Relief Checks: Summary News 16 December
Inflation news: Latest updates
Headlines: Friday, 16 December 2022
- Workplace fatalitiesincreased 8.9 percent in 2021
- Supreme Court will hear second challenge to Biden's Student Loan Debt Forgiveness plan
- Wall Street sinks after Powell says Fed will not lower rates in 2023: How this will affect you
- Interest rates up to 4.5% as Fed increases them again
- Bureau of Labor Statistics finds that inflation slowed to 7.1% in November
- Founder of failed cryptocurrency exchange Sam Bankman-Fried indicted on eight criminal charges
- National average just under $3.18 per gallon on Friday per AAA
- Biden administration approves $24 billion in student loan relief
- Supplemental Security Income recipients will be the first to receive COLA boost
- California continues distributing Middle-Class Tax Refund payments, $7.5 bn issued so far
- Some groups will receive two Social Security checks this month
Related news
After the covid-19 pandemic left millions unemployed, workplace injuries and fatalities dropped to a record low. However, in 2021, as workers returned to their jobs, many faced more dangerous environments leading to a nearly nine percent increase in the number of people injured or killed while on the job. The 2021 Census of Fatal Occupational Injuries, released by the Bureau of Labor Statistics (BLS) each December, shows that while the number of deaths did not reach the tragic levels seen in 2018 and 2019, the total did surpass that recorded in 2017.
Read our full coverage for more on the response from the Department of Labor and how the tragic data shows a disproportionate risk of death in the workplace for immigrants and workers of color.
Interest rates for mortgages come down slightly after record climb
To bring inflation down, the Federal Reserve has increased interest rates which have brought mortgage rates to recent highs after seeing periods of historically low rates.
Earlier this week, the Fed announced further increases to rates which will likely drive up those for mortages after they had come down slightly in recent weeks.
Increases in workplace injuries could lead to a greater push for unions
As prices trend upward due to inflationary trends caused by supply chain disruptions resulting from the covid-19 pandemic and the Russian invasion of Ukraine, workers have organized for higher wages. Corporate greed has also driven many workplaces to vote to form a union as profits increase and wages stagnate or lose power.
Additionally, new data shows that workplaces in the US are getting more dangerous, which could become another central argument to workers looking to organize their place of work. The BLS has reported an 8.9 percent increase in workplace injuries and fatalities from 2020 to 2021, showing that as people returned to the workplace, managers and owners failed to ensure the proper safety precautions were implemented.
Workplace homicides hit their highest level since 2017, an indicator that the increases in mass shootings are endangering people who are on and off the clock. Read more from the BLS.
What was behind the fall in retail sales in November?
Retail sales in November fell more than expected, but the biggest decrease in 11 months could be down to a couple different factors. One theory is that US consumers got started on their holiday shopping early in October to take advantage of sales as retailers dropped prices to clear out inventory thus reducing purchases the following month.
On the other hand, goods prices plummeted in November, and since the numbers aren't adjusted for inflation the dollar value of sales came in lower.
"It is hard to know at this point if the November weakness represented a fundamental change in the trend or reflected some inevitable cooling following a strong run for real spending into October, or some combination," Economist at JPMorgan in New York Daniel Silver told Reuters. "For now we are not particularly alarmed by the November drop in retail spending."
Will central banks go too far with rate hikes to tackle inflation?
The US is not the only economy struggling with inflation. Rising Prices have hit records levels in major economies the world over and central banks are taking aggressive steps to bring inflation down.
The Federal Reserve jacked rates by half a percentage point on Wednesday. That was followed by matching hikes by the European Central Bank and in the UK. However, just as policymakers were slow to react to the rising inflation rate, so too they may be slow to react to the signs of disinflation in the opinion of Kallum Pickering, Berenberg Senior Economist.
Come January, workers in two dozen states that get paid the minimum wage will see a raise. Three others and the District of Columbia will follow suit later in 2023.
Three states will raise their minimum wage to $15 or more joining California and the District of Columbia as well as a handful of municipalities that have already mandated the sought for level. That amount is more than twice the federal minimum wage of $7.25 per hour which has been in place since the summer of 2009.
Confused about the state of student loan forgiveness? Get your questions answered
President Biden announced his plan to cancel up to $20,000 in federal student loan debt for millions of Americans in August. Days after the online portal to submit applications went live, the legal challenges to the program forced the Department of Education to put it on ice.
The Supreme Court has now agreed to hear two separate lawsuits against the White House's debt forgiveness plan. The education team of Senator Bob Menendez of New Jersey will be hosting a webinar on Friday to answer questions regarding where the plan stands.
