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Yahoo
3 hours ago
- Business
- Yahoo
As the Fed waits on the impact of tariffs, some are already feeling it
This post originally appeared in the Business Insider Today newsletter. You can sign up for Business Insider's daily newsletter here. Happy Juneteenth! Since the BI Today team is off for the holiday, we're running an abbreviated version of the newsletter. But we've still got time for a scoop! Meta's deal with Scale AI has left its Big Tech clients eager to distance themselves from the company. In today's big story, the Fed is holding firm on interest rates as Fed Chair Jerome Powell waits to see the impact of Trump's tariffs. However, some people are already feeling me if you've heard this before: The Fed didn't cut interest rates as it waits to see the impact of tariffs. For the fourth-straight time this year, the central bank chose not to adjust interest rates. And as was the case before, the impact of President Donald Trump's trade war was a key part of the decision, writes BI's Allie Kelly. It's tricky to navigate for multiple reasons. First, the ultimate severity of the tariffs is unclear as negotiations are ongoing. Second, the financial data hasn't yet indicated notable price changes due to the trade war. Still, Powell said he ultimately expects the cost of tariffs will fall to the consumer. "We expect a meaningful amount of inflation to arrive in the coming months," Powell said Wednesday, adding, "Someone has to pay for the tariffs." In some cases, it's already happening. (Much to the surprise of the customer.) BI's Emily Stewart has a story on the sticker shock customers are getting when steep import bills arrive on their doorsteps. Some people even questioned the legitimacy of the bills. A customer who purchased an $850 bag from Spain thought the text she got from UPS billing her $250 for the delivery was a scam, she told Emily. It's led to a lot of finger-pointing about who is to blame. Retailers often say their websites explain — albeit oftentimes in the fine print — that import duties are the customers' responsibility. Carriers like UPS and FedEx say they are just passing the bill they had to pay to the US government on to the buyers. Meanwhile, buyers are left frustrated with additional fees they often weren't aware of ahead of time. What's worse: Even if they return the item, they're still on the hook for the tariff bill. AI runs on dirty power — and the public pays the price. CEOs are trying to warn you: Use AI or else Apple, Siri, and the booted blogger: A Conversation with John Gruber. F1's CEO says the job comes with 'no holiday.' He explains how he stays calm under pressure. Sneaker loafers, a hot new shoe trend, toe the line between fashionable and geriatric. Looking for a sign to put off buying an engagement ring? This just might be it. A Chinese herbal-medicine stock with no revenue has surged 60,000% this year. 5 things to know about the company's mysterious spike. Microsoft turned me down twice. Here's what I did differently the third time to get the job. CEOs haven't felt this gloomy about the economy since the pandemic. The Silicon Valley leaders who have experimented with psychedelics. The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York City. Hallam Bullock, editor, in London. Akin Oyedele, deputy editor, in New York. Ella Hopkins, associate editor, in London. Grace Lett, editor, in Chicago. Amanda Yen, associate editor, in New York. Read the original article on Business Insider
Yahoo
4 hours ago
- Business
- Yahoo
Gold Holds as Traders Weigh Inflation Warning, Middle East Risks
