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Tag: Inflation

  • America’s Tai faces uphill battle to defuse EU trade war fears

    America’s Tai faces uphill battle to defuse EU trade war fears

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    PRAGUE — U.S. Trade Representative Katherine Tai traveled more than 4,000 miles to prevent a transatlantic trade war over electric vehicles, but her EU counterparts signaled on Monday that they would be a tough crowd to win round.

    The growing spat hinges on U.S. legislation that encourages consumers via tax credits to “Buy American” when it comes to choosing an electric car.

    At a time when the U.S. and Europe want to present a united front against Russia, this protectionist measure has triggered outrage in many EU countries, including France and Germany, two leading European carmaking nations. Beyond the EU, China, Japan and South Korea have also voiced concern.

    After speaking with Tai at a meeting of EU ministers in Prague, the bloc’s trade chief Valdis Dombrovskis predicted it would be difficult to resolve the dispute.

    “It will not be easy to fix it  — but fix it we must,” he said.

    Among the 27 EU countries, anxiety about the U.S. measure is growing. Sweden’s new trade minister, Johan Forssell, whose country takes over the presidency of the Council of the EU in January, told POLITICO on Sunday that aspects of the U.S. legislation were “worrying” and “not in accordance with [World Trade Organization] rules.” 

    Another senior official stressed: “It’s not only one or two member states, which are concerned … It’s also the small ones; they will have no access at all” to the U.S. market.

    French President Emmanuel Macron and German Chancellor Olaf Scholz agreed over lunch last week that the EU should retaliate if Washington pushed ahead with the controversial bill. Macron floated the idea of a “Buy European Act” to strike back. 

    The new tax credits for electric vehicles are part of a huge U.S. tax, climate and health care package, known as the Inflation Reduction Act, which passed the U.S. Congress in August.

    The idea is that a U.S. consumer can claim back $7,500 of the value of an electric car from their tax bill. To qualify for that credit, however, the car needs to be assembled in North America and contain a battery with a certain percentage of the metals mined or recycled in the U.S., Canada or Mexico. 

    Czech Trade Minister Jozef Síkela, whose country currently holds the presidency of the Council of the EU, said that European carmakers wanted to qualify for the scheme, just as the North Americans do.  

    In its current form, the bill is “unacceptable,” and “is extremely protective against exports from Europe,” said Síkela as he walked into Monday’s meeting. “We simply expect that we will get the same status as Canada and Mexico.” 

    U.S. Trade Representative Katherine Tai and European Commission Executive Vice President Valdis Dombrovskis | Jim Watson/AFP via Getty Images

    “But we need to be realistic,” Síkela told reporters later. “This is our starting point in the negotiations and we’ll see what we’ll manage to negotiate at the end.”

    In a bid to soothe tensions, a joint task force was set up last week by the European Commission and the U.S. The task force is supposed to meet at the end of this week, although the exact date isn’t yet fixed, according to the senior official. 

    Asked whether Brussels would retaliate should no agreement be struck with Washington, Dombrovskis took a cautious approach: “Setting up this task force is already … a response of us, raising those concerns … At this stage, we are focusing on a negotiated solution before considering what other options there may be.” 

    The midterm elections in the U.S., where President Joe Biden’s Democrats look likely to lose ground, compound the difficulties. 

    It doesn’t seem like the tensions will be eased by the next Trade and Technology Council, which takes place between U.S. and European negotiators in early December. 

    Dismay over the U.S. subsidies has overshadowed the preparatory work for the next TTC meeting, for which the EU and businesses on both sides of the Atlantic want to see rapid concrete results to avoid the perception that the format is simply a talking shop.

    Tai herself had no immediate comment in Prague, but later released a statement on her meeting with Síkela that gave no hint of a breakthrough.

    “Ambassador Tai and Minister Síkela discussed the ongoing work of the Trade and Technology Council, and the importance of achieving meaningful results for the December TTC Ministerial and beyond.  They also discussed the newly-created U.S.-EU Task Force on the Inflation Reduction Act,” the statement said.  

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  • Euro zone inflation hits record high of 10.7% as growth slows sharply

    Euro zone inflation hits record high of 10.7% as growth slows sharply

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    Inflation in the euro zone remains extremely high. Protestors in Italy used empty shopping trolleys to demonstrate the cost-of-living crisis.

    Stefano Montesi – Corbis | Corbis News | Getty Images

    Euro zone inflation rose above the 10% level in the month of October, highlighting the severity of the cost-of-living crisis in the region and adding more pressure on the European Central Bank.

    Preliminary data on Monday from Europe’s statistics office showed headline inflation came in at an annual 10.7% last month. This represents the highest ever monthly reading since the euro zone’s formation. The 19-member bloc has faced higher prices, particularly on energy and food, for the past 12 months. But the increases have been accentuated by Russia’s invasion of Ukraine in late February.

    This proved to be the case once again, with energy costs expected to have had the highest annual rise in October, at 41.9% from 40.7% in September. Food, alcohol and tobacco prices also rose in the same period, jumping 13.1% from 11.8% in the previous month.

    Monday’s data comes after individual countries reported flash estimates last week. In Italy, headline inflation came in above analysts’ expectations at 12.8% year-on-year. Germany also said inflation jumped to 11.6% and in France the number reached 7.1%. The different values reflect measures taken by national governments, as well as the level of dependency that there nations have, or had, on Russian hydrocarbons.

    There are, however, euro nations where inflation rose by more than 20%. This includes Estonia, Latvia and Lithuania.

    The European Central Bank — whose primary target is to control inflation — on Thursday confirmed further rate hikes in the coming months in an attempt to bring prices down. It said in a statement that it had made “substantial progress” in normalizing rates in the region, but it “expects to raise interest rates further, to ensure the timely return of inflation to its 2% medium-term inflation target.”

    The ECB decided to raise rates by 75 basis points for a second consecutive time last week.

    Speaking at a subsequent press conference, ECB President Christine Lagarde said the likelihood of a recession in the euro zone had intensified.

    Growth figures released Monday showed a GDP (gross domestic product) figure of 0.2% for the euro area in October. This is after the region grew at a rate of 0.8% in the second quarter. Only Belgium, Latvia and Austria registered GDP rates below zero.

    So far, the 19-member bloc has dodged a recession but an economic slowdown is evident. Several economists predict there will be a contraction in GDP during the current quarter.

    The euro traded below parity against the U.S. dollar in early European trading hours Monday and ahead of the new data releases, and barely moved after the new figures. The euro has been weaker against the greenback and that’s also something the ECB has been concerned about with concerns that this will push up inflation in the euro zone even further.

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  • RBI’s big focus to remain on combating inflation in upcoming MPC meet on Nov 3: SBI Ecowrap

    RBI’s big focus to remain on combating inflation in upcoming MPC meet on Nov 3: SBI Ecowrap

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    The Reserve Bank of India (RBI) is likely to focus on bringing inflation within target levels and lowering it to around the midpoint. The upcoming Monetary Policy Committee (MPC) meeting will take place under Section 45ZN of the RBI Act. 

    Under Section 45ZN of the RBI Act, the central bank has to send a detailed report to the central government if it fails to meet the inflation targets for three consecutive quarters. RBI defines failure to meet inflation targets as either overshooting or undershooting the upper and lower tolerance bands for four consecutive quarters instead of the present three quarters. 

    This report focuses on reasons behind failure to achieve inflation target, remedial actions proposed by the bank and an estimate of the time-period within which the inflation target will be achieved. Since the inflation data for September 2022 was revealed on October 12, the RBI will have to submit this report to the centre before November 12, as per the latest SBI Ecowrap. 

    The RBI also said in its recent bulletin that the fight against inflation will be “dogged and prolonged” given the geopolitical and epidemiological uncertainties and variable lags with which monetary policy operates. 

    As per the SBI report, the central bank is also likely to hike the repo rate to 6.5 per cent in its upcoming MPC meeting on November 3. The MPC will take place a day after the US Federal Reserve meets on November 2. This MPC is purely focused on addressing the shortfall in meeting inflation targets for three successive quarters. 

