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Tag: us economy

  • The US economy added 119,000 jobs in September, but unemployment rose to a nearly four-year high

    (CNN) — A long-awaited jobs report offered a mixed picture of the US labor market.

    The economy added 119,000 jobs in September, an unexpected rebound for the labor market — but it comes as the overall economy shows signs of slowing.

    Economists were expecting 50,000 jobs to have been added and an unemployment rate that remained at 4.3%, according to FactSet.

    Delayed for seven weeks due to the government shutdown, the latest snapshot of America’s job market showed that unemployment rose in September to the highest level in nearly four years.

    In addition, August’s tepid job gains of 22,000 were revised to a job loss of 4,000 jobs and July was revised down by 7,000 jobs, according to Bureau of Labor Statistics data released Thursday.

    The health care and social assistance sector continued to drive overall employment growth. Those sectors added an estimated 57,100 jobs in September, accounting for nearly half of the overall gains. Leisure and hospitality contributed 47,000 jobs during a month with unseasonably warm weather.

    Jobs were lost in sectors such as transportation and warehousing (-25,300), temporary help services (-15,900) and manufacturing (-6,000).

    Although the September employment data has been on the shelf since early October, it provides a critical snapshot of the labor market at a time when tariffs, stubborn inflation and elevated interest rates continue to slow the US economy.

    Summer of job losses

    Plus, Thursday’s report might very well be the last clean jobs report for a couple of months, since the shutdown mucked up the finely tuned process of data collection and analysis during October and part of November. The BLS on Wednesday announced that there will not be a separate October jobs report published but instead some of that data will be included in the November report scheduled for December 16.

    Despite the stronger-than-expected September gains, this year is still on pace for the weakest employment growth since the pandemic and, before that, the Great Financial Crisis.

    “The job market was really weak in the summer, and it didn’t improve much in September,” said Heather Long, chief economist at Navy Credit Union. “What we learned today is that both June and August had negative job growth, so, shedding jobs; 119,000 is pretty good for September, but when you step back, the average (monthly job gain) of the past four months is in the low 40,000s.”

    “So, it looks very weak,” she added.

    Unemployment, a closely watched recession indicator, ticked higher in September, rising to the highest rate since October 2021.

    However, driving the jobless rate higher was an increase in the labor force – primarily an uplift in more people looking for work, versus a sharp increase in layoffs, BLS data shows.

    Low-fire, low-hire, low-opportunity market

    The job gains remain heavily concentrated. Two sectors – health care and social assistance, and leisure and hospitality – accounted for 87% of September’s job growth.

    But in a labor market that’s been in a low-hire, low-fire slog, there are also few opportunities for those seeking work. On average, it’s taking people six months to find work, according to the latest BLS data.

    The latest unemployment claims data supports that trend: In a separate report on Thursday, the Labor Department reported that an estimated 1.974 million people filed continuing claims for unemployment insurance for the week ended November 8, hitting a fresh four-year high.

    Initial claims, which are considered the best proxy for layoff activity, fell to 220,000 last week, remaining well below more concerning thresholds (300,000 to 400,000 range, consistently).

    “If I had to characterize it, it still looks a lot like ‘no-hire, no-fire,’” Long said. “I do worry, given the number of industries that are starting to fire, that this is starting to look like ‘no-hire, start-to-fire.’”

    ‘Cold water’ for a Fed cut

    Despite the mixed bag of data, the September report “could throw cold water” on the Federal Reserve cutting interest rates further when it meets in December, Kathy Bostjancic, chief economist at Nationwide, wrote in a note on Thursday.

    “The sharp rebound in employment gains, up 119,000 in September following the downwardly revised negative 4,000 print in August soothes concerns that the labor market was on the precipice of a large downturn and removes urgency for another rate cut,” she wrote.

    Still, because of the historic government shutdown, the September jobs report will be the freshest official monthly employment snapshot available when the Fed makes its next interest rate decision on December 10. The partial October and full November data won’t come out until the following week.

    Alicia Wallace and CNN

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  • Tea Tariffs Once Sparked a Revolution. Now They Are Creating Angst

    A tax on tea once sparked rebellion. This time, it’s just causing headaches.

    Importers of the prized leaves have watched costs climb, orders stall and margins shrink under the weight of President Donald Trump’s tariffs. Now, even after Trump has given them a reprieve, tea traders say it won’t immediately undo the damage.

    “It took a while to work its way through the system, these tariffs, and it will take a while for it to work its way out of the system,” says Bruce Richardson, a celebrated tea master, tea historian and purveyor of teas at his shop, Elmwood Inn Fine Teas, in Danville, Kentucky. “That tariffed tea is still working its way out of our warehouses.”

    While a handful of bigger firms are behind the biggest supermarket brands, the premium tea market is largely the work of smaller businesses, from family farms to specialty importers to a web of little tea shops, tea rooms and tea cafes across the U.S. Amid an onslaught of tariffs, they have become showcases for the levies’ effects.

