Raphael Stevens

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    Here's where the Federal Reserve sees interest rates, the economy and inflation going

    The Federal Reserve on Wednesday dialed up its economic growth expectations but signaled that there are no expected interest rate hikes for the next two years.The so-called dot-plot projections budged little, with most members still expecting to keep rates near zero through 2023.Four of the 18 Federal Open Market Committee members were looking for a rate hike at some point in 2022, compared with just one at the December meeting. For 2023, seven members see a rate increase, compared with five in the December forecast. As the chart shows, a strong majority forecast no hikes until the “longer run.”Every quarter, members of the FOMC forecast where interest rates will go in the short, medium and long term. These projections are represented visually in charts below called a dot plot.  Here are the Fed’s latest targets, released in Wednesday’s statement:Zoom In IconArrows pointing outwardsThis is what the Fed’s forecast looked like in December 2020:Zoom In IconArrows pointing outwardsThe Federal Reserve sharply ramped up its economic expectations for 2021, according to the central bank’s Summary of Economic Projections released Wednesday.The central bank now expects real gross domestic product to grow 6.5% in 2021, compared with its 4.2% forecast from its December meeting. The Fed also upped its 2022 real GDP forecast to 3.3% from 3.2% expected previously.Zoom In IconArrows pointing outwardsSource: Federal ReserveThe Fed estimates the unemployment rate will fall to 4.5% in 2021, below the previous estimate of 5%. The FOMC expects the unemployment rate to drop to 3.9% and 3.5% in 2022 and 2023, respectively.The central bank now sees inflation running to 2.4% this year, above its previous estimate of 1.8%. The Fed also slightly hiked its PCE inflation estimates for 2022 and 2023.Core PCE inflation is expected to come in at 2.2% in 2021, up from December’s forecast of 1.8%. Core PCE for 2022 is now expected at 2.0% and 2.1% in 2023. More

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    Stocks making the biggest moves after the bell: Five Below, Lordstown Motors, PagerDuty & more

    A Five Below location.John Greim | LightRocket | Getty ImagesCheck out the companies making headlines after the bell on Wednesday:Five Below – The discount retailer’s shares ticked up 6% after the company’s fourth-quarter results topped Wall Street analyst expectations. Five Below reported earnings per share of $2.20 on revenue of $859 million. Analysts polled by Refinitiv expected a profit of $2.11 per share on revenue of $838 million.PagerDuty – PagerDuty shares slid 5% after the company issued fiscal first-quarter and full-year guidance that missed analyst expectations. The company expects to lose between 9 cents per share and 10 cents per share in the first quarter. Analysts polled by FactSet expected a loss of 7 cents per share. For the year, PagerDuty expects to lose between 36 cents per share and 43 cents per share. That’s more than a FactSet forecast for a loss of 22 cents per share. PagerDuty’s disappointing guidance overshadowed the release of better-than-expected results for the previous quarter.Williams-Sonoma – Shares of the cookware company popped 11% after the company announced better-than-expected fourth-quarter results. Williams-Sonoma posted earnings per share of $3.95 on revenue of $2.29 billion. Analysts polled by Refinitiv expected earnings per share of $3.39 on revenue of $2.18 billion. The company also announced a quarterly dividend increase of 11% and a stock repurchase program of $1 billion. Lordstown Motors – The electric vehicle manufacturer’s shares fell 4% after the company confirmed the Securities and Exchange Commission requested information regarding a Hindenburg Research report that alleges the company artificially inflated pre-orders of its new electric pick-up truck. The vehicle is slated for production in September. More

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    Restaurant tech firm Olo shares soar 39% in IPO as online ordering surges

    Olo, which makes online ordering software for restaurants, saw shares soar 39% in its public market debut on Wednesday.The company priced shares at $25 per share, raising about $450 million at a valuation of $3.6 billion. The stock closed on Wednesday at $34.75 per share. Olo had initially said that its target price was $16 to $18 per share, before raising it to $20 to $22 per share on Monday. The stock is trading on the New York Stock Exchange under the ticker “OLO.””For us, we are so well known within the restaurant industry but so unknown outside the restaurant industry, certainly by public investors, so it’s important for us to meet with as many investors as we could,” CEO Noah Glass said in an interview.Before the initial public offering, Olo had raised less than $100 million in funding from outside investors since the company was founded in 2005. That stands in stark contrast to other restaurant tech companies, like DoorDash, which raised $2 billion before it went public in December.Glass said that the higher profile of being publicly listed could help Olo grow beyond large chain restaurants into working with smaller eateries or even working with grocery or convenience stores.The surge in online restaurant ordering during the coronavirus pandemic helped Olo turn a profit of $3.06 million last year, according to regulatory filings. In 2018 and 2019, the company lost money.In 2020, net sales nearly doubled to $98.4 million. Olo’s revenue comes from the subscription fees it charges restaurant chains like Shake Shack and Brinker International’s Chili’s for access to its digital ordering software, as well as transaction fees for delivery orders. More