    “Currently the September food inflation is at 8.4 per cent and a similar trend like the one seen in 2019 can put headline inflation towards 7.5 per cent in December. This could put a spanner to the inflation projections of RBI and market consensus. This could also mean that the terminal repo rate could still be difficult to comprehend at this time, though consensus puts it at 6.5 per cent,” the Ecowrap report read. 

    The frequent rise in repo rates has led to banks raising their external benchmark lending rates or EBLRs by 190 basis points (bps) whereas marginal cost of funds-based lending rate (MCLR) and base rates have risen by 50-70 bps only. 

    The Ecowrap mentions, “We believe RBI is pushing banks to increase their deposit rates to garner more deposits or secured funds to finance their credit growth and this could be one of the reasons to keep the liquidity in deficit mode for an extended period.” 

    Also read: RBI to hold additional Monetary Policy Committee meeting on November 3

    Also read: RBI’s explanation to govt on inflation likely to cover these three broad areas

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  • CBS Weekend News, October 30, 2022

    CBS Weekend News, October 30, 2022

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    CBS Weekend News, October 30, 2022 – CBS News


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  • Another jumbo Fed rate hike is expected this week — and then life gets difficult for Powell

    Another jumbo Fed rate hike is expected this week — and then life gets difficult for Powell

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    First the easy part.

    Economists widely expect Federal Reserve monetary-policy makers to approve a fourth straight jumbo interest-rate rise at its meeting this week. A hike of three-quarters of a percentage point would bring the central bank’s benchmark rate to a level of 3.75%- 4%.

    “The November decision is a lock. Well, I would be floored if they didn’t go 75 basis points,” said Jonathan Pingle, chief U.S. economist at UBS.

    The Fed decision will come at 2 p.m. on Wednesday after two days of talks among members of the Federal Open Market Committee.

    What happens at Fed Chairman Jerome Powell’s press conference a half-hour later will be more fraught.

    The focus will be on whether Powell gives a signal to the market about plans for a smaller rise in its benchmark interest rate in December.

    The Fed’s “dot plot” projection of interest rates, released in September, already penciled in a slowdown to a half-point rate hike in December, followed by a quarter-point hike early in 2023.

    The market is expecting signals about a change in policy, and many think Powell will use his press conference to hint that a slower pace of interest-rate rises is indeed coming.

    A Wall Street Journal story last week reported that some Fed officials are not keen to keep hiking rates by 75 basis points per meeting. That, alongside San Francisco Fed President Mary Daly’s comment that the Fed needs to start talking about slowing down the pace of hikes, were taken as a sign of a slowdown to come by the stock and bond markets.

    “No one wants to be late for the pivot party, so the hint was enough,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

    Luke Tilley, chief economist at Wilmington Trust, said he thinks Powell will signal a smaller rate hike in December by focusing on some of the good wage-inflation news that was published earlier Friday.

    There was a clear slowdown in private-sector wage growth, Tilley said.

    See: U.S. third-quarter wage pressures cool a little from elevated levels

    But the problem with Powell signaling he has found an exit ramp from the jumbo rate hikes this year is that his committee members might not be ready to signal a downshift, Pingle of UBS said. He argued that the inflation data writ large in September won’t give Fed officials any confidence that a cooling in price pressures is in the offing.

    See: U.S. inflation still running hot, key PCE price gauge shows

    Another worry for Powell is that future data might not cooperate.

    There are two employment reports and two consumer-price-inflation reports before the next Fed policy meeting on Dec. 13–14.

    So Powell might have to reverse course.

    “If you pre-commit and the data slaps you in the head — then you can’t follow through,” said Stephen Stanley, chief economist at Amherst Pierpont Securities.

    This has been the Fed’s pattern all year, Stanley noted. It was only in March that the Fed thought its terminal rate, or the peak benchmark rate, wouldn’t rise above 3%.

    While the Fed may want to slow down the pace of rate hikes, it doesn’t want the market to take a downshift in the size of rate rises as a signal that a rate cut is in the offing. But some analysts believe that the first cut in fact will come soon after the Fed reduces the size of its rate rises.

    In general terms, the Fed wants financial conditions to stay restrictive in order to squeeze the life out of inflation.

    Pingle said he expects Kansas City Fed President Esther George to formally dissent in favor of a slower pace of rate hikes.

    There is growing disagreement among economists about the “peak” or “terminal rate” of this hiking cycle. The Fed has penciled in a terminal rate in the range of 4.5%–4.75%. Some economists think the terminal rate could be lower than that. Others think that rates will go above 5%.

    Those who think the Fed will stop short of 5% tend to talk about a recession, with the fast pace of Fed hikes “breaking something.” Those who see rates above 5% think that inflation will be much more persistent.

    Ultimately, Amherst Pierpont’s Stanley is of the view that the data aren’t going to be the deciding factor. “The answer to the question of what either forces or allows the Fed to stop is probably not going to come from the data. The answer is going to be that the Fed has a number in mind to pause,” he said.

    The Fed “is careening toward this moment of truth where it has very tight labor markets and very high inflation, and the Fed is going to come out and say, ‘OK, we’re ready to pause here.’ “

    “That strikes me that is going to be a very volatile period for the market,” he added.

    Fed fund futures markets are already volatile, with traders penciling in a terminal rate above 5% two weeks ago and now seeing a 4.85% terminal rate.

    Over the month of October, the yield on the 10-year Treasury note
    TMUBMUSD10Y,
    4.046%
    rose steadily above 4.2% before softening to 4% in recent days.

    “When you get close to the end, every move really counts,” Stanley said.

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  • Another jumbo Fed rate hike is expected this week — and then life gets difficult for Powell

    Another jumbo Fed rate hike is expected this week — and then life gets difficult for Powell

    [ad_1]

    First the easy part.

    Economists widely expect Federal Reserve monetary-policy makers to approve a fourth straight jumbo interest-rate rise at its meeting this week. A hike of three-quarters of a percentage point would bring the central bank’s benchmark rate to a level of 3.75%- 4%.

    “The November decision is a lock. Well, I would be floored if they didn’t go 75 basis points,” said Jonathan Pingle, chief U.S. economist at UBS.

    The Fed decision will come at 2 p.m. on Wednesday after two days of talks among members of the Federal Open Market Committee.

    What happens at Fed Chairman Jerome Powell’s press conference a half-hour later will be more fraught.

    The focus will be on whether Powell gives a signal to the market about plans for a smaller rise in its benchmark interest rate in December.

    The Fed’s “dot plot” projection of interest rates, released in September, already penciled in a slowdown to a half-point rate hike in December, followed by a quarter-point hike early in 2023.

    The market is expecting signals about a change in policy, and many think Powell will use his press conference to hint that a slower pace of interest-rate rises is indeed coming.

    A Wall Street Journal story last week reported that some Fed officials are not keen to keep hiking rates by 75 basis points per meeting. That, alongside San Francisco Fed President Mary Daly’s comment that the Fed needs to start talking about slowing down the pace of hikes, were taken as a sign of a slowdown to come by the stock and bond markets.

    “No one wants to be late for the pivot party, so the hint was enough,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

    Luke Tilley, chief economist at Wilmington Trust, said he thinks Powell will signal a smaller rate hike in December by focusing on some of the good wage-inflation news that was published earlier Friday.

    There was a clear slowdown in private-sector wage growth, Tilley said.

    See: U.S. third-quarter wage pressures cool a little from elevated levels

    But the problem with Powell signaling he has found an exit ramp from the jumbo rate hikes this year is that his committee members might not be ready to signal a downshift, Pingle of UBS said. He argued that the inflation data writ large in September won’t give Fed officials any confidence that a cooling in price pressures is in the offing.

    See: U.S. inflation still running hot, key PCE price gauge shows

    Another worry for Powell is that future data might not cooperate.

    There are two employment reports and two consumer-price-inflation reports before the next Fed policy meeting on Dec. 13–14.

    So Powell might have to reverse course.

    “If you pre-commit and the data slaps you in the head — then you can’t follow through,” said Stephen Stanley, chief economist at Amherst Pierpont Securities.

    This has been the Fed’s pattern all year, Stanley noted. It was only in March that the Fed thought its terminal rate, or the peak benchmark rate, wouldn’t rise above 3%.