    On their shelves, selection has narrowed, with some teas now missing because they’re no longer viable products to stock with steep levies on top. In their warehouses, managers are consumed with uncertainty and operational headaches, including calculating what a blend really costs, with ingredients from multiple countries on a roller coaster of tariffs. And in backrooms where the wafting scent of fresh tea permeates, owners have been forced to put off job postings, raises, advertising and other investments so they can have cash available to pay duties when their containers arrive at U.S. ports.

    “If I were to add up all the money I’ve spent on tariffs that weren’t there a year ago, it could equal a new employee,” says Hartley Johnson, who owns the Mark T. Wendell Tea Company in Acton, Massachusetts.

    Johnson’s prices used to stay static for a year or longer. He ate the tariff costs before being forced to respond. His most popular tea, a smoky Taiwanese one called Hu-Kwa, has steadily risen from $26 to $46 a pound.

    He knows some customers are reconsidering.

    “Where is that tipping point?” Johnson asks. “I’m kind of finding that tipping point is happening now.”

    Though Trump backed off some tariffs on agricultural products last week, many in the tea trade are wary of celebrating too soon and caution tea drinkers shouldn’t either. Much of next year’s supply has already been imported and tariffed and the full impact of those duties may not have fully spilled downhill.

    Meantime, other tariff-driven price hikes persist. All sorts of other products tea businesses import, from teapots to infusers, remain subject to levies, and costs for some American-made items, like tins for packaging, have spiked because they rely on foreign materials.

    “The canisters, the bamboo boxes, the matcha whisks, everything that we import, everything that we sell has been affected by tariffs,” says Gilbert Tsang, owner of MEM Tea Imports in Wakefield, Massachusetts.

    Though globally, tea reigns supreme, imbibed more than anything but water, it has long been overshadowed by coffee in the U.S. Still, tea is entwined in American history from the very beginning, even before colonists angry with tariffs dumped tons of it in Boston Harbor.

    Boston may run on Dunkin’ today, but it was born on tea.

    The 1773 revolt that became known as the Boston Tea Party rose out of the British Parliament’s implementation of tea tariffs on colonists, who rejected taxation without representation in government. After an independent United States was born, one of the new government’s first major acts, the Tariff Act of 1789, ironically set in law import taxes on a range of products including tea. In time, though, trade policy came to include carve-outs for many products Americans rely on but don’t produce.

    For more than 150 years, most tea has passed through U.S. ports with little to no duties.

    That began to change in Trump’s first term with his hardline approach to China. But nothing compared to what came with his return to the White House.

    In July, the most recent month for which the U.S. International Trade Commission has tallied tariff numbers, tea was taxed at an average rate of over 12 percent, a huge increase from a year earlier when it was just under one-tenth of a percent. In that single month, American businesses and consumers paid more than $6 million in tea import taxes, amassing in just 31 days more tariffs than any previous full year on record.

    “All over again, taxation without representation,” says Richardson, an adviser to the Boston Tea Party Ships & Museum. “Our wants and needs and our voices are not being represented because Congress is avoiding the issue by simply allowing the president to act like George III.”

    All told, tea importers paid about $19.6 million in tariffs in the first seven months of 2025, nearly seven times as much as the same period last year.

    It’s all been confounding to those steeped in the world of tea, on which the U.S. depends on foreign countries for nearly all of the billions of pounds Americans brew each year. Though a number of small tea farms exist in the U.S., they can’t fill Americans’ cups for more than a few hours of the year.

    “We don’t have an industry and we can’t produce one overnight,” says Angela McDonald, president of the United States League of Tea Growers.

    Trump’s suspension of tea tariffs came too late for some businesses, including Los Angeles-based International Tea Importers Inc., for which tariffs created an untenable cash-flow crunch.

    “We just became over-leveraged financing not just the inventory, but also the tariffs,” says the company’s CEO, Brendan Shah.

    Tariffs weren’t the only thing the 35-year-old business was facing, but without them, Shah says it may have survived.

    “Unpredictable tariff policies,” he wrote to customers in announcing the company’s closure, “have created the final, insurmountable barrier.”

    Copyright 2025. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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    Associated Press

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  • Black Friday Puts Focus on Consumer Spending for Rocky Markets

    With U.S. stocks in the midst of a grim month, investors will look in the coming week for signs of strength in the U.S. consumer with Black Friday putting the spotlight on the holiday shopping season.

    The rally in stocks has stalled in November, with the benchmark S&P 500 declining more than 4 percent so far during the month. Strong quarterly results from semiconductor giant Nvidia Corp failed on Thursday to calm markets, which have been rattled by concerns about elevated valuations and questions about returns on massive corporate investments in artificial intelligence infrastructure.

    Consumer spending, which accounts for more than two-thirds of U.S. economic activity, will now come under Wall Street’s microscope.

    The trading week will be interrupted by the Thanksgiving holiday on Thursday, followed by Black Friday, known for ushering in discounts, then Cyber Monday and holiday shopping promotions heading into year end.

    Recent readings have shown a slump in consumer sentiment, while other data has been missing due to the government shutdown. This could make any signals about holiday spending more significant than usual.

    “From a sentiment standpoint, the early reads we get on Black Friday and Cyber Monday, due to the lack of data we have, will be important,” said Chris Fasciano, chief market strategist at Commonwealth Financial Network.