(Bloomberg) -- Gold traded little changed as investors weighed rising geopolitical risks in the Middle East against an inflation warning from the Federal Reserve that raises the possibility of fewer US rate cuts. Security Concerns Hit Some of the World's 'Most Livable Cities' JFK AirTrain Cuts Fares 50% This Summer to Lure Riders Off Roads Taser-Maker Axon Triggers a NIMBY Backlash in its Hometown How E-Scooters Conquered (Most of) Europe NYC Congestion Toll Cuts Manhattan Gridlock by 25%, RPA Reports Bullion hovered near $3,369 an ounce as trading wound down in London, with activity muted because US markets are closed for a public holiday. The Fed left rates unchanged Wednesday, and policymakers penciled in two cuts by year's end. But Chair Jerome Powell said the central bank's market committee continued to expect tariffs to work their way into price gains. Fed policymakers also released new economic forecasts — their first since President Donald Trump's tariff spree in April — showing they expect weaker growth, higher inflation and lower employment in 2025. A significant rise in consumer prices may curtail monetary easing, which would be a negative for gold as it doesn't pay interest. That offset support for bullion from war fears in the Middle East, with some US officials said to be preparing for the possibility of a strike on Iran in the coming days. The geopolitical tensions and economic uncertainty have combined with robust buying from central banks and inflows to exchange-traded funds to push gold almost 30% higher this year. Spot gold was little changed at $3,370.78 as of 3:37 p.m. in New York. Silver fell 1%, but remained near the highest since 2012, while palladium also slipped. Platinum dropped 1.4%, reversing an earlier jump that saw it reach the highest level in more than a decade. Gains in the metal have been underpinned by a spike in demand and an ongoing market deficit. 'Gold is currently hovering near record highs, which makes further investment vulnerable to changing macroeconomics,' said Priyanka Sachdeva, an analyst at Phillip Nova Pte Ltd. 'That's probably why we are seeing safe-haven flows being redirected to platinum and silver.' --With assistance from Doug Alexander. Ken Griffin on Trump, Harvard and Why Novice Investors Won't Beat the Pros Is Mark Cuban the Loudmouth Billionaire that Democrats Need for 2028? The US Has More Copper Than China But No Way to Refine All of It How a Tiny Middleman Could Access Two-Factor Login Codes From Tech Giants Can 'MAMUWT' Be to Musk What 'TACO' Is to Trump? ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Business
- Yahoo
Will Dow Jones Futures Rebound As Trump Says 'Two Weeks' For Iran Decision?
Dow Jones futures: U.S. stock markets are closed. President Trump suggested an Iran attack decision may not be imminent. Fed chief Jerome Powell is in no rush to cut rates.
Yahoo
5 hours ago
- Business
- Yahoo
Fed Chair Jerome Powell To Wait On Rate Cuts
The Fed hit pause on interest?rate moves at 4.25% to 4.50% and made it clear they're in no rush to cutespecially with tariff shocks and a surprisingly sturdy jobs market still hanging over the here's the scoop from Jerome Powell's post?meeting chat: the Fed's happy sitting tight, watching how steel and auto tariffs ripple through prices. He admitted duties will nudge inflation higher, but just how big or lasting that bump will be? Honestly, we don't know yet, he said. Meanwhile, hiring has cooled off a bitmostly because fewer folks are entering the workforcebut layoffs? Still pretty rare. All in all, the jobs scene looks pretty good, Powell shrugged. Warning! GuruFocus has detected 2 Warning Sign with AMZN. On the inflation front, prices have eased from their peak but haven't quite hit that comfy 2% target. Long-run expectations haven't budged, which is what the Fed wants to see. Despite nodding toward two quarter-point rate cuts next year, Powell stressed we're unlikely to get them before fall. In fact, they've even nudged up their forecast for the ultimate neutral rate to 3.4% by 2027 (up from 3.1%).If you're hoping for an early rate cut, you may need to wait. Powell's we'll see how the data looks this summer stance means every CPI report or tariff update could swing their thinking. Investors and borrowers alike will be watching that consumer?price index and any news on duties like hawks at a falconry a summer full of datawatchingespecially price?index updates and trade news. If inflation stays sticky or new tariffs bite harder than expected, those cuts could move even further out. Otherwise, the Fed's patience playbook stays in force for now. This article first appeared on GuruFocus.
