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      PCE, a Key Inflation Measure, Sped Up in October

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      Inflation has been stubborn in recent months. Now, President-elect Donald J. Trump’s tariffs loom as a potential risk.The Federal Reserve’s preferred inflation measure sped up in October, a development that is likely to keep central bankers wary as they contemplate the path ahead for interest rates.The Personal Consumption Expenditures index climbed 2.3 percent from a year earlier, quicker than 2.1 percent in September.After stripping out volatile food and fuel costs to get a better sense of the underlying trend in prices, a “core” index climbed 2.8 percent from a year earlier. That was up from 2.7 percent previously.Looking at how much prices climbed over just the past month, the overall index rose 0.2 percent from September, and the core index increased 0.3 percent. Both changes were in line with their previous readings and with economist expectations. Policymakers sometimes look at monthly price changes to get an up-to-date sense of how inflation is evolving.The upshot from the report is that inflation is proving sticky after months of steady progress. Price increases remain much cooler than they were at their peak in 2022, which topped out at about 7 percent for the overall index. But they remain slightly faster than the 2 percent pace that the Fed targets.That is preventing officials from declaring victory over inflation, although policymakers still expect price increases to continue to cool toward their goal.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Inflation Concerns Loom as Trumponomics Revs Up

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      Investors are bracing for the latest data as the president-elect’s economic agenda of cutting immigration and taxes, while raising tariffs takes shape.Progress on tamping down inflation has stalled in recent months. Will today’s data show more of the same?David Zalubowski/Associated PressTrump puts inflation on the agenda The inflation risk stalking the markets eased over the summer, but it never really went away. It’s front and center again as investors contend with a Trumponomics crackdown on immigration, a rising trade-war risk and a potential bonanza of tax cuts.An important inflation measure comes out at 10 a.m. Eastern: the Personal Consumption Expenditures index report. It’s the Fed’s preferred inflation gauge and one of the last big data releases of the year that the central bank will consider as it ponders when to lower borrowing costs further. (Next week’s jobs report is another.)Donald Trump’s latest trade threats show how uncertain the outlook could be. Since the president-elect this week vowed to impose tariffs on Canada, China and Mexico — the United States’ three biggest trade partners — analysts have been gaming out the potential impact. Economists fear that it could add bottlenecks and costs to supply chains and reignite inflation, and that it could scramble the Fed’s policy on interest rates.A worst-case scenario from Deutsche Bank economists: that core P.C.E. next year would jump by an additional 1.1 percentage points if the Trump tariffs were fully enacted. Is the tariff talk an opening salvo for trade negotiations, or a fait accompli? That uncertainty can be felt in the $28 trillion market for U.S. Treasury notes and bonds: Yields hit a four-month high this month, though they are down on Wednesday. Yields climb when prices fall, and have been especially sensitive to concerns that fiscal policy could fuel inflation.Here’s what to watch for in Wednesday’s P.C.E.:Core P.C.E., which excludes volatile food and food prices, is forecast to come in at 2.8 percent on an annualized basis. That would be 0.29 percent above September’s reading.Such a rise would represent a second straight month of inflation trending higher, putting the level further above the Fed’s 2 percent target. The report “should show another ‘bump in the road’ on the path to 2 percent inflation,” Veronica Clark, an economist at Citigroup, wrote in an investor note this week.The culprits are thought to be shelter inflation — especially house prices, with mortgage rates soaring — and used car prices, as well as higher portfolio management fees.Futures traders on Wednesday were pricing in roughly 60 percent odds of a Fed rate cut next month. But their calculations have been volatile in recent months, and a surprisingly hot number could cause a shift in thinking once again.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Trump Taps Kevin Hassett to Lead National Economic Council