    “The entirety of the holiday shopping period will be an important read for where we are with the consumer and what that means for the economy.”

    While the S&P 500 remains up 11 percent year-to-date, it has declined just over 5 percent from its late October all-time high. The Cboe Volatility index on Thursday posted its highest closing level since April.

    Stock market performance could factor into how consumers spend over the holidays, particularly those with higher incomes who are more invested in equities. Despite the recent wobble, the S&P 500 has soared over 80 percent since its latest bull market began just over three years ago.

    “If you get a pullback there, a lot of the wealth in the upper income is in the stock market … so it will be interesting to see if they spend like they have in the past,” said Doug Beath, global equity strategist at the Wells Fargo Investment Institute.

    This month, the National Retail Federation said it expected U.S. holiday sales to surpass $1 trillion for the first time. Still, that November-December forecast equated to growth of between 3.7 percent and 4.2 percent from the year-earlier period, slower than the 4.3 percent growth in 2024.

    Household balance sheets are “in a very strong place,” yet slowing employment growth could pressure holiday spending, said Michael Pearce, deputy chief U.S. economist at Oxford Economics.

    “The most important factor for consumer spending is the health of the labor market,” Pearce said.

    Data from the delayed monthly employment report released on Thursday showed U.S. job growth accelerated in September. But the unemployment rate increased to a four-year high of 4.4 percent.

    Persistently firm inflation, with import tariffs contributing to higher prices, also could weigh on spending, Pearce said.

    Holiday shopping is critical for retailers. Walmart on Thursday raised its annual forecasts in a signal of confidence heading into year end. Reports from other retailers during the week were mixed.

    Another read on the consumer will come with Tuesday’s release of U.S. retail sales for September. That report has been delayed along with other government releases because of the 43-day federal shutdown that ended earlier this month.

    The influx of pent-up data in the coming weeks could further ramp up volatility for investors as they assess the economy’s health and prospects that the Federal Reserve will cut interest rates at its December 9-10 meeting.

    Following the September jobs report, which will be the last monthly employment release before the next Fed meeting, Fed funds futures late on Thursday reflected a 67 percent chance the central bank would hold rates steady in December after quarter-point cuts in each of the prior two meetings.

    Morgan Stanley economists said on Thursday they no longer expected the Fed to ease in December but they project three cuts in 2026.

    “The policy rate path remains highly data-dependent,” the Morgan Stanley economists said in a note. “In our view, a mixed report means the committee will want to see more data before taking another step.”

    Reporting by Lewis Krauskopf; Editing by Alden Bentley and David Gregorio

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    Reuters

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  • Video: Where Things Stand With SNAP Benefits

    new video loaded: Where Things Stand With SNAP Benefits

    Millions of low-income Americans will see staggering cuts and delays to their food stamps this month due to the government shutdown. Tony Romm, an economic policy reporter at The New York Times, walks us through the last several weeks of chaos around SNAP benefits.

    By Tony Romm, Christina Shaman, Christina Thornell, June Kim and Zach Wood

    November 5, 2025

    Tony Romm, Christina Shaman, Christina Thornell, June Kim and Zach Wood

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  • Legal expert warns of buy now, pay later plans this holiday shopping season

    DENVER — As you’re out holiday shopping, one legal expert warns to keep an eye out for buy now, pay later (BNPL) plans. With tighter budgets, they can look enticing as they can split large purchases into smaller, more manageable ones over a monthly basis.

    However, the lawyer Denver7 spoke with said BNPL plans can easily rope you into more debt, and there aren’t many protections in place to keep you out of trouble.

    76% of Americans use BNPL plans, 72% of GenZ uses them, and 50% of users have already missed at least one payment, according to LegalShield.

    Rebecca Carter is a principal at the law firm Friedman, Framme & Thrush. Carter told Denver7 she is seeing more people calling her office asking for advice after falling into debt with buy now, pay later plans. She said there’s not much that can be done legally after you’ve signed the terms.

    “It’s not as though [these companies] are doing anything unlawful,” Carter said. “Protection really comes in with spreading education and understanding the potential for penalty. I wish there was more, but [there’s not].”

    Prices for all goods rose 0.3% in September after rising 0.4% in August, according to the latest Consumer Price Index report. It continues a trend of rising inflation amid interest rate cuts aimed at jump-starting a slowing job market.

    It has made holiday shopping budgets tighter this year, so Carter said to be mindful and educate yourself and your kids about these plans.

    “Creditors have an interest in getting paid back,” Carter said. “You have an interest in preserving your credit, you know, and trying to be proactive earlier on.”

    She said it can be easy to find yourself over-spending when you rely on BNPL plans and then finding yourself in credit trouble down the road.

    Denver7 | Your Voice: Get in touch with Dan Grossman

    Denver7 morning anchor Dan Grossman shares stories that have an impact in all of Colorado’s communities, but specializes in covering consumer and economic issues. If you’d like to get in touch with Dan, fill out the form below to send him an email.

    Dan Grossman

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  • As the shutdown drags on, here’s how it can drag down the economy

    (CNN) — The federal government shutdown has lasted all month and is on pace to become the longest on record.