Yahoo
5 hours ago
- Business
- Yahoo
Trump tariffs live updates: US talks with Canada, EU take focus as deadlines loom
President Trump this week firmed up a trade deal with the United Kingdom, and its European Union neighbors are apparently pushing for a similarly styled deal despite talks seeing starts and stops over the past several weeks. According to reports, the EU now expects a 10% "reciprocal" tariff to be the starting point for an US-EU trade deal. The FT reported on Thursday that the EU is pushing for a deal modeled on the US-UK agreement, which did leave the baseline levy in place. Trump has threatened tariffs of up to 50% on EU imports after various tariff "pauses" lapse July 9. Elsewhere this week, Trump said Japan would soon receive a letter he has threatened to send to US trading partners who do not reach a deal, calling the country's negotiators "tough." Meanwhile, in Canada, Prime Minister Mark Carney's government threatened to hike tariffs by late July on US imports of steel and aluminum after Trump ballooned US levies to 50%. At the G7 this week, Trump and Carney both expressed optimism on a trade deal between the countries. The furious push follows Trump's recent warning that he would soon send letters setting unilateral tariff rates, raising questions about the status of negotiations and a return to his "Liberation Day" tariffs that roiled markets. Trump instituted a pause on his most punishing duties that expires July 9. Federal Reserve Chair Jerome Powell said as the central bank held interest rates steady this week that the Fed is still waiting to see the effects of the tariffs on prices. "We're beginning to see some effects, and we do expect to see more of them over the coming months," he said. He said the Fed needs more data, saying "the pass-through of tariffs to consumer price inflation is a whole process that's very uncertain." Meanwhile, Bloomberg reported on Tuesday that two family-owned businesses have filed a challenge to Trump's most sweeping tariffs with the Supreme Court, expediting the process for a potential definitive ruling should the court take the case. Read more: What Trump's tariffs mean for the economy and your wallet Here are the latest updates as the policy reverberates around the world. Bloomberg reports: Read more here. Tariffs and conflict have clouded the outlook for central banks. President Trump's sweeping tariff threats and the escalating Israel-Iran conflict have left central banks steering policy amid rare global economic uncertainty. Reuters reports: Read more here. A study from Bain & Co. on Thursday, has shown that global sales of personal luxury goods will slow, but not collapse. AP reports: Read more here. Reuters reports: Read more here. According to the FT, the EU is pushing for a UK-style trade deal with the US. This would allow for some tariffs to remain in place after President Trump's July 9 deadline and would prevent any further retaliation against Washington. The FT reports: Read more here. European officials now expect a 10% "reciprocal" tariff to be the starting point in any US-EU trade deal, according to five sources close to the talks. According to Reuters, EU negotiators are still pushing for the rate to be lower than 10%. However, ine of the sources, an EU official, said negotiating this had become harder since the US started drawing reve from its global tariffs. Reuters reports: Read more here. President Trump's first five months in office have been dominated by his trade war. Despite having some recent wins, Trump is running out of time to "seal the deal." CNN reports: Read more here. Over 70% of Japanese firms say the business impact of US tariffs is as expected and have not adjusted their investment plans, a Reuters survey shows. Reuters reports: Read more here. Fed Chair Jerome Powell signaled he's watching the near-term developments on tariffs very closely, as the Fed expects to see more tariff effects filter through to consumer prices throughout the summer. The next major tariff policy deadline is July 9, when the steeper "Liberation Day" tariffs are expected to resume if deals are not reached or if the Trump administration decides not to extend the pause. The next report on core Personal Consumption Expenditures (PCE) Price Index, the Fed's preferred inflation measure, is scheduled to be released on June 27. It remains to be seen when and how tariff costs are distributed. "The pass-through of tariffs to consumer price inflation is a whole process that's very uncertain," Powell explained. "There are many parties in that chain — there's the manufacturer, the exporter, the importer, the retailer, and the consumer, and each one of those is going to be trying not to be the one to pay for the tariff. But together they will all pay for the tariff, or maybe one party will pay it