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    U.S. could start vaccinating young kids in early 2022, Dr. Fauci says

    Dr Anthony Fauci, director of the National Institute for Allergy and Infectious Diseases, testifies during a Senate Health, Education, Labor and Pensions (HELP) Committee hearing on Capitol Hill in Washington, U.S.Kevin Dietsch | ReutersThe U.S. could begin vaccinating older kids against Covid-19 this fall while elementary-aged children may start getting their shots early next year, White House Chief Medical Officer Dr. Anthony Fauci told lawmakers on Wednesday.”For high school students, it looks like they will be available to get vaccinated in the beginning of the fall, very likely for the fall term,” Fauci told lawmakers during a hearing with the House Committee on Energy and Commerce.Fauci said researchers will likely have enough data on immunizations for younger children — 12 and under — to begin giving them shots in the first quarter of 2022.The Food and Drug Administration authorized the vaccines from Moderna and Johnson & Johnson’s for people ages 18 and older, while Pfizer’s vaccine can be used in people as young as 16.Drugmakers are quickly testing their coronavirus vaccines in children to determine whether they’re safe and effective. Both Pfizer and Moderna started testing their vaccines in adolescents late last year.Moderna on Tuesday said it’s started dosing younger children in a mid- to-late stage study to determine whether its vaccine, mRNA-1273, can be used to immunize children between six months up to 12-years old. The study, which will enroll about 6,750 children in the United States and Canada, will test the company’s two-dose vaccine given 28 days apart.However, Moderna CEO Stephane Bancel said in January that he doesn’t expect the data from kids younger than 12 to be ready before 2022, though he anticipates more information on the vaccines’ performance among those 12 and older before September.”I don’t think the trials will take long at all,” Dr. Paul Offit, a member of the FDA Vaccines Advisory Committee told CNBC’s “The News with Shepard Smith” on Tuesday.”I think it’s very likely for children over 12 that we could have vaccines for them by the summer, and for children who are younger, it’s possible we could have it by the end of this year, beginning of next year,” Offit said.Pfizer has fully enrolled children in a study testing its vaccine in children ages 12 to 15. The company plans to initiate a trial in the first half of 2021 for children between the ages of 5 and 11, depending on the findings from the first cohort, Pfizer spokesperson Keanna Ghazvini told CNBC in an email Wednesday. More

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    Stocks making the biggest moves midday: Plug Power, Coupa Software, Lennar and more

    Plug Power hydrogen delivery truck.Source: Plug PowerCheck out the companies making headlines in midday trading.Plug Power – The fuel cell maker’s shares slid 7.9% after Plug Power said it will restate financial results following accounting errors. In a filing the company said the errors are primarily related to areas including the impairment of certain long-lived assets, as well as loss accruals for certain service contracts. “There is no expected impact to our cash position, business operations or economics of commercial arrangements,” the company said, adding that the review did not find any misconduct.Coupa Software – Shares of the financial management software company dropped 4.8% even after a better-than-expected quarterly report. Coupa earned an adjusted 17 cents per share for its latest quarter, compared to expectations of an 11 cents per share loss, according to Refinitiv. The company’s revenue also topped expectations. Lennar — The homebuilder’s share price popped 13.8% after reporting strong quarterly results. Lennar reported earnings per share of $2.04. Revenue came in at $5.33 billion, topping estimates of $5.13 billion, according to Refinitiv.CrowdStrike Holdings  – The security software stock rose 6% after the company reported earnings that topped analysts’ estimates. CrowdStrike reported quarterly earnings of 13 cents per share, beating estimates by 5 cents, according to Refinitiv. CrowdStrike also issued an upbeat outlook, projecting more than $1 billion in revenue this year.Uber — Shares of the ride-hailing service dropped 4.2% Wednesday morning after the company said it would grant U.K. drivers worker status, minimum wage and certain benefits. Uber’s decision came after the country’s Supreme Court upheld a ruling that a group of drivers were workers, not independent contractors.McDonald’s — Shares of McDonald’s rose 1.9% in midday trading after Deutsche Bank upgraded the global burger chain to buy and said investors should see 11% upside over the next year. UBS also published a bullish note on Wednesday and said McDonald’s should continue to see strong sales growth throughout 2021 thanks to its foray into chicken sandwiches.Coherent — The laser company’s stock price jumped 3.3% after Coherent said it had received a revised takeover bid from optical components maker Lumentum for $6.9 billion in cash and stock.  This is the 8th bid for Coherent in a takeover contest involving Lumentum, II-VI and MKS Instruments.— with reporting from CNBC’s Yun Li, Pippa Stevens, Tom Franck and Jesse Pound. More