    While the Fed may want to slow down the pace of rate hikes, it doesn’t want the market to take a downshift in the size of rate rises as a signal that a rate cut is in the offing. But some analysts believe that the first cut in fact will come soon after the Fed reduces the size of its rate rises.

    In general terms, the Fed wants financial conditions to stay restrictive in order to squeeze the life out of inflation.

    Pingle said he expects Kansas City Fed President Esther George to formally dissent in favor of a slower pace of rate hikes.

    There is growing disagreement among economists about the “peak” or “terminal rate” of this hiking cycle. The Fed has penciled in a terminal rate in the range of 4.5%–4.75%. Some economists think the terminal rate could be lower than that. Others think that rates will go above 5%.

    Those who think the Fed will stop short of 5% tend to talk about a recession, with the fast pace of Fed hikes “breaking something.” Those who see rates above 5% think that inflation will be much more persistent.

    Ultimately, Amherst Pierpont’s Stanley is of the view that the data aren’t going to be the deciding factor. “The answer to the question of what either forces or allows the Fed to stop is probably not going to come from the data. The answer is going to be that the Fed has a number in mind to pause,” he said.

    The Fed “is careening toward this moment of truth where it has very tight labor markets and very high inflation, and the Fed is going to come out and say, ‘OK, we’re ready to pause here.’ “

    “That strikes me that is going to be a very volatile period for the market,” he added.

    Fed fund futures markets are already volatile, with traders penciling in a terminal rate above 5% two weeks ago and now seeing a 4.85% terminal rate.

    Over the month of October, the yield on the 10-year Treasury note
    TMUBMUSD10Y,
    4.030%
    rose steadily above 4.2% before softening to 4% in recent days.

    “When you get close to the end, every move really counts,” Stanley said.

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  • Soaring inflation drives up Halloween prices

    Soaring inflation drives up Halloween prices

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    Soaring inflation drives up Halloween prices – CBS News


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    Candy prices are soaring this Halloween thanks to inflation. It’s not just candy, pumpkin prices are also up. Carter Evans takes a look.

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  • Obama, campaigning in Georgia, warns of threats to democracy

    Obama, campaigning in Georgia, warns of threats to democracy

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    COLLEGE PARK, Ga. (AP) — Former President Barack Obama returned to the campaign trail Friday in Georgia, using his first stop on a multi-state tour to frame the 2022 midterm elections as a referendum on democracy and to urge voters not to see Republicans as an answer to their economic woes.

    It was a delicate balance, as the former president acknowledged the pain of inflation and tried to explain why President Joe Biden and Democrats shouldn’t take all the blame as they face the prospects of losing narrow majorities in the House and Senate when votes are tallied Nov. 8. But Obama argued that Republicans who are intent on making it harder for people to vote and — like former President Donald Trump — are willing to ignore the results, can’t be trusted to care about Americans’ wallets either.

    “That basic foundation of our democracy is being called into question right now,” Obama told more than 5,000 voters gathered outside Atlanta. “Democrats aren’t perfect. I’m the first one to admit it. … But right now, with a few notable exceptions, most of the GOP and a whole bunch of these candidates are not even pretending that the rules apply to them.”

    With Biden’s approval ratings in the low 40s, Democrats hope Obama’s emergence in the closing weeks of the campaign boosts the party’s slate in a tough national environment. He shared the stage Friday with Sen. Raphael Warnock, who faces a tough reelection fight from Republican Herschel Walker, and Stacey Abrams, who is trying to unseat Republican Gov. Brian Kemp, who defeated her narrowly four years ago.

    Obama will travel Saturday to Michigan and Wisconsin, followed by stops next week in Nevada and Pennsylvania.

    For Obama personally, the campaign blitz is an opportunity to do something he was unable to do in two midterms during his presidency: help Democrats succeed in national midterms when they already hold the White House. For his party, it’s an opportunity to leverage Obama’s rebound in popularity since his last midterm defeats in 2014. Their hope is that the former president can sell arguments that Biden, his former vice president, has struggled to land.

    Biden was in Pennsylvania on Friday with Vice President Kamala Harris and plans to be in Georgia next week, potentially in a joint rally with Obama and statewide Democratic candidates. But he has not been welcomed as a surrogate for many Democratic candidates across the country, including Warnock.

    “Obama occupies a rare place in our politics today,” said David Axelrod, who helped shape Obama’s campaigns from his days in the Illinois state Senate through two presidential elections. “He obviously has great appeal to Democrats. But he’s also well-liked by independent voters.”

    Obama tried to show off that reach Friday. The first Black president drew a hero’s welcome from a majority Black audience, and he offered plenty of applause lines for Democrats. But he saved plenty of his argument, especially on the economy, for moderates, independents and casual voters, including a defense of Biden, who Obama said is “fighting for you every day.”

    He called inflation “a legacy of the pandemic,” the resulting supply chain disruption and the Ukraine war’s effects on global oil markets — a sweeping retort to Republican attempts to cast sole blame on Democrats’ spending bills.

    “What is their answer? … They want to give the rich tax cuts,” Obama said of the GOP. “That’s their answer to everything. When inflation is low, let’s cut taxes. When unemployment is high, let’s cut taxes. If there was an asteroid heading toward Earth, they would all get in a room and say, you know what we need? We need tax cuts for the wealthy. How’s that going to help you?”

    Biden has sought to make similar arguments, and was buoyed this week with news of 2.6% economic growth in the third quarter after two consecutive quarters of negative growth.

    Yet Lis Smith, a Democratic strategist, said Obama is better positioned to convince voters who haven’t decided whom to vote for or whether to vote at all.

    “If it’s just a straight-up referendum on Democrats and the economy, then we’re screwed,” Smith said. “But you have to make the election a choice between the two parties, crystallize the differences.”

    Obama, she said, did that in the 2008 and 2012 presidential elections “by winning over a lot of working-class white voters and others we don’t always think about as part of the ‘Obama coalition.’”

    Obama left office in January 2017 with a 59% approval rating, and Gallup measured his post-presidential approval at 63% the following year, the last time the organization surveyed former presidents. That’s considerably higher than his ratings in 2010, when Democrats lost control of the House in a midterm election that Obama called a “shellacking.” In his second midterm election four years later, the GOP regained control of the Senate.

    Still, Bakari Sellers, a prominent Democratic commentator, said Obama’s broader popularity shouldn’t obscure how much his “special connection” with Black voters and other non-white voters can help Democrats.

    The Atlanta rally brought Obama together with Warnock, the first Black U.S. senator in Georgia history, and Abrams, who’s vying to become the first Black female governor in American history.

    In Michigan, Obama will campaign in Detroit with Gov. Gretchen Whitmer, who is being challenged by Republican Tudor Dixon, and in Wisconsin he’ll be in Milwaukee with Senate candidate Mandela Barnes, who is trying to oust Republican Sen. Ron Johnson. Each city is where the state’s Black population is most concentrated. Obama’s Pennsylvania swing will include Philadelphia, another city where Democrats must get a strong turnout from Black voters to win competitive races for Senate and governor.

    With the Senate now split 50-50 between the two major parties and Vice President Kamala Harris giving Democrats the deciding vote, any Senate contest could end up deciding which party controls the chamber for the next two years. Among the tightest Senate battlegrounds, Georgia, Wisconsin and Pennsylvania are three where Black turnout could be most critical to Democratic fortunes.

    Axelrod said Obama’s turnabout from his own midterm floggings to being Democrats’ leading surrogate is, in part, a rite of passage for any former president. “Most of them — maybe not President Trump, but most of them — are viewed more favorably after they leave office,” Axelrod said.

    Notably, during Obama’s presidency, former President Bill Clinton was the in-demand heavyweight surrogate, especially for moderates trying to survive Republican surges in 2010 and 2014.

    Axelrod said Obama and Clinton have a similar approach.

    “What Clinton and Obama share is a kind of unique ability to colloquialize complicated political arguments of the time, just talk in common-sense terms,” Axelrod said. “They’re storytellers.”

    ___

    Learn more about the issues and factors at play in the 2022 midterm elections at https://apnews.com/hub/explaining-the-elections. And follow the AP’s election coverage of the elections at https://apnews.com/hub/2022-midterm-elections.

    ___

    This story has been corrected to show Abrams, not Kemp, is trying to unseat the governor.

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  • Democrats cautiously campaign on Jan. 6, democracy threats

    Democrats cautiously campaign on Jan. 6, democracy threats

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    WASHINGTON (AP) — Speaking last year on the House floor, Democratic Rep. Tim Ryan angrily bemoaned the lack of bipartisanship after the Jan. 6 Capitol insurrection and said Republican opposition to an investigative commission was a “slap in the face” to the law enforcement officers assaulted by then-President Donald Trump’s supporters that day.

    Ryan has trodden more carefully this year as he runs for the U.S. Senate in Ohio, a onetime battleground state that has trended rightward in the Trump era. At a recent debate, his Republican opponent, JD Vance, charged that Ryan has an “obsession” with the insurrection and called the Jan. 6 House committee’s investigation a “political hit job” on Trump.

    “I don’t want to talk about this any more than anybody else,” Ryan shot back. “I want to talk about jobs. I want to talk about wages. I want to talk about pensions … but, my God, you’ve got to look into it.”

    Ryan’s cautiousness is a reflection of the political divide that remains nearly two years after the violent Capitol insurrection spurred by Trump’s lies of a stolen 2020 presidential election. Many Republicans still falsely believe the vote count was rigged against Trump, and GOP lawmakers have repeatedly downplayed the violent attack, which left at least five people dead, injured more than 100 police officers and sent lawmakers running for their lives.

    But some Democrats’ reluctance to talk about Jan. 6 on the campaign trail is an acknowledgement that voters are primarily focused on pocketbook issues, like gas prices and rising inflation, in a midterm year that is typically a referendum on the president in power. That dynamic has created a delicate balance for Democrats, especially those like Ryan who are running in more Republican-leaning areas or swing states.

    “The public sees this as something in the past, whereas they are dealing with inflation right now,” says GOP pollster Frank Luntz, who has conducted focus groups on the Jan. 6 attack. If you can’t afford to feed your family or fill your tank with gas, Luntz says, “arguing something that happened two years ago isn’t prone to be high on your list.”

    Still, some candidates are betting that voters will care.

    Independent Evan McMullin, a former Republican running against Utah Sen. Mike Lee, has made the issue a central part of his campaign. In a debate this month, McMullin said Lee had committed a “betrayal of the American republic” after it was revealed that the GOP senator had texted with White House aides ahead of the insurrection about finding ways for Trump to overturn his defeat. Lee demanded an apology, which McMullin did not offer, and noted that he had voted with most senators to certify Democrat Joe Biden’s victory.

    McMullin also appeared with Illinois Rep. Adam Kinzinger, one of two Republicans on the Jan. 6 panel, at an event in Salt Lake City. Speaking to an audience that included supporters carrying signs that read “Country First,” the two men framed the midterms as a fight for democracy.

    “If you’re Mike Lee, it’s still acceptable to say that Donald Trump is the future of the party and the leader of the party,” Kinzinger said.

    In a debate earlier this month, Rep. Elaine Luria, D-Va., defended her work as a member of the House Jan. 6 panel by saying it is “the most important thing that I have done or ever will do” professionally, beyond her military service. Her campaign later ran an ad showing footage of her opponent, Republican Jen Kiggans, refusing to say whether Biden was fairly elected.

    “I’m not your candidate if you stand with insurrectionists,” Luria said at the debate. “I’m not your candidate if you’d rather have Donald J. Trump as president again.”

    In Wisconsin, Democrat Brad Pfaff is struggling against his opponent, Republican Derrick Van Orden, but is betting that more people will vote against Van Orden if they find out that he was among the Trump supporters outside the Capitol on Jan. 6. One Pfaff ad shows images of the violence and a veteran criticizing Van Orden.

    Another ad in Wisconsin targets Republican Sen. Ron Johnson, who is running for reelection and has repeatedly downplayed the violence of the attack. “Ron Johnson is making excuses for rioters who tried to overthrow our government,” a police officer says in the ad, paid for by Senate Majority PAC, which is associated with Senate Majority Leader Chuck Schumer, D-N.Y.

    Democratic pollster Celinda Lake says that the democracy issue has proven salient among Democratic voters, particularly among older and suburban women who have less favorable views of Trump. “They are talking about it as a get-out-the-vote issue,” Lake said.

    John Zogby, also a Democratic pollster, agrees that the threat to democracy is a top-tier issue for many Democrats. But he has seen less interest among the independent voters who could decide the most competitive elections.

    “I don’t know that it gains any new voters for Democrats,” Zogby says.

    Like Ryan, the chair of the House spending subcommittee that oversees the Capitol Police, some Democrats who have been outspoken about the insurrection while in Washington have been talking about it less on the campaign trail.

    New Hampshire Rep. Annie Kuster and Michigan Rep. Dan Kildee have spoken about their post-traumatic stress from being trapped in the House gallery as rioters tried to beat down the doors on Jan. 6. Now in competitive reelection races, neither has focused much on the attack or threats to democracy — though both have occasionally mentioned it.

    Kildee noted that police protected him that day in a debate against his opponent, Republican Paul Junge, as he spoke about his opposition to efforts to defund law enforcement. “People wearing uniforms saved my life on Jan. 6,” Kildee said. “I know what the police can do.”

    Answering a question on support for Ukraine, Kuster said that she thinks the United States also needs to fight for democracy at home and that she is a “survivor, witness, victim of the insurrection on Jan. 6 in our Capitol.”

    Vermont Rep. Peter Welch, who was trapped alongside Kuster and Kildee and others that day, has chosen a different strategy as he runs for Senate in his liberal-leaning state. He talks about his experience often.

    Asked about the committee’s work in a recent debate, Welch told the audience that “I was there” and that it was a violent assault on the peaceful transfer of power.

    “A big issue in this election is the American people coming together and fighting to preserve that democracy that has served us so well,” Welch said.

    His opponent, Republican Gerald Malloy, responded that criminals should be held to account but that Americans have a right to peacefully assemble.

    “I am not calling this an insurrection,” Malloy said.

    ___

    Associated Press writers Sam Metz in Salt Lake City; Tom Beaumont in Des Moines, Iowa; Scott Bauer in Madison, Wis.; Kathy McCormick in Concord, N.H.; and Will Weissert and Hannah Fingerhut in Washington contributed to this report.

    ___

    Follow the AP’s coverage of the 2022 midterm elections at https://apnews.com/hub/2022-midterm-elections. And check out https://apnews.com/hub/explaining-the-elections to learn more about the issues and factors at play in the midterm.

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  • First King Charles coins go into production

    First King Charles coins go into production

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    First King Charles coins go into production – CBS News


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    The first coins featuring the face of King Charles III are being produced by the Royal Mint in Wales. The 50 pence coin also features a tribute to Queen Elizabeth II.

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  • A key US inflation gauge stayed at a high 6.2% in September

    A key US inflation gauge stayed at a high 6.2% in September

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    WASHINGTON — A measure of inflation that is closely monitored by the Federal Reserve remained painfully high last month, the latest sign that prices for most goods and services in the United States are still rising steadily.

    Friday’s report from the Commerce Department showed that prices rose 6.2% in September from 12 months earlier, the same year-over-year rate as in August.

    Excluding volatile food and energy costs, so-called core prices rose 5.1% last month from a year earlier. That’s also faster than the 4.9% annual increase in August, though below a four-decade high of 5.4% reached in February.

    The report also showed that consumers spent more last month, even after adjusting for inflation, a sign of Americans’ willingness to keep spending in the face of high prices. Consumer spending increased 0.6% from August to September, or 0.3% after accounting for price increases.

    The latest figures come just as Americans have begun voting in midterm elections in which Democrats’ control of Congress is at stake and inflation has shot to the top of voters’ concerns. Republicans have heaped blame on President Joe Biden and congressional Democrats for the skyrocketing prices that have buffeted households across the country.

    The persistence of high inflation, near the worst in four decades, has intensified pressure on the Federal Reserve to keep aggressively raising its key short-term interest rate to try to wrestle rising prices under control. Last month, the Fed raised its key rate by a substantial three-quarters of a point for a third straight time, and next week it’s expected to do so for a fourth time.

