US financial news summary | 5 July 2023
US Financial news latest updates
Headlines | Wednesday, 5 July 2023
- US manufacturing PMI dips to lowest level since May 2020
- Supreme Court ruled 6-3 against Biden's Student Loan Forgiveness Program
- 16 million student loan borrowers had debt relief approved, what will happen now?
- When do student loan repayments restart?
- PCE data shows both headline and core inflation declined in May year-on-year to 3.8% and 4.6%, respectively
- The weekly average mortgage rate ticked up last week to 6.71% for 30-yr FRM
- Initial unemployment claims dropped last week to 239,000, a decrease of 26,000 from a week prior
- Fed Chair Powell doesn't discount two consecutive rate hikes in future
- US consumer confidence jumps to highest level since January 2022
- Dates for Social Security payments in July
Taxation varies state to state, from those with no income tax to those that take a hefty cut of your income.
The White House moved fast after the Supreme Court struck down the student loan debt forgiveness program releasing the finalized structure of “the most affordable” payment plan ever.
It is important that workers, in addition to making it one of their financial priorities, are well informed about their retirement. That is why it is essential to consider several factors so that your money goes further so that you can enjoy your golden years. For example, finding out what the cost of living is where you live and if it is compatible with your budget.
In the country, there are some states that represent better options in terms of cost of living, as well as taxes for retirees, while others, in addition to high tax rates, have a high cost of living. We’ll share with you the states that you should avoid in your retirement, especially if you’ll be living on a tight budget.
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In April, the IRS announced that nearly 1.5 million people nationwide were still eligible to receive a tax refund worth up to $900.
The IRS will send these tax refunds when people file their 2019 returns who have not yet done so. However, there is a hard deadline before the money is lost forever.
Bud Light is out with a new ad after sales plummet trying to win back its core consumers to show it’s about “good times, goodwill, and easy enjoyment.”
Every month, the Social Security Administration issues millions of payments to Social Security recipients, most of which are retired workers.
The data provided by the SSA from May will give insights into how much beneficiaries can expect to receive this month. In May, the SSA sent Social Security checks to 66 million people, of which 74 percent were retired workers. The average check was worth 1,836.06, with the maximum benefit amount for this year being $4,555.
Read our full coverage for details on the July payment schedule.
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If you're looking to buy a car, the best time to do it might be coming soon.
In February, JP Morgan noted that after new car prices reached an all-time high in December 2022, they were likely to remain above pre-pandemic levels, but with a slight drop within the year.
As this reports tells us, some factors that have developed since that period indicate that this will indeed be the case, as car supply exceeds demand.
Borrowers are not getting anymore extensions of the moratorium due to the debt ceiling deal reached between the White House and Republican leadership in the House of Representatives. As the Federal Student Aid website states: “Congress recently passed a law preventing further extensions of the payment pause.”
As part of the deal, President Biden managed to avoid throwing out his broad-based federal student loan forgiveness program that was then awaiting a Supreme Court ruling but set a fixed expiration to the pause on payments and interest.
FTC warns of student loan scams following SCOTUS decision
Scammers are likely to target student loan borrowers after the Supreme Court struck down the Biden administration’s debt forgiveness plan in a 6-3 ruling, and as loan repayments are poised to restart in the fall, according to the Federal Trade Commission.
Scammers often “take advantage of confusion around big news like this,” the FTC said in a consumer alert. The commission warns that scammers would likely target borrowers by maybe posing as US Department of Education personnel and offering loan assistance.
“If you’re worried about repaying your loans, the offers to ‘help’ can be tempting,” the alert said. “Scammers are likely to start blasting out robocalls and texts about ‘helping’ you with your loan.
Boomers could be contributing to shortage of houses in real estate market
A study shows that Boomers hold 44% of real estate wealth in the US. This could be a factor in the current housing market, where there is a shortage of supply.
According to US Money Reserve, Boomers tend to own homes longer than most, keeping them off the market.
As they head into their retirement years, they are reluctant to leave homes where they feel comfortable and where their costs are affordable.
Because of this propensity to "age in place" and stay in their houses for decades, less existing supply is available for new homebuyers entering the market.
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Severe weather has been affecting various states in the US, and as a result, some areas have chosen to offer financial assistance to those who need it most. Some US residents will be able to apply for an emergency benefit for SNAP coupons. Who qualifies for the extra food assistance?
