Economy

“Based on what we know now, we believe the FOMC probably leans toward downshifting to a 25 bps pace going forward,” Economists at Wells Fargo said in a recent note, flagging the updated Fed’s summary of economic projections, or so-called dot plot. The Fed delivered a 50 basis point rate cut on Sept. 18 and signaled that it could deliver two further 25bps cuts this year and a percentage point cut next year.Fed Governor Michelle Bowman was the lone dissenter against the larger cut, favoring a smaller 25bps cut at the September meeting, but the dot plot showed “a meaningful share of the Committee is in no hurry to make 50 bps cuts the default move,” the economists added.The Fed’s big rate cut was an effort to front-load the initial policy easing, Wells Fargo suggests, as most members of the FOMC didn’t “want to see any further weakness in the labor market.”But hopes for another jumbo 50 bps cut could be revived should incoming labor market signals unexpected weakening. The next two employment reports, slated for Oct. 4 and Nov. 1, will be critical to the monetary policy outlook.”An unexpected slowdown in payroll growth or larger-than-anticipated rise in the unemployment rate might push us to project another 50 bps move at the November 7 FOMC meeting,” Wells Fargo said. More

(Reuters) -The families of the six workers who died in the March collapse of the Francis Scott Key Bridge in Baltimore filed lawsuits on Friday against the owner and operator of the cargo ship that struck the bridge.The lawsuits filed in Maryland federal court by the families of Carlos Daniel Hernandez Estrella, Alejandro Hernandez Fuentes, Miguel Angel Luna, Dorlian Ronial Castillo Cabrera, Maynor Yasir Suazo Sandoval and Jose Mynor Lopez seek unspecified damages from the registered owner of the ship, Grace Ocean Pte Ltd, and its manager, Synergy Marine Group, claiming they negligently allowed the ship to depart Baltimore when they knew it was plagued by mechanical issues.Julio Cervantes Suarez, another worker who survived the bridge’s collapse, filed a separate lawsuit on Friday against the companies, also seeking unspecified damages for his injuries. Cervantes was in his truck when it fell into the river from the bridge, according to his lawsuit.Darrell Wilson, a spokesperson for the companies, said in a statement that the filing of the claim was anticipated ahead of a September deadline but declined to comment on its merits.”We do look forward to our day in court to set the record straight,” Wilson said.Craig Sico, one of the attorneys representing Maynor Yasir Suazo Sandoval’s family, said the lawsuits were filed as part of a coordinated effort between the victims’ families.”It’s our belief that the crew of the Dali could foresee this incident taking place,” Sico told Reuters in an interview.The U.S. Department of Justice filed a lawsuit on Wednesday against the companies over the disaster, accusing the companies of wilfully ignoring or mishandling mechanical problems on the ship. The department’s lawsuit seeks at least $100 million it says the government spent in responding to the disaster and clearing the wreck of the Dali ship and bridge debris from the Port of Baltimore so the waterway could reopen in June.In the early morning of March 26, the container ship lost power and crashed into a support pylon, sending the bridge into the Patapsco River and killing six people who were working on the span at the time of the crash.Grace Ocean and Synergy filed a petition on April 1 in Maryland federal court to limit their liability from the crash to the present value of the ship and its cargo, which they estimated to be just over $43 million, according to the petition. Claimants have until Sept. 24 to come forward.The company that employed the workers who died in the collapse, Brawner Builders, also sued Grace Ocean and Synergy on Wednesday, seeking an unspecified sum in damages for the deaths of its workers and loss of construction vehicles and equipment on the bridge.Also on Friday, Ace American Insurance filed a lawsuit against Grace Ocean and Synergy, seeking to recoup $350 million it said it paid to the Maryland Transportation Authority after the bridge’s collapse as part of a property insurance policy. Representatives for Ace American, now known as Chubb (NYSE:CB), did not immediately respond to a request for comment. A spokesperson for Grace Ocean and Synergy did not immediately respond to a request for comment on the Chubb lawsuit. More