    The central bank’s latest rate hikes far exceed the quarter-point increases that it typically used in the past when it sought to tighten credit to fight inflation. But after being caught off guard beginning late last year, when prices accelerated far more than the Fed’s policymakers had anticipated, the officials have been raising their benchmark rate at the fastest pace in four decades. In doing so, they are raising the risk of a recession — something that many economists expect to occur sometime next year as a result.

    The Fed’s hikes have led to much higher loan rates for businesses and consumers, particularly for mortgages. The average 30-year fixed mortgage rate surged past 7% this week, according to Freddie Mac, the highest level in two decades and more than twice what it was a year ago.

    The rapid run-up in borrowing costs has crushed the housing market. Sales of existing homes have dropped for eight straight months and are down nearly 25% in the past year. New-home sales and construction are also falling.

    A weaker housing market has slowed the economy, as fewer home purchases also drag down sales of furniture, appliances, and home improvement gear.

    Home prices, which rocketed during the pandemic, have started to fall as a result. The S&P Case-Shiller home price index fell from July to August for a second straight month, according to the latest data available,

    But those declines have yet to show up in the government’s measures of housing costs, which include rents, which are still rising for many people as they renew their leases. It could take until late spring or summer before falling home prices work their way into the government’s inflation indexes. That delay could keep official measures of inflation from falling much over the next few months.

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  • Inflation data shows US prices were still uncomfortably high last month | CNN Business

    Inflation data shows US prices were still uncomfortably high last month | CNN Business

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    Minneapolis
    CNN Business
     — 

    New inflation data shows that US prices were still uncomfortably high last month, despite aggressive action from the Federal Reserve to rein in decades-high inflation.

    The Personal Consumption Expenditures Index, which measures prices paid by consumers for goods and services, climbed by by 0.3% from August to September but remained unchanged at 6.2% for the year.

    Core PCE, which strips out volatile food and energy prices and is the Fed’s preferred measure of inflation, climbed by 5.1% on an annual basis, higher than the August rate of 4.9% but below the consensus estimate of 5.2%, per Refinitiv.

    From August to September, the core index rose by 0.5%, matching estimates. The prior month’s jump was revised down to 0.5% from 0.6%.

    The latest PCE numbers come just days before the central bank meets to discuss another rate hike — and as Americans hit the polls to vote in midterm elections.

    This story is developing and will be updated.

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  • Japan Cabinet OKs $200B spending plan to counter inflation

    Japan Cabinet OKs $200B spending plan to counter inflation

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    TOKYO — Japanese Prime Minister Fumio Kishida’s government approved Friday a hefty economic package that will include government funding of about 29 trillion yen ($200 billion) to soften the burden of costs from rising utility rates and food prices.

    Kishida was set to give a news conference in the evening.

    Inflation has been rising in Japan along with globally surging prices. A weakening of the yen against the dollar has amplified costs for imports.

    The stimulus package includes subsidies for households that are largely seen as an attempt by Kishida to lift his plunging popularity. His government has been rocked by the ruling Liberal Democratic Party’s close ties to the South Korean-based Unification church, which surfaced after the assassination of former leader Shinzo Abe in July.

    “We will make sure to deliver the measures to everyone and do our utmost so that people can feel supported in their daily lives,” Kishida said after preliminary approval of the package earlier in the day.

    Any market reaction to another flood of stimulus was likely already taken into account earlier in the week as share prices fell in Tokyo, with the benchmark Nikkei 225 losing 0.9% to 27,105.20.

    Japan has stuck to using fiscal measures, or government spending, to counter current economic challenges. While central banks around the world are raising interest rates aggressively to try to tame decades-high inflation, Japan’s inflation rate is a relatively moderate 3% and the greater fear is that the economy will stall, not overheat.

    The Bank of Japan, which has kept its benchmark rate at minus 0.1% since 2016, kept its longstanding lax monetary policy at a policy making meeting that wrapped up on Friday.

    In doing so, it runs the risk of seeing the yen weaken further since the Federal Reserve is still raising rates, which tends to push the dollar higher. That in turn will raise prices in Japan since it imports much of what it consumes.

    The overall size of the package, including private-sector funding and fiscal measures, is expected to amount to 71.6 trillion yen ($490 trillion), Kishida said.

    The plan includes about 45,000 yen ($300) subsidies for household electricity and gas bills and coupons worth 100,000 yen ($680) for women who are pregnant or rearing babies.

    The 29 trillion yen ($200 billion) spending package will be part of a supplementary budget that still must be approved by the parliament.

    Kishida vowed to compile and submit a budget plan and get it approved as soon as possible.

    His support ratings have sunk since July amid public criticisms over his Liberal Democratic Party’s longstanding cozy ties with the Unification Church, which is accused of brainwashing adherents into making huge donations, causing financial hardships and breaking up families.

    An LDP internal survey showed about half of its 400 lawmakers were tied to the church, though not as followers. Kishida’s economy minister, Daishiro Yamagiwa, was obliged to resign earlier this week because of his ties with the church and failure to explain them. He was replaced by former health minister Shigeyuki Goto.

    The hefty spending package will require issuing of more government bonds, further straining Japan’s worsening national debt that has piled up as the government spent heavily to counter the impact of the pandemic. Japan now has a long-term debt exceeding 1.2 quadrillion yen ($8.2 trillion), or more than 200% of the size of its economy.

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  • Inflation, gas prices threaten sports business, concessions just as fans return

    Inflation, gas prices threaten sports business, concessions just as fans return

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    Sitting on a bench in front of Soldier Field, about to watch his beloved Chicago Bears play in person, money wasn’t exactly a big concern for Corey Metzger.

    Or any concern, really.

    “This trip has been a long time in the making, and I’m splurging whatever I got to spend to make it happen,” said the 45-year-old Metzger, who works in law enforcement in Fargo, North Dakota.

    Metzer’s eager pilgrimage is a familiar one for sports fans, especially after the COVID-19 pandemic eased. But persistently high inflation and gas prices are looming over the monetary pipeline that resumed when fans returned.

    U.S. inflation jumped 8.2% in September from a year ago, the government reported this month. That’s not far from a four-decade high of 9.1% in June. Higher prices for housing, food and medical care were among the largest contributors to the rise.

    Given the industry’s reliance on disposable income, the inflation numbers are a troubling sign for sports business leaders.

    “What’s historically accurate for teams is that they tend to try to take less on the ticketing side because once somebody comes in they typically will make up for it once they are inside,” said Ron Li, a senior vice president at Navigate, a consulting firm in sports and entertainment. “But with costs rising pretty much across the board after the turnstile, I think they have some decisions they need to make.”


    What to expect from the 2022 NFL season

    04:49

    Costlier ticket prices

    According to Team Marketing Report, the average cost for a family of four to attend a 2022 Major League Baseball game was $256.41, an increase of $3.04 from the previous season. The main engine behind the rise was the cost of tickets, with the average general ticket price increasing 3.6% to $35.93.

    Despite the jump in prices, Americans have largely kept up their spending, particularly on entertainment and other services like travel that they missed out on during the pandemic. Still, there are signs the solid spending won’t last: Credit card debt is rising and savings have declined as consumers, particularly low-income ones, have taken hits to their finances from the spike in inflation.

    Casey Lynn, 43, a low-voltage technician from Minneapolis, and his wife, Lori, 44, a commercial lender, aren’t big football fans, but they decided to check out the Bears on a trip to Chicago. While Casey Lynn said he is bothered by the ticket surcharges, the couple didn’t want to pass on the opportunity to see the game.

    “The gas is a necessity. Electric’s a necessity. The sports isn’t a necessity,” he said. “But when in Rome, why not?”

    Dan Coyne, 38, a life insurance wholesaler from Harrisburg, Pennsylvania, makes an annual trip to Chicago to see the Bears with his brother, Dave, 47, of Valparaiso, Indiana, who has season tickets. But this time around was a little different.

    “Flying out here, rental cars have like tripled in price, it definitely factored in,” he said. “But this is a once-in-a-year thing.”

    Eating before the game

    The brothers got something to eat a couple hours before the game. Dave Coyne normally stays away from the concessions at Soldier Field, but “I only had to pay for myself tonight,” he said. “I didn’t have a kid or my wife with me.”