all." "But that process is very hard to predict, and we haven't been through a situation like this," he added. "We'd like to get some more data." Federal Reserve Chair Jerome Powell commented on "elevated" tariff levels Wednesday after the central bank held interest rates steady for the fourth meeting in a row. "We're beginning to see some effects, and we do expect to see more of them over the coming months," Powell said at a press conference. "What we've learned is that ... tariffs are going to be substantially larger than forecasters generally thought," he added later on. "What we learned, particularly in April, was that substantially larger tariffs were coming and that that would mean higher inflation. That's what happened." Powell stated that the US economy is a "solid" but that the Fed needs to see more evidence that inflation is moving down before it cuts rates. However, he said tariffs are hindering that progress on inflation. Powell noted that Fed officials' estimates of core Personal Consumption Expenditures (PCE) for 2025 have moved higher. "Without tariffs, that confidence would be building because if you see what's happening with non-housing services and housing services ... those are coming down really nicely now," Powell said. "I think we have to learn a little more about tariffs. ... I think it's hard to know with any confidence how we should react until we see really the size of the effects, then we can start to make a better judgment, and that's what we're doing." Watch the full press conference here. US consumers are becoming more worried about rising prices fueled by tariffs, a report from the credit reporting agency, TransUnion has shown. Reuters reports: Read more here. President Trump claimed this week that his trade posturing helped clinch a ceasefire between India and Pakistan after tensions bubbled up last month. Indian Prime Minister Narendra Modi says that's not the case, adding to tensions between the US and India as the countries are indeed working to clinch a trade deal before Trump's pause on "Liberation Day" duties expires. Via Bloomberg, Modi attempted to set the record straight during a call with Trump, according to India's foreign secretary: Read more here. Taiwan has joined the US campaign and blacklisted China's Huawei Technologies Co. Bloomberg News reports: Read more here. Trump is also pushing ahead with another tariff bombardment, which some believe may be more legally sound than his country-by-country duties. The US Commerce Department has been investigating certain sectors, which are considered to be of national interest, such as semiconductors, pharma products and critical minerals. The investigation is set to conclude soon and it could mean that some foreign-made products coming into the US will face high duties. Bloomberg News reports: Read more here. Japanese Prime Minister Shigeru Ishiba's aim to get US President Trump to relax tariffs is not just impacting his country's economy. It is also affecting his political future. Bloomberg News reports: Read more here. Hasbro (HAS), the maker of popular game Monopoly, announced on Tuesday that it would be cutting 3% of its total workforce due to high US tariffs on toys coming from China. Reuters reports: Read more here. Shares of Nintendo (NTDOY, 7974.T) continued to climb, with President Trump's trade policy shift providing an added tailwind to the success of its Switch 2 games console update. The stock jumped in Tokyo, while the US-listed stock popped before the bell on Wednesday. According to analysts, due to the US and Japan failing to reach a tariff agreement at the G-7 meeting this week, funds are flowing into the gaming sector, which is less affected by President Trump's tariffs. Bloomberg reports: Read more here. Bloomberg reports that two family-owned companies are asking the Supreme Court to consider striking down President Trump's most sweeping tariffs. Legal experts previously told Yahoo Finance that they expect the case to eventually be taken up by the Supreme Court as part of the president's high-stakes legal battles over the policy. From Bloomberg: Transportation Secretary Sean Duffy said at the Paris Airshow that he wants to return to a 1979 zero-tariff trade agreement for the aviation industry but acknowledged it's part of larger tariff negotiations. "You look at what free trade has done for aviation," Duffy said, per Reuters. "It's been remarkable for them. It's a great space of net exporters. And so the White House understands that, but if you go over there and you see the moving parts of what they're dealing with, it is pretty intense, and it's a lot." The US is a net exporter in aerospace, with a trade surplus of nearly $75 billion for the sector. Since the 1979 Agreement on Trade in Civil Aircraft went into effect, US commercial aerospace exports