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Why the December inflation report could push back Fed rate cuts on January 11, 2024 at 4:52 pm Business News | The Hill

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The consumer price index (CPI) inched upwards in December following a surprisingly strong jobs report for that month, potentially pushing back an expected March cut in interest rates by the Federal Reserve.

The CPI advanced 0.3 percent on the month, the Labor Department reported Thursday, up from 0.1 percent in November and no increase in October. Annually, the index advanced to a 3.4-percent increase from 3.1 percent in November, but still below recent highs around 3.7 percent reached in September and October.

“This uptick in CPI is a critical reminder of the unpredictable nature of economic recovery and the murkiness of the macro-economic data,” asset manager Jon Maier of Global X said in an analysis.

“It suggests that investors might need to temper their expectations and remain vigilant.”

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Thursday’s CPI numbers also come in the wake of a surprisingly strong December jobs report.

The economy added 216,000 jobs in December and the unemployment rate held firm at 3.7 percent, the Labor Department said last week.

The hotter-than-expected inflation and jobs reports still keep the U.S. on track to see price growth fall without a recession — a feat known as a soft landing — despite earlier fears.

Even so, the data could push back the Fed’s plans to reduce interest rates and is dampening expectations on Wall Street of a March cut. Financial markets give the Fed a 69 percent chance of cutting rates at least once in March and are almost certain to see rates hold steady in January, according to the CME FedWatch tool.

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Despite the monthly acceleration, headline inflation has fallen precipitously from its pandemic peak of a 9-percent annual increase in June, 2022.

“Core” inflation – which excludes the more volatile categories of energy and food, and is given greater attention by the Fed – was flat on the month and slowed to 3.9-percent annual increase from 4 percent in November.

Housing costs still nearly double the overall rate of inflation

Housing, a sector of the economy that’s particularly responsive to Federal Reserve interest rate hikes, is still trailing the decreases in headline inflation.

Housing costs remain the main driver of inflation at a 6.2-percent annual increase for December. Car insurance prices are also way above average at a 20.3 percent annual increase.

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“Shelter and motor vehicle insurance continue to be the persistent trouble spots, extending the streak of outsized monthly increases,” Greg McBride, an analyst with Bankrate, wrote in a Thursday analysis. 

“Shelter remains the largest contributor, responsible for more than half of this month’s increase in the headline CPI and more than two-thirds of the increase in core CPI over the past year,” he said.

Despite the level of inflation in housing, prices are still heading downward. They fell in December to a 6.2-percent annual increase from 6.5 percent in November, and they’re down from their peak of 8.2 percent in March of last year.

“Housing is the last mile on inflation and the only way to fight it is by increasing our housing supply. Instead, the Fed’s high interest rates are making this crisis worse by forcing potential buyers back into the rental market and tanking the construction of new housing,” Lindsay Owens, a director of the economic policy advocacy organization Ground Collaborative, said in a statement. 

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“A higher-for-longer interest rate environment is exactly the wrong approach to bringing down housing costs. Shelter inflation should give the Fed even more incentive to cut rates,” she wrote.

Austin Schaul, an analyst with investment company Avantax, wrote that yields on government bonds could increase with the expectation of fewer cuts this year. That could boost mortgage rates, even as the Fed plans cuts eventually.

“There’s reason to believe the shelter component of inflation should start to weaken, but in the absence of an economic slump or substantial disinflation during the coming months, we may see Treasury yields continue to drift higher as markets curtail their expectations for the easing of monetary policy,” he wrote.

Energy costs are down across the board

Changes in energy costs measured annually were in negative territory for December in every category except electricity.

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Gasoline was down 1.9 percent, household gas was down 13.8, and energy as a whole deflated 2 percent.

The average price of a gallon of gasoline nationally is down to $3.07, down from $3.26 a year ago and far below the post-pandemic highs around $5 a gallon, according to the automotive company AAA.

Food prices are lower, but still rising

Food inflation in December was lower than headline inflation at a 2.7-percent annual increase.

Fresh fruit and vegetables have deflated 0.5 percent on the year while fresh seafood deflated 2.5 percent. Eggs were 23.8 percent cheaper than they were in December, 2022.

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But food price hikes remain a risk for consumers.

“The last few years of commodity price volatility have coincided with a period of record profit growth by global energy and food traders. In the area of food trading, the four companies that conservatively account for about 70 per cent of the global food market share registered a dramatic rise in profits during 2021 – 2022,” U.N. economists wrote in an October report.

​Business, Economy, Consumer Price Index, CPI, federal reserve, Federal Reserve interest rates, Food prices, Housing, inflation The consumer price index (CPI) inched upwards in December following a surprisingly strong jobs report for that month, potentially pushing back an expected March cut in interest rates by the Federal Reserve. The CPI advanced 0.3 percent on the month, the Labor Department reported Thursday, up from 0.1 percent in November and no increase in…  

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The Cities Bracing for Trump’s Immigration Crackdown

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In the wake of Donald Trump’s recent election victory and his promise of “the largest deportation operation in American history,” several major U.S. cities are bracing for potentially seismic shifts in their economic and social landscapes. As the nation grapples with the implications of this proposed policy, urban centers that have long been havens for immigrant communities find themselves at the epicenter of a looming storm.

