(NEW YORK) — As inflation continues to worry Americans, Aldi CEO Jason Hart said the discount grocery chain is focused on keeping grocery prices low as the summer season heats up.
Hart joined ABC News’ Good Morning America live Thursday to discuss the summer grocery outlook ahead of Memorial Day.
“We don’t really focus on what the competition is doing. We’re focused on what consumers want and need,” Hart said. “Before the consumer was stressed with inflation, we were still about low prices, but those low prices become even more important as value is even more top of mind for the consumer.”
“So our actions are all based on consumer demand,” Hart continued. “We’re always looking for opportunities to lower prices to reduce our cost of doing business, to reduce our cost of product and to lean in on our lower prices. So that’s what we’re all about.”
Earlier this month, Aldi announced it would cut prices on over 250 summer essentials, including barbecue basics like chicken and steak and other family favorites like frozen blueberries and granola bars.
“It’s focused on, as you can imagine, fresh meat, snacks for the summer road trip and our fresh meat prices are lower than they were last year and our sales are up 30%,” Hart said, adding that low prices are part of the “DNA” of Aldi. “We’ve got our boneless, skinless chicken breasts at $2.19 a pound. Since we’ve marked that product down, it’s up 50% in movement and that’s just showing the popularity of low prices and the popularity of Aldi is as high as it’s ever been.”
Other major stores followed suit, including Walmart and Target, with the Minneapolis-based store saying it would lower prices on 5,000 items, including “everyday items” such as milk, meat, fresh fruit, vegetables and snacks.
Hart said lower prices are driving Aldi’s growth. The discount grocery chain announced this May it would open 800 more stores over the course of the next five years, especially in the Southeast.
“Twenty-five percent of U.S. customers now shop at Aldi. That’s twice what it was just six years ago,” Hart said. “And Aldi’s built to fight inflation. Our business model, which is based on simplicity and efficiency, really provides savings for customers and also saves them time when they’re shopping with their grocery lists.”
In this April 17, 2024, file photo, the Live Nation website is shown on a laptop in New York. (Bloomberg via Getty Images)
(WASHINGTON) — The Justice Department and a group of state attorneys general are expected to announce an antitrust lawsuit against Live Nation as soon as Thursday over Ticketmaster’s dominance over the concert ticket sales market, two sources familiar with the matter told ABC News on Wednesday.
Details of the pending lawsuit were not immediately clear.
The Justice Department’s antitrust suit follows a more than two-year investigation that probed whether the company created a monopoly over the concert ticket market through its exclusive contracts with venues.
The Justice Department declined to comment on the investigation. Live Nation did not immediately comment about the probe.
The Washington Post and Bloomberg first reported news of the expected lawsuit.
The company has come under increased scrutiny since late 2022 following a fiasco over pre-sales for Taylor Swift’s “Eras Tour.”
Ticketmaster, which controls more than 70% of the market for ticketing and live events, crashed during the first day of sales, leaving millions of fans out of luck or seeking higher-priced tickets on the secondary market.
A StubHub secondary ticket for the show sold as high as $22,000.
Live Nation acknowledged the issues over the presales and said high demand for the show, technical issues and bots were behind it. The company said that every customer with a “Verified Fan” code was able to purchase an “Eras Tour” ticket.
Swift addressed the incident, without naming Live Nation or Ticketmaster, and chastised the system.
“It’s really difficult for me to trust an outside entity with these relationships and loyalties, and excruciating for me to just watch mistakes happen with no recourse,” Swift said in a statement.
Ticketmaster and Live Nation have been accused of mistreating customers with speculative ticket sales, deceptive websites and large hidden fees ever since they merged in 2010.
In 2019, the company paid fines pertaining to the company violating the agreed-upon terms of a Justice Department consent decree during the final merger.
Swift fans have filed a lawsuit against Live Nation over the Eras Tour debacle contending that the company violated antitrust laws and deceived customers.
In January 2023, Joe Berchtold, Live Nation’s president and CFO, testified before the Senate Judiciary Committee and was grilled by members of both sides of the aisle over these issues.
Berchtold apologