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Tag: Inflation

  • What oil CEOs really think about Trump’s management of the oil sector: ‘Those who can are running for the exits’ | Fortune

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    Oil companies may have President Donald Trump cheering them on from the bully pulpit. But in the oil patch, the mood is anything but celebratory.

    New data on Wednesday from the Dallas Fed Energy Survey,  which polled oil and gas executives at 139 firms across Texas, northern Louisiana and southern New Mexico in mid-September, shows oil and gas activity slipped again in the third quarter of 2025, weighed down by soaring costs, policy uncertainty, and the chaos of new tariffs.

    The survey’s broadest measure of business conditions, the business activity index, came in at –6.5, marking the second consecutive quarter of contraction.

    The outlook was even gloomier. The company outlook index plunged to –17.6 from –6.4, while more than 44% of firms said uncertainty remains elevated. Production of both oil and natural gas ticked lower, while costs for everything from drilling to equipment leasing surged.

    ‘The noise and chaos is deafening‘

    Executives were blunt in the anonymous comments that come out with the survey each quarter.

    “The uncertainty from the administration’s policies has put a damper on all investment in the oilpatch,” one wrote. “Those who can are running for the exits.”

    Another added that “the administration’s tariffs, particularly on steel and aluminum at fifty percent, are increasing our cost of business.”

    For exploration and production firms, finding and development costs doubled this quarter, while lease operating expenses also jumped sharply.

    Oilfield services firms reported their margins are still deeply negative, with one describing the sector as “bleeding.”

    The tariffs are cutting deep: operators said higher costs for tubular steel, heavy material, and imported components are making wells uneconomic.

    “Tariffs continue to increase the cost of production. We are suffering from a combination of increased cost due to tariffs and downward pricing pressure from end users,” one services executive said.

    A grim investment climate

    That mix of weak prices and high costs has throttled capital spending. The survey found capital expenditures are falling sharply, with the index dropping to –11.6 from –3.0.

    One operator emphasized that the uncertainty from regulatory policy was putting a damper on the spending.

    “Day-to-day changes to energy policy is no way for us to win as a country,” the operator said. “Investors avoid investing in energy because of the volatility … and the ‘stroke of pen’ risk that the federal government wields.”

    The gloom is reflected in price expectations. Respondents now see West Texas Intermediate crude ending 2025 at just $63 a barrel,  barely above where it traded during the survey period. Two years out, the consensus rises modestly to $69, and to $77 five years from now, levels many independents say are too low to justify new drilling.

    The shale dream frays

    A decade ago, U.S. shale was hailed as the world’s most dynamic energy engine. Now, industry insiders describe it as broken, even as Trump removes tax credits for renewables.

    “The collapse of capital availability has fueled consolidation by the majors, pushing out independents and entrepreneurs who once defined the shale revolution,” one respondent said. “In their place, a handful of giants now dominate but at the cost of enormous job loss and the destruction of the innovative, risk-taking culture that made the U.S. shale industry great.”

    Others warned that the sector is being whipsawed by politics from both parties.

    “The sword being wielded against the renewables industry right now will likely boomerang back in 3.5 years against traditional energy,” one said, pointing to methane penalties and permitting fights that could return with a vengeance.

    While Trump insists domestic drilling will fuel an American energy renaissance, the very policies his administration is pushing are raising costs, curbing investment, and leaving many operators sitting on their hands.

    “The oil industry is once again going to lose valuable employees,” one executive lamented. “Drilling is going to disappear.”

    Fortune Global Forum returns Oct. 26–27, 2025 in Riyadh. CEOs and global leaders will gather for a dynamic, invitation-only event shaping the future of business. Apply for an invitation.

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    Eva Roytburg

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  • Trump’s tariffs have already hurt the economy—and the pain is only beginning

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    The U.S. economy is already feeling the effects of Trump’s tariffs, and the Organization for Economic Cooperation and Development (OECD) projects that things could get worse.

    The OECD’s biannual interim economic outlook, published on Tuesday, forecasts U.S. growth will fall by a full percentage point from its 2024 rate. While this might not sound like much, this will translate to Americans missing out on trillions of dollars of goods and services by 2035 if this decrease in growth persists.

    From 2010 to 2019, American gross domestic product (GDP) grew by an average of 2.4 percent per year. In 2024, it grew by 2.8 percent. Now, the OECD projects that the economy will grow by only 1.8 percent in 2025 and 1.5 percent in 2026, “owing to higher tariff rates [and] moderating net immigration,” among other factors. Assuming that yearly GDP growth neither rebounds nor falls further but persists at 1.8 percent, the U.S. economy will be $2.2 trillion smaller in 2035 than it would be had President Donald Trump not adopted his protectionist policies and growth remained at 2.4 percent.

    Even though the OECD’s growth projections show the long-run macroeconomic damage of Trump’s tariffs, the American economy has remained relatively strong since he took office. The stock market is at an all-time high while inflation has been about the same as that experienced during the last year of the Biden administration: The average monthly inflation from January 2024 to August 2024, as measured by the consumer price index (CPI), was 0.2 percent. From January 2025 to August 2025, monthly CPI growth was not much higher: 0.225 percent. Meanwhile, the average monthly increase in the producer price index (PPI), which measures changes in expenses borne by American businesses, was 36 percent lower compared to the same time last year.

    The Bureau of Labor Statistics (BLS) explains that “imports are excluded from PPI.” The experimental BLS index, which incorporates imports, tells a story similar to regular PPI: this index experienced 38 percent lower inflation from January 2025 to July 2025 than it did during the same period a year ago.

    Relatively stable consumer price inflation and lower producer price inflation—excluding and including imports—under Trump are surprising. After all, the president has more than tripled the average effective tariff rate to 11.6 percent on approximately $2.2 trillion worth of imports, according to the Tax Foundation. Therefore, all things being equal, CPI and PPI should be elevated. So, why aren’t they? The answer lies in the delayed implementation of Trump’s tariffs: Although “Liberation Day” was April 2, the “reciprocal tariffs” announced then were postponed for months, finally taking effect on August 7, meaning “the full effects of tariff increases have yet to be felt,” as the OECD explains.

    While most Americans have not yet felt the tariffs’ full effects, businesses have started to. An August survey administered by the Dallas Federal Reserve found that 60 percent and 70 percent of Texas retailers and manufacturers, respectively, said that Trump’s tariffs were negatively affecting their businesses. Earlier this month, The New York Times reported that Section 232 tariffs on imported steel and aluminum have cost John Deere “$300 million so far, with nearly another $300 million expected by the end of the year.” The company has already laid off “238 employees across factories in Illinois and Iowa.” While anecdotal, John Deere’s struggles are reflected in the 48 percent lower growth in total nonfarm employment from January 2025 to August 2025 (598,000 jobs added) compared to those months last year (1.1 million jobs added).

    Trump can reverse course at any time by rolling back the Section 232 tariffs and reciprocal tariffs. Even if Trump insists on hobbling the economy with his pointless trade war, Americans could soon enjoy some relief when the Supreme Court convenes in November to hear arguments about the constitutionality of his “Liberation Day” tariffs.

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    Jack Nicastro

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  • Wall Street set to open higher after taking a break from its most recent rally a day earlier

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    Wall Street was poised to open with small gains Wednesday, a day after markets took a break from their relentless record-breaking rally.

