Fed Chairman Signals September Rate Cut on the Table
In his Jackson Hole speech, Fed Chair Jerome Powell acknowledged the dual risks of slowing job growth and persistent inflation, signaling the Fed may cut rates at its September 17 meeting. Economists interpreted his remarks as a clear shift toward easing, with markets rallying on the news. Powell noted that tariffs from President Trump continue to pose inflationary pressures, though their impact will take time to filter through supply chains. Despite political and economic pressures, Powell emphasized the Fed’s commitment to balancing its dual mandate of supporting employment while keeping inflation in check.
Retailers Manage Tariff Pressures With Mixed Results as Consumer Resilience Is Tested
Major retailers like Walmart, Home Depot, and Tapestry reported that while tariffs have raised costs, they’ve managed to limit widespread price hikes through strategies like early importing, diversifying sourcing, and selective price adjustments. Consumer spending has stayed relatively resilient, though lower-income shoppers are showing more sensitivity to rising prices, and certain categories like home improvement and Crocs footwear remain weak. Strong brands and new revenue streams, such as Walmart’s advertising and marketplace business, have helped offset cost pressures and keep earnings steadier. However, companies without strong demand or vendor leverage are feeling the tariff impact more sharply, leading to cautious outlooks for the second half of the year.
U.S. Government Takes 10% Stake in Intel to Boost Chipmaking
The Trump administration announced an $8.9 billion investment in Intel, giving the U.S. government a 10% ownership stake in the struggling chipmaker. The deal converts unallocated CHIPS Act and Defense Department funds into equity, though the government will not hold board seats or decision-making power. Trump framed the agreement as a “great deal for America,” tying it to his push for domestic semiconductor leadership and plans for 100% tariffs on foreign-made chips. While Intel’s stock jumped on the news, questions remain over whether the move will fix its lagging technology compared to rivals like TSMC.
