US financial news summary | 24 June 2023
US Finance Feed: Latest Updates
Headlines | Saturday, 24 June
- Fed Chair Jerome Powell testifies before Congress and makes clear that further rate hikes are on the way.
- Initial unemployment claims remained steady at 264,000 last week
- Federal Reserve held rates steady in June, but signaled two more rate hikes in 2023
- The Consumer Price Index tracks a 0.1 percent increase in prices in May
Read more from AS USA:
Ford reportedly about to cut hundreds of jobs
Ford Motor Co. is planning to lay off a minimum of "several hundred" salaried employees, starting as soon as next week, the Detroit Free Press has learned.
The action will be limited to white-collar workers in North America, perhaps just the US.
The third of three units at the company, Ford Pro commercial, is not part of this job reduction. The carmaker employs about 174,000 white- and blue-collar workers globally.
Fourth of July barbecue to cost more this year
The traditional Fourth of July barbecue is once again going to cost more this year, according to the latest report from Wells Fargo.
The price of sirloin steak is up 2.9% compared with the same time last year, Wells Fargo said, citing the Bureau of Labor Statistics' May Consumer Price Index. That comes out to a hefty price tag at $10.75 per pound.
You might get a better deal with hamburgers, as ground beef is up less than 1% with an average cost of $5.36 per pound.
Pork and chicken are your best bet for affordable protein.
Each month, the Social Security Administration sends different payments: retirement benefits, survivor benefits, as well as disability benefits, including Social Security Disability Insurance, and Supplemental Security Income (SSI).
What does SSI consist of and how does one qualify to receive it?
DirecTV has reached a settlement following a nationwide class action lawsuit for $16.85 million, to resolve claims that it violated the Telephone Consumer Protection Act of 1991.
According to the lawsuit, the satellite television subscription company made unsolicited phone calls to people whose numbers were on the National Do Not Call Registry.
Beneficiaries can receive up to $400. Here’s how to claim the money.
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Walmart will distribute $4 million to customers who were affected by a gift card scam, and the date to claim the payment is approaching. The referral program benefits consumers who purchased a Walmart gift card between April 1, 2016 and July 31, 2017.
Luxury sales increasingly coming from high-end shoppers
When it comes to shopping, the rich are definitely the ones doing the spending. According to management consulting firm Bain & Co., luxury brands focused on wealthier consumers in the US are performing better than those who appeal to aspirational shoppers on lower incomes who are deterred by the economic uncertainty.
In its twice-yearly report, Bain increased its annual sales forecasts for the global personal luxury goods market - spanning clothing, accessories and beauty products - and expects growth of between 5% and 12% this year, compared to previous expectations of between 3% and 8%.
"There is an overall slowdown mostly driven by the aspiration side of the customer and more entry prices, so categories like streetwear and sneakers are a bit underperforming as we speak," partner Federica Levato told Reuters.
One of the main US government food aid programs is the Supplemental Nutrition Assistance Program (SNAP). It provides low-income families with benefits to buy food through an electronic benefits transfer (EBT) card.
SNAP is a federal program that varies in its requirements and benefits across different states as it is administered by them. Governor Kathy Hochul of New York has recently introduced the Fresh2You program, which doubles the purchasing power of SNAP beneficiaries.
SNAP benefits, also known as the Supplemental Nutrition Assistance Program, are a form of government assistance provided to eligible individuals and families to help them afford nutritious food. In order to qualify for SNAP benefits, certain criteria must be met, including having a household income below a specified threshold, being a US citizen or legal immigrant, and fulfilling other program requirements.
The amount of SNAP benefits one is eligible to receive is determined by factors such as household size, income, and other relevant conditions.
The United States offers several economic assistance programs to support individuals with limited resources. One such program is the Supplemental Nutrition Assistance Program (SNAP).
While it is a federal program, state governments manage and distribute SNAP payments through an electronic benefits transfer card, commonly known as EBT. These cards function like regular debit cards and can be utilized at retail stores, grocery stores, and mobile markets. Additionally, they can be used to purchase groceries online.
Read more on the requirements and amounts distributed in our full coverage.
Federal Reserve Chair Powell provides update to Congress on the central bank's monetary policy
The U.S. economy slowed significantly last year, and recent indicators suggest that economic activity has continued to expand at a modest pace. Although growth in consumer spending has picked up this year, activity in the housing sector remains weak, largely reflecting higher mortgage rates. Higher interest rates and slower output growth also appear to be weighing on business fixed investment.
The labor market remains very tight. Over the first five months of the year, job gains averaged a robust 314,000 jobs per month. The unemployment rate moved up but remained low in May, at 3.7 percent. There are some signs that supply and demand in the labor market are coming into better balance. The labor force participation rate has moved up in recent months, particularly for individuals aged 25 to 54. Nominal wage growth has shown some signs of easing, and job vacancies have declined so far this year. While the jobs-to-workers gap has narrowed, labor demand still substantially exceeds the supply of available workers.1
Initial unemployment claims inch up
According to the US Department of Labor's report last week, there was no significant change in initial unemployment claims for the week ending on June 17, as it remained at 264,000. This number is the highest it has been since late 2021. However, the total number of claims made for the week ending on June 10 decreased by 13,000, totaling 1,759,000.
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Each month, the Social Security Administration sends monthly benefits to retired workers. In addition, the SSA is responsible for remitting Supplemental Security Income program payments, as well as disability and survivor benefits.
The SSA continues to send monthly payments for June. Here’s who will receive up to $914 by the end of this month.
Read our full coverage for more details.
US credit card debt
Credit cards are widely used in the US for daily expenses, online shopping, and convenience. The ease of obtaining and using credit cards contributes to their popularity. A major problem with them is the culture of consumerism and a desire for instant gratification, leading many individuals to rely on credit cards for purchases beyond their immediate financial means.
Breakdown of SNAP benefits for 2023
To be eligible for SNAP benefits you must meet certain criteria, such as having a household income below a certain threshold, being a US citizen or legal immigrant, and meeting other program requirements.
These are the maximum amounts awarded in the 48 contiguous United States, including the District of Columbia, depending on the number of family members:
- one member: $281
- two members: $516
- three members: $740
- four members: $939
- five members: $1,116
- six members: $1,339
- seven members: $1,480
- eight members: $1,691
- any further additional member: +$211
Maximum SNAP benefits on Hawaii and Alaska
For recipients living in Alaska, the maximum is $1,172 for urban families of four, $1,494 for rural zone 1, and $1,819 for recipients living in Alaska rural zone 2.
In Hawaii, the maximum is $1,794 for a family of four.
Starbucks employees to stage strike over Pride decor dispute
More than 3,000 workers at over 150 Starbucks stores in the US will walk off the job over the next week, the union representing the coffee chain's baristas said on Friday, following claims the company had banned Pride Month decorations at some of its cafes.
The strikes are also aimed at pushing the company to reach fair labor contracts for improved pay and benefits, the Starbucks Workers United union added. The company is yet to reach any collective bargaining agreements at its newly unionized cafes.
Hello and welcome to AS USA's live blog covering financial news from Wall Street to Washington, DC.
Fed Chair Jerome Powell testified in front of Congress this week to provide an update on where the central bank stood in its fight against inflation. Chair Powell made clear that while no additional rate increases were implemented in June, rates would likely be hiked again starting this summer.
Last week initial unemployment claims rose to 264,000, up slightly from a week prior. The high numbers are an indicator that the labor market is softening, as figures like these have not been seen since early 2017.