    Futures for the S&P 500 ticked up 0.1% before the bell, while Nasdaq futures rose 0.2%. Futures for the Dow Jones Industrial Average were unchanged.

    Shares of Alibaba soared nearly 10% after the Chinese e-commerce giant announced a partnership with Nvidia and an expansion of data center operations into a handful of countries to bolster its artificial intelligence infrastructure. Alibaba is the latest in a string of companies announcing that they were plowing money into AI, many of which are also partnering with AI-chipmaker Nvidia.

    U.S. markets paused from their recent rally on Tuesday after Federal Reserve Chair Jerome Powell said stock prices were “fairly highly valued.”

    In his first public remarks since the Fed cut its main interest rate last week for the first time this year, Powell said that the Fed is stuck in an unusual position because worries about the job market are rising at the same time that inflation has stubbornly remained above its 2% target.

    Analysts said his comments reiterated his stance that there is no risk-free path.

    “Essentially the Fed Chairman confirmed what we already knew, which is that the central bank remains somewhat ‘between a rock and a hard place’ when it comes to managing the risks of rising inflation and falling employment,” said Tim Waterer, chief market analyst at KCM Trade.

    Fed officials have penciled in more cuts to rates through the end of this year and into next, but they are remaining wary because lower rates can also give inflation more fuel.

    An update Friday will show how much prices are rising for U.S. households based on the Fed’s preferred measure of inflation, and economists expect it to show a slight acceleration for last month.

    Elsewhere, in Europe at midday France’s CAC 40 slipped 0.6%, while the German DAX and Britain’s FTSE 100 each fell 0.2%.

    Japan’s benchmark Nikkei 225 recouped morning losses to finish 0.3% higher at 45,630.31. Australia’s S&P/ASX 200 slipped 0.9% to 8,764.50. South Korea’s Kospi dropped 0.4% to 3,472.14. Hong Kong’s Hang Seng rose 1.4% to 26,518.65, while the Shanghai Composite gained 0.8% to 3,853.64.

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  • Powell signals Federal Reserve to move slowly on interest rate cuts | Long Island Business News

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    In Brief:
    • Powell warns against cutting rates too aggressively, citing risks
    • Trump appointees Miran and Bowman push for faster, deeper cuts
    • Fed cut its key rate to 4.1% last week, first reduction this year
    • Divisions deepen within Fed as job market softens and inflation lingers

    Chair on Tuesday signaled a cautious approach to future interest rate cuts, in sharp contrast with other Fed officials this week who have called for a more urgent approach.

    In remarks in Providence, Rhode Island, Powell noted that there are risks to both of the Fed’s goals of seeking maximum employment and stable prices. But with the rate rising, he noted, the Fed agreed to cut its key rate last week. Yet he did not signal any further cuts on the horizon.

    If the Fed were to cut rates “too aggressively,” Powell said, “we could leave the inflation job unfinished and need to reverse course later” and raise rates. But if the Fed keeps its rate too high for too long, “the labor market could soften unnecessarily,” he added.

    Powell’s remarks echoed the caution he expressed during a news conference last week, after the Fed announced its first rate cut this year. At that time he said, “it’s challenging to know what to do.”

    The careful approach he outlined is quite different from that of some other members of the Fed’s rate-setting committee, particularly those who were appointed by President Donald Trump, who are pushing for faster cuts. On Monday, said the Fed should quickly reduce its rate to as low as 2% to 2.5%, from its current level of about 4.1%. Miran was appointed by Trump this month and rushed through the Senate, taking his seat just hours before the Fed met last Tuesday. He is also a top adviser in the Trump administration and expects to return to the White House after his term expires in January, though Trump could appoint him to a longer term.

    And earlier Tuesday, Fed governor also said the central bank should cut more quickly. Bowman, who was appointed by Trump in his first term, said inflation appears to be cooling while the job market is stumbling, a combination that would support lower rates.

    When the Fed cuts its key rate, it often over time reduces other borrowing costs for things like mortgages, car loans, and business loans.

    “It is time for the (Fed) to act decisively and proactively to address decreasing labor market dynamism and emerging signs of fragility,” Bowman said in a speech in Asheville, North Carolina. “We are at serious risk of already being behind the curve in addressing deteriorating labor market conditions. Should these conditions continue, I am concerned that we will need to adjust policy at a faster pace and to a larger degree going forward.”

    Yet Powell’s comments showed little sign of such urgency. Other Fed officials have also expressed caution about cutting rates too fast, reflecting deepening divisions on the rate-setting committee.

    On Tuesday, , president of the Federal Reserve’s Chicago branch, said in an interview on CNBC that the Fed should move slowly given that inflation is above its 2% target.

    “With inflation having been over the target for 4 1/2 years in a row, and rising, I think we need to be a little careful with getting overly up-front aggressive,” he said.

    Last week the Fed cut its key rate for the first time this year to about 4.1%, down from about 4.3%, and policymakers signaled they would likely reduce rates twice more. Fed officials said in a statement that their concerns about slower hiring had risen, though they noted that inflation is still above their 2% target.

    In a question and answer session, Powell said that tariffs, so far, have had a fairly limited impact on inflation, though he suggested that could change.

    He said U.S. companies are paying most of the tariffs, which contradicts Trump administration claims that overseas companies are shouldering the payments. But he said that the pass-through of tariff costs to consumers “has been later and less than we expected.”

    He also said the Fed continues to tune out attacks against it and added that the Fed does not consider when making its decisions. Powell and the Fed have been under steady attack from Trump, though Powell did not name him.

    “Whenever we make decisions, we’re never, ever thinking about political things,” Powell said. “Truth is, mostly people who are calling us political, it’s just a cheap shot. … We don’t get into back and forth with external people.”


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    The Associated Press

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  • Japan PM contender Koizumi vows wage hikes to counter inflation

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    By Leika Kihara

    TOKYO (Reuters) -Shinjiro Koizumi, launching a bid to become Japan’s next prime minister, pledged on Saturday to focus on revitalising the economy by boosting wages and productivity to counter rising prices.

    Koizumi, seen as a frontrunner in the ruling party’s leadership race, said Japan must shift the focus of economic policy from beating deflation to one better suited to an era of inflation.

    “Japan’s economy is in a transition phase from deflation to inflation,” Koizumi told a news conference announcing his bid for president of the Liberal Democratic Party.

    “We must have wage growth accelerate at a pace exceeding inflation, so consumption becomes a driver of growth,” Koizumi said, adding that the economy would be his policy priority.

    On monetary policy, Koizumi said he hoped the Bank of Japan would work in lock step with the government to achieve stable prices and solid economic growth.

    Koizumi and veteran fiscal dove Sanae Takaichi are seen as the top contenders in the October 4 party race after Prime Minister Shigeru Ishiba’s decision this month to step down.

    The next LDP leader is likely to become prime minister as the party is by far the largest in the lower house of parliament, although the LDP lost its majorities in both houses under Ishiba, so the path is not guaranteed.

    Koizumi said if he were to become prime minister, his government would immediately compile a package of measures to cushion the economic blow from rising prices, and submit a supplementary budget to an extraordinary parliament session.

    “While being mindful of the need for fiscal discipline, we can use increased tax revenues from inflation to fund policies for achieving economic growth,” he said.