increased by more than 2,100%, according to a white paper. Duffy highlighted some of those benefits, stating: "I think we should take aviation off the negotiating table by going back to '79, and that only helps us. And to take some tools away from our trading partners would be beneficial to us." A delegation of lawmakers is in attendance at the Paris Airshow to shore up economic partnerships. Industry lobbyists have been seeking to return to the 1979 agreement since the Trump administration imposed 10% tariffs on imported planes, jet engines, and parts. Meanwhile, macroeconomic uncertainty stemming from tariffs and other factors has begun to weigh on travel demand. On Monday, JetBlue (JBLU) revealed it was cutting flights, citing consumers pulling back on spending. Read more here. US consumers will bear the tariff cost, according to Japan's Mitsubishi Motors (MMTOY, 7211.T) which announced on Tuesday that it will raise US vehicle prices by an average 2.1%. Mitsubishi is the latest company to pass along cost increases to its customers as their expenses rise due to President Trump's tariffs. Reuters reports: Read more here. Bloomberg reports: Read more here. Tariffs and conflict have clouded the outlook for central banks. President Trump's sweeping tariff threats and the escalating Israel-Iran conflict have left central banks steering policy amid rare global economic uncertainty. Reuters reports: Read more here. A study from Bain & Co. on Thursday, has shown that global sales of personal luxury goods will slow, but not collapse. AP reports: Read more here. Reuters reports: Read more here. According to the FT, the EU is pushing for a UK-style trade deal with the US. This would allow for some tariffs to remain in place after President Trump's July 9 deadline and would prevent any further retaliation against Washington. The FT reports: Read more here. European officials now expect a 10% "reciprocal" tariff to be the starting point in any US-EU trade deal, according to five sources close to the talks. According to Reuters, EU negotiators are still pushing for the rate to be lower than 10%. However, ine of the sources, an EU official, said negotiating this had become harder since the US started drawing reve from its global tariffs. Reuters reports: Read more here. President Trump's first five months in office have been dominated by his trade war. Despite having some recent wins, Trump is running out of time to "seal the deal." CNN reports: Read more here. Over 70% of Japanese firms say the business impact of US tariffs is as expected and have not adjusted their investment plans, a Reuters survey shows. Reuters reports: Read more here. Fed Chair Jerome Powell signaled he's watching the near-term developments on tariffs very closely, as the Fed expects to see more tariff effects filter through to consumer prices throughout the summer. The next major tariff policy deadline is July 9, when the steeper "Liberation Day" tariffs are expected to resume if deals are not reached or if the Trump administration decides not to extend the pause. The next report on core Personal Consumption Expenditures (PCE) Price Index, the Fed's preferred inflation measure, is scheduled to be released on June 27. It remains to be seen when and how tariff costs are distributed. "The pass-through of tariffs to consumer price inflation is a whole process that's very uncertain," Powell explained. "There are many parties in that chain — there's the manufacturer, the exporter, the importer, the retailer, and the consumer, and each one of those is going to be trying not to be the one to pay for the tariff. But together they will all pay for the tariff, or maybe one party will pay it all." "But that process is very hard to predict, and we haven't been through a situation like this," he added. "We'd like to get some more data." Federal Reserve Chair Jerome Powell commented on "elevated" tariff levels Wednesday after the central bank held interest rates steady for the fourth meeting in a row. "We're beginning to see some effects, and we do expect to see more of them over the coming months," Powell said at a press conference. "What we've learned is that ... tariffs are going to be substantially larger than forecasters generally thought," he added later on. "What we learned, particularly in April, was that substantially larger tariffs were coming and that that would mean higher inflation. That's what happened." Powell stated that the US economy is a "solid" but that the Fed needs to see more evidence that inflation is moving down before it cuts rates. However, he said tariffs are hindering that progress on inflation. Powell noted that Fed officials' estimates of core Personal Consumption Expenditures (PCE) for 2025 have moved higher. "Without tariffs, that confidence would be building because if you see