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Business Briefs - Associated Press - July 10, 2024

Fed's Powell highlights slowing job market in signal that rate cuts may be nearing

WASHINGTON (AP) — The Federal Reserve faces a cooling job market as well as persistently high prices, Chair Jerome Powell said in testimony to Congress, a shift in emphasis away from the Fed's single-minded fight against inflation that suggests it's moving closer to cutting interest rates. The Fed has made "considerable progress" toward its goal of defeating the worst inflation spike in four decades, Powell told the Senate Banking Committee. "Inflation has eased notably" in the past two years, he added, though it remains above the central bank's 2% target. Powell pointedly noted that "elevated inflation is not the only risk we face." Cutting interest rates "too late or too little could unduly weaken economic activity and employment," he said.


Analysts alarmed by threats to US data gathering

Statisticians and demographers are sounding the alarm about threats to official data gathering in the U.S. They warn that funding for the federal statistical agencies is inadequate and measures in a House appropriations bill could undermine what Americans know about themselves. A report released Tuesday by the American Statistical Association also warns that the agencies lack protections against political interference. Other advocates worry about the appropriations bill being considered by the GOP-controlled Congress. They say that bill would limit how many times a respondent can be contacted by federal agencies, and would therefore miss many more people.


Boeing has agreed to plead guilty to fraud in 737 Max crashes

Boeing has agreed to plead guilty to fraud to settle charges stemming from the crashes of two of its 737 Max jets. If a judge in Texas accepts the deal, Boeing won't have to go on trial. The plea deal was disclosed in a court filing late Sunday. It's not yet a sure thing, however. Relatives of some of the passengers who died in the Max crashes have indicated they will ask a federal judge to throw out the agreement. Under the deal, Boeing will pay another fine, bringing the total to $487.2 million, and be required to invest at least $455 million in making additional safety improvements.


The US housing slump deepened this spring

LOS ANGELES (AP) — The nation's housing market sales slump is dragging on into its third straight year, as evidenced by another weak spring homebuying season. Sales of previously occupied U.S. homes fell in the March-May period from a year earlier, and early June data point to another down month. The lackluster spring sales are a reflection of the affordability challenges many home shoppers face due to elevated mortgage rates, a shortage of properties on the market and record-high home prices. Economists are projecting mortgage rates will ease modestly by the end of this year. But a small decline in rates may not be enough to improve affordability, and may drive prices higher.


Rent inflation remains a pressure point for small businesses

NEW YORK (AP) — Rent inflation remains a pressure point for small businesses. The Bank of America Institute found that average monthly rent payment growth for the bank's small business clients rose 12% year-over-year in May. The rent payments per client closely track the nonresidential real estate rents component of the Producer Price Index, which suggests the increases are largely due to inflation rather than small businesses upgrading to bigger or better space. Easing wage inflation has taken some pressure off of small businesses, Bank of America says.


Key senators reach agreement on spending levels for next year, setting up clash with House

WASHINGTON (AP) — The Senate will pursue a spending increase next year of about 3.4% for defense and 2.7% increase for non-defense programs under a bipartisan agreement reached by the Senate Appropriations Committee. The deal reached by Sens. Patty Murray and Susan Collins sets up a certain clash later this year with the House, which is pursuing less spending in both categories. Spending was set to increase 1% for defense and non-defense programs next year under an agreement reached by President Joe Biden and then-Speaker Kevin McCarthy. But some senators said such an increase would not keep pace with inflation and amounted to a cut for many programs.


Target to stop accepting personal checks next week

NEW YORK (AP) — Target says it will no longer accept personal checks from shoppers as of July 15. The Minneapolis-based discounter confirmed the move in a statement to The Associated Press on Tuesday, citing "extremely low volumes" of customers who still write checks. It's another sign of how a once ubiquitous payment method is going the way of outmoded objects like floppy disks and the Rolodex. Target said it remained committed to creating an easy and convenient checkout experience with credit and debit cards, "buy now, pay later" services and the Target Circle membership program. Target's decision leaves Walmart, Macy's and Kohl's among the retailers that still accept personal checks at their stores.


Paramount and Skydance merge

NEW YORK (AP) — The entertainment giant Paramount will merge with Skydance, closing out a decades-long run by the Redstone family in Hollywood and injecting desperately needed cash into a legacy studio that has struggled to adapt to a shifting entertainment landscape. It also signals rise of a new power player, David Ellison, the founder of Skydance and son of billionaire Larry Ellison, the founder of the software company Oracle. The new combined company is valued at around $28 billion.