    The LDP race has drawn strong attention from market players and led to a rise in super-long government bond yields on the view the next leader could boost fiscal spending.

    Investors have also focused on the candidates’ view on monetary policy, as the BOJ eyes further hikes in still-low interest rates. Takaichi had criticised the BOJ’s rate hikes in the past but made no comment on monetary policy at a news conference on Friday.

    Koizumi said that if chosen as prime minister, his government would slash tax on gasoline, increase tax exemptions for households and take steps to raise average wages by 1 million yen ($6,800) by fiscal 2030, Koizumi said.

    He also pledged to increase government support on corporate capital expenditure to boost Japan’s manufacturing capacity. “We need to build a strong economy backed by growth in both demand and supply,” Koizumi said.

    ($1 = 147.9400 yen)

    (Reporting by Leika Kihara; Editing by William Mallard)

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  • Midwest homeowners with electric heat may see a chilling 20% increase in bill

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    For those who like to crank the thermostat up during the winter, a new report showing data for the Midwest and other parts of the country says you should be prepared for a much higher price tag this season if you have electric heat. 

    Friday’s report from the National Energy Assistance Directors Association says that on average, heating costs will increase by more than 7.5% from last winter across the country, from $907 to $976. However, officials with NEADA say homeowners with electric heat are expected to see an even higher increase. 

    The average price last winter was $1,093, and this year, NEADA projects that same average cost to be $1,205. That’s an increase of $112, or 10.2%.

    The association says electrical bill increases are due to the construction of large data centers, the rising cost of natural gas as well as maintaining and upgrading the electrical grid. 

    The report went on to break down estimated winter heating costs by region by using regional temperature and price projections. In the Midwest, electric heat users on average spent $1,251 last winter, according to the report, which projects this winter to cost $1,498. That’s an increase of $246, or nearly 20%. 

    Meanwhile, natural gas users in the Midwest should see an average increase of $99, while propane users should see an increase of about $5. Those are increases of 16.4% and 0.5% from last winter, respectively. 

    Since the winter of 2021-2022, NEADA says the average winter heating cost has risen by 31% for electric users and 26.5% for those who use natural gas. 

    According to NEADA, roughly 21 million households are behind on energy bills. Nationally, 3 million homes had their energy shut off in 2023, and another 3.5 million followed suit in 2024. This year, that number could reach 4 million.

    In Minnesota, a state law known as the Cold Weather Rule prevents utility services from being shut off from Oct. 1 to April 30, while the Extreme Heat Law makes sure electricity isn’t turned off when temperatures reach excessive heat levels. However, to make sure your service isn’t disconnected, a payment plan must be made and agreed upon by the user and the utility company. A payment plan can be set up at any time during the Cold Weather Rule season. 

    Note: The above video first aired on Sept. 15. 

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    Krystal Frasier

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  • Japan’s central bank holds steady on key interest rate

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    Japan’s central bank has kept its key interest rate unchanged at 0.5%, in a decision that was widely expected, given recent inflation trends that have stayed above target

    TOKYO — Japan’s central bank kept its key interest rate unchanged at 0.5% Friday, in a decision that was widely expected, given recent inflation trends that have stayed above target.

    The Bank of Japan issued its decision on the overnight call rate after a two-day meeting by its policy board.

    “Japan’s economy has recovered moderately, although some weakness has been seen in part. Overseas economies have grown moderately on the whole,” it said in a statement.

    The U.S. Federal Reserve cut its policy rate by 0.25 percentage points earlier this week, the Fed’s first cut since December, and lowered its short-term rate to about 4.1%, down from 4.3%.

    Japan had been ailing from deflationary trends in recent years, but prices are gradually rising. Recent government data show consumer prices rising above the central bank’s target of 2%, at between 2.5% and 3%.

    The Bank of Japan noted exports will be hit by higher tariffs, which have come about because of U.S. President Donald Trump’s policies. There was an increase in trade in anticipation of the tariffs, but those rises are now tapering off, it said.

    Also mentioned as a risk factor was the uncertainty in domestic politics. Prime Minister Shigeru Ishiba is stepping down, and the ruling party is holding an election to choose a new leader.

    Five candidates are expected to enter the race, with a party vote coming early next month. The grip on power by the Liberal Democratic Party, which has ruled postwar Japan almost incessantly, appears to be unraveling lately.

    The Japanese stock market has been booming recently, with the benchmark Nikkei 225 hitting another record Thursday, cheered by the Fed’s rate cut. Shares were falling slightly in Friday morning trading.

    ___

    Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama

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  • Rising grocery prices could lead to shrinkflation, food industry analyst says

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    Santa Monica, California — It’s no secret that a trip to the grocery store is costing more these days. Food prices grew by a half-percent from July to August, according to data from the U.S. Bureau of Labor Statistics Consumer Price Index — the fastest monthly change since the fall of 2022.

    And overall grocery prices in August rose 2.7% compared to one year ago, according to the CPI.

    “Tariffs have a huge impact on grocery prices,” food industry analyst Phil Lempert, editor of SupermarketGuru, told CBS News. 

    Lempert believes the Trump administration’s tariffs are one of three primary reasons that Americans are seeing a rise in grocery prices, with the others being climate change and labor shortages.

    “We can’t grow our food where we used to grow it,” Lempert said of the impact of climate change. “… Now it’s had to move to Central and Latin America… Number two is the labor shortage… And then third is our tariffs.” 

    One of the products that has seen some of the biggest price jumps is coffee, which has jumped 21.7% compared to one year ago, according to the CPI.

    “We got 50% tariffs on coffee from Brazil, and we import about 35% of our coffee beans, unroasted, from Brazil,” Lempert said. “… Yes, coffee’s going to get more expensive.”

    He also says the U.S. should brace for shrinkflation — when food and product manufacturers keep prices the same, but reduce the size of items, meaning consumers are ultimately paying more for the same amount.

    A September 2024 analysis from Lending Tree found that about one-third of approximately 100 common consumer products had shrunk in size or servings since the start of the pandemic.

    As an example, Lempert showed CBS News coffee bean packets in one grocery store in Santa Monica, California, that used to be sold in 16-ounce sizes, but are now 10.5 ounces. 

    “What they’re doing is they’re trying to put less in the package, hoping that you and I are not going to observe that, and keep that price either stable or just slightly increased,” Lempert explained.

    Lempert says shrinkflation is “absolutely not” going away. According to his analysis, higher prices are changing consumer behavior, with more shoppers choosing less expensive store brands, shopping at multiple stores in an effort to find deals, and buying in bulk. 

    “No. 1, always have a shopping list,” says Lempert on his advice on seeking out savings. “… Don’t waste food… Take doggy bags from restaurants, use leftovers, freeze leftovers. And then, obviously, use your coupons. Use your frequent shopper card. Do everything you can to compare prices before you head to the store.” 

    Jo Ling Kent

    Journalist Jo Ling Kent joined CBS News in July 2023 as the senior business and technology correspondent for CBS News. Kent has more than 15 years of experience covering the intersection of technology and business in the U.S., as well as the emergence of China as a global economic power.

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  • FTC sues Ticketmaster, saying it forces fans to pay more for concerts and events

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    The Federal Trade Commission and a bipartisan group of state attorneys general sued Ticketmaster and its parent company Thursday, saying they are forcing consumers to pay more to see live events through a variety of illegal tactics.