    While history has shown that the economy typically rebounds from a shutdown within a couple of months, each day it drags on brings a greater risk that the economy won’t just bend but will start to break — and rupture livelihoods in the process, economists say.

    “The economy is fragile and, therefore, something like a government shutdown could become a bigger problem a lot faster than people might think,” said Mark Zandi, chief economist at Moody’s Analytics.

    Congressional Budget Office estimates released Wednesday projected that the shutdown has permanently sapped at least $7 billion in output from the economy.

    The negative effects start to build on themselves very rapidly and the collateral damage becomes more widespread, said Diane Swonk, chief economist at KPMG.

    “That’s kind of like a snowball rolling down a hill, gathering momentum and mass,” she said.

    Predicting something that has becoming increasingly unpredictable is an impossible task, but here’s a look at how the shutdown could ripple through critical avenues of everyday life.

    Jobs

    Prior to the shutdown, the US job market was already on its back.

    It’s been a low-hire, low-fire, low-churn environment. Employers, frozen by high economic and policy uncertainty, have held off making investments and adding workers. Some businesses have used this period to test the waters on artificial intelligence and other technologies – in turn putting to the test that “low-fire” descriptor by announcing mass layoffs in recent weeks.

    “We’re not creating any jobs of consequence, really,” Zandi said.

    Considering that backdrop, the tepid job gains can potentially turn into deeper job losses if safety nets become frayed, more paychecks are missed by federal workers and contractors, and spending pullbacks reverberate through the private sector, causing businesses to lay off workers or shut down, he said.

    A US Chamber of Commerce analysis released this week estimated that 65,500 small business contractors have billions of dollars in payments at risk because of the shutdown — $12 billion in payments for the month alone.

    Rate cuts and some greater clarity around trade deals and tariffs were supposed to fuel a rebound in hiring heading into 2026, noted Nicole Bachaud, labor economist at employment site ZipRecruiter.

    “However, tariffs are projected to dampen consumer spending before year’s end, and a prolonged shutdown could further erode consumer confidence,” she wrote in a note earlier this month. “This would delay hiring plans that might otherwise materialize, keeping the labor market stuck in place.”

    US consumer confidence during October dipped to its lowest level since April, when President Donald Trump announced a massive suite of steep tariffs on imported goods, according to The Conference Board’s latest index released this week.

    Health care and the care economy

    The expiration of the enhanced premium subsidies for Affordable Care Act coverage is at the crux of the Congressional stalemate to fund the federal government and end the shutdown.

    Democrats are demanding that a short-term funding package include an extension of the enhanced assistance, while Republicans say they won’t negotiate until the government reopens.

    Open enrollment starts on November 1, and the more than 22 million Americans who use the federal health insurance marketplace are expected to see their monthly premium leap by 26% on average, according to a KFF analysis.

    Also on November 1, more than 65,000 children and families in 41 states and Puerto Rico are at risk of losing access to Head Start programs, which provide early education and child development resources to low-income households.

    Any center closures could quickly increase financial hardship for lower-earnings families. Child care disruptions have been shown to negatively impact labor force participation (particularly for women), productivity growth and overall economic growth.

    Spending

    The lengthier the shutdown, the higher the probability for a greater drag on overall economic activity, said Joe Brusuelas, RSM US chief economist.

    “And this isn’t economic activity that is just deferred or delayed, you’re now creating a condition of economic activity that just simply doesn’t happen,” he said.

    There’s the job that doesn’t get filled, the trip that doesn’t get taken and the holiday spending that doesn’t occur.

    “At some point, things start to break because they’re just not getting done,” added Zandi, of Moody’s Analytics. “When this thing really metastasizes and takes out the broader economy is when it starts to affect confidence – consumer, business, investor confidence – the stock market takes notice and instead of going straight up, it starts to wobble and starts going down.”

    If the shutdown continues past Thanksgiving, “there’s no coming back from that quickly,” he said, adding that once it passes that “point of no return,” it will cause “damage that’s longer-lasting.”

    Consumer spending accounts for two-thirds of US economic activity. It has remained largely resilient, despite massive uncertainty and persistently high inflation.

    However, it’s likely done so because of an increasingly bifurcated, or “K-shaped” economy. Wealthy consumers, buoyed in part by strong market gains, are driving more of the spending while lower- and middle-income households are facing increased strain.

    Prices and interest rates

    A drawn-out shutdown could inject further “crosscurrents” into an already choppy price environment, Zandi said.

    On one hand, disruptions to government services and funding could affect trade and supply chains, driving up prices. On the other hand, a weakened economy would mean it’s harder for companies to raise prices, which could help keep overall inflation in check.

    “The net of all that, I think, is hard to know,” he said.

    Still, the shutdown and its economic fallout could give the Federal Reserve one more reason to continue cutting interest rates, he added.

    “The Fed’s putting a higher weight at this point on the weak job market than they are on inflation or financial conditions,” he said. “This [shutdown] would weaken the already fragile job market more.”

    The human impact

    The shutdown could very well exacerbate those struggles for many Americans, especially people on the margins.