First time unemployment claims drop by 20,000
211,000 Americans filed for unemployment benefits the week ending 10 December. That was a drop of 20,000 from the week before. The 4-week moving average also decreased by 3,000 to 227,250 initial UI claims.
The US job market has been running hot over the past couple years with the total number of nonfarm jobs finally surpassing where the US was before the pandemic. There are more jobs available than there are people that are unemployed making it a great opportunity for workers to try to find a better job.
Many workers have already done this during what has been called the ‘Great Resignation’. But leaving your job in search of greener pastures voluntarily can come with risks. For one you may not be able to claim any unemployment benefits.
Mortgage rates drop for five straight week, 30-year fixed rate now 6.31%
Demand in the housing market has stabilized as mortgage rates have come down over the past five weeks. The current 30-year fixed rate mortgage is now averaging 6.31% as of 15 December. However, demand is still weak due to inflated prices around the nation posing an obstacle for many would-be homebuyers.
Two main factors have put the brakes on the US housing market over the past few months. The Federal Reserve’s aggressive rate hikes to fight inflation have helped to drive up mortgage interest rates on top of home prices increasing at a breakneck speed over the previous two years.
This could create a situation in 2023 where homebuyers will be better positioned when negotiating the purchase price when hunting for a home. Here’s a look at what the experts are saying to expect in the coming year.
National average gas price on track to drop below $3 per gallon before Christmas
Gas prices are heading down and on pace to drop below $3 per gallon on average nationally before Christmas. Currently, they are just over 15 cents from that mark according to data from Gas Buddy, a tech company that tracks real-time fuel prices at over 140,000 gas stations.
The Social Security Administration (SSA) announced an 8.7 percent cost-of-living adjustment increase for 2023 in October. The boost to Social Security benefits is the largest since 1981 and the fourth biggest in the history of COLA increases.
The increase will affect payments for old-age, survivor and disability benefits as well as Supplement Security Income, which will be the first payments to reflect the augmented amount hitting bank accounts 30 December 2022. The 2023 COLA increase will also be applied to government and military pensions along with VA benefits.
In order to receive Social Security benefits, generally workers in qualified employment must earn 40 credits, or ten years’ worth. However, younger workers that become disabled may qualify for Social Security Disability Insurance (SSDI) with fewer credits.
New legislation would offer student loan debt relief
While the Biden administration continues to battle in the courts for Student Loan Forgiveness, members of Congress are trying to pass more targeted forms of relief for borrowers. Recipients of Medicare and Social Security programs could see their outstanding student loan debt entirely eliminated if the bill were to pass in its current form.
It appears unlikely that the required 60 votes could be found to see the bill approved in the Senate, but it is a testament to the desire to offer further debt relief for students.
The White House announced a plan to wipe out up to $20,000 in student debt in August. However, that program has been put on ice after being challenged in the courts and it could be months until there is a definitive decision on the matter.
In the meantime, President Biden has extended the moratorium on repaying student loans until the end of August or the lawsuits are settled, whichever comes first. But even if White House lawyers should fail to convince the Supreme Court of the legality of Biden’s debt forgiveness, there exist other legitimate federal programs that can erase all of a borrower’s student loan debt. Here’s a look…
Wages and the problem with inflation
In a good year, the government aims to ensure that the US economy grows a little to ensure that there is sustained growth. However throughout 2022 we have seen growth an a dangerously high level, pushing up prices for consumers and making everyday essentials prohibitively expensive.
At the same time, wages have been growing, but at a slower pace however too fast for the Federal Reserve. Why doesn't workers pay increase at the same rate as inflation? CNBC explains...
Interest rate change remains a blunt tool to tackle a nuanced economic issue and its use doesn’t come without some pain. However, “the worst pain would be if we failed to act,” according to the Fed chair. We take a look at some of the consequences of the interest rate hike and how it could affect you…
In a bid to bring down inflation, the Federal Reserve has announced that it will increase interest rates by a further 0.5 percentage points. This is the latest in a string of interest rate hikes seen during 2022, all of which designed to cool the economy and prevent continued price rises.
After announcing the rise, Federal Reserve chair Jerome Powell said: “The inflation data received so far in October and November show a welcome reduction in the pace of price increases, but it will take substantially more evidence to give confidence inflation is on a sustained downward path.”
Hello and welcome to AS USA!
Good morning!
We'll be bringing you all the latest news and information on Friday, 1y6 December after the Federal Reserve raised interest rates by an expected half percentage point. However, comments by chairman Jerome Powell on the economic forecast for 2023 sent markets lower.