Los Angeles, often dubbed the “City of Angels,” stands to lose more than its celestial nickname suggests. As a primary gateway for immigrants, the city’s vibrant tapestry of cultures and its economic engine could face significant disruption. From the bustling streets of Koreatown to the sun-drenched orchards of the Central Valley, the absence of undocumented workers could leave gaping holes in the city’s workforce and cultural identity.

Across the country, New York City, with its iconic skyline and melting pot reputation, faces its own reckoning. The Big Apple’s 5.9 million immigrants, many of whom are undocumented, form the backbone of industries ranging from construction to healthcare. The potential exodus could transform neighborhoods like Jackson Heights and Flushing, altering the very essence of what makes New York a global city.In the Sunshine State, Miami’s tropical allure belies the turbulent times ahead. Home to 2.5 million immigrants, the city’s economy relies heavily on sectors like tourism and hospitality – industries where undocumented workers often fill crucial roles. The potential deportation of these workers could send shockwaves through Miami’s economic ecosystem, from South Beach’s glitzy hotels to the agricultural heartlands of South Florida.

Chicago, the “City of Big Shoulders,” may find those shoulders significantly weakened. With 1.7 million immigrants in its metropolitan area, the Windy City’s diverse neighborhoods and industries face an uncertain future. From the meatpacking plants to the tech startups, Chicago’s economic resilience could be tested like never before.

In the Lone Star State, Houston and Dallas stand as twin testaments to the complexities of immigration policy. These Texas titans, each home to large immigrant populations, could see their booming economies stumble. The construction sites that dot their ever-expanding skylines and the service industries that keep these cities humming could face unprecedented labor shortages.

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Out West, the San Francisco Bay Area’s reputation as a bastion of innovation and progress could be challenged. The region’s tech industry, often reliant on immigrant talent, might find itself grappling with a new reality. From Silicon Valley’s coding campuses to the agricultural expanses of the Central Valley, California’s economic powerhouse could face a reckoning. Phoenix, rising from the Sonoran Desert, could see its growth trajectory altered. As Arizona’s urban center, it stands at the forefront of the immigration debate, potentially facing not just economic impacts but social and political upheaval as well.

These cities, along with others like San Diego and Las Vegas, are not just facing potential economic disruptions. They are staring down the barrel of profound social change. Family separations, community fragmentation, and the erosion of cultural enclaves built over generations are all possible consequences of mass deportations. Moreover, the fiscal implications are staggering. Undocumented immigrants contribute billions in taxes annually, often without receiving the full benefits of their contributions. Their sudden absence could leave gaping holes in city budgets, potentially affecting public services and infrastructure projects.

As these urban centers brace for impact, the debate rages on. Supporters of stricter immigration policies argue for the need to enforce laws and protect American jobs. Critics warn of economic devastation and the unraveling of America’s urban fabric. What’s clear is that America’s cities stand at a crossroads. The coming months and years will likely reshape urban landscapes in ways both visible and invisible. From the foods we eat to the services we rely on, from the neighborhoods we call home to the very character of our cities, the impacts of this proposed immigration crackdown could be far-reaching and long-lasting. As the nation watches and waits, these cities – vibrant, diverse, and economically vital – find themselves on the front lines of a policy that could redefine what it means to be an American city in the 21st century.

Bolanle Media is excited to announce our partnership with The Newbie Film Academy to offer comprehensive courses designed specifically for aspiring filmmakers. Whether you’re just starting out or looking to enhance your skills, our resources will provide you with the tools and knowledge needed to succeed in the competitive world of screenwriting. Join us today to unlock your creative potential and take your first steps toward crafting compelling stories that resonate with audiences. Let’s turn your ideas into impactful scripts together!

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How Trump’s Deportation Plans Could Reshape Major Cities

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In the wake of Donald Trump’s recent election victory, his ambitious plans for mass deportations have thrust America’s urban centers into the spotlight. As the nation grapples with the potential implications of what Trump calls “the largest deportation operation in American history,” cities across the country are bracing for significant changes that could reshape their economic, social, and cultural landscapes.

The stakes are particularly high for metropolitan areas like New York, Los Angeles, Houston, Dallas, and Miami, which host the largest populations of unauthorized immigrants. These cities, along with other major urban hubs such as Chicago, Washington D.C., and San Francisco, stand at the forefront of a looming transformation that could reverberate throughout the nation.

Economic Tremors

Economists warn that the proposed deportations could send shockwaves through urban economies. Mark Zandi, chief economist at Moody’s, cautions that businesses would face “significant challenges” if a substantial number of immigrants were removed. Industries such as construction, hospitality, and healthcare—pillars of urban economies—could face severe labor shortages.

