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      The Big Number: 2.9%

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      The rate of inflation in July on a yearly basis.Inflation slowed in July, the Consumer Price Index showed, increasing 2.9 percent from a year earlier. That was a drop from 3 percent in June, and it marked the first time that inflation had fallen below 3 percent since 2021.Inflation is still higher than the Federal Reserve’s target of 2 percent, but it has fallen well below the high of 9.1 percent reached in June 2022. The report on Wednesday was another data point to suggest that the Fed will cut interest rates when it meets next month.“It doesn’t mean our work is done, but it does mean we’re moving in the right direction, and with a bit of momentum,” Jared Bernstein, chair of the White House Council of Economic Advisers, said in an email after the release of the report.The Fed started raising interest rates in March 2022 to slow demand and bring price pressures under control after a run-up during the Covid-19 pandemic. Since July 2023, the Fed has held rates steady at about 5.3 percent, the highest level in more than two decades.But evidence like Wednesday’s report makes it all the more likely that the central bank will begin cutting rates, especially after the unemployment rate last month ticked up to 4.3 percent. Historically, increases in joblessness like the one in July have been an indicator of a recession.Still, consumer spending has remained robust while the economy has continued to grow.Can the growth continue? That is the unanswered question at the moment.“The government is taking action to ensure that these products do not turn the dream of homeownership into a nightmare.”Rohit Chopra, the director of the Consumer Financial Protection Bureau, on the agency’s intention to crack down on seller-financed home sales, a predatory practice.“You can’t compare a machine-made cookie with a handmade cookie. It’s like comparing a Rolls-Royce with a Volkswagen.”Wally Amos, the creator of the cookie brand Famous Amos, said in an interview with MSNBC in 2007. He died Tuesday.“We took what people thought were Tubi’s perceived weaknesses — older content, no stars, lower-budget movies — and we made it our strength.”Nicole Parlapiano, Tubi’s marketing chief, on how Tubi has become one of the most popular streaming services.

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      Inflation Progress Cheers Biden and Democrats

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      After more than two years of being politically battered over soaring prices, Wednesday’s inflation report left many Democrats feeling victorious.Consumer prices rose 2.9 percent in the year through July, falling below 3 percent for the first time since 2021. The report keeps the Federal Reserve on track to cut interest rates next month, a move that could lift economic sentiment in the United States ahead of the November election.“We’ve won the battle against inflation,” Bharat Ramamurti, former deputy director of the National Economic Council, wrote on X. “It’s time for the Fed to begin cutting rates.”Congressional Democrats were also using the report to push the Fed to cut aggressively.“Inflation is down,” Senator Martin Heinrich of New Mexico, the chairman of the Joint Economic Committee, said in a news release. “The price of gas or a new car have fallen over the last year. And many families can now breathe a bit easier. Now, we need to make sure that this relief is reaching all Americans.”Republicans have been hammering Democrats over inflation and are unlikely to let them off the hook. They continue to note that prices are up nearly 20 percent since President Biden took office and note that the labor market is showing signs of slowing.“Despite a small improvement in the rate of price increases, the damage from the Biden-Harris administration’s philosophy of ‘tax it, regulate it, and spend it’ is done and continues to plague the economy,” said Representative Jodey Arrington of Texas, the chairman of the House Budget Committee. “It’s hard to fathom how hardworking American families can survive another four years of the Biden-Harris failed economic agenda.”Vice President Kamala Harris, the Democratic presidential nominee, has pledged to crack down on corporate price gouging and is expected to lay out additional plans for lowering costs in a speech this week.Former President Donald J. Trump, her Republican opponent, will hold a rally in Pennsylvania this weekend with a focus on inflation, according to his campaign. He has claimed that the Biden administration’s spending policies have fueled record levels of inflation.“Under Kamala Harris, everything costs 20 percent more than it did under President Trump,” said Karoline Leavitt, the Trump campaign’s national press secretary. “America cannot afford another four years of Kamala’s failed economic policies.”While Mr. Biden cheered the inflation figures, he cautioned that the cost of living remained too expensive. He said large corporations had been sitting on record profits and failing to do enough to help.“We have more work to do to lower costs for hardworking Americans, but we are making real progress,” Mr. Biden said, while noting that wages have outpaced price increases for 17 months running. “Prices are still too high.” More

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      How Food Prices Have Changed During the Biden Administration