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With over 42 million recipients, the Supplemental Nutritional Assistance Program, commonly known as SNAP, is one of the largest social assistance programs administered in the United States. SNAP benefits are sent to over 20 million households, but across the country, eligibility varies widely.
Here's a look at the differences in the program requirements.
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Are you one of the 1.5 million people who failed to file a 2019 income tax return? Well, if so, you may be eligible to receive a refund. The Internal Revenue Service reported in early June that around $1.5 billion were never claimed and that if a return is filed by 17 July, those who missed the initial deadline could receive a piece of that pot.
Here’s how to claim your refund.
AirBnB clients to see 36% higher rates this summer
Airbnb has tackled surprise add-on fees that have long annoyed travelers, by rolling out a button that shows the additional fees the guests may have to shoulder when they are booking accommodation.
This has improved transparency in the company's prices, but it also means that an additional 36% on average will be added on to the room rate.
The Supreme Court’s final ruling of the year blocked the Biden administration from going forward with the student debt relief plan. This affects over16 million borrowers that applied and were approved for student loan debt forgiveness.
Borrowers who had hoped to take advantage of the program blocked by SCOTUS must now contend with what to do next.
Out-of-sync US stocks hide market risks
US stocks' tendency to move in sync has plunged to near-record lows, but what might seem like a stock picker's dream may actually be a mirage, and investors may be in for a rude awakening.
S&P 500 correlation- a gauge of herd behavior, which measures how closely daily returns of index constituents align over a month- slipped to 0.22 at the end of June, close to the lowest since November 2021, according to data from S&P Dow Jones Indices. That means that many stocks are moving in different directions.
That would typically lower risk and offer more opportunities for stock pickers. But with the bulk of the market's gains being driven by a handful of mega cap names and a crowd of market bets on continued low correlation, investors may be relying on a false sense of calm.
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If you need to be hospitalized and have paid the right premiums, you could make use of Medicare Part A, the portion of the Medicare program that covers hospital insurance. It primarily involves inpatient hospital care, skilled nursing facility care, hospice care, and some home health care services.
Here’s a breakdown of the services that is offers, and the costs involved in this coverage.
The 2023 tax season ended on April 18- the deadline for taxpayers to file their returns as well as pay what they owe to the Internal Revenue Service. However, some people who have filed the paperwork have still not received refunds from the IRS.
Here’s what you can do if you are still waiting to get your money back.
SNAP payments for July have started but they vary from state to state across the nation. Here are the benefit payment dates for July 2023 in each state.
Thanks to the distribution of SNAP coupons, these people could receive up to $4,223 in July 2023.
Home prices are barely lower than where they were last year with the median US home-sale price just $4,000 lower than the June 2022 peak according to Redfin data. That represents a 0.9 percent decrease year-over-year and the smallest decline in four months. A typical home in the United States is selling for $383,000.
The main culprit is high mortgage rates, which are more than double their historic lows at the end of 2021. Through the month of June the weekly average for a 30-year fixed-rate mortgage hovered around 6.7 percent according to Freddie Mac data. This has created a situation where millions of homeowners who locked in rates around 3 percent, and many more under 5 percent, feel trapped by those low rates and the high price of switching to a new home.
Thus they are not selling, and sufficient new completions have yet to come onto the market which is creating a dearth of supply while demand remains, albeit less than what would be expected, that there are more buyers than sellers. Those that are able to close a deal are paying list price on average helping to sustain the higher values.
Hello and welcome to AS USA's live blog covering financial news
The Supreme Court ruled 6-3 that President Biden didn’t have the authority to issue his broad student loan debt forgiveness executive order. Now millions of student loan borrowers who had hoped to benefit from the debt relief will need to reassess how to deal with what they owe.
The moratorium on student loan repayments and interest, in place for more than three years, cannot be extended under law. Experts worry that once repayments start in the fall it could take a toll on the economy, others are concerned that many borrowers could drown under debt.
But for now, American consumers feel the most confident about the economy since January 2022 as the US economy continues to chug along. The latest data showed initial unemployment claims dropping by the most in 20 months and the new PCE inflation report showed price increases slowing more than expected. Despite that good news, and because of it, the chances of the Federal Reserve resuming interest rate hikes in July jumped.