    Most Americans are “not taking any solace from the fact that AI stocks are going stratospheric; they’re focused on having to make their credit card payment or the student loan monthly payment,” Zandi said. “The economy is fragile and, therefore, something like a government shutdown could become a bigger problem a lot faster than people might think so.”

    A lack of funding for safety net programs, particularly the Supplemental Nutrition Assistance Program, could not only exacerbate hunger and hardship for tens of millions of Americans, but also threatens to destabilize local economies, especially in rural areas.

    “It just adds insult to injury on an economy that was already showing some cracks,” KPMG economist Swonk said. “Low- and middle-income households are really struggling, and inequality tends to stoke political divisions as well as political backlash. So, this is just feeding in to already a not very comfortable situation that we are in.”

    “It’s hard when you see the struggles we’re already facing, but this is a man-made problem,” she added.

    Alicia Wallace and CNN

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  • US Stocks to be Tested by Tesla, Netflix Earnings and Delayed CPI report

    Earnings reports next week, including from Tesla and Netflix, will provide a deeper look at U.S. corporate profits while delayed U.S. inflation data will mark another test of the stock market, which has become shakier even as it remains around record highs.

    The fourth year of the S&P 500’s bull run kicked off this week with some significant gyrations after a long period of market calm.

    Revived U.S.-China trade tensions and credit concerns at regional U.S. banks drove the anxiety. The CBOE market volatility index, known as Wall Street’s “fear gauge”, has surged in recent days and hit its highest level in nearly six months on Friday.

    “The market is becoming more volatile, but it’s also coming off of a very non-volatile period where we didn’t have a lot of risk catalysts bubbling to the top,” said Michael Reynolds, vice president of investment strategy at Glenmede.

    “Once you have valuations hit sort of full levels, as we’re seeing now almost across the board, you have to be on the lookout for incremental risk catalysts.”

    The spark for the latest volatility was a surprise resurgence in U.S.-China trade tensions. Stocks slumped late last week after the U.S. threatened to significantly hike tariffs by November 1 over China’s rare-earth export controls.

    The U.S.-China trade issue will be key for markets in the coming week, said Doug Beath, global equity strategist at Wells Fargo Investment Institute. U.S. President Donald Trump confirmed on Friday that he would meet with Chinese President Xi Jinping in two weeks in South Korea.

    Sharp swings in global financial shares to end the week also kept investors on edge as they weighed the extent of credit concerns emerging from regional U.S. banks.

    Major stock indexes posted weekly gains and are on pace for strong years. The benchmark S&P 500 is up 13.3 percent year-to-date and 1.3 percent below its record high. But there are signs the market is weakening under the surface.

    The percentage of S&P 500 stocks in some form of an uptrend declined from 77 percent in early July to 57 percent as of Tuesday while the number of stocks in a downtrend increased from 23 percent to 44 percent over that time, according to Adam Turnquist, chief technical strategist for LPL Financial.

    That “narrowing gap highlights emerging cracks in the market’s foundation,” Turnquist said in written commentary. Similarly, Kevin Gordon, senior investment strategist at Charles Schwab, said he will be watching how broadly based the market’s gains are going forward.

    “If you have a fewer number of companies that are actually moving higher, but the indexes do move higher because of the megacaps, that’s a really important divergence,” Gordon said.

    Attention will be on third-quarter earnings after major banks started the reporting season on a strong note. Aside from streaming giant Netflix and electric vehicle maker Tesla, other companies due to report in the coming week include consumer companies Procter & Gamble and Coca-Cola, aerospace and defense giant RTX and tech stalwart IBM.

    The corporate results and executive comments will offer insight into the economy as the U.S. government shutdown has stopped economic data releases since October 1, including monthly employment data.

    Corporate “reports and what companies say is really our best chance at assessing what the broader economic health is,” Gordon said.

    The government has said it will release the U.S. consumer price index for September on Friday, nine days late, saying the CPI data allows the Social Security Administration to meet deadlines for timely payment of benefits.

    The CPI report, which is a closely watched inflation gauge, will be released days before the Federal Reserve’s next monetary policy meeting on October 28-29. The U.S. central bank is widely expected to cut interest rates by a quarter percentage point again, after weakening jobs data prompted the Fed to lower rates last month for the first time this year.

    “We’d really have to see something out of left field in terms of notable inflation pressures to knock the Fed off of a rate cut path at the October meeting,” Glenmede’s Reynolds said.

    Reporting by Lewis Krauskopf; Editing by David Gregorio and Cynthia Osterman

    Reuters

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  • Video: Senate Votes In Trump Pick for Fed Board

    new video loaded: Senate Votes In Trump Pick for Fed Board

    transcript

    transcript

    Senate Votes In Trump Pick for Fed Board

    Senate Republicans confirmed President Trump’s nomination of Stephen Miran, a top White House economic adviser, as a governor for the Federal Reserve on Monday.

    “The yeas are 48. The nays are 47, and the nomination is approved.”

    Shawn Paik

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

    (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.

    Elisabeth Buchwald and CNN

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  • Closures of Fred Meyer in Tacoma, WA impacting 200 employees, creates ‘food desert’

    TACOMA, Wash. – The upcoming closure of a Fred Meyer store in Tacoma will impact more than 200 employees and has left residents concerned that they will be living in a food desert. 

