WSJ's Nick Timiraos: Very hard to see the Fed cutting rates until unemployment rate moves up
Nick Timiraos, Wall Street Journal chief economist correspondent, joins 'Squawk Box' to discuss last week's mixed inflation data, state of the economy, impact on the Fed's interest rate decision, and more.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
2 hours ago
- Yahoo
Hunting for big game: Trump tariff inflation
My safari hat has been on for a month in search of big-game inflation. I blame Walmart (WMT) CFO John David Rainey for making me get into this wardrobe. "And so we'll work hard to try to keep prices low. But it's unavoidable that you're going to see some prices go up on certain items," Rainey told me in mid-May after Walmart reported first quarter earnings. Rainey — responding to my question on the impact of new Trump tariffs — said increases would be noticeable in a few short weeks. "Well, if you've got a 30% tariff on something, you're likely going to see double digits [in price increases]," Rainey warned. I've been on high alert ever since for signs of eye-popping inflation that brings back the discussion of a potential Fed rate hike this year (which has gone dormant). Or, at the bare minimum, renewed market volatility due to a more uncertain outlook. By and large, my hunting expeditions have come up short. The Consumer Price Index (CPI) for April rose by a seasonally adjusted 0.2%. The tame jump put the 12-month inflation rate at 2.3%, its lowest since February 2021. This report hit the wires on May 13, before an inflation-indicator company like Walmart warned about the looming effects of tariffs. Still, a data point is a data point. Also surprisingly docile was the inflation expectations reading in the University of Michigan's May sentiment report. Year-ahead inflation expectations were little changed at 6.6% versus April's 6.5%. The uptick marked the smallest increase since the election and ended a four-month streak of "extremely large" jumps in near-term inflation expectations. Long-term inflation expectations dropped to 4.2% in May from 4.4% in April. This was the first decline since December 2024. Again, a data point is a data point. While I hate to be the bearer of bad news, I have started to scope inflation charging out on the prairie. What I'm seeing seems to validate what Rainey told me and could set the stage for negative surprises for the bulls on inflation report days. New research from Morgan Stanley analyst Alex Straton shows that major retailers still reliant on China and other markets for production have begun to jack up prices a good bit. The average footwear year-over-year price increase tallied 13% in May, according to Straton's research. The prior six-month average was 1%. Under Armour (UA) and ON Holdings (ONON) were cited as being aggressive on recent price hikes. Some apparel pricing looked even worse, per Straton. Gap (GAP), for instance, hiked its average apparel pricing by 20% in May. Macy's (M) clocked in with a 12% apparel price increase, Levi's (LEVI) with 9%, and Nike (NKE) by 10%. Meanwhile, those aforementioned price increases at Walmart appear to be happening as Rainey promised. Customers are posting pics on the Walmart subreddit of large price increases on toys and apparel. "We also put in place some selective price actions," HP (HPQ) CEO Enrique Lores explained to me about how he is offsetting tariffs on parts that make up PCs and printers. "We think that the industry-wide price increases that we see, and especially the increased economic uncertainty, will have an impact on demand," he said, "and therefore we continue to expect that the market will grow, but we feel it will grow at a lower pace than we were expecting." Bottom line: If you've been complacent on tracking inflation, don't be. It's beginning to rear its ugly head and could devour your portfolio this summer if not careful. The Yahoo Finance team is heads down on our annual fall Invest conference. It's shaping up to be our most impactful one yet! At this invitation-only event, our guests will delve into the most critical issues powering global markets with our newsroom. Key themes include artificial intelligence, cryptocurrencies, and prosperity. Engage in Q&As following thought-provoking conversations with renowned investors, policymakers, economists, and other leading experts. For the first time, we will host two investor education rooms: one led by yours truly and one by the dynamic duo of data master Jared Blikre and veteran trader Kenny Polcari. I strongly encourage you to register now here before we are out of tickets. I will continue to remind you about Invest each Sunday in this newsletter. Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Axios
