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WASHINGTON (AP) From Wall Street traders to car dealers to home buyers, Americans are eager for the Federal Reserve to start cutting interest rates and lightening the heavy burden on borrowers.

The Fed is widely expected to do so this year probably several times. Inflation, as measured by its preferred gauge, rose in the second half of 2023 at an annual rate of about 2%  the Fed’s target level. Yet this week, several central bank officials underscored that they werent ready to pull the trigger just yet.

Why, with inflation nearly conquered and the Fed’s key rate at a 22-year high, isn’t now the time to cut?

Most of the Fed’s policymakers have said they’re optimistic that even as the economy and the job market keep growing, inflation pressures will continue to cool. But they also caution that the economy appears so strong that there’s a real risk that price increases could spike again.

And some are worried that if they cut rates now and inflation re-accelerates, then the Fed could be forced into an about-face and have to raise rates again.

“History tells many stories of inflation head-fakes,” said Tom Barkin, president of the Federal Reserve Bank of Richmond, in a speech Thursday.

Inflation had seemed defeated in 1986, Barkin noted, when Paul Volcker was Fed chair.

The Fed reduced rates, but inflation then escalated again the following year, causing the Fed to reverse course,” he said.

“I would love to avoid that roller-coaster if we can, said, Barkin, who is among 12 Fed officials who vote on interest rate policy this year.

Several officials have said they want more time to see if inflation continues to subside. In the meantime, they note, the economy is solid enough that it can thrive without any rate cuts. Last month, for example, Americas employers delivered a burst of hiring, and the unemployment rate stayed at 3.7%.

Theyre going to be glacial, and take their time, said Steven Blitz, chief US economist at GlobalData TS Lombard. Theyre willing to say, We dont know, but we can afford to wait so were going to wait. “

The sturdiness of the economy has also raised questions about just how effective the Feds 11 rate hikes have been. If higher borrowing rates are only barely restraining the economy, some officials may conclude that high rates should stay in place longer or that few rate cuts will be needed.

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I dont feel theres a sense of urgency here, Loretta Mester, president of the Cleveland Federal Reserve, told reporters Tuesday. I think later this year, if things evolve as anticipated, we would be able to start moving the rate down.

Yet their caution carries risks. Right now, the economy appears on track for a soft landing,” in which inflation would be defeated without causing a recession or high unemployment. But the longer that borrowing rates stay high, the higher the risk that many companies and consumers would stop borrowing and spending, weakening the economy and potentially sending it into a recession.

High rates could also compound the struggles of banks that are saddled with bad commercial real estate loans, which would be harder to refinance at higher rates.

The high cost of borrowing has become a headache for David Kelleher’s Chrysler-Jeep dealership just outside of Philadelphia. Just 2 1/2 years ago, Kelleher recalled, his customers could get an auto loan below 3%. Now, they’re lucky to get 5.5%.

Customers who had monthly car lease payments of, say, $400 three years ago are finding that with vehicle prices much higher and interest rates up, their monthly payments would be closer to $650. The trend is pushing many of his customers toward lower-priced used cars or no purchase at all.

We need the government to address the interest rates … and understand that theyve accomplished their goal of lowering inflation,” Kelleher said. If interest rates can come down, I think were going to start selling more cars.

Kelleher is likely to get his wish by May or June, when most economists expect the Fed to start reducing its benchmark rate, which is now at about 5.4%. In December, all but two of the 19 policymakers that participate in the Fed’s policy discussions said they expect the central bank to cut rates this year. (Twelve of those 19 actually get to vote on rate policies each year.)

Yet economic growth has accelerated since then. In the final three months of last year, the economy expanded at an unexpectedly strong 3.3% annual rate. Surveys of manufacturers and service-providers, such as retailers, banks, and shippers, also reported that business perked up last month.

Collectively, the latest reports suggest that the economy may not be headed for a soft landing but rather what some economists call a no landing. By that they mean a scenario in which the economy would remain robust and inflation an ongoing threat, potentially stuck above the Fed’s target. Under this scenario, the Fed would feel compelled to keep rates at elevated levels for an extended period.

Powell said last week that while the Fed wants to see continued strong growth, a strong economy does threaten to send inflation up.

I think that is a risk … that inflation would accelerate, Powell said. I think the greater risk is that it would stabilize at a level meaningfully above 2%. … Thats why we keep our options open here and why were not rushing.”

Other officials this week drove home the point that the Fed is trying to balance the risk of cutting rates too soon which might cause inflation to surge again and keeping rates too high for too long, which could trigger a recession.

At some point, the continued cooling of inflation and labor markets may make it appropriate to reduce rates, Andrea Kugler, a recently appointed Fed governor said Wednesday in her first public speech. On the other hand, if progress on disinflation stalls, it may be appropriate to hold the target range steady at its current level for longer.