    What we know:

    The closure on Pacific Avenue has alarmed some members of the community. Neighborhood leaders have scheduled a town hall meeting to discuss the loss in late August.  

    On a Sunday afternoon, you can find the South End Fred Meyer in Tacoma pretty packed as people stock up for the week. 

    However, that Sunday ritual will soon be a thing of the past at the store located at 72nd Ave and Pacific Ave. Parent company Kroger announced a group of nationwide closures in June, which will include the store at 72nd and Pacific Avenue.

    Tacoma City Councilmember Joe Bushnell says it’s part of a larger company-wide decision to run more efficiently and ensure the long-term health of their business.

    He said in an online statement:

    “I want to express my disappointment regarding the news of the upcoming closure of our local Pacific Fred Meyer store. For years, this store has been more than just a place to shop; it has been a community hub, a vital source of groceries and prescriptions, and an employer for many of our residents.

    We have been in communication with Kroger, the parent company, and we understand this was a difficult decision for them, and that this closure is part of a larger company-wide decision to run more efficiently and ensure the long-term health of their business.”

    In the wake of that announcement, thousands signed the change.org petition, which calls for leaders to keep the store or provide for a replacement.  It reads, “This store is a lifeline in a neighborhood already recognized by public health officials as a food desert — an area where people have limited access to affordable, fresh, and nutritious food.”

    “That community is losing a vital grocery store. A lot of those shoppers aren’t going to have access to coming to a different Fred Meyer,” said Aria Joslyn, member of UFCW 367, Fred Meyer cashier. 

    Joslyn, who used to work at the store that is closing, says the impact on workers is also a concern.

     A Worker Adjustment and Retraining Notification (WARN) filing with the state says that permanent layoffs are slated for September 27th with an impact on 226 workers.  

    “It’s super disappointing. I worked at that store for a long time, and the people there, it’s a great crew there,” said Joslyn.

    Kroger has said it is offering its workers the opportunity to transfer.  However, Joslyn says there are worries about hours.

    “Bringing on new employees at each of the stores is just going to spread the hours thinner and leave more people in unstable employment situations,” says Joslyn. 

    To talk about concerns, the South End Neighborhood Council has planned a town hall meeting on Thursday, August 28th.

    An online post states, “The South End Fred Meyer is closing—and the impacts on food access, jobs, and our community will be real. Let’s talk about it, plan for the future, and make sure our neighborhood is heard.”

    That meeting is scheduled from 6-7:30 p.m.

    The Source: Information in this story came from Worker Adjustment and Retraining Notification and original FOX 13 Seattle interviews.

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  • Inflation report spurs mixed narratives on US economy

    Does the latest consumer price index report show that Americans are paying more or less for goods? You might be seeing mixed messaging based on the politicians you listen to or what your social media algorithms surface.

    Some say the numbers show President Donald Trump’s success. Others say the opposite. 

    Every month, the federal Bureau of Labor Statistics publishes the consumer price index, which measures price changes for goods and services including food, apparel, gasoline and housing. The report is used to assess economic stability and inform policy decisions.

    Sen. Rick Scott, R-Fla., celebrated the July report the day of its release.

    “Another month of inflation coming in lighter than expected. That’s GREAT NEWS for Florida families, and another reminder to trust in Pres. Trump!” Scott posted Aug. 12 on X, alongside a short Fox Business clip about energy and gas price decreases.

    U.S. Rep Kathy Castor, D-Fla., had a different take. 

    “Trump is raising your grocery bill to line the wallets of his billionaire friends. Nothing great about this for American families across the country,” Castor wrote in an Aug. 12 X post that included a link to a CBS News story that said in its headline that the index rose in July by 2.7% on an annual basis.

    Economists told PolitiFact this muddled framing isn’t new and people from different political tribes use varying metrics to reinforce their views. They said the full picture on the economy’s health and trajectory needs more time to come into focus.

    Overall, the report’s numbers are “another dose of modest bad news,” said Douglas Holtz-Eakin, president of the center-right policy institute American Action Forum. “It’s not dramatic yet, it’s not a crisis, but it’s not positive.”

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    Trump’s tariffs, widely watched to see how they affect consumer prices and inflation, are still new and some just went into effect in August. 

    “Since at least 2021 the CPI reports have become a partisan battle ground with both sides cherry picking the data to best support their argument,” said Jason Furman, an economist and professor at Harvard University’s John F. Kennedy School of Government who previously served as an economic adviser to former President Barack Obama. “And there is so much data in the CPI report that there is always some way to slice and dice it to support just about any view.”

    The consumer price index report and its meaning

    For July, the consumer price index increased 0.2% compared with the previous month and 2.7% from a year ago. That’s slightly cooler than the 2.8% rise economists had forecast, thanks to declines in gasoline and energy prices.

    Gary Burtless, senior fellow at the Brookings Institution, said the 2.7% 12-month rise in consumer prices for all items is a “bit lower than it was at the start of 2025,” to Trump’s advantage. But the number is also a bit higher than it was from March to July, he said, an advantage for Trump’s critics.  