    Concessions typically have a higher profit margin for sports teams and providers, but increased costs for goods, transportation and labor have cut into those margins. The changes come after concessions companies were already profoundly impacted by the pandemic.

    “The whole model has been kind of disrupted in a pretty big way as we’re dealing with inflation of 10, 15, 20, 25, 30% when we have typically underwritten 2 or 3%,” said Jamie Obletz, president of Delaware North Sportservice. “And you can imagine the impact that that’s had on us and what it’s forced us to think about and do over the past six to 12 months, like a lot of companies.”


    2022 World Series preview: Houston Astros vs. Philadelphia Phillies

    03:44

    Paul Pettas, a vice president with Sodexo Live!, estimated overall costs are up 10% to 15% over the past 12 to 24 months.

    “In reality, costs are up across the board, but we certainly try to do as much as we can to keep that down and not have that affect the average fan or guest who comes to our events,” he said.

    Concessions companies also are experiencing lingering issues with their supply chains, which have improved recently but remain a factor. Obletz recalled his company running out of peanuts midway through the 2021 World Series in Atlanta, so two workers drove a truck to another venue, loaded up and then drove through the night to get back to Truist Park.

    One less chicken finger

    “Things are not great,” Obletz said. “They’re better than they were, it feels like, three to six months ago, and our hope is that it continues to improve.”

    The issues have forced concession companies to get creative in an effort to address the rising costs with minimal effect on consumers in terms of culinary options and price.

    Chefs are redesigning menus to replace items that face significant cost increases and consolidating other options. They are using analytics to examine portion sizes — do consumers need six chicken fingers or will five work instead? — and taking a closer look at their vendors.

    “There’s dozens of things like this that we’ve tried to do and are doing as we speak, trying very desperately to offset those pricing increases that we’re seeing,” Obletz said.

    Alison Birdwell, the president and CEO of Aramark Sports + Entertainment, said the company is leaning on analytics and its data science team “more than ever” when it comes to menu strategies and new concessions items.

    “With that guidance, we are working to give fans the items they’re looking for while simultaneously being efficient with our product and mitigating significant increases in cost,” Birdwell said in a statement to AP.

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  • Stocks end mixed as Facebook’s parent company slumps

    Stocks end mixed as Facebook’s parent company slumps

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    Stocks ended mixed on Wall Street as weakness in several tech companies offset gains in other parts of the market. Facebook’s parent company, Meta Platforms, lost another one-fourth of its value after reporting a second straight quarter of revenue decline amid falling advertising sales and stiff competition from TikTok. That followed weak reports from Google’s parent company, Alphabet, and Microsoft. 

    The S&P 500 fell 23 points, or 0.6%, to close at 3,807, while the Dow climbed 194 points, or 0.6%, to 32,003. Meta’s slump pulled the Nasdaq down 1.6%. Markets got some encouraging economic news as the government reported the U.S. economy returned to growth last quarter, expanding 2.6%. Treasury yields fell.

    Facebook’s parent company, Meta Platforms, plummeted 24.3% after reporting a second straight quarter of revenue decline amid falling advertising sales and stiff competition from TikTok. It joins other tech and communications stocks, such as Google’s parent company, Alphabet, and Microsoft, in reporting weak results and worrisome forecasts over advertising demand.

    “What you’re seeing is a little bit of relief,” said Megan Horneman, chief investment officer at Verdence Capital Advisors. “Earnings are not great but they’re not awful either.”

    The benchmark S&P 500 is still holding on to weekly gains and remains solidly on track to end October in the green.


    Meta announces its first hiring freeze, signaling tech slowdown

    03:23

    Focus on earnings

    Earnings have been the big focus for Wall Street this week, but markets got some encouraging economic news Thursday as the government reported the U.S. economy returned to growth last quarter, expanding 2.6%. That marks a turnaround after the economy contracted during the first half of the year.

    The economy has been under pressure from stubbornly hot inflation and the Federal Reserve’s efforts to raise interest rates in order to cool prices. The central bank is trying to slow economic growth through rate increases, but the strategy risks going too far and brining on a recession.

    The rising interest rates have made borrowing more difficult, particularly with mortgage rates. Average long-term U.S. mortgage rates topped 7% for the first time in more than two decades this week.

    The latest economic data is being closely watched for any signs of a slowdown or that inflation might be easing as Wall Street tries to determine if and when the Fed might pull back on its interest rate increases.

    The central bank is expected to raise interest rates another three-quarters of a percentage point at its upcoming meeting in November. But traders have grown more confident that it will dial down to a more modest increase of 0.50 percentage points in December, according to CME Group.

    Central banks around the world have also been raising interest rates in an effort to tame inflation. The European Central Bank piled on another outsized interest rate hike on Thursday. Markets in Europe were mixed.

    Wall Street has more earnings to review later Thursday. Internet retail giant Amazon and iPhone maker Apple report results after the market closes. Exxon Mobil will report its latest financial results on Friday.

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  • Surging demand for

    Surging demand for

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    So many investors are rushing to buy Series I savings bonds ahead of an October 28 deadline to lock in a rate of 9.62% that it crashed a U.S. Treasury Department website selling the securities, which are considered a low-risk hedge against inflation. 

    The Treasury Direct website froze up on Wednesday, while some users on social media reported delays accessing the service and getting their I-bond order processed. The delays could prevent some investors from completing their purchases before this week’s deadline.

    With the deadline fast approaching, the Treasury Department is opening more I-bond accounts each day than it typically creates in a year, according to an agency official. The website, TreasuryDirect, has been around for two decades and wasn’t built for the spike in traffic it’s receiving this week, the official added. Treasury has doubled its server capacity to handle the surge, but the site is still experiencing slowdowns, the agency said.

    I-bonds are typically a niche investment that provide a return based on the Consumer Price Index for All Urban Consumers, an inflation gauge. Because U.S. inflation was at or below 2% for years, they hadn’t provided an attractive return compared with stocks and other investments. 

    That changed as inflation has soared, pushing up the guaranteed rate of return on I-bonds this year to 9.62%. Because the Treasury Department resets the rate for I-bonds every six months, the next adjustment will occur next month. At that point, the I-bond rate will decline to about 6.5% — still respectable, but less eye-popping than the current 9.62% rate. 

    Any bonds issued before October 31 will yield 9.62%, but Treasury has said that people should order by October 28 to allow for the several days it typically takes to issue a bond, which is sparking the rush on the Treasury Direct website. 

    I-bonds come with some significant limitations. First, one person can buy only up to $10,000 worth of bonds a year, with an additional $5,000 allowed if they use a tax refund for the purchase. For married couples, that limit doubles. Parents can also buy I-bonds for their children (under age 18), although they need to set up separate accounts for each kid.

    I-bond buyers also aren’t allowed to redeem them for the first year. After that, you can sell the bond, but that will forfeit the last three months of interest. After five years, investors can sell with no restrictions. 

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  • Biden zeroes in on economic message as campaign winds down

    Biden zeroes in on economic message as campaign winds down

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    SYRACUSE, N.Y. (AP) — President Joe Biden zeroed in Thursday on economic issues as he fine-tuned his closing argument in upstate New York for voters trying to cope with raging inflation and fears of a recession heading into the Nov. 8 election.

    Biden’s visits to a congressional battleground in Syracuse and then to Philadelphia on Friday are part of a strategic two-step crafted for a persistently unpopular president: promote his administration’s accomplishments at official White House events while saving the overt campaigning for states where his political power can directly bolster Democratic candidates.

    The White House of late has paid outsize attention to Pennsylvania, where Democrats are aggressively contesting a Republican-held Senate seat to help offset potential losses in other marquee Senate races.

    “The previous president left a string of broken promises in places like Wisconsin, Indiana and Ohio, where promised investments in jobs and manufacturing never materialized,” Biden said, criticizing former President Donald Trump and Republicans for their economic policies. “On my watch, ‘Made in America’ isn’t just a slogan, it’s a reality.”

    Biden got a boost on the news Thursday that the economy grew at a better-than-expected 2.6% annual rate from July through September, overcoming inflation and interest rates and snapping two straight quarters of economic contraction.

