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Fed keeps rates unchanged for first time in 15 months but signals 2 more potential hikes this year
WASHINGTON (AP) — The Federal Reserve kept its key interest rate unchanged after having raised it 10 straight times to combat high inflation. But in a surprise move, the Fed signaled that it may raise rates twice more this year, beginning as soon as next month. The Fed’s move to leave its benchmark rate at about 5.1%, its highest level in 16 years, suggests that it believes the much higher borrowing rates it’s engineered have made some progress in taming inflation. But top Fed officials want to take time to more fully assess how their rate hikes have affected inflation and the economy. The central bank’s 18 policymakers envision raising its key rate by an additional half-point this year, to about 5.6%.
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Stock market today: Wall Street swings as Fed keeps rates steady but signals more hikes may come
NEW YORK (AP) — Stocks are swinging on Wall Street after the Federal Reserve hinted it may raise interest rates two more times this year. The S&P 500 was virtually flat in late Wednesday trading after pinballing from a modest gain before the Fed’s announcement to a modest loss just after. The Dow fell 247 points, and the Nasdaq was 0.2% higher. The Fed said it would hold rates steady to give more time to see how its fusillade of rate hikes over the last 15 months is affecting the economy. But at the same time, Fed Chair Jerome Powell said underlying trends in inflation are not improving fast enough.
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Bud Light, top US seller since 2001, loses sales crown to Modelo as backlash continues
After more than two decades as America’s best-selling beer, Bud Light has slipped into second place. Mexican lager Modelo Especial overtook Bud Light in U.S. retail dollar sales in the month ending June 3, according to Bump Williams Consulting. Modelo controlled 8.4% of U.S. grocery, convenience and liquor store sales; Bud Light fell to 7.3%. It’s a milestone in the months-long sales decline Bud Light has experienced since early April, when critics vowed to boycott the beer after the company sent a commemorative can a transgender influencer. Bud Light’s U.S. sales were down 24% in the week ending June 3.
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Google should break up digital ad business over competition concerns, European regulators say
BRUSSELS (AP) — European Union regulators have hit Google with fresh antitrust charges, saying the only way to satisfy competition concerns about its lucrative digital ad business is by selling off parts of the tech giant’s main moneymaker. The unprecedented decision Wednesday to push for such a breakup marks a significant escalation by Brussels in its crackdown on Silicon Valley digital giants. The European Commission said its preliminary view after an investigation is that “only the mandatory divestment by Google of part of its services” would satisfy the concerns. Google can now make its case before a final decision. The company says it disagreed with the preliminary finding and “will respond accordingly.”
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It’s almost time to resume student loan payments. Not doing so could cost you
NEW YORK (AP) — After three years, the pandemic-era freeze on student loan payments will end in late August. It might seem tempting to just keep not making payments, but the consequences can be severe, including a hit to your credit score and exclusion from future aid and benefits. More than 40 million Americans will have to start making federal student loan payments again at the end of the summer under the terms of a debt ceiling deal approved by Congress. Millions are also waiting to find out whether the Supreme Court will allow President Joe Biden’s student loan forgiveness plan to go ahead. But payments will resume regardless of what justices decide.
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New commercial jets will be required to have secondary barriers to the cockpit to protect pilots
It will be harder to break into the cockpit on new airline planes. The Federal Aviation Administration issued a final rule Wednesday that will require commercial planes built after mid-2025 to have secondary barriers for extra security when the main cockpit door is open. Pilot groups have been lobbying for the change. Officials call the rule an important step to give pilots more protection. In 2018, Congress ordered the FAA to require secondary barriers, but the agency didn’t issue a proposal until last year.
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Shell ditches lower oil production target but insists it’s committed to cutting emissions
LONDON (AP) — Shell has effectively abandoned a plan to cut oil production by 1-2% per year until the end of the decade. Europe’s largest energy company argued Wednesday that it had already met the target it had set for itself in 2021 through asset sales. It says it has seen its production drop from 1.9 million barrels of oil equivalent per day in 2019 to 1.5 million last year. New chief executive Wael Sawan insisted that the company was still committed to decarbonizing its operations, reiterating the goal that Shell will become a net-zero emissions energy business by 2050. Shell and other oil giants have faced increasing pressure to do more to fight emissions from climate activists.
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Germany says climate measures will narrow but not fully close the country’s emissions gap by 2030
BERLIN (AP) — German officials say that an array of climate measures being introduced by the government will bring the country closer but not all the way toward meeting its national goals for cutting greenhouse gas emissions by 2030. Germany’s Climate Ministry said Wednesday that measures already in place or soon to become law will reduce emissions by about 900 million metric tons of carbon dioxide for the period from 2022 to 2030. An “emissions gap” of about 200 million tons of CO2 will remain and needs to be closed through additional steps over the coming years. That is largely because of persistent high emissions in the transport sector. Germany aims to reduce its emissions of planet-warming gases by 65% from 1990 levels by 2030.
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Inflationary pressures continue to ease, producer prices drop 0.3% from April to May
WASHINGTON (AP) — Wholesale prices in the United States dropped 0.3% from April to May, another sign that inflationary pressures continue to ease in the face of repeated interest rate hikes by the Federal Reserve. The Labor Department’s producer price index — which measures inflation before it reaches consumers — rose 1.1% last month from May 2022, the smallest year-over-year gain since December 2020. Excluding volatile food and energy prices, so-called core wholesale inflation was up 0.2% last from April and 2.8% from a year earlier.
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The S&P 500 rose 3.58 points, or 0.1%, to 4,372.59. The Dow Jones Industrial Average fell 232.79 points, or 0.7%, to 33,979.33. The Nasdaq composite rose 53.16 points, or 0.4% to 13,626.48. The Russell 2000 index of smaller companies fell 22.24 points, or 1.2%, to 1,874.10.
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