what's happening with non-housing services and housing services ... those are coming down really nicely now," Powell said. "I think we have to learn a little more about tariffs. ... I think it's hard to know with any confidence how we should react until we see really the size of the effects, then we can start to make a better judgment, and that's what we're doing." Watch the full press conference here. US consumers are becoming more worried about rising prices fueled by tariffs, a report from the credit reporting agency, TransUnion has shown. Reuters reports: Read more here. President Trump claimed this week that his trade posturing helped clinch a ceasefire between India and Pakistan after tensions bubbled up last month. Indian Prime Minister Narendra Modi says that's not the case, adding to tensions between the US and India as the countries are indeed working to clinch a trade deal before Trump's pause on "Liberation Day" duties expires. Via Bloomberg, Modi attempted to set the record straight during a call with Trump, according to India's foreign secretary: Read more here. Taiwan has joined the US campaign and blacklisted China's Huawei Technologies Co. Bloomberg News reports: Read more here. Trump is also pushing ahead with another tariff bombardment, which some believe may be more legally sound than his country-by-country duties. The US Commerce Department has been investigating certain sectors, which are considered to be of national interest, such as semiconductors, pharma products and critical minerals. The investigation is set to conclude soon and it could mean that some foreign-made products coming into the US will face high duties. Bloomberg News reports: Read more here. Japanese Prime Minister Shigeru Ishiba's aim to get US President Trump to relax tariffs is not just impacting his country's economy. It is also affecting his political future. Bloomberg News reports: Read more here. Hasbro (HAS), the maker of popular game Monopoly, announced on Tuesday that it would be cutting 3% of its total workforce due to high US tariffs on toys coming from China. Reuters reports: Read more here. Shares of Nintendo (NTDOY, 7974.T) continued to climb, with President Trump's trade policy shift providing an added tailwind to the success of its Switch 2 games console update. The stock jumped in Tokyo, while the US-listed stock popped before the bell on Wednesday. According to analysts, due to the US and Japan failing to reach a tariff agreement at the G-7 meeting this week, funds are flowing into the gaming sector, which is less affected by President Trump's tariffs. Bloomberg reports: Read more here. Bloomberg reports that two family-owned companies are asking the Supreme Court to consider striking down President Trump's most sweeping tariffs. Legal experts previously told Yahoo Finance that they expect the case to eventually be taken up by the Supreme Court as part of the president's high-stakes legal battles over the policy. From Bloomberg: Transportation Secretary Sean Duffy said at the Paris Airshow that he wants to return to a 1979 zero-tariff trade agreement for the aviation industry but acknowledged it's part of larger tariff negotiations. "You look at what free trade has done for aviation," Duffy said, per Reuters. "It's been remarkable for them. It's a great space of net exporters. And so the White House understands that, but if you go over there and you see the moving parts of what they're dealing with, it is pretty intense, and it's a lot." The US is a net exporter in aerospace, with a trade surplus of nearly $75 billion for the sector. Since the 1979 Agreement on Trade in Civil Aircraft went into effect, US commercial aerospace exports increased by more than 2,100%, according to a white paper. Duffy highlighted some of those benefits, stating: "I think we should take aviation off the negotiating table by going back to '79, and that only helps us. And to take some tools away from our trading partners would be beneficial to us." A delegation of lawmakers is in attendance at the Paris Airshow to shore up economic partnerships. Industry lobbyists have been seeking to return to the 1979 agreement since the Trump administration imposed 10% tariffs on imported planes, jet engines, and parts. Meanwhile, macroeconomic uncertainty stemming from tariffs and other factors has begun to weigh on travel demand. On Monday, JetBlue (JBLU) revealed it was cutting flights, citing consumers pulling back on spending. Read more here. US consumers will bear the tariff cost, according to Japan's Mitsubishi Motors (MMTOY, 7211.T) which announced on Tuesday that it will raise US vehicle prices by an average 2.1%. Mitsubishi is the latest company to pass along cost increases to its customers as their expenses rise due to President Trump's tariffs. Reuters reports: Read more here.