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      Grocery prices are no longer rising as rapidly, but food inflation remains a top issue for voters, polls show.A central issue has plagued the Biden administration for most of its term: the steep rise in grocery prices.Polls have consistently found that inflation remains a top concern for voters, who have seen their budgets squeezed. A YouGov poll published last month found that 64 percent of Americans said inflation was a “very serious problem.” And when it comes to inflation, several surveys suggested that Americans were most concerned about grocery prices.Despite the gloom about grocery costs, food price increases have generally been cooling for months. On Wednesday, new data on inflation for July will show if the trend has continued.Economists in a Bloomberg survey think that inflation overall probably climbed by 3 percent from a year earlier, in line with a 3 percent rise in June. That sort of reading would probably keep officials at the Federal Reserve on track to cut interest rates in September. Investors, who were recently rattled by signs of an economic slowdown, have looked to rate cuts as a support for markets.Some voters have blamed President Biden for rising prices, pointing out that food costs have soared over the past four years. Former President Donald J. Trump, when accepting the Republican nomination last month, highlighted grocery costs and said that he would “make America affordable again.”In the year through June, grocery prices rose 1.1 percent, a significant slowdown from a peak of 13.5 percent in August 2022. Many consumers might not be feeling relief, though, because food prices overall have not fallen but have continued to increase, albeit at a slower rate. Compared with four years ago, grocery prices are up about 20 percent.

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      Annual change in grocery prices for U.S. consumers
      Year-over-year change in average for “food at home” index, not seasonally adjusted.Source: Bureau of Labor StatisticsBy The New York TimesWe 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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      Fed Rate Cuts Are Expected Soon, as Inflation Cools. But Will They Be Early Enough to Avoid a Recession?

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      The Federal Reserve was about to cut interest rates, turning the corner after a long fight with inflation. But now, its soft landing is in question.The Federal Reserve’s fight against inflation was going almost unbelievably well. Price increases were coming down. Growth was holding up. Consumers continued to spend. The labor market was chugging along.Policymakers appeared poised to lower interest rates — just a little — at their meeting on Sept. 18. Officials did not need to keep hitting the brakes on growth so much, as the economy settled into a comfortable balance. It seemed like central bankers were about to pull off a rare economic soft landing, cooling inflation without tanking the economy.But just as that sunny outcome came into view, clouds gathered on the horizon.The unemployment rate has moved up meaningfully over the past year, and a weak employment report released last week has stoked concern that the job market may be on the brink of a serious cool-down. That’s concerning, because a weakening labor market is usually the first sign that the economy is careening toward a recession.The Fed could still get the soft landing it has been hoping for — weekly jobless claims fell more than expected in fresh data released on Thursday, a minor but positive development. Given the possibility that everything will turn out fine, central bank officials are not yet ready to panic. During an event on Monday, Mary C. Daly, the president of the Federal Reserve Bank of San Francisco, suggested that officials were closely watching the job market to try to figure out whether it was cooling too much or simply returning to normal after a few roller-coaster years.“We’re at the point of — is the labor market slowing a lot, or slowing a little?” Ms. Daly said, as she pointed to one-off factors that could have muddled the latest report, like Hurricane Beryl and a recent inflow of new immigrant workers that left more people searching for jobs.“It’s clear inflation is coming down closer to our target, it’s clear that the labor market is slowing, and it’s to a point where we have to balance those goals,” she said.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 and His Allies Seize on Market Downturn to Attack Harris

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      Economists blamed a variety of factors for Monday’s slide. But Donald Trump was trying to disrupt weeks of momentum for Vice President Kamala Harris and her party.Donald J. Trump didn’t wait for the opening bell before blaming Monday’s market sell-off on Vice President Kamala Harris.“Stock markets are crashing, jobs numbers are terrible, we are heading to World War III, and we have two of the most incompetent ‘leaders’ in history,” the former president and Republican presidential nominee wrote in a post on Truth Social at 8:12 a.m. Eastern time. “This is not good.”Mr. Trump did not mention that markets had suffered far greater single-day losses when he was president, or that economists blamed a variety of factors — including a disappointing July jobs report, a plunge in Japanese markets earlier in the day and a growing consensus among investors that the Federal Reserve has waited too long to start cutting interest rates — for Monday’s slide.He also did not mention that earlier this year, he had claimed credit for a surge in stock prices, which he said reflected confidence he would be re-elected.What Mr. Trump was engaged in was a calculated attempt at political marketing. By 9:45 a.m. on Monday, less than an hour after U.S. markets opened, Mr. Trump branded what would become a 3 percent decline for the day in the S&P 500 the “Kamala Crash.”By lunchtime, it was official party messaging: The Republican National Committee hyped the “Great Kamala Crash of 2024,” and the Trump campaign had produced and circulated on social media a video tying the vice president to Monday’s dip in the markets. By the afternoon, the Trump forces had turned “KamalaCrash” into a “trending” subject on X.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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      Berkshire’s Cash Stockpile Soars as It Cuts Its Stake in Apple