Joe Brusuelas, chief economist at RSM, emphasizes the potential ripple effects: “The native-born workforce cannot meet current labor demands.” This labor gap could lead to increased wages, potentially rekindling inflation—a concern that looms large over city planners and policymakers alike.

Community Fabric Under Strain

Beyond economic considerations, the social fabric of cities hangs in the balance. Elena, a Nicaraguan immigrant in Houston, voices a fear echoed in immigrant communities across the nation: “I’m scared… This is my home.” The threat of family separations, particularly in mixed-status households, casts a long shadow over urban neighborhoods.

Immigrant advocacy groups like FIEL are mobilizing, advising clients to prepare for “anything that can happen.” This atmosphere of uncertainty could lead to decreased community engagement and cooperation with local authorities, potentially impacting public safety and community cohesion.

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Cities at a Crossroads

As the debate intensifies, cities find themselves at a crossroads. Some, like New York and Los Angeles, have historically positioned themselves as “sanctuary cities,” often at odds with federal immigration enforcement. The impending clash between federal policy and local governance promises to be a defining feature of this new political landscape.

Meanwhile, the logistical challenges of implementing such a massive deportation operation remain daunting. Questions abound regarding detention facilities, transportation networks, and the sheer manpower required to carry out Trump’s vision.

Looking Ahead

As America’s urban centers brace for potential change, the full impact of Trump’s deportation plans remains to be seen. Legal challenges are all but certain, and the resilience of America’s cities will be put to the test.

What is clear is that the coming months and years will be pivotal for urban America. As Jason Miller, a senior Trump adviser, puts it, the plan is to “immediately reinstate” immigration policies from Trump’s first term. For America’s cities, this could mean a period of unprecedented change, challenge, and, potentially, transformation.

As the nation watches and waits, the story of America’s cities in the face of this ambitious deportation plan is just beginning to unfold. The outcome will undoubtedly shape the future of urban life in America for years to come.

Bolanle Media is excited to announce our partnership with The Newbie Film Academy to offer comprehensive courses designed specifically for aspiring screenwriters. Whether you’re just starting out or looking to enhance your skills, our resources will provide you with the tools and knowledge needed to succeed in the competitive world of screenwriting. Join us today to unlock your creative potential and take your first steps toward crafting compelling stories that resonate with audiences. Let’s turn your ideas into impactful scripts together!

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Donald Trump Wins 2024 USA Election

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Based on the election results, Donald Trump has indeed won the 2024 U.S. presidential election, defeating Vice President Kamala Harris. Here’s an analysis of the key statistics and implications:

Electoral College Victory

Donald Trump has secured the presidency by winning crucial battleground states and flipping some key states that were previously held by Democrats. The final Electoral College tally is still being determined, but Trump has surpassed the 270 electoral votes needed to win.

Battleground State Performance

Trump’s victory was largely secured by winning several critical swing states:

  • Wisconsin: Trump’s win here was pivotal in securing his path to victory.
  • Pennsylvania: This state flipped back to Republican control.
  • Georgia: Another key state that Trump managed to win back.
  • Michigan: Trump successfully flipped this traditionally Democratic stronghold.

While the final popular vote tally is still being calculated, exit polls provide insight into voter priorities:

Congressional Control

The election results extend beyond the presidency:

Media Implications

The outcome of this election could be seen as a challenge to mainstream media narratives for several reasons:

  1. Polling Discrepancies: Many pre-election polls suggested a tight race or even a slight Harris advantage in key states. Trump’s victory, particularly in battleground states, may indicate that polls underestimated his support.
  2. Narrative Shifts: Throughout the campaign, much of the mainstream media focused on Trump’s legal challenges and controversies. His victory suggests that these issues may not have resonated with voters as much as economic and policy concerns.
  3. Voter Priorities: The emphasis on issues like the economy and immigration in voter decision-making may indicate a disconnect between media focus and voter concerns.
  4. Electoral Predictions: Many mainstream outlets were cautious about predicting a Trump victory, even as results began to favor him. This hesitancy could be seen as a reflection of broader media skepticism about Trump’s chances.
  5. Underestimation of Trump’s Base: The results suggest that Trump’s core support remained strong and potentially grew, despite negative coverage in much of the mainstream media.

It’s important to note that while the election outcome may challenge some media narratives, it doesn’t necessarily invalidate all mainstream reporting. The complex factors influencing voter behavior and the challenges of accurate political forecasting remain subjects of ongoing analysis and debate.

As the dust settles on this historic election, both the media and political analysts will likely engage in extensive reflection on the factors that led to Trump’s victory and the implications for future political coverage and analysis.

Bolanle Media is excited to announce our partnership with The Newbie Film Academy to offer comprehensive courses designed specifically for aspiring screenwriters. Whether you’re just starting out or looking to enhance your skills, our resources will provide you with the tools and knowledge needed to succeed in the competitive world of screenwriting. Join us today to unlock your creative potential and take your first steps toward crafting compelling stories that resonate with audiences. Let’s turn your ideas into impactful scripts together!

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