    The FTC said Live Nation and its subsidiary, Ticketmaster, have deceived artists and consumers by advertising lower ticket prices than what consumers must pay and falsely claiming to impose strict limits on the number of tickets consumers can buy for an event.

    In reality, the FTC said, Ticketmaster coordinates with ticket brokers who bypass those ticket limits. The FTC said brokers use fake accounts to buy up millions of dollars worth of tickets and then sell them at a substantial markup on Ticketmaster’s platform. Ticketmaster benefits from the additional fees it collects from those sales, the FTC said.

    The Associated Press left messages seeking comment Thursday with Beverly Hills, California-based Live Nation Entertainment.

    Ticketmaster controls 80% or more of major U.S. concert venues’ primary ticketing, according to the FTC. Consumers spent more than $82.6 billion buying tickets from Ticketmaster between 2019 and 2024, the agency added.

    “American live entertainment is the best in the world and should be accessible to all of us. It should not cost an arm and a leg to take the family to a baseball game or attend your favorite musician’s show,” FTC Chairman Andrew Ferguson said in a statement.

    The lawsuit was filed in the U.S. District Court for the Central District of California. Joining the lawsuit were the attorneys general of Colorado, Florida, Illinois, Nebraska, Tennessee, Utah and Virginia.

    Ticketmaster has been in lawmakers’ sights since 2022, when it spectacularly botched ticket sales for Taylor Swift’s Eras Tour. The company’s site was overwhelmed by fans and attacks from brokers’ bots, which were scooping up tickets to sell on secondary sites. Senators grilled Live Nation in a 2023 hearing.

    But reform in the industry has been slow. The Biden administration took action with a ban on junk fees, requiring Ticketmaster to display the full price of a ticket as soon as consumers begin shopping. That rule went into effect in May.

    President Donald Trump has also taken aim at the industry. In March, with Kid Rock by his side in the Oval Office, Trump signed an executive order directing U.S. officials to ensure ticket resellers are complying with Internal Revenue Service rules. The order also directed the FTC to “take enforcement action to prevent unfair, deceptive, and anti-competitive conduct in the secondary ticketing market.”

    In August, the FTC sued Maryland-based ticket broker Key Investment Group use, alleging it has used thousands of fictitious Ticketmaster accounts and other methods to buy tickets for events, including Swift’s tour.

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  • Will mortgage rates drop further after the Fed’s rate cut? Not necessarily

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    LOS ANGELES — Hoping that mortgage rates will keep dropping following the Federal Reserve’s first rate cut since last year? Don’t bank on it.

    As expected, the central bank delivered a quarter-point cut Wednesday and projected it would lower its benchmark rate twice more this year, reflecting growing concern over the U.S. job market.

    Here’s a look at factors that determine mortgage rates and what the Fed’s latest move means for the housing market:

    Mortgage rates have been mostly falling since late July on expectations of a Fed rate cut. The average rate on a 30-year mortgage was at 6.35% last week, its lowest level in nearly a year, according to mortgage buyer Freddie Mac.

    A similar pullback in mortgage rates happened around this time last year in the weeks leading up to the Fed’s first rate cut in more than four years. Back then, the average rate on a 30-year mortgage got down to a 2-year low of 6.08% one week after the central bank cut rates.

    But it hasn’t come close to that since.

    Mortgage rates didn’t keep falling last year, even as the Fed cut its main rate two more times. Instead, mortgage rates rose and kept climbing until the average rate on a 30-year home loan reached just over 7% by mid-January.

    Like last year, the Fed’s rate cut doesn’t necessarily mean mortgage rates will keep declining, even as the central bank signals more cuts ahead.

    “Rates could come down further, as the Fed has signaled the potential for two more rate cuts this year,” said Lisa Sturtevant, chief economist at Bright MLS. “However, there are still risks of a reversal in mortgage rates. Inflation heated up in August and if the September inflation report shows another bump in consumer prices, it’s possible we could see rates rise.”

    No. Mortgage rates are influenced by several factors, from the Fed’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation.

    Mortgage rates generally follow the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans.

    That’s because mortgages are typically bundled into mortgage-backed securities that are sold to investors. To keep mortgage-backed securities attractive to investors, their yield — or annual return — is adjusted to be competitive with the yield offered by the U.S. on its 10-year government bonds. When those bond yields rise, they tend to push up mortgage rates, and vice-versa.

    The 10-year Treasury yield has been mostly easing since mid-July as growing signs that the job market has been weakening fueled expectations of a Fed rate cut this month.

    Until now, the Fed had kept its main interest rate on hold this year because it was more worried about inflation potentially worsening due to the Trump administration’s tariffs than about the job market.

    At the same time, inflation has so far refused to go back below the Fed’s 2% target.

    When the Fed cuts rates that can give the job market and overall economy a boost, but it can also fuel inflation. That, in turn, could push up mortgage rates.

    “It’s not just about what the Fed is doing today, it’s about what they’re expected to do in the future, and that’s determined by things like economic growth, what’s going to happen in the labor market and what do we think inflation is going to be like over the next year or so,” said Danielle Hale, chief economist at Realtor.com.

    “If the Fed keeps lowering rates, it doesn’t necessarily mean mortgages will go down,” said Stephen Kates, financial analyst at Bankrate. “It means that they probably could go down more, and they may trend in that direction, even if they don’t move in lockstep.”

    Ahead of the Fed’s rate cut, the futures market had priced in expectations that the central bank would cut its key interest rate at upcoming policy meetings this year and into 2026. But the Fed’s latest projections show a less aggressive path of rate cuts than the market has been expecting.

    “This ongoing gap between market and Fed expectations means that some risk of upward pressure on mortgage rates remains,” said Hale, adding that the decline in mortgage rates “is likely to continue at least through this week.”

    Hale recently forecast that the average rate on a 30-year mortgage will be between 6.3% and 6.4% by the end of this year. That’s in line with recent projections by other economists who also don’t expect the average rate to drop below 6% this year.

    The late-summer pullback in mortgage rates has been a welcome trend for the housing market, which has been in a slump since 2022, when mortgage rates began climbing from historic lows. Sales of previously occupied U.S. homes sank last year to their lowest level in nearly 30 years and have remained sluggish so far this year.

    While lower rates give home shoppers more purchasing power, mortgage rates remain too high for many Americans to afford to buy a home. That’s mostly because home prices, while rising more slowly than in years past, are still up by roughly 50% nationally since the start of this decade.

    “While lower rates will bring some buyers and sellers into the market, today’s cut will not be enough to break up the housing market logjam,” said Sturtevant. “We will need to see further drops in mortgage rates and much slower home price growth, or even home price declines, to make a dent in affordability.”

    If mortgage rates continue to ease, home shoppers will benefit from more affordable financing. But lower mortgage rates could also bring in more buyers, making the market more competitive at a time when sellers across the country are having a tougher time driving a hard bargain.

    Predicting when mortgage rates will decline and by how much is daunting because so many variables can influence their trajectory from one week to the next.

    Home shoppers who can afford to buy at current rates may be better off buying now if they find a property that fits their needs, rather than attempt to time the market, said Kates.