WASHINGTON (Reuters) -Federal Reserve officials, in their first public comments since the U.S. central bank cut interest rates by half a percentage point, laid out on Friday the depth of the debate over the move, with one governor saying inflation was now so weak the large reduction was needed and another arguing price pressures remain so strong a smaller cut would have been better.Fed Governors Christopher Waller and Michelle Bowman have been close in spirit through much of the central bank’s battle against inflation as advocates of faster and more robust rate increases to keep it contained.But Waller said in an interview with CNBC that recent data convinced him the Fed needed to cut rates faster because it is at risk of undershooting its inflation target, while Bowman in a separate statement worried the half-percentage-point cut sent the wrong signal with inflation still above the central bank’s 2% goal.Waller said data released in the days before the policy-setting Federal Open Market Committee’s two-day meeting this week led him to believe that the central bank’s preferred index of inflation, the personal consumption expenditures price index, was “softening much faster than I thought it was going to. And that is what put me over the edge to say, look, I think 50 (basis points) is the right thing to do.” With the same information in hand, however, Bowman said that while she agreed it was time to cut rates given how much inflation has slowed, prices were still increasing at a roughly 2.5% rate on a year-over-year basis, and “the Committee’s larger policy action could be interpreted as a premature declaration of victory.””Moving at a measured pace toward a more neutral policy stance will ensure further progress in bringing inflation down,” she said in explaining her dissent in favor of a quarter-percentage-point cut.It was the first dissent by a member of the Fed’s Board of Governors in 19 years, and highlighted the still unresolved issue of how fully Fed Chair Jerome Powell had the backing of the FOMC’s 12 voting members and seven non-voting participants in beginning a new cycle of rate-cutting with the 50-basis-point reduction.Only voting members of the committee, including the seven Fed governors and five of the 12 reserve bank presidents at any given meeting, can dissent. Economic projections issued by other Fed policymakers alongside the policy statement on Wednesday showed many seemed inclined towards a quarter-percentage-point cut, though the “dot plot” reflecting officials’ rate outlook does not indicate how many of them were non-voters with no option to register an objection.’PROTECT OUR CREDIBILITY’The comments from Waller and Bowman, who were both appointed by former President Donald Trump, also highlighted the differing ways incoming data may be interpreted as the Fed decides its next steps.Bowman’s focus on year-over-year inflation numbers is consistent with how the Fed sets its 2% target, and she also gave weight in her statement on Friday to existing data that she says shows the economy and labor market are largely on track.Waller said he noted that inflation over a shorter time frame of a few months was growing so weak he felt the Fed might miss its target on the low side – a problem the central bank struggled with for a decade before the COVID-19 pandemic.In his post-meeting press conference on Wednesday, Powell similarly suggested the central bank was making decisions in anticipation of what it thinks might be developing in the economy, hoping to stay ahead of any weakness in the job market by acting before it comes to pass.Waller, in remarks that prompted traders to stiffen bets that another half-percentage-point cut is coming in November, said he was ready to move aggressively if inflation does prove too tepid.”I was a big advocate of large rate hikes when inflation was moving much, much faster than any expected. And I would feel the same way on the downside to protect our credibility of maintaining a 2% inflation target,” he said. “So if the data starts coming in soft and continues to come in soft, I would be much more willing to be aggressive on cuts.” More

A Federal Reserve official predicted quarter point rate cuts if data looked ‘fine’. But he also set out a scenario for a pause — or faster reductions.Having made their first interest rate cut in more than four years this week, Federal Reserve officials are keeping their options open as they try to figure out how rapidly to lower borrowing costs in the months ahead.Fed officials could lower interest rates in standard quarter-point increments if the data continue to look “fine,” Christopher J. Waller, a Fed governor, suggested in a CNBC interview on Friday. If inflation were to pick back up, Fed policymakers could hold rates steady.And if the job market cools more than expected or if inflation comes in weaker than expected, the Fed could reduce interest rates more rapidly.“If the data starts coming in soft and continues to come in soft,” Mr. Waller said in the interview, he would be willing “to be aggressive on rate cuts to get inflation closer to our target of 2 percent.”Central bankers appear to be poised to lower borrowing costs much more quickly than most economists had expected as recently as a month or two ago. That has left some questioning what prompted the Fed’s pivot toward a more proactive path. And the Fed’s decision to cut rates by a larger-than-usual half point this week has many investors wondering whether other large moves could be on the table.Mr. Waller’s remarks offer insight into the Fed’s thinking at a critical juncture. Policymakers are trying to bring interest rates — which they lifted rapidly starting in 2022 and have left at a high level since 2023 — back toward a more normal setting, at which the rates no longer weigh so heavily on the economy. But how rapidly to do that is a challenging question.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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