    “For months, doomsayers have been arguing that the U.S. economy is in a recession and congressional Republicans have been rooting for a downturn,” Biden said in a statement. “But today we got further evidence that our economic recovery is continuing to power forward. This is a testament to the resilience of the American people.”

    Biden jogged over to reporters before he left for New York and said it was a “Great economic report today – GDP report — things are looking good.”

    In Syracuse, Biden showcased a significant investment by the U.S.-based company Micron, one of the largest microchip manufacturers in the world. The company has credited a new law boosting domestic production of semiconductors for its new facility that will create 50,000 jobs, which will pay an average of $100,000 a year.

    “This is going to be massive,” Micron CEO Sanjay Mehrotra told Biden, showing off a model of what the facility would look like in 20 years. “This is going to be the largest investment in semiconductor manufacturing in the U.S.”

    Biden called it the “largest American investment of its kind, ever, ever, ever in our history” and said the announcement was “the latest example of my economic plan at work.”

    He warned against GOP proposals that he said would raise drug prices for older people and cut taxes on corporations. Biden also cited comments by Republicans suggesting they would use the debt limit as leverage in negotiations with the White House should they retake the majority in Congress.

    “They’re determined to cut Social Security, Medicare and they’re willing to take down the economy over it,” Biden said.

    Publicly, the White House and senior Democratic leaders express optimism that they’ll defy traditional midterm headwinds and retain control of Congress. But in private, there is angst that the House will be lost to Republicans and that control of the Senate is a coin flip.

    It’s a position that Democrats point out is far more favorable than earlier in the election cycle — particularly before the Supreme Court’s decision overturning Roe v. Wade ended constitutional protections for abortion and upended the political landscape — yet many in the party are nonetheless bracing for the loss of at least one chamber.

    Senate Majority Leader Chuck Schumer was captured on camera Thursday delivering a mixed assessment of the Senate map to Biden when he landed in Syracuse, expressing optimism about Nevada and the situation in Pennsylvania after John Fetterman’s debate performance Monday set off alarm bells among national Democrats. But Schumer raised his concerns about the state of the race in Georgia.

    “It looks like the debate didn’t hurt us too much in Pennsylvania as of today, so that’s good, and basically we’re picking up steam in Nevada,” Schumer was heard telling Biden. “The state where we’re going downhill is Georgia. It’s hard to believe that they will go for Herschel Walker.”

    But Schumer added that Democrats were performing well in early voting in Georgia, where incumbent Sen. Raphael Warnock is aiming to hold off the Trump-backed challenger.

    The president has had a steady uptick in travel in recent weeks, although he has avoided states such as Nevada and Arizona in which Democratic candidates prefer not to be tagged with the national party brand. He has appeared with a smattering of vulnerable House Democrats at official White House events in California and New York and raised campaign cash for candidates in Pennsylvania, Michigan and Oregon, as well as millions of dollars for the Democratic National Committee at fundraisers in Washington and elsewhere. He held a trio of virtual fundraisers Wednesday night for congressional candidates in Iowa, Nevada and Pennsylvania.

    A reception scheduled for Friday in Philadelphia with the state Democratic Party, which Vice President Kamala Harris will also attend, will mark Biden’s 15th visit to Pennsylvania during his presidency. Plans for a joint appearance in the state with former President Barack Obama are in the works for next week.

    Also next week, Biden is scheduled to headline a political rally Tuesday in Florida. Democratic gubernatorial candidate Charlie Crist has been publicly encouraging the president to campaign with him in a state that has increasingly trended toward Republicans in recent election cycles.

    Biden sought to use the Micron event to hammer home a closing message aimed at framing the contrast between the two parties’ economic agendas — an argument that the president began sketching out at a Democratic National Committee event earlier this week.

    “Everybody wants to make it a referendum, but it’s a choice between two vastly different visions for America,” Biden said of the midterms. “Democrats are building a better America for everyone with an economy that grows from the bottom up and the middle out, where everyone does well. Republicans are doubling down on their mega MAGA trickle-down economics that benefits the very wealthy.”

    He continued: “It failed their country before and will fail it again if they win.”

    In recent weeks, Biden has used the presidential bully pulpit considerably to promote Democratic accomplishments. But there’s some concern among Democrats that voters are not connecting economic growth in their communities often enough to what a Democratic-controlled government has completed during the first two years of Biden’s presidency.

    “I think we have to be far more aggressive,” said Rep. Ro Khanna, D-Calif. “We’re actually bringing jobs back, but we’re not going out enough and acknowledging people’s anger and fear and say, ‘Here’s what we’re doing.’”

    The Syracuse area is home to a House race for a seat being vacated by moderate Republican Rep. John Katko, a critical pickup opportunity for Democrats in a district that Biden won by more than 7 percentage points in 2020. Biden’s visit could also give a boost to New York Gov. Kathy Hochul, whose reelection contest against Republican Lee Zeldin has tightened in recent weeks.

    Cabinet officials are fanning out nationwide to promote the administration’s economic message. For instance, Treasury Secretary Janet Yellen traveled to Cleveland on Thursday to talk about Biden’s manufacturing agenda with Sen. Sherrod Brown, D-Ohio. The retirement of his Republican colleague, Sen. Rob Portman, has led to another critical Senate race, this one between Republican J.D. Vance and Democrat Tim Ryan.

    According to a White House tally, through Friday, members of Biden’s Cabinet will have gone to 29 states and Puerto Rico on 77 separate trips, with about half focused on amplifying Biden’s economic message.

    —

    AP White House Correspondent Zeke Miller in Washington contributed to this report.

    ___

    Follow the AP’s coverage of the 2022 midterm elections at https://apnews.com/hub/2022-midterm-elections. And check out https://apnews.com/hub/explaining-the-elections to learn more about the issues and factors at play in the midterms.

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  • Asian shares mostly lower as Japan preps massive stimulus

    Asian shares mostly lower as Japan preps massive stimulus

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    Shares were mostly lower in Asia on Friday after a mixed session on Wall Street, where tech sector losses offset gains in other parts of the market.

    Tokyo’s benchmark slipped as the government was preparing about $490 billion in stimulus spending to help the world’s No. 3 economy cope with inflation. As expected, the Bank of Japan wrapped up a policy meeting by keeping its ultra-lax monetary policy unchanged even as it forecast higher inflation.

    The Nikkei 225 index lost 0.5% to 27,210.03 while the Hang Seng in Hong Kong sank 2.3% to 15,069.69. The Shanghai Composite index shed 0.8% to 2,958.25.

    The Kospi in Seoul declined 0.4% to 2,278.64. Australia’s S&P/ASX 200 dropped 0.8% to 6,788.00.

    The economic stimulus package due for approval Friday includes government funding of about 29 trillion yen ($200 billion) in subsidies and other measures to help soften the burden of costs from rising utility rates and food prices. It is also designed to help shore up support for Prime Minister Fumio Kishida, whose popularity has taken a beating due to a scandal over ties between the ruling Liberal Democratic Party and the South Korea-based Unification church.

    Thursday on Wall Street, the S&P 500 fell 0.6%, with about 44% of stocks within the benchmark index losing ground. It closed at 3,807.30.

    The tech-heavy Nasdaq fell 1.6% to 10,792.67, while the Dow Jones Industrial Average rose 0.6% to 32,033.28.

    Smaller company stocks held up better than the broader market. The Russell 2000 index added 0.1% to 1,806.32.

    Facebook’s parent company, Meta Platforms, plummeted 24.6% for the biggest drop in the S&P 500 after reporting a second straight quarter of revenue decline amid falling advertising sales and stiff competition from TikTok. It joined other tech and communications stocks, such as Google’s parent company, Alphabet, and Microsoft, in reporting weak results and worrisome forecasts over advertising demand. Alphabet fell 2.9% and Microsoft slid 2%.

    Amazon slid 19% in after-hours trading after the retail giant issued an estimate for sales in the last quarter of the year came in well below analysts’ forecasts. The stock fell 4.1% in regular trading before the release of its latest quarterly results.

    Construction equipment maker Caterpillar jumped 7.7% after it handily beat analysts’ third-quarter profit forecasts. The big gain helped boost the 30-company Dow.