    Many homeowners looking to refinance have already seized on the decline in rates, sending applications for refinance loans sharply higher in recent weeks.

    One rule of thumb to consider when refinancing is whether you can reduce your current rate by at least one percentage point, which helps blunt the impact of refinancing fees.

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  • Bank of Canada cuts interest rates to combat slowing economy – MoneySense

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    Governor Tiff Macklem said the risks have shifted since the bank’s last interest rate decision in July. Cracks in the labour market and a sharp drop in exports are threatening growth, he said, while earlier signs of underlying inflation pressure are fading. “With a weaker economy and less upside risk to inflation, governing council judged that a reduction in the policy rate was appropriate to better balance the risks,” he told reporters after the rate decision Wednesday.

    The Bank of Canada signalled it will keep looking over a shorter horizon than usual as it tries to set monetary policy in a constantly shifting environment. Macklem said the bank is ready to adjust its policy rate again if warranted. “We’ve demonstrated today, if the risks tilt, if the risks shift, we’re prepared to take action,” he said. “And if the risks tilt further, we are prepared to take more action. But we’re going to take it one meeting at a time.”

    Macklem forecasts modest growth despite rising unemployment and shrinking economy

    Macklem said some of the stickiness in underlying inflation that was worrying the Bank of Canada earlier this year now appears to be diminishing. The federal government’s decision to drop most retaliatory tariffs against the United States at the start of this month will also take some fuel out of price growth, he said. Counter-tariff impacts were most noticeable in food in recent months, Macklem said, but with the removal of those measures, prices should fall back in affected areas going forward.

    Canada’s jobless rate has meanwhile moved up to 7.1% and the economy shrank in the second quarter as U.S. tariffs took full effect. Macklem reiterated that the central bank does not currently have a recession baked into its outlook, calling instead for modest growth of roughly 1% in the second half of the year. “It’s not going to feel good. It is growth, but it’s slow growth,” he said.

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    RBC economist questions rate cut, citing strong consumer spending

    While the decision to lower the policy rate was widely expected by economists—and came from a consensus of the central bank’s governing council—not all forecasters were in favour of the cut. Nathan Janzen, assistant chief economist at RBC, said Wednesday’s decision was going to be a “close call” but he’s not convinced the economy needed rate-cut stimulus. Consumer spending is holding up and could push inflation higher going forward, he argued.

    Meanwhile, economic weakness is still largely concentrated in trade-exposed sectors—an arena for governments to support, not the central bank. “There’s probably a better policy response than changes in interest rates,” Janzen said.

    Macklem acknowledged that he believes fiscal policy is better suited to handle the sector-specific impacts of U.S. tariffs, while the Bank of Canada’s interest rate can smooth the broader hit from the ensuing shifts in the economy. “Monetary policy can’t undo the effects of tariffs. The most it can do is try to help the economy adjust at a macro level while keeping inflation well controlled,” he said.

    Next rate decision comes ahead of federal fall budget

    The Bank of Canada’s next rate decision will come before the federal government’s long-awaited fall budget, which Finance Minister François-Philippe Champagne announced Tuesday would come on Nov. 4.

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    Macklem largely dismissed reporter questions Wednesday about whether the lack of fiscal clarity was affecting the Bank of Canada’s decisions. He said government spending plans were just one input into the central bank’s forecasts, and monetary policymakers would adjust their models after the budget is tabled.

    Janzen said that while RBC wasn’t calling for a rate cut this month, at 2.5% the policy rate is only slightly below the middle of the central bank’s estimated “neutral range”—where it’s neither boosting nor restricting economic growth. “It’s not aggressively stimulating the economy. It’s still akin to easing your foot off the brakes rather than stepping on the gas from a monetary policy perspective,” he said.

    While there are still a lot of unknowns tied to U.S. tariffs and the global trade disruption, Macklem said “near-term uncertainty may have come down a little.” If the tariff situation with the United States remains steady, he said the central bank will likely return to publishing a single, central forecast for the economy at its next monetary policy decision on Oct. 29.

    Economists expect more rate cuts, but future moves depend on incoming data

    CIBC senior economist Katherine Judge said in a note to clients Wednesday that the economy is “losing resilience” and inflation should remain well contained moving forward. She argued that will set the central bank up for another cut at its October decision.

    Financial markets were placing odds of another quarter-point cut next month at just over 40% as of Wednesday afternoon, according to LSEG Data & Analytics.

    Janzen said it would be rare for a central bank to either cut or hike its policy rate just once, and RBC is now also expecting additional rate cuts to follow. But he cautioned that the Bank of Canada is still “ultra-focused” on near-term indicators, so incoming data on inflation, the labour market and international trade could sway the central bank back to a hold in the coming weeks. Monetary policymakers will be looking at how export activity evolves and whether costs from the trade disruption are passed on to consumers as it gauges where to take the policy rate next.

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  • Jerome Powell on signs of an AI bubble and an economy leaning too hard on the rich: ‘Unusually large amounts of economic activity’ | Fortune

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    For months, Wall Street commentators have fretted that the artificial intelligence boom looks like a bubble, with capital spending – which some analysts estimate could reach $3 trillion by 2028 – fattening a few mega-cap firms, while lower-income workers suffer from a slack labor market. 

    On Wednesday, they got validation from an unlikely source: the chair of the Federal Reserve. 

    Jerome Powell said the U.S. is seeing “unusually large amounts of economic activity through the AI buildout,” a rare acknowledgement from the central bank that the surge is not only outsized, but also skewed toward the wealthy.

    That imbalance extends beyond markets. Roughly 70% of U.S. economic growth comes from consumer spending, yet most households live paycheck to paycheck. That demand picture has taken on a shape that analysts call  K-shaped: while many families cut back on essentials, wealthier households continue to spend on travel, tech, and luxury goods—and they continued to do so in August. For now, the inflation recovery depends heavily on this dynamic remaining in fragile stasis. It’s a fix that works well until it doesn’t, if it could be described as working at all.

    “[Spending] may well be skewed toward higher-earning consumers,” Powell told reporters after the Fed’s latest policy meeting. “There’s a lot of anecdotal evidence to suggest that.”

    That skew has become increasingly obvious in markets. Just seven firms — Microsoft, Nvidia, Apple, Alphabet, Meta, Amazon, and Tesla — now make up more than 30% of the S&P 500’s value. Their relentless AI capex is keeping business investment positive, even as overall job growth has slowed to a crawl. Goldman Sachs estimates AI spending accounted for nearly all of the 7% year-over-year gain in corporate capex this spring.

    The comments underscore a widening concern at the Fed: that while headline GDP growth is holding above 1.5%, the composition of that growth is uneven, unlike previous booms in housing or manufacturing. 

    Powell pointed to “kids coming out of college and younger people, minorities” as struggling to find jobs in today’s cooling labor market, even as affluent households continue to spend freely and companies funnel cash into cutting-edge technologies.

    The imbalance reflects what Powell described as “a low firing, low hiring environment,” where layoffs remain rare but job creation has slowed to a crawl. That dynamic, combined with the concentration of economic gains in AI and among the wealthy, risks deepening inequality, and complicates the Fed’s attempt to balance its inflation and employment mandates.

    That disconnect risks widening the gap between Wall Street and Main Street. While affluent households continue to spend freely and tech titans pour billions into data centers and chips, revised jobs data show the economy added just 22,000 positions in August, with unemployment edging up to 4.3%.