3 hours ago
- Axios
Trump might be the most accessible president ever — for spies or scammers
President Trump reportedly picks up when his cell rings even if he doesn't know who's calling. Senior members of his team also love chatting on their personal devices. That makes the administration uniquely vulnerable to basic scams like spoofed calls and impersonation attempts. Why it matters: If Trump is willing to answer unknown numbers, as The Atlantic reported this week, there's no guarantee a scammer, impersonator, or even a foreign intelligence operative couldn't have a chat with the president. There's no evidence that has actually happened. But recent reports involving Trump and other top officials have raised red flags about the security of their communications. Driving the news: Federal authorities are investigating a scheme where someone spoofed the phone number of White House chief of staff Susie Wiles to impersonate her in calls to senators, governors, and CEOs, per the Wall Street Journal. Meanwhile, Chinese hackers reportedly penetrated U.S. telecom networks as early as summer 2023, according to Bloomberg — a year earlier than previously known. That access has been used by China-backed group Salt Typhoon to spy on Trump, Vice President Vance, and other officials, the NYT reported. Then there are the series of Signal-related scandals involving former national security adviser Mike Waltz, Defense Secretary Pete Hegseth and others. Between the lines: Eavesdropping on world leaders isn't new — but it's a lot easier if the leader in question is using a personal phone and eschewing standard cybersecurity practices. Flashback: In 2017, Trump had two phones — one issued through the White House and only capable of making phone calls, and a less secure phone equipped just for social media. At the time, he was urged to swap out his Twitter phone at least once a month. Politico reported he'd instead go months without security checks. It's unclear how many of those security protocols were brought back in this time around. "I think people gave up on that years ago," one adviser told The Atlantic. In a written statement, White House communications director Steven Cheung said the administration would "not discuss or disclose security measures regarding the President." "President Trump is the most transparent and accessible President in American history," Cheung said. "World leaders, heads of state, elected officials, and business titans all reach out to him because they know America is back under President Trump's leadership. "Whereas, Joe Biden was hidden and sheltered by his handlers because he was a total embarrassment and bumbling idiot during his time in office," Cheung added. The big picture: Since returning to office, the Trump administration has: Ignored basic security norms, including heavy reliance on Signal and personal numbers. Gutted existing federal cybersecurity leadership, with one-third of CISA's staff already gone. Empowered security-weakening tech initiatives through Elon Musk's Department of Government Efficiency (DOGE), which has been pursuing projects like using a buggy AI tool to crawl sensitive government data. Threat level: AI tools can clone a voice using just a few seconds of audio, and the FBI warned last month that scammers are already using them to impersonate senior officials.
Wall Street Journal
13 hours ago
- Wall Street Journal
Treasury Yields Rise on Stable Employment Ahead of CPI
1600 ET – U.S. job creation slows less than expected, reducing odds of a dovish Fed. Bond markets react with a selloff that boosts yields. May's job creation slows less than forecast and unemployment remains at 4.2%. CME data show diminishing odds of a rate cut before September. Two or more cuts this year still represent the highest odds, but bets on only one or no cut rise. Wells Fargo foresees May's 12-month core CPI, due Wednesday, accelerating to 3.3% from April's 2.8%. The 10-year gains 0.089 percentage point this week, including 0.155 p.p. today, to 4.507%. The two-year rises 0.125 p.p. in the week and 0.115 p.p. today, to 4.039%. ( @ptrevisani) 0846 ET – U.S. job creation didn't slow as much as expected in May, spurring a bonds selloff that takes Treasury yields higher. May payrolls slowed to 139,000 from a downwardly revised 147,000. Economists surveyed by WSJ forecast 125,000. Unemployment was unchanged at 4.2%, as expected. The data likely supports expectations of a Fed hold. Yields were already rising ahead of payrolls, as markets watched the Trump-Musk break up. They rose faster after the data, particularly in longer maturities. The 10-year trades at 4.452%% and the two-year at 3.985%. ( @ptrevisani)
