Economic News and Analysis

The latest news and analysis about the health of the US economy.

The Fed should not commit to further interest rate cuts until it is clear whether the Trump administration's tariff policies lead to persistent inflation or a less serious, one-time adjustment in prices, St. Louis Fed President Alberto Musalem said on Friday. Musalem said he currently puts even odds on either of the two paths for inflation. In theory, tariffs should prompt a one-time price jump similar to the imposition of a tax; but coming off the heels of recent high inflation the effect could be longer-lasting, and may also be more persistent since the new levies hit intermediate goods, for example.

Fed's Musalem: Should not commit to rate cuts until tariff impact becomes certain

The Fed should not commit to further interest rate cuts until it is clear whether the Trump administration's tariff policies lead to persistent inflation or a less serious, one-time adjustment in prices, St. Louis Fed President Alberto Musalem said on Friday. Musalem said he currently puts even odds on either of the two paths for inflation. In theory, tariffs should prompt a one-time price jump similar to the imposition of a tax; but coming off the heels of recent high inflation the effect could be longer-lasting, and may also be more persistent since the new levies hit intermediate goods, for example.
Reuters 2 hours ago
Fed's Cook warns tariffs could lower productivity, feed inflation

Fed's Cook warns tariffs could lower productivity, feed inflation

PALO ALTO (Reuters) -President Donald Trump's unfolding trade policy may curb U.S. productivity and possibly require higher interest rates to contain inflation in a less efficient economy, Federal Reserve governor Lisa Cook said on Friday. "I expect to see a drag on productivity in the near term stemming from the recent changes to trade policy and the related uncertainty," Cook said in remarks prepared for a delivery at an economics conference at Stanford University's Hoover Institution.
Reuters 2 hours ago
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US federal HR agency leading DOGE job cuts cancels sole-source Workday award

US federal HR agency leading DOGE job cuts cancels sole-source Workday award

The U.S. federal human resources agency at the heart of billionaire Trump adviser Elon Musk's efforts to slash the federal workforce on Friday canceled a contract it had awarded to Workday. The contract for a new cloud-based HR platform, signed on May 2, was awarded without seeking bids from rivals and had raised eyebrows among current and former employees of the Office of Personnel Management. They had described the sole-source contract as unusual, given the competition in an industry that includes ADP and SAP, and expressed surprise to see OPM's largely successful in-house HR platform on track to be replaced.
Reuters 4 hours ago
Fed's Bowman picks staff from Goldman, Davis Polk and BPI, Bloomberg News reports

Fed's Bowman picks staff from Goldman, Davis Polk and BPI, Bloomberg News reports

The three were picked by Bowman and will be employed by the Fed to work in its Supervision and Regulation Division, according to the report. The new staff include Randall Guynn, who was chairman of Davis Polk & Wardwell's financial institutions group in New York until earlier this month, the report said. Another pick is Aleksandra Wells, who until recently was a vice president in Goldman Sachs Group government affairs unit, according to the report.
Reuters 4 hours ago
Fed Officials Remain Focused On Possibility Tariffs Will Spur Inflation

Fed Officials Remain Focused On Possibility Tariffs Will Spur Inflation

If you're waiting for the Federal Reserve to lower borrowing costs, don't hold your breath. Out of the multiple Federal Reserve officials who spoke Friday, none sounded in a big hurry to cut the central bank's benchmark interest rate.
Investopedia 5 hours ago

Featured Content

Americans haven't had this little faith in finding a new job since 2021

Americans haven't had this little faith in finding a new job since 2021

American workers are the least confident they've been in over four years about finding a new job if they become unemployed, according to a new survey released by the Federal Reserve Bank of New York on Thursday.
The Fed will 'wait and see' if something bad happens in US economy

The Fed will 'wait and see' if something bad happens in US economy

Federal Reserve Chair Jerome Powell offered investors a consistent message on Wednesday: patience.
Strong labor market data doesn't mean the coast is clear for the US economy

Strong labor market data doesn't mean the coast is clear for the US economy

A strong April jobs report may have masked other signs of weakening in the US economy, which has Wall Street increasingly calling for a recession in 2025.
Fed's rate cuts, like Trump's tariffs, look to be on 90-day pause: Morning Brief

Fed's rate cuts, like Trump's tariffs, look to be on 90-day pause: Morning Brief

The delay gives the Fed room to breathe and permission to do nothing but watch.
Fed holds rates steady, defying Trump's call for cuts

Fed holds rates steady, defying Trump's call for cuts

The Federal Reserve held interest rates steady Wednesday for the third meeting in a row, defying President Trump's repeated calls for the central bank to loosen monetary policy further.
Buffett's Berkshire departure, Fed decision, and another rush of earnings: What to know this week

Buffett's Berkshire departure, Fed decision, and another rush of earnings: What to know this week

The S&P 500 clinched its longest winning streak since 2004. The week ahead will see the Federal Reserve put that to the test.
Are we in a recession? Here are the umpires who make the final call.

