the global jobs market. The International Energy Agency said Thursday that a post-pandemic jobs rebound in the sector has been driven by emissions-cutting technologies such as electric vehicle production, building insulation, solar projects and wind farms. Clean energy, which under IEA’s definition also includes nuclear power, is now estimated to account for more than half the 65 million energy sector jobs across all regions except Russia and the Middle East. The Paris-based agency said high energy prices have also seen an upswing in fossil fuel project and wages clean energy jobs still lag on pay.
Bankruptcy stay for Nord Stream 2 pipeline firm extended
BERLIN (AP) — A Swiss court has granted the operating company for the never-opened Nord Stream 2 pipeline, which was built to bring gas from Russia to Germany but put on ice shortly before Russia invaded Ukraine, a four-month extension to its “stay of bankruptcy.” The stay for Nord Stream 2 AG was extended from Sept. 10 through Jan. 10 by a regional court in Zug canton (state), according to a notice published Thursday in the Swiss Official Gazette of Commerce. The company, a subsidiary of Russia’s Gazprom, is based in Zug. German Chancellor Olaf Scholz’s government halted the certification process for the pipeline on Feb. 22, after Russia recognized the independence of two separatist regions in eastern Ukraine.
Fewer Americans apply for jobless aid last week
WASHINGTON (AP) — The number of Americans filing for unemployment benefits last week fell to its lowest level since May despite repeated attempts by the Federal Reserve to cool the economy and bring inflation under control. Applications for jobless aid for the week ending Sept. 3 fell by 6,000 to 222,000, the Labor Department reported Thursday. First-time applications generally reflect layoffs. The four-week average for claims, which smooths out some of the weekly ups and downs, declined by 7,500 to 233,000. Hiring in the U.S. in 2022 has been remarkably strong even as the country faces rising interest rates and weak economic growth.
As housing market cools, homebuyers regain leverage
LOS ANGELES (AP) — Homebuyers are regaining leverage at the negotiating table as the housing market slows, new data from Redfin shows. On average, U.S. homes purchased during a four-week period in August sold for less than the asking price. That hasn’t happened since at least March 2021, according to the real estate brokerage. Years of soaring home prices and sharply higher mortgage rates remain hurdles for many would-be homebuyers, but with more homes selling for less than their asking price, the housing market is at least becoming less skewed in favor of sellers.