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    Starbucks sets goal of making its green coffee carbon neutral by 2030

    Starbucks President and Chief Executive Officer Kevin Johnson is pictured at the Annual Meeting of Shareholders in Seattle, Washington on March 20, 2019.Jason Redmond | AFP | Getty ImagesStarbucks said at its annual shareholder meeting on Wednesday that it plans to make its green coffee carbon neutral by 2030.The coffee giant is also aiming to halve water usage in green coffee processing by 2030. Green coffee refers to the first steps of the coffee supply chain, as beans are grown, harvested and transported to ports. Last year, the company set a goal of becoming “resource positive” by storing more carbon than it emits, eliminating waste and providing more clean freshwater than it uses. To help fulfill that long-term commitment, it has been setting firm targets with a 2030 deadline. Those objectives include cutting carbon emissions in half in direct operations and its supply chain, conserving or replenishing half of the water taken for coffee production or operators and halving the waste sent to landfills by cafes and manufacturing.”We are a company that aspires to give back more than we take when it comes to people and the planet while creating prosperity for all who connect with Starbucks,” CEO Kevin Johnson wrote in a LinkedIn post on Wednesday celebrating the company’s 50th anniversary.The company also announced several updates on other parts of its business. It plans to start testing Cold Pressed Espresso in some cafes by the end of the year. The drink was already available in Starbucks’ upscale Reserve locations. Cold beverages, which are favored by younger customers, have played a crucial role in growing the chain’s same-store sales in recent years. In the last three years, consumers have spent more than $1 billion on Starbucks’ cold drinks.In China, Starbucks’ second-largest market, the company will open a sustainable roasting plant by 2022, it said. With $150 million earmarked for it, the project is the company’s largest investment outside of the United States.Ahead of the meeting, Starbucks said that it is working to make its cafes more accessible for blind and low-vision customers. U.S. customers now have free access to Aira, a service that connects blind or low-vision people to visual interpreters through an app. Starting this summer, Starbucks plans to roll out new large-print and Braille menus in the U.S. and Canada.Starbucks’ commitments to social causes, including racial justice and climate change, have made the company popular with investors who take into account environmental, social and corporate governance when picking stocks. Analysis from RBC Capital Markets found that Starbucks is the most popular restaurant stock in the S&P 500 with actively managed funds that are dedicated to ESG investing.Shares of Starbucks have risen about 87% over the last year, giving it a market value of nearly $130 billion. While the company’s sales have been battered by the pandemic, its recovery in the U.S. and China is happening faster than expected. For next quarter, Starbucks is forecasting U.S. same-store sales growth of 5% to 10%.Correction: An earlier version of this story inaccurately defined green coffee. More

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    TurboTax, H&R Block need time to account for $10,200 unemployment tax break