Are we in a recession? Here are the umpires who make the final call.

Economists warn that an official recession may not be declared for months or even years, as the National Bureau of Economic Research (NBER) relies on a broader set of indicators and retrospective data to determine economic downturns.
Manufacturing activity hits 5-month low as Trump tariffs leave businesses in 'state of near paralysis'

Manufacturing activity hits 5-month low as Trump tariffs leave businesses in 'state of near paralysis'

Manufacturing activity declined in April as President Trump's tariffs clouded the outlook for businesses.
Continuing jobless claims reach highest level since November 2021, initial claims hit 2-month high

Continuing jobless claims reach highest level since November 2021, initial claims hit 2-month high

Unemployment claim filings moved higher to end April as investors closely watch for any signs of further cooling in the labor market.
Negative GDP data is the latest to offer 2 views on the US economy: Morning Brief

Negative GDP data is the latest to offer 2 views on the US economy: Morning Brief

Instead of clarity, the "hard" growth data is seen as a distortion or a warning.
What To Expect From Tuesday's Report On Inflation

What To Expect From Tuesday's Report On Inflation

You may see some price increases from tariffs in your shopping, but you won't see them in Wednesday's official report on inflation in April, forecasters say.
Investopedia 5 hours ago
Exclusive-Fed’s Hammack wants clear data before moving on rates, not much data by June

Exclusive-Fed’s Hammack wants clear data before moving on rates, not much data by June

PALO ALTO, California (Reuters) -The Federal Reserve needs more time to see how the economy responds to U.S. President Donald Trump's tariff and other policies before figuring out the right response, Cleveland Fed President Beth Hammack said on Friday, noting that much of the administration's sweeping agenda remains unclear. "I stand ready to move whenever we have clear and convincing evidence, but ... given the overall breadth of the policies that have been discussed and put in place, I think there's a real question about what those impacts are going to look like, and so it may take longer," Hammack said. "There's not a lot of data between now and June," when the Fed next meets to set interest rates, she said in an interview on the sidelines of a monetary policy conference at Stanford University's Hoover Institution in which she elaborated on the Fed's current dilemma.
Reuters 5 hours ago
Ex Fed's Warsh highlights a path to lower rates, takes a fresh dig at the Fed

Ex Fed's Warsh highlights a path to lower rates, takes a fresh dig at the Fed

Kevin Warsh, an apparent frontrunner to be U.S. President Donald Trump's pick to be the next chair of the Federal Reserve, on Friday suggested a possible pathway to the lower policy rates that Trump has repeatedly pressed the current Fed Chair Jerome Powell to deliver, and delivered a fresh dig at the Fed's conduct of monetary policy. A large and often growing Fed balance sheet can work at cross-purposes with the Fed's main policy lever of setting short-term borrowing rates, Warsh told a monetary policy panel at Stanford University's Hoover Institution, but "if the printing press could be quiet, we could have lower policy rates."
Reuters 7 hours ago
Federal Reserve official sees signs of slowing economy but not ready to cut rates

Federal Reserve official sees signs of slowing economy but not ready to cut rates

A top Federal Reserve official said Friday that massive uncertainty created by President Donald Trump's tariffs has caused some businesses to cut back on hiring and spending, threatening to slow the economy, but he added that it’s not yet clear whether the central bank should cut its key interest rate. Tom Barkin, president of the Federal Reserve's Richmond branch, said businesses have turned cautious, though are not yet engaging in steep job cuts or other behavior typical of a recession. “The way I've been describing it is, it’s really hard to drive when it’s foggy,” Barkin said in remarks to the Loudoun County, Virginia Chamber of Commerce.
Associated Press Finance 7 hours ago
U.S. farm economy is starting to see first hits from Trump tariffs

U.S. farm economy is starting to see first hits from Trump tariffs

President Trump's tariffs are upending crop trading, delaying tractor purchases and constraining imports of chemical supplies into the United States.
LA Times 7 hours ago
US oil and gas rig count falls to lowest since January, Baker Hughes says

US oil and gas rig count falls to lowest since January, Baker Hughes says

(Reuters) -U.S. energy firms this week cut the number of oil and natural gas rigs operating to their lowest since January, energy services firm Baker Hughes said in its closely followed report on Friday. Baker Hughes said this week's decline puts the total rig count down 25, or 4% below this time last year. Baker Hughes said oil rigs fell by five to 474 this week, their lowest since January, while gas rigs were unchanged at 101.
Reuters 9 hours ago
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