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      The conglomerate reported nearly $277 billion in cash in the second quarter. And while it sold about 390 million shares in Apple, it still owned about 400 million.Cash at Berkshire Hathaway, the conglomerate run by Warren E. Buffett, soared to nearly $277 billion in the second quarter as it sold a large chunk of its stake in Apple.Berkshire reported on Saturday that it had sold about 390 million Apple shares in the quarter, after selling 115 million shares from January to March, as Apple’s stock price rose 23 percent. It still owned about 400 million shares worth $84.2 billion as of June 30.The cash stake grew to $276.9 billion from $189 billion three months earlier largely because Berkshire sold $75.5 billion in stocks, including shares in Bank of America. The conglomerate said its stake in the bank was worth $41.1 billion as of June 30. It was the seventh straight quarter Berkshire sold more stocks than it bought.Second-quarter profit from Berkshire’s dozens of businesses rose 15 percent to $11.6 billion from $10.04 billion a year earlier. Nearly half of that profit came from Berkshire’s insurance businesses, which include Geico. The higher insurance earnings, it said, reflected increased revenue from premiums, rising investment income as well as the fact there were no significant catastrophic events.Berkshire’s net income fell 15 percent to $30.34 billion from $35.91 billion a year earlier, when it benefited from rising stock prices that boosted the value of its investments.Mr. Buffett has long urged shareholders to ignore Berkshire’s quarterly investment gains and losses, which often lead to outsize net profits or net losses.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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      Stocks Drop as Jobs Report Shakes Market

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      Stocks skidded on Friday, capping off a turbulent week for Wall Street, as investors were jolted by data showing that hiring slowed and unemployment rose in July.The spiking uncertainty about the economic outlook, and the question of whether the Federal Reserve has been too slow to raise interest rates, was evident across financial markets.The S&P 500 fell 2.4 percent within the hour after the jobs report was released, while the tech-heavy Nasdaq dropped 3 percent. Yields on government bonds, which are sensitive to expectations for the economy, dropped sharply, and oil prices were lower too.The U.S. economy added 114,000 jobs on a seasonally adjusted basis, much fewer than economists had expected and a significant drop from the average of 215,000 jobs added over the previous 12 months. The unemployment rate rose to 4.3 percent, the highest level since October 2021.“That all-important macro data we have been hammering for months is finally starting to turn in an ominous direction,” said Alex McGrath, chief investment officer at NorthEnd Private Wealth.Markets are now predicting a half a percent cut in interest rates at the Fed’s next meeting in September, up from the quarter-point cut investors had been anticipating as of Thursday, according to CME FedWatch. The two-year Treasury yield, which is also reflective of short-term interest rate expectations, fell 20 basis points, to 3.96 percent.This week had already been a rocky one for Wall Street. The Federal Reserve’s indication on Wednesday that it was moving closer to cutting interest rates in September prompted an accelerated market rally, and the S&P 500 rose 2 percent on comments by Jerome H. Powell, the Fed chair.But the market sold off on Thursday, with the S&P 500 falling 1.4 percent, led lower by a drop in chip stocks and economic data suggesting the economy is cooling. The 10-year U.S. Treasury yield — which underpins many other borrowing costs — also dropped below 4 percent on Thursday.All this comes as investors started reconsidering their appetite for big technology stocks last month and bought up shares of smaller companies, which are particularly sensitive to borrowing costs and stand to benefit from interest rate cuts. Also driving this shift is a rethink among investors about the potential for artificial intelligence to continue to drive gains at big companies like Microsoft, Nvidia and Alphabet, after shares of those businesses surged in the past year. More

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      Productivity Surges 2.3%, Beating Forecasts

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      The NewsProductivity grew at a 2.3 percent annual rate in the second quarter, the U.S. Bureau of Labor Statistics reported on Thursday, surpassing economists’ expectations. The pickup was a major improvement upon the sluggish 0.4 percent rate in the first quarter. And on a yearly basis, productivity increased 2.7 percent. That far exceeds prepandemic averages.An assembly line at a car plant in Michigan in April.Bill Pugliano/Getty ImagesWhy It Matters: A key to prosperity.A highly productive economy generally means businesses and workers are operating efficiently, making more money in fewer hours. In the second quarter, production was up 3.3 percent, while hours worked rose 1 percent.On a less technical level, productivity is best explained by the old axiom of “doing more with less” or the folksy virtue of “getting the biggest bang for your buck.”Economists tend to sigh with relief when they see productivity gains because it offers a potential “win-win” for workers, customers and business owners: If businesses can make more money in fewer work hours, then — according to basic economic logic — they can presumably make more dollars per hour, while also reinvesting and giving workers raises, without sacrificing profits.Being able to make more with less (or with the same amount of labor and machinery) also means businesses may not feel as much pressure to set higher prices to push profits. That, too, is welcome news after a yearslong bout of inflation.Facts to Keep in Mind: A volatile indicator.Productivity, at a basic level, is calculated as a simple ratio: the total amount of output an economy produces per hour worked by its labor force. But the output side of the equation is adjusted for inflation on a quarterly basis. That can cause volatility, in both directions.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