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      President-elect Donald J. Trump selected Kevin Hassett on Tuesday to be the director of the White House National Economic Council, giving an adviser who served as his top economist during his first term a leading role in steering his economic agenda.As the director of the N.E.C., Mr. Hassett will work closely with the Treasury secretary to push forward Mr. Trump’s economic plans, focused on cutting taxes, increasing tariffs and expanding energy production. The role is one of the most expansive in the administration and will put Mr. Hassett at the center of the most pressing policy debates.“He will play an important role in helping American families recover from the Inflation that was unleashed by the Biden Administration,” Mr. Trump said in a statement. “Together, we will renew and improve our record Tax Cuts, and ensure that we have Fair Trade with Countries that have taken advantage of the United States in the past.”Mr. Trump has been rounding out his economic team, having last week picked Scott Bessent to run the Treasury Department and Howard Lutnick, the former chief executive of Cantor Fitzgerald, to lead the Commerce Department. Those positions, unlike the N.E.C. directorship, require Senate confirmation.Mr. Trump also selected Jamieson Greer, a lawyer and former Trump official, to lead the Office of the United States Trade Representative.Mr. Greer is a partner in international trade at the law firm King & Spalding. During Mr. Trump’s first term, he served as chief of staff to Robert E. Lighthizer, the trade representative at the time. He was involved in the Trump administration’s trade negotiations with China, as well as the renegotiation of NAFTA with Canada and Mexico.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Crony Capitalism Is Coming to America

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      It’s late 2025, and Donald Trump has done what he said he would do: impose high tariffs — taxes on imports — on goods coming from abroad, with extremely high tariffs on imports from China. These tariffs have had exactly the effect many economists predicted, although Trump insisted otherwise: higher prices for American buyers.Let’s say you have a business that relies on imported parts — maybe from China, maybe from Mexico, maybe from somewhere else. What do you do?Well, U.S. trade law gives the executive branch broad discretion in tariff-setting, including the ability to grant exemptions in special cases. So you apply for one of those exemptions. Will your request be granted?In principle, the answer should depend on whether having to pay those tariffs imposes real hardship and threatens American jobs. In practice, you can safely guess that other criteria will play a role. How much money have you contributed to Republicans? When you hold business retreats, are they at Trump golf courses and resorts?I’m not engaging in idle speculation here. Trump imposed significant tariffs during his first term, and many businesses applied for exemptions. Who got them? A recently published statistical analysis found that companies with Republican ties, as measured by their 2016 campaign contributions, were significantly more likely (and those with Democratic ties less likely) to have their applications approved.But that was only a small-scale rehearsal for what could be coming. While we don’t have specifics yet, the tariff proposals Trump floated during the campaign were far wider in scope and, in the case of China, far higher than anything we saw the first time around; the potential for political favoritism will be an order of magnitude greater.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      The Markets Cheer Trump’s Treasury Pick, Scott Bessent

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      Investors seemed to signal their approval for Scott Bessent as a safe choice to implement the president-elect’s economic agenda.Stocks and bonds are gaining on Monday, as investors seem to cheer the pick of Scott Bessent to run the Treasury Department.Dominic Gwinn/Middle East Images/AFP via Getty ImagesA steady hand Stocks and bonds are rising on Monday, and the dollar is down. On the first trading day since Donald Trump chose the billionaire financier Scott Bessent as his pick for Treasury secretary, investors seem to be signaling they like the choice.The hedge fund mogul is seen as a steady hand to enact the president-elect’s economic vision — and, just as important, oversee the $28 trillion Treasuries market. “Investors prefer orthodoxy, predictability, and coherence from economic policy; there were fears that some of the candidates may not possess those attributes. Bessent does,” Paul Donovan, chief economist of UBS Global Wealth Management, wrote in a research note on Monday.The Key Square Group founder overcame serious opposition from some in Trump’s inner circle. Elon Musk derided Bessent as a “business-as-usual choice” and threw his weight behind Howard Lutnick, the C.E.O. of Cantor Fitzgerald. When Trump tapped Lutnick to lead the Commerce Department instead, Bessent was left to fight it out against the likes of Mark Rowan, the boss of Apollo Global Management, the private equity giant.Bessent won a “knife fight” to get the nod. On Wall Street, a document was circulated suggesting that his Key Square hedge fund had underperformed the booming markets. Bessent’s ascent is notable in that he doesn’t appear to have been on Trump’s radar during his first administration.His background as a former Democratic donor who worked with George Soros, a villain for the right, has also been scrutinized. (Interesting fact: Bessent furnished the progressive billionaire financier with key data that prompted Soros to make one of his most famous trades: shorting the British pound.) Some Trump backers, including Palmer Luckey, the defense tech entrepreneur, worried about Bessent’s commitment to the president-elect’s America-first agenda.Investors appear to have fewer qualms. Bessent gets high marks as a fiscal conservative and a champion of growth — at Key Square, he told clients that Trumponomics would usher in an “economic lollapalooza” — through deregulation and lower taxes.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Biden’s Chief Economist Processes the Election With ‘Confusion, Guilt’