    “Unusually large” AI investment may sustain top-line growth, Powell suggested, but it’s doing little to lift the broad labor market.

    “The overall job finding rate is very, very low,” he said. “If layoffs begin to rise, there won’t be a lot of hiring going on.”

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  • UK inflation remains nearly double target ahead of expected interest rate hold

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    LONDON — Inflation in the U.K. held steady at 3.8% in the year to August, official figures showed Wednesday, a day before the Bank of England is widely expected to keep interest rates on hold.

    The Office for National Statistics found food and drink prices rose for the fifth month in a row, but airfares fell sharply after a big spike in July.

    Though inflation remains nearly double the Bank of England’s target rate of 2%, most economists had anticipated a modest increase in August.

    Stubbornly high inflation has been one of the reasons why the Labour government’s poll ratings have fallen sharply since it came to power in July 2024.

    Treasury chief Rachel Reeves will be hoping inflation starts to drop down towards target, as many forecasters predict, in the year to come as it will relieve some of the cost-of-living pressures that are hurting households and undermining the government’s support.

    “I know families are finding it tough and that for many the economy feels stuck,” she said after the figures were released. “That’s why I’m determined to bring costs down and support people who are facing higher bills.”

    Reeves’ economic plans will be in the spotlight over the coming weeks ahead of her annual budget on Nov. 26, where she is widely expected to increase taxes again to bolster revenues and simultaneously introduce policies to ease the cost-of-living pressures.

    Many critics blame Reeves personally for the increase inflation this year, saying her decision to increase taxes on businesses to plug a budget hole prompted firms to up prices.

    The inflation figures have cemented market expectations that the Bank of England will keep interest rates unchanged on Thursday.

    Since it started cutting borrowing rates in August 2024 after the unwinding of the previous spike in inflation in the wake of Russia’s invasion of Ukraine, the bank has done so in a gradual manner every three months. When it cut its main rate to 4% in August, it was largely expected there would be no further reduction at the September meeting.

    If the bank were to continue to cut interest rates in the manner it has been doing so, the next meeting in November would see a further reduction. However, economists remain split as to whether another cut is forthcoming since inflation has proven to be stickier than anticipated earlier this year, partly because of relatively high wage increases.

    “Several months of disappointing data has highlighted the U.K.’s unwanted position as an international outlier for ‘sticky’ inflation, with the highest headline inflation of any G-7 economy,” said James Smith, research director at the Resolution Foundation think tank.

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  • You’ve heard that gold is hitting record highs. Not quite, BofA says | Fortune

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    Gold prices have indeed soared to all-time highs in 2025, prompting headlines about a historic rally. But according to Bank of America (BofA) Global Research, the story is more nuanced: The gold sector, while booming, hasn’t returned to all of the metrics that defined previous cyclical peaks, especially regarding its value relative to the broader equity market and its own historical valuations.

    This year, gold surged past major thresholds, as the traditional hedge against inflation and macroeconomic uncertainty has been propelled by a preponderance of both. On September 2, gold shot past $3,500/oz, climbing further to $3,600/oz on the Monday following the disappointing U.S. jobs data for August, which raised bets on easier monetary policy. The BofA Commodities team is “bullish,” they say, now forecasting the quarterly average price reaching $4,000/oz in the second quarter of 2026, with the spot price already up 4.1% week-over-week to $3,589/oz.

    Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, told Fortune in March that gold may be a good investment for some but it’s not exactly liquid. “You’re not sending gold to buy your Domino’s pizza,” he said, adding that gold’s rally in recent years has been driven by central banks buying the precious metal as the U.S. dollar weakens and countries like China seek alternatives.  

    Here’s why Bank of America says perspective is important in evaluating gold’s record high, and it depends on how you look at it.

    Sector market cap doubling past peaks, but …

    The global gold sector’s total market capitalization has ballooned to just over $550 billion, nearly twice the peaks seen in 2011 and 2020 ($331-$334 billion), more than 8x the 2016 cycle low ($70 billion), and more than 3x the recent cycle low of $170 billion in 2022. This rally, according to BofA, reflects not just price gains. but also investor interest heightened by inflation and sector cost pressures.

    Yet, when viewed as a share of the total global equity market, gold’s ascent looks less dramatic and it’s “far below” its previous highs, the Commodities team says. The sector now stands at 0.39% of world market capitalization, matching the 2020 peak but still far below 2011’s high of 0.71%. If the sector returned to that 2011 percentage, it would imply a market cap of nearly $990 billion—a potential upside only if the cycle continues long enough.

    Room to run

    Despite high metal prices, gold equities are not trading at historical top valuations. The sector’s next-12-month (NTM) EV/EBITDA multiple sits at 11x, well below the 2020 peak of 15.4x. Price-to-net-asset-value (P/NAV) for the sector rests at 1.88x, compared to 2.27x in 2020 and 2.19x in 2011. Adjusted for current spot gold prices, sector multiples suggest even further upside, with NTM EV/EBITDA at 11.7x and P/NAV at 1.39x.

    Gold equities have responded to the price rally, but not uniformly. Major indices such as the S&P/TSX Global Gold Index (+5.5% WoW), Philadelphia Gold and Silver Index (+4.8%), and NYSE Arca Gold Bugs Index (+4.1%) all surged alongside bullion’s breakout. Year-to-date, Fresnillo is the best performer, climbing over 268%, spotlighting disparate returns in the sector.

    BofA’s research points to room for growth—if current trends in monetary policy, inflation, and investor sentiment persist. However, the gold sector remains a small slice of the global equity pie, with equity valuations still well below historical highs. For market observers, the surging price of gold is only part of the story; the fundamentals suggest this boom is not yet a rerun of previous peaks, and “record highs” should be viewed in context.

    For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

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  • The Fed faces economic uncertainty and political pressure as it decides whether to cut rates

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    WASHINGTON — In a sign of how unusual this week’s Federal Reserve meeting is, the decision it will make on interest rates — usually the main event — is just one of the key unknowns to be resolved when officials gather Tuesday and Wednesday.

    For now, it’s not even clear who will be there. The meeting will likely include Lisa Cook, an embattled governor, unless an appeals court or the Supreme Court rules in favor of an effort by President Donald Trump to remove her from office. And it will probably include Stephen Miran, a top White House economic aide whom Trump has nominated to fill an empty seat on the Fed’s board. But those questions may not be resolved until late Monday.

    Meanwhile, the U.S. economy is mired in uncertainty. Hiring has slowed sharply, while inflation remains stubbornly high.

    So a key question for the Fed is: Do they worry more about people who are out of work and struggling to find jobs, or do they focus more on the struggles many Americans face in keeping up with rising costs for groceries and other items? The Fed’s mandate from Congress requires it to seek both stable prices and full employment.

    For now, Fed Chair Jerome Powell and other Fed policymakers have signaled the Fed is more concerned about weaker hiring, a key reason investors expect the central bank will reduce its benchmark interest rate by a quarter point on Wednesday to about 4.1%.

    Still, stubbornly high inflation may force them to proceed slowly and limit how many reductions they make. The central bank will also release its quarterly economic projections Wednesday, and economists project they will show that policymakers expect one or two additional cuts this year, plus several more next year.