    A separate measure, core inflation — which excludes food and energy because they are considered volatile measures prone to large, rapid fluctuations — increased 0.3% for July and 3.1% from a year ago. This is the first time annual core inflation, which officials use to monitor underlying, longer-term inflation trends, has risen above 3% in several months. This outpaces Federal Reserve projections before the 2024 election, which projected 2.2% median core inflation for 2025.

    “Economists tend to focus on the core because it is less erratic than food and energy prices,” said Dean Baker, co-founder of the liberal Center for Economic and Policy Research. “Food and energy prices are very important, but big changes in either direction tend to be reversed. Therefore it is often more useful if we are looking for future trends to look at the core index.”

    Despite the uptick, the report was mild enough for investors, as U.S. stocks closed near a record high Aug. 12. The stock market appears, for now, to be focusing on the likelihood that the Federal Reserve will cut interest rates in September given concerns about a cooling labor market. Central bank officials, to Trump’s disapproval, have held rates steady in 2025 as they wait to see tariffs’ effect on the economy.

    The July data comes amid a Bureau of Labor Statistics shakeup. After the agency’s downward revision of May and June employment data, Trump fired bureau Commissioner Erika McEntarfer, accusing her of political bias. Trump nominated E.J. Antoni, an economist at the conservative Heritage Foundation who has criticized the bureau, as the agency’s new commissioner.

    The long and winding road of Trump’s tariffs

    As the Trump administration highlights the collection of nearly $130 billion from the new tariffs so far, many economists expect that businesses will begin passing on the additional costs to U.S. customers.

    Goldman Sachs estimated in an analysis shared with Bloomberg that U.S. companies have so far absorbed the bulk of tariff costs — around two-thirds of the levies — while consumers absorbed around 22% of the costs through June.

    But Goldman Sachs said it expects the consumer share of the costs to soar to 67% by October if the tariffs follow previous patterns of how import levies affected prices.

    Trump wrote in an Aug. 12 Truth Social post that Goldman Sachs CEO David Solomon should replace its economist. “It has been proven, that even at this late stage, Tariffs have not caused Inflation, or any other problems for America, other than massive amounts of CASH pouring into our Treasury’s coffers,” Trump wrote.

    Some U.S. companies have avoided passing along higher prices by stockpiling goods ahead of the tariffs’ implementation. Others have absorbed costs to avoid losing customers or are holding off in hopes that courts nix the tariffs.

    “That’s just businesses making business decisions,” said Holtz-Eakin, from the American Action Forum. “But there will be a point if the tariffs stay in place at the current levels where that just won’t be feasible anymore.”

    Many studies of past tariffs have found that they harm the economy and raise consumer prices.

    For now, however, experts agreed that the U.S. economy is in a wait-and-see moment.

    Burtless, from Brookings, believes that the effects of tariffs on consumer prices are modest so far, and that price increases across different categories of goods and services appear “inconsistent with the idea that tariffs are the main driver of overall inflation.”

    “That may turn out to be the case in the future,” he said, “but not yet.”

    Holtz-Eakin also warned about putting too much stock in a single report.

    “Never believe one month’s data,” he said. “That’s a rule of life if you’re doing policy work.”

    RELATED: New Trump tariffs could put even more downward pressure on economy because they’re less targeted 

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  • Video: ‘Declaration of Progress’: Biden Hails Fed Rate Cuts

    Video: ‘Declaration of Progress’: Biden Hails Fed Rate Cuts

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    ‘Declaration of Progress’: Biden Hails Fed Rate Cuts

    President Biden hailed the Federal Reserve’s move to begin cutting interest rates during a speech at the Economic Club of Washington.

    No one should confuse why I’m here. I’m not here to take a victory lap. I’m not here to say a job well done. I’m not here to say we don’t have a hell of a lot more work to do. We do have more work to do. But what I am here to speak about is how far we come, how we got here, and most importantly, the foundation that I believe built for a more prosperous and equitable future in America. So let’s be clear: The Fed lowering interest rates isn’t a declaration of victory. It’s a declaration of progress. It’s a signal we’ve entered a new phase of our economy and our recovery. I believe it’d important for the country to recognize this progress because if we don’t, the progress we’ve made will remain locked in the fear of the negative mind-set that dominated our economic outlook since the pandemic began.

    Recent episodes in Washington

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  • Video: What Does the Fed Interest Rate Cut Mean?

    Video: What Does the Fed Interest Rate Cut Mean?

    On Wednesday, the Federal Reserve lowered the interest rate for the first time since 2020. Jeanna Smialek, a reporter covering the Federal Reserve and the U.S. economy for The New York Times, explains what the half-percentage-point cut could mean for the economy, politics and you.

    Jeanna Smialek, Karen Hanley, Claire Hogan and James Surdam

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  • Video: ‘Lack of Further Progress’ on Inflation Keeps Interest Rates High

    Video: ‘Lack of Further Progress’ on Inflation Keeps Interest Rates High

    new video loaded: ‘Lack of Further Progress’ on Inflation Keeps Interest Rates High

    transcript

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    ‘Lack of Further Progress’ on Inflation Keeps Interest Rates High

    Jerome H. Powell, the Fed chair, said that the central bank needed “greater confidence” that inflation was coming down before it decided to cut interest rates, which are at a two-decade high.