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      Jared Bernstein, the chair of the White House Council of Economic Advisers, was a leading architect of “Bidenomics.”Since the election, Jared Bernstein, the chair of the White House Council of Economic Advisers, has often found himself in a down mood — dealing, he says, with “confusion, guilt” and “cognitive dissonance.”President-elect Donald J. Trump’s sweeping victory was fueled in part by lousy consumer sentiment and working-class Americans’ frustration with the underlying state of the economy. That is a big blow to the idea of “Bidenomics,” of which Mr. Bernstein was a leading evangelist and architect.The U.S. economy recovered from the pandemic with greater strength than any of its peers. Unemployment stayed below 4 percent for the longest stretch since the 1960s, and remains low. A widely predicted, long-feared recession never materialized. And data show there is continuing a boomlet in manufacturing construction and business productivity.But price increases also spiked on President Biden’s watch. Several prominent economists, peers of Mr. Bernstein’s, argue that the administration’s robust fiscal response caused the inflation. And other issues of affordability — especially housing — have sapped the optimism of many households in the last couple of years.Calling in from Paris on Friday after serving as chair of an economic meeting of the Organization for European Economic Cooperation at the Château de la Muette, Mr. Bernstein, a longtime Biden confidant, spoke with The New York Times about how he is making sense of the moment.You told me three years ago that one goal of the American Rescue Plan was to intentionally “run the economy with a little bit more heat.” We’ve seen benefits of that, but in light of ensuing inflation, do you regret the size and the scope of the American Rescue Plan?We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Newsom Heads to California Counties That Voted for Trump

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      Gov. Gavin Newsom acknowledged that residents were frustrated by economic problems and said that Democrats needed to address their concerns.On Thursday, Gov. Gavin Newsom will make the first of three post-election visits to California counties that Donald J. Trump won in the presidential race, reaching out to working-class voters in the Central Valley who remain frustrated by economic woes.The appearance in Fresno, to unveil a new economic development system, comes as interviews and polls have shown that economic and class divisions were key to Mr. Trump’s return to power.With Democrats still mulling over their presidential and congressional losses, Mr. Newsom said in an interview on Wednesday that his party needed to learn from the recent election and to address the struggles of American workers.“A lot of people feel like they’re losing their identity or losing their future,” Mr. Newsom said. “Message received.”A leading Democrat who has been viewed as a potential 2028 presidential contender, California’s governor has long been a pointed critic of Mr. Trump. Over the past two and a half weeks, he has indicated that he expects his state and the Trump administration to repeat the pitched battle they waged during Mr. Trump’s first term, when California sued the federal government more than 120 times.The governor’s immediate response after the Nov. 5 election was to call his state’s Democrat-dominated legislature into an emergency special session that would start in December. Mr. Newsom urged Democrats to “stand firm” against expected efforts by Mr. Trump to deport immigrants, further limit reproductive rights and weaken environmental regulation.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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      Walmart Stock Rises on Strong Earnings Ahead of Holiday Shopping Season

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      The bellwether retailer reported higher-than-expected sales in its latest quarter and upgraded its forecast for the rest of the year.Walmart has told its workers that it plans to “win” the holiday season. Ahead of the peak shopping period, the nation’s largest retailer appears well positioned, citing “broad-based strength” across its product range.Walmart said Tuesday that U.S. sales increased 5 percent in the third quarter, to $114.9 billion, easily surpassing analysts’ estimates. Sales at its U.S. e-commerce business jumped 22 percent, aided by pickup and delivery options as well as its expanding online advertising and marketplace business.The number of visits and the amount spent per visit both rose, a promising trend for the retailer. Walmart raised its full-year forecast for sales and profit, higher than the estimates it had already increased three months ago.Doug McMillon, Walmart’s chief executive, said the company had “momentum.” “In the U.S., in-store volumes grew, pickup from store grew faster, and delivery from store grew even faster than that,” he said in a statement on Tuesday. The results were somewhat affected by hurricanes and a strike by East Coast port workers, the company said, slightly raising sales but denting profits.Walmart, which brings in millions of customers each week, is a bellwether of U.S. consumer trends. The period between Thanksgiving and New Year’s Day can make or break a retailer’s year, and companies are unsure about how freely shoppers will spend in the weeks ahead.Analysts have recently cautioned that Walmart’s success does not necessarily mean the rest of the retail industry will see similarly strong sales.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More