    Kimberly White | Getty Images Entertainment | Getty ImagesOnline tax preparers like TurboTax and H&R Block haven’t yet updated their software to account for a tax break on unemployment benefits some Americans received last year.As a result, taxpayers who are eligible for the new break and typically file a return digitally should wait, experts said.About 138 million individual tax returns last year were filed electronically — almost 98% of the total, according to IRS data as of mid-July.$10,200 unemployment tax breakThe American Rescue Plan Act of 2021, signed Thursday by President Joe Biden, waives federal tax on up to $10,200 of jobless benefits received last year, per person.Taxpayers are eligible for the tax cut if their modified adjusted gross income was less than $150,000 in 2020.The IRS issued guidance on Friday to taxpayers who file a paper return with instructions on how to claim the tax break. The agency also said it would work with firms to update current tax software.It appears some are still tweaking their systems to account for the new rules.More from Personal Finance:Scammers promising to get your student loans forgivenMillions of $1,400 stimulus checks now available by direct deposit$300 unemployment boost may not arrive until April or later, says Labor DepartmentIn some cases, they might not have to wait much longer — TurboTax expects to have updated its software by Thursday evening, according to spokeswoman Ashley McMahon.”We’re working around the clock to make updates to TurboTax based on the recently enacted American Rescue Plan so our customers can file with confidence and get their maximum refund,” McMahon said.TurboTax processed nearly 40 million tax returns last year.Lisa Patterson, a spokeswoman for H&R Block, said Tuesday the company is awaiting additional guidance from the IRS on how the unemployment exclusion will be implemented.The Free File Alliance, a group of nine firms that partner with the IRS to offer free electronic tax filing, didn’t return a request for comment. IRS Free File is available to taxpayers whose adjusted gross income is $72,000 or less.Companies in the Free File Alliance include 1040NOW Corp., ezTaxReturn.com, FileYourTaxes, Free Tax Returns, Intuit (which owns TurboTax), OnLine Taxes, TaxACT, TaxHawk and TaxSlayer.The IRS didn’t return a request for comment.Wait to fileConstantine Johnny | Moment | Getty ImagesThe $1.9 trillion Covid relief bill offered the unemployment tax break in the middle of filing season, which began Feb. 12 and runs to April 15. The IRS is expected to push the deadline to May 17.About 40 million people received unemployment benefits last year, according to The Century Foundation. The average person got $14,000 in assistance.”It’s always challenging in the middle of a tax season when you have a tax law change,” said Nina Olson, executive director and founder of the Center for Taxpayer Rights. “It’s challenging for the IRS to incorporate it, and it’s challenging for the software providers.”Zoom In IconArrows pointing outwardsAbout 53.9 million tax returns have been e-filed this year, according to IRS data through March 5. That’s almost 97% of all returns so far.For those who haven’t yet filed and want to claim the unemployment tax break, it’s likely best for e-filers to wait until online preparers have tweaked their systems accordingly, Olson said.That’s especially true since the IRS has already begun depositing $1,400 stimulus checks into bank accounts. At this point, rushing to file a tax return so one’s eligibility and check amount are based on 2020 income may not occur in time, Olson said. (Taxpayers will eventually get any money owed to them.)”I think if you give the major software companies a week, they will have it programmed in, and it would be worth waiting to save yourself the confusion,” Olson said.Zoom In IconArrows pointing outwardsHowever, some smaller software providers may not make the change this tax season, which is a concern, she added.After Hurricane Katrina, for example, some firms in the Free File network didn’t incorporate new tax benefits offered to people affected by the natural disaster, Olson said. And those provisions were passed before tax season began, not in the middle as with the American Rescue Plan, she added.Taxpayers who already filed their taxes and are eligible for the unemployment tax break should not file an amended tax return, the agency said Friday. The IRS may be determining how to provide the benefit without such an action, experts said. More

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    CDC considers shortening Covid social distancing recommendations for schools to 3 feet, director says

    A girl looks on after returning to school as coronavirus disease (COVID-19) restrictions are lifted in Philadelphia, Pennsylvania, March 8, 2021.Hannah Beier | ReutersWASHINGTON — The Centers for Disease Control and Prevention is working on updated Covid-19 guidance for schools that could reduce its social distancing recommendations from 6 feet to 3 feet, Director Dr. Rochelle Walensky told lawmakers Wednesday.”As soon as our guidance came out, it became very clear that 6 feet was among the things that was keeping schools closed, and in that context science evolves,” Walensky testified before the House Committee on Energy and Commerce’s oversight and investigations subcommittee, which was holding a hearing on increasing Covid-19 vaccinations.”There has been one study that was published late last week that demonstrated in Massachusetts where there is generally 100% mask-wearing that 3 feet was actually safe,” she said. The agency is reviewing several other unpublished studies on shorter social distancing guidelines as it revises its own recommendations, she said.When pressed on the timeline for revising the agency’s school guidance, Walensky, who said she’s been homeschooling her three children throughout the pandemic herself, said the CDC was still “actively looking at those additional studies.””We are looking to update our guidance,” Walensky said, adding, “I am entirely with you as that we need to get our children back [to school].”The new study, published in Clinical Infectious Diseases, compared infection rates of Covid-19 in Massachusetts public schools with different physical distancing requirements. The research suggests that 3 feet may be as safe as 6 feet if everyone is masked.Dr. Anthony Fauci, the country’s top infectious diseases official and President Joe Biden’s chief medical advisor, was asked about the study on Sunday.”What the CDC wants to do is they want to accumulate data and when the data shows that there is an ability to be 3 feet they will act accordingly,” Fauci told CNN’s Jake Tapper. “I can assure you within a reasonable amount of time, quite reasonable, they will be giving guidelines according to the data they have.” More