    Ellen Meade, an economics professor at Duke University and former senior economist at the Fed, said it’s a stark contrast to the early pandemic, when it was clear the Fed had to rapidly reduce rates to boost the economy. And when inflation surged in 2021 and 2022, it was also a straightforward call for the Fed, which moved quickly to raise borrowing costs to combat higher prices.

    But now, “it’s a tough time,” Meade said. “It would be a tough time, even if the politics and the whole thing weren’t going on the way they are, it would be a tough time. Some people would want to cut, some people would not want to cut.”

    Amid all the economic uncertainty, Trump is applying unprecedented political pressure on the Fed, demanding sharply lower rates, seeking to fire Cook, and insulting Powell, whom he has called a “numbskull,” “fool,” and “moron.”

    Loretta Mester, a former president of the Federal Reserve Bank of Cleveland and finance professor at the University of Pennsylvania’s Wharton School, said that Fed officials won’t let the criticisms sway their decisions on policy. Still, the attacks are unfortunate, she said, because they threaten to undermine the Fed’s credibility with the public.

    “Added to their list of the difficulty of making policy because of how the economy is performing, they also have to contend with the fact that there may be some of the public that’s skeptical about how they’ve gone about making their decisions,” she said.

    David Andolfatto, an economics professor at the University of Miami and former top economist at the Federal Reserve Bank of St. Louis, said that presidents have pressured Fed chairs before, but never as personally or publicly.

    “What’s unusual about this is the level of open disrespect and just childishness,” Andolfatto said. “I mean, this is just beyond the pale.”

    There are typically 12 officials who vote on the Fed’s policies at each meeting — the seven members of the Fed’s board of governors, as well as five of the 12 regional bank presidents, who vote on a rotating basis.

    If a court rules that Cook can be fired, or Miran isn’t approved in time, then just 11 officials will vote on Wednesday. Either way, there ought to be enough votes to approve a quarter-point cut, but there could be an unusual amount of division.

    Miran, if he is on the board, and Governor Michelle Bowman may dissent in opposition to a quarter-point reduction in favor of a steeper half-point cut.

    There could be additional dissenting votes in the other direction, potentially from regional bank presidents who might oppose any cuts at all. Beth Hammack, president of the Fed’s Cleveland branch, and Jeffrey Schmid, president of the Federal Reserve Bank of Kansas City, have both expressed concern that inflation has topped the Fed’s 2% targer for more than four years and is still elevated. If either votes against a cut, it would be the first time there were dissents in both directions from a Fed decision since 2019.

    “This degree of division is unusual, but the circumstances are unusual, too,” Andolfatto said. “This is a situation central banks really don’t like: The combination of inflationary pressure and labor market weakness.”

    Hiring has slowed in recent months, with employers shedding 13,000 jobs in June and adding just 22,000 in August, the government reported earlier this month. And last week a preliminary report from the Labor Department showed that companies added far fewer jobs in the year ending in March than previously estimated.

    At the same time, inflation picked up a bit last month and remains above the Fed’s 2% target. According to the consumer price index, core prices — excluding food and energy — rose 3.1% in August compared with a year earlier..

    With inflation still elevated, the Fed may have to proceed slowly with any further cuts, which would likely further frustrate the Trump White House.

    “When you get to turning points, people can reasonably disagree about when to go,” Meade said.

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  • Federal Reserve to announce interest rate cut amid economic slowdown, pressure from President Trump

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    Federal Reserve to announce interest rate cut amid economic slowdown, pressure from President Trump

    The Federal Reserve is set to announce an interest rate cut this week in response to a slowing economy, making clear it is not surrendering to President Donald Trump’s demands.

    Updated: 7:42 AM PDT Sep 14, 2025

    Editorial Standards ⓘ

    The Federal Reserve is expected to announce a long-awaited interest rate cut this week, responding to a slowing economy as opposed to yielding to President Donald Trump’s demands. Recent data shows hiring is slowing and unemployment is ticking up, which would normally call for an interest rate cut. Lower interest rates make borrowing money for things like cars and credit cards cheaper. At the same time, inflation remains stubbornly high, which is usually solved by keeping interest rates where they are and leaving costly prices up.With a big decision facing the Fed, added pressure from President Trump isn’t helping. Experts say his repeated calls for the Fed to lower interest rates are damaging the agency’s independence and credibility, spooking investors and the market. “If the Fed is politicized and they’re acting based upon political pressures rather than accurate economic data, that’s going to send messages throughout the economy that maybe what they’re doing isn’t really good for the economy, and maybe it doesn’t come from a solid place of evidence,” political analyst Todd Belt said. “It will introduce even more uncertainty in the economy, and uncertainty is the enemy of business planning.”President Trump’s tariffs have also injected lots of uncertainty in the market, and economists say that, in turn, will further drive up inflation.In a further escalation involving the president and the Fed, last week, a federal judge blocked Trump’s unprecedented attempt to fire Federal Reserve Governor Lisa Cook, alleging mortgage fraud. Now, the administration is appealing and is pushing the courts for an emergency ruling before the Fed’s big interest rate decision this week. But a big twist could undermine the administration’s case, as the Associated Press reports that Cook previously referred to the property in question as a “vacation home,” which would contradict the White House’s accusations of fraud.Watch the latest on the Federal Reserve:

    WASHINGTON —

    The Federal Reserve is expected to announce a long-awaited interest rate cut this week, responding to a slowing economy as opposed to yielding to President Donald Trump’s demands.

    Recent data shows hiring is slowing and unemployment is ticking up, which would normally call for an interest rate cut. Lower interest rates make borrowing money for things like cars and credit cards cheaper.

    At the same time, inflation remains stubbornly high, which is usually solved by keeping interest rates where they are and leaving costly prices up.

    With a big decision facing the Fed, added pressure from President Trump isn’t helping. Experts say his repeated calls for the Fed to lower interest rates are damaging the agency’s independence and credibility, spooking investors and the market.

    “If the Fed is politicized and they’re acting based upon political pressures rather than accurate economic data, that’s going to send messages throughout the economy that maybe what they’re doing isn’t really good for the economy, and maybe it doesn’t come from a solid place of evidence,” political analyst Todd Belt said. “It will introduce even more uncertainty in the economy, and uncertainty is the enemy of business planning.”

    President Trump’s tariffs have also injected lots of uncertainty in the market, and economists say that, in turn, will further drive up inflation.

    In a further escalation involving the president and the Fed, last week, a federal judge blocked Trump’s unprecedented attempt to fire Federal Reserve Governor Lisa Cook, alleging mortgage fraud.

    Now, the administration is appealing and is pushing the courts for an emergency ruling before the Fed’s big interest rate decision this week. But a big twist could undermine the administration’s case, as the Associated Press reports that Cook previously referred to the property in question as a “vacation home,” which would contradict the White House’s accusations of fraud.

    Watch the latest on the Federal Reserve:

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  • ‘We’re not gonna be able to price match’: Chicago woman blindsided by $7 rhinestones at Walmart. Then cashier tells her shocking news about pricetags

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    A woman shopping at Walmart was flabbergasted when she the rhinestones she was getting had a 154% price increase. This was without the company updating the price tags. 

    In a video with over 279,000 views, @taylorpwnz discussed a recent trip to Walmart. It ended with her spending much more than she thought she would.