    Another pullback in long-term Treasury yields helped support stocks in companies that weren’t reporting quarterly results. The yield on the 10-year Treasury, which influences mortgage rates, fell to 3.91% from 4.01% late Wednesday. The two-year yield fell to 4.30% from 4.42%.

    Excluding the Nasdaq, the major indexes are on pace for weekly gains. And the S&P 500 remains solidly on track to end October in the green.

    Markets got some encouraging economic news Thursday as the government reported the U.S. economy returned to growth last quarter, expanding 2.6%. That marks a turnaround after the economy contracted during the first half of the year.

    The economy has been under pressure from stubbornly hot inflation and the Federal Reserve’s efforts to raise interest rates in order to cool prices. The central bank is trying to slow economic growth through rate increases, but the strategy risks going too far and brining on a recession.

    The rising interest rates have made borrowing more difficult, particularly with mortgage rates. Average long-term U.S. mortgage rates topped 7% for the first time in more than two decades this week.

    Central banks around the world also have been raising interest rates in an effort to tame inflation. The European Central Bank piled on another outsized interest rate hike on Thursday. Markets in Europe were mixed.

    Wall Street has more earnings to review Friday, including Exxon Mobil, Chevron and Charter Communications.

    Meanwhile, S&P Dow Jones Indices said Thursday that insurer Arch Capital Group will replace Twitter in the S&P 500 index before the opening of trading on Tuesday. The move comes ahead of Elon Musk’s acquisition of Twitter in a transaction expected to close Friday.

    In other trading, the dollar fell to 146.20 yen from 136.31 late Thursday. The euro

    ___

    AP Business Writers Damian J. Troise and Alex Veiga contributed.

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  • Energy stocks get oil price support as recession looms

    Energy stocks get oil price support as recession looms

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    NEW YORK (AP) — Surging oil prices charged energy stocks through 2022 and could keep supporting the sector despite a looming recession and stubbornly hot inflation squeezing consumers.

    The sector’s 50% gain is a standout in the S&P 500 this year while every other sector has lost ground. Big names like Exxon Mobil are up even more, with gains of nearly 75%. It’s a stark contrast to the benchmark index’s 20% slide.

    The sector’s sharp gains were kicked off earlier this year after Russia’s invasion of Ukraine raised worries about the oil supply, with inflation already squeezing global economies. U.S. crude oil prices are up 13% for the year, around $85 per barrel. The U.S. government expects prices to hit $95 per barrel next year, which could potentially support energy stocks even through a recession.

    Oil prices got another boost this month when the OPEC+ alliance of oil-exporting countries decided to sharply cut production to support prices. Longer-term trends, such as the shift to renewables, have also kept companies from ramping up drilling. That’s helped maintain a disconnect between still high demand and low supplies.

    “Producers are getting signals to stay disciplined,” said John LaForge, head of real asset strategy at Wells Fargo Investment Institute. “They see the future, and drilling and completion of wells are built on a 10-year timeframe and producers see it will be structurally different in 10 years.”

    That long-term view has helped maintain a disconnect between still high demand and low supplies.

    “A recession takes a backseat to the longer-term secular trend of structurally undersupplied oil,” LaForge said.

    Analysts and economists have been warning about a likely recession ahead. Meanwhile major companies have raised the alarm about weakening demand heading into 2023. The Federal Reserve, the International Monetary Fund and others have all warned that economies are in for more pain from inflation.

    The U.S. economy contracted in the first half of the year, and consumer confidence and spending are slipping. Inflation remains extremely hot and the Fed is expected to continue raising interest rates in an effort to tame high prices.

    That’s raised the risk of inducing a recession by slamming the brakes too hard on the economy. The severity of any recession will also have an impact on the energy sector. A light recession might not change habits too much, analysts have said, while a more severe recession could crimp spending on fuel and other essentials.

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  • Scholz and Macron threaten trade retaliation against Biden

    Scholz and Macron threaten trade retaliation against Biden

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    BERLIN/PARIS — After publicly falling out, Olaf Scholz and Emmanuel Macron have found something they agree on: mounting alarm over unfair competition from the U.S. and the potential need for Europe to hit back.

    The German chancellor and the French president discussed their joint concerns during nearly three-and-a-half hours of talks over a lunch of fish, wine and Champagne in Paris on Wednesday.

    They agreed that recent American state subsidy plans represent market-distorting measures that aim to convince companies to shift their production to the U.S., according to people familiar with their discussions. And that is a problem they want the European Union to address.

    The meeting of minds on this issue followed public disagreements in recent weeks on key political issues such as energy and defense, fracturing what is often seen as the EU’s central political alliance between its two biggest economies.

    But even though their lunch came against an awkward backdrop, both leaders agreed that the EU cannot remain idle if Washington pushes ahead with its Inflation Reduction Act, which offers tax cuts and energy benefits for companies investing on U.S. soil, in its current form. Specifically, the recently signed U.S. legislation encourages consumers to “Buy American” when it comes to choosing an electric vehicle — a move particularly galling for major car industries in the likes of France and Germany.

    The message from the Paris lunch is: If the U.S. doesn’t scale back, then the EU will have to strike back. Similar incentive schemes for companies will be needed to avoid unfair competition or losing investments. That move would risk plunging transatlantic relations into a new trade war.

    Macron was the first to make the stark warning public. “We need a Buy European Act like the Americans, we need to reserve [our subsidies] for our European manufacturers,” the French president said Wednesday night in an interview with TV channel France 2, referring specifically to state subsidies for electric cars.

    Scholz and Macron agreed the EU must act if the US progresses a ‘Buy American’ act offering incentives for companies investing on US soil, which would particularly affect French and German electric vehicle industries | David Hecker / Getty Images

    Macron also mentioned similar concerns about state-subsidized competition from China: “You have China that is protecting its industry, the U.S. that is protecting its industry and Europe that is an open house,” Macron said, adding: “[Scholz and I] have a real convergence to move forward on the topic, we had a very good conversation.”

    Crucially, Berlin — which has traditionally been more reluctant when it comes to confronting the U.S. in trade disputes — is indeed backing the French push. Scholz agrees that the EU will need to roll out countermeasures similar to the U.S. scheme if Washington refuses to address key concerns voiced by Berlin and Paris, according to people familiar with the chancellor’s thinking.

    Scholz is not a big fan of Macron’s wording of a “Buy European Act” as it evokes the nearly 90-year-old “Buy American Act,” which is often criticized for being protectionist because it favors American companies. But the chancellor shares Macron’s concerns about unfair competitive advantages, the people said.

    Earlier this month, Scholz said publicly that Europe will have to discuss the Inflation Reduction Act with the U.S. “in great depth.”

    In a blow to Germany’s industrial core, chemical giant BASF announced plans Wednesday to reduce its business activities and jobs in Germany, with company chief Martin Brudermüller citing heightened gas prices — which he criticized for being six times as high as in the U.S. — as well as increasing EU regulation as the reason.

    “The decisions of a successful company like BASF show that we need to improve the overall attractiveness of Germany as a business location,” German Finance Minister Christian Lindner said in a tweet, vowing to take various measures such as “tax relief for private investments.”

    Before bringing out the big guns, though, Scholz and Macron want to try to reach a negotiated solution with Washington. This should be done via a new “EU-U.S. Taskforce on the Inflation Reduction Act” that was established during a meeting between European Commission President Ursula von der Leyen and U.S. Deputy National Security Adviser Mike Pyle on Tuesday.

    The taskforce of EU and U.S. officials will meet via videoconference toward the end of next week, underlining the seriousness of the European push.

    On top of that, EU trade ministers will gather for an informal meeting in Prague next Monday, with U.S. trade envoy Katherine Tai planning to attend to discuss the tensions.

    In Brussels, the Commission is also looking with concern at Macron’s wording of a “Buy European Act,” which evokes protectionist tendencies that the EU institution has long sought to fight.

    “Every measure we take needs to be in line with the World Trade Organization rules,” a Commission official said, adding that Europe and the U.S. should resolve differences via talks and “not descend into tit-for-tat trade war measures as we experienced them under [former U.S. President Donald] Trump.”

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    Hans von der Burchard and Clea Caulcutt

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