    Today, the F.O.M.C. decided to leave our policy interest rate unchanged and to continue to reduce our securities holdings, though, at a slower pace. Our restrictive stance of monetary policy has been putting downward pressure on economic activity and inflation, and the risks to achieving our employment and inflation goals have moved toward better balance over the past year. However, in recent months, inflation has shown a lack of further progress toward our 2 percent objective, and we remain highly attentive to inflation risks. We’ve stated that we do not expect that it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2 percent. So far this year, the data have not given us that greater confidence. In particular, and as I noted earlier, readings on inflation have come in above expectations. It is likely that gaining such greater confidence will take longer than previously expected.

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    The New York Times

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  • Video: Federal Reserve Continues to Hold Interest Rates Steady

    Video: Federal Reserve Continues to Hold Interest Rates Steady

    new video loaded: Federal Reserve Continues to Hold Interest Rates Steady

    transcript

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    Federal Reserve Continues to Hold Interest Rates Steady

    During a news conference, Jerome H. Powell, the Federal Reserve chair, announced that interest rates will remain unchanged with a hope that it will lead to price stability and bring down inflation in the future.

    My colleagues and I are acutely aware that high inflation imposes significant hardship as it erodes purchasing power. Reducing inflation is likely to require a period of below potential growth and some softening of labor market conditions. The committee decided at today’s meeting to maintain the target range for the federal funds rate at 5.25 to 5.5 percent, and to continue the process of significantly reducing our securities holdings. We are committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation sustainably down to 2 percent over time. Inflation has moderated since the middle of last year, and readings over the summer were quite favorable. But a few months of good data are only the beginning of what it will take to build confidence that inflation is moving down sustainably toward our goal. Price stability is the responsibility of the Federal Reserve. Without price stability, the economy does not work for anyone.

    Recent episodes in Business

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  • Video: Fed Raises Interest Rates a Quarter of a Point

    Video: Fed Raises Interest Rates a Quarter of a Point

    Jerome H. Powell said that the Federal Reserve raised interest rates to combat inflation amid turmoil in the banking system.

    The New York Times

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  • Video: Yellen Reaffirms Support for Small Financial Institutions

    Video: Yellen Reaffirms Support for Small Financial Institutions

    Treasury Secretary Janet L. Yellen said that pressures on the nation’s banking system are “stabilizing” in remarks to the American Bankers Association.

    The Associated Press

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  • Video: Fed Is Likely to Raise Rates Higher Than Expected, Powell Says

    Video: Fed Is Likely to Raise Rates Higher Than Expected, Powell Says

    Jerome H. Powell, the Federal Reserve chair, said the central bank was prepared to raise interest rates higher than it had previously anticipated to combat inflation.

    Reuters

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  • Video: Fed Raises Interest Rates in Fight Against Inflation

    Video: Fed Raises Interest Rates in Fight Against Inflation

    The Federal Reserve raised interest rates by three-quarters of a point in their sixth increase this year. Jerome H. Powell, the Fed chair, said “at some point” it would be appropriate to slow the pace of increases.

    The Associated Press

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  • US economic growth rebounds in Q3, but demand is slowing

    US economic growth rebounds in Q3, but demand is slowing

    US economic growth rebounded more than expected in the third quarter amid a continued decline in the trade deficit, but that overstates the economy’s health as the Federal Reserve’s aggressive interest
    rate increases curbed consumer spending.

    Gross domestic product increased at a 2.6% annualized rate last quarter, the Commerce Department said in its advance GDP estimate on Thursday, ending two straight quarterly decreases in output, which had raised concerns that the economy was in recession.

    The economy contracted at a 0.6% pace in the second quarter. 

    Economists polled by Reuters had forecast GDP growth rebounding at a 2.4% rate. Estimates ranged from as low as a 0.8% rate to as high as a 3.7% pace.

    While the economy may not be in recession, the risks of a downturn have increased as the Fed doubles down on rate hikes as it fights the fastest-rising inflation in 40 years.

    The U.S. central bank has raised its benchmark overnight interest rate from near zero in March to the current range of 3.00% to 3.25%, the swiftest pace of policy tightening in a generation or more.

    The report will have little impact on monetary policy, with Fed officials watching September personal consumption expenditures price data and third-quarter labor cost numbers due on Friday, ahead of their Nov. 1-2 policy meeting.

    The trade deficit narrowed sharply in part as slowing demand curbed the import bill. Exports also increased for much of last quarter. Wild swings in trade and inventories were behind the contraction in GDP in the first half of the year.

    Growth in consumer spending, which accounts for more than two-thirds of U.S. economic activity, slowed to 1.4% rate from the April-June quarter’s 2.0% pace.

    Consumer spending is being supported by a strong labor market, which is driving up wages. The Labor Department reported on Thursday a modest increase in the number of people filing new claims for unemployment benefits last week.

    Initial claims for unemployment benefits increased 3,000 to a seasonally adjusted 217,000 for the week ended Oct. 22. Claims have remained significantly low despite reports of companies, mostly in the interest rate-sensitive sectors of the economy, laying off workers.

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