    “I just went to Walmart to get rhinestones,” she said. “This tiny [container] of rhinestones was [supposed to be] $2.98. I get to the cash register and it rings up as $7.50. So I swiftly left and went back to the crafting aisle. I took a picture of the price, and I brought it back up front.” 

    When she showed an employee her findings, she was shocked by his response. The Walmart employee said they would “honor” the pricing, but that it would be changing to $7.50 in the future. She asked the employee what he meant. He mentioned the fact that Walmart was introducing digital price tags to their store, a plan which is coming to 2,300 stores in 2026. The employee explained that the “price can change at any time.

    “We’re not gonna be able to price match any pictures you provide us,” he purportedly told her.

    “Robbery, straight robbery,”  @taylorpwnz added. “I’m not paying $7 for cheap [expletive] rhinestones.”

    A Walmart boycott

    Walmart used to be known as an affordable grocery store for everyday consumers. However, more people have felt deterred by the company’s recent policy changes.

    Digital price tags—which make it significantly easier to adjust prices at a moment’s notice— pose a potential risk to consumers who want a consistent shopping experience. Despite their functionality, there’s reasonable worry. A digital pricing system could make it easier to hike up prices on any given day. This is instead of having to deliberately change prices. Fluctuating food costs could change at a moment’s notice with the new system, which is currently being tested at a Walmart in Texas. 

    Many customers have noticed ‘shrinkflation‘ from the company or general high prices. Others are worried that simple products like laundry detergent will get locked in anti-theft cases in stores across the country. Employees at certain locations have already started locking basic goods like baby formula. 

    All of these things have started to irk some customers. Many want to “cancel Walmart,” as one TikTok commenter put it. 

    Another added, “Dynamic pricing will be the death of stores. No one wants to shop [go up] to the register [and then have their items double in price]. We are done with these games and [Walmart] blaming [their] greed on everything else.”

    @taylorpwnz

    Dynamic pricing can go to ? ? I was never a fan of Walmart to begin with but I’ll be avoiding it like the plague now!!

    ♬ original sound – taylorpwnz

    The Mary Sue has reached out to Walmart via its press email and digital creator @taylorpwnz for more information.

    Have a tip we should know? [email protected]

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  • Inflation fears drive falling consumer sentiment in September

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    New data shows Americans are feeling increasingly concerned about the state of the economy. A survey reveals that consumer sentiment fell in September for the second consecutive month. CBS News senior business and technology correspondent Jo Ling Kent has more.

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  • Americans are feeling a lot worse about the state of the economy

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    (CNN) — American consumers are downbeat about the economy, according to preliminary results of a monthly survey conducted by the University of Michigan.

    The index measuring consumer sentiment fell unexpectedly this month to 55.4 from 58.2 in August as inflation is on the rise and job prospects are worsening. September’s reading also represents a 21% decline compared to a year ago, well before President Donald Trump took office and raised tariffs on practically everything the country imports.

    In addition to inflation and the labor market, tariffs also remain a concern for consumers, Joanne Hsu, the survey’s director, noted.

    “Trade policy remains highly salient to consumers, with about 60% of consumers providing unprompted comments about tariffs during interviews,” Hsu, said in a statement, noting that the same thing happened in the previous month.

    Economists polled by FactSet had been anticipating a minor improvement in consumer sentiment from August. Despite sentiment that’s near historic lows in a survey that goes back to the early 1950s, consumers are still feeling slightly better about the economy now compared to April and May during Trump’s initial rollout of so-called “reciprocal” tariffs, according to prior readings.

    The survey also spotlights what appears to be an increasingly bifurcated economy between income classes, where higher-income Americans continue to spend relatively freely and are feeling more optimistic about the state of the economy, while lower and middle-income Americans are cutting back and are more worried.

    Whiffs of stagflation

    While the economy is nowhere close to where it was in the 1970s and 1980s, when the nation’s annual inflation rate and unemployment rate both hit double-digit levels, recent employment and inflation data have led to mounting concerns of stagflation – when the economy slows significantly while inflation accelerates.

    Consumer prices rose 0.4% last month, bringing the annual inflation rate to 2.9%, according to Consumer Price Index data released Thursday. Meanwhile, there’s a laundry list of recent data pointing to a weakening labor market.

    For example, first-time applications for unemployment benefits surged last week to their highest level in four years. Also for the first time in four years, there are more people looking for work than there are jobs available for them.

    To top it off, the August employment report showed employers hired just 22,000 new workers and the unemployment rate rose to 4.3%, the highest level since 2021. The labor force snapshot also revealed that the US economy lost 13,000 workers in June, marking the first month since 2020 when employers laid off more workers than they hired.

    “Economic sentiment declined more than expected in September largely because Americans are fearful of losing their jobs,” Heather Long, chief economist at Navy Federal Credit Union, said in a statement on Friday.

    This string of data has essentially guaranteed the Federal Reserve will cut interest rates at its monetary policy meeting next week after having held rates steady for close to a year. Traders are also now betting on cuts at the subsequent two meetings this year, which has helped push stocks to record highs.

    This story has been updated with additional developments and context.

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    Elisabeth Buchwald and CNN

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  • Russia cuts interest rate to 17% as wartime economy slows while deficit grows

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    Russia’s central bank cut its benchmark interest rate Friday by one percentage point to 17%, a step that could support the economy as growth slows and spending on the war against Ukraine increases the budget deficit.

    The bank had raised its key rate as high as 21% to combat inflation, but has begun to retreat amid complaints from business leaders and legislators about their impact on economic activity.

    The bank’s inflation warnings in its policy statements underlined the stresses in the Kremlin’s wartime economy.

    The bank noted that inflation eased somewhat in July and August but remains elevated at 8.2%. Still, it warned that “inflation expectations have not changed considerably in recent months.”

    “In general, they remain elevated,” the bank said. “This may impede a sustainable slowdown in inflation.”

    The contrast between a rate cut and continued inflation warnings reflects serious frictions in the Russian economy.

    The central bank is focused on containing prices. Yet the finance ministry is pumping money into the economy in the form of defense orders and military recruitment bonuses that have fueled growth, wages and inflation over the course of Russia’s 3 1/2 year war against Ukraine.

    Year over year growth slowed to 1.1% in the second quarter from 1.4% in the first quarter and from 4.5% at the end of last year. Compared to the quarter before, however, the second quarter figure was a negative 0.6%, indicating the economy has lost speed in recent months.

    The deficit increased to 4.9 trillion rubles ($58 billion) in the January-July period, up from 1.1 trillion rubles the year before. Spending was 129% of the planned amount, according to the Kyiv School of Economics, which tracks the Russian economy and oil revenues. Meanwhile oil and gas revenues fell 19% compared with the year earlier period, in part due to slack global oil prices.

    Despite sanctions that have deprived Russia of foreign investment in some industries and the loss of its natural gas sales to Europe, the economy has held up better than many expected at the start of the war. Unemployment is at record lows and household incomes are rising. Recruitment bonuses have pumped cash into poorer regions. Oil shipments have remained steady even as the price has fluctuated.

    Meanwhile the government is able to finance its deficit by selling ruble bonds to domestic banks, which are eager to buy the bonds because they anticipate that interest rates will continue to fall.

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