Some analysts have pointed to signs that the economy is becoming more productive, or efficient, allowing it grow faster without necessarily increasing inflation. Yet productivity data is notoriously hard to measure, and any meaningful improvement wouldn’t necessarily become apparent for years.

Still, maybe the economy can take higher interest rates than we thought in 2019 before the pandemic, said Eric Swanson, an economist at the University of California, Irvine.

If so, that might not just delay the Fed’s rate cuts, but result in fewer of them. Fed officials are still saying they plan to cut rates perhaps three times this year, below the five or six that some market analysts foresee.

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Science

NASA’s Hubble and Webb Discover Bursting Star Formation in Small Magellanic Cloud

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NASA’s Hubble and Webb Discover Bursting Star Formation in Small Magellanic Cloud

Scientists from NASA observed the bursting expansion of gas, stars, and dust from the glittering territory of the dual star clusters using Hubble and Webb space telescopes. NGC 460 and NGC 456 stay in the Small Magellanic Cloud, which are open clusters, with dwarf galaxies and orbit the Milky Way. These clusters are part of the extensive star complex clusters and nebulae that are most likely to be linked to each other. Stars are born upon the collapse of clouds.

Hubble and Webb Reveal Explosive Star Births in Small Magellanic Cloud

As per a report from NASA, the open clusters are from anywhere from a few dozen to many young stars, which are loosely bound by gravity. The images captured by Hubble capture the glowing and ionised gas, which comes from stellar radiation and blows bubbles in the form of gas and dust, which is blue in colour. The infrared of Webb shows the clumps and delicate filament-like structures and dust, which is red in colour.

NGC 460 and NGC 456: A Window into Early Universe Star Formation

Hubble shows the images of dust in the form of a silhouette against the blocking light; however, in the images of Webb, the dust is warmed by starlight and glows with infrared waves. The blend of gas and dust between the stars of the universe is called the interstellar medium. The region holding these clusters is known as the N83-84-85 complex and is home to multiple, rare O-type stars. These are hot and extremely massive stars that burn hydrogen like the Sun.

Such a state mimics the condition in the early universe; therefore, the Small Magellanic Cloud gives a nearby lab to find out the theories regarding star formation and the interstellar medium of the cosmos’s early stage.

With these observations, the researchers tend to study the gas flow from convergence to divergence, which helps in refining the difference between the Small Magellanic Cloud and its dwarf galaxy, and the Large Magellanic Cloud. Further, it helps in knowing the interstellar medium and gravitational interactions between the galaxies.

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Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

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Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

Binance co-founder CZ has dismissed a Bloomberg report linking him to the Trump-backed USD1 stablecoin, threatening legal action over alleged defamation.

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Science

New Interstellar Object 3I/ATLAS Could Reveal Secrets of Distant Worlds

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New Interstellar Object 3I/ATLAS Could Reveal Secrets of Distant Worlds

The entry of a third known object into our solar system has been confirmed on July 1, 2025 by the astronomers. This object is named 3I/ATLAS, where 3I stands for “Third Interstellar”, having a highly hyperbolic (eccentricity ≈ 6.2) orbit, confirming it is not bound to the Sun but is a true interstellar visitor. Only two such visitors, 1I/ʻOumuamua (2017) and 2I/Borisov (2019), had been seen before. Notably, 3I/ATLAS appears to be the largest and brightest interstellar wanderer yet discovered.

Comparison with previous interstellars

According to NASA, astronomers from the ATLAS survey first spotted the object on July 1, 2025, using a telescope in Chile. It immediately drew attention for its unusual motion. Shortly after discovery, observers saw a faint coma and tail, leading to its classification as comet C/2025 N1 (ATLAS).

This comet-like appearance is shared with 2I/Borisov, the second interstellar visitor. Global observatories now track 3I/ATLAS. It poses no threat but offers a rare opportunity to study alien material. Since 1I/ʻOumuamua was observed only as it was leaving the solar system, it was difficult for astronomers to get enough data on it to confirm its exact nature — hence the crazy theories about it being an alien spaceship — though it’s almost certainly an asteroid or a comet.

Size and Significance

3I/ATLAS is much larger and brighter than earlier interstellar visitors. It is about 15 kilometers (km) [9 miles] in diameter, with huge uncertainty, compared to 100m for 1I/’Oumuamua and less than 1km for 2I/Borisov. This brightness and size makes it a a better target for study. Astronomers are planning to analyze its light for chemical signatures from its home system to get clues about the formation of distant planetary systems.

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Apple Maps in iOS 26 Beta Version Come With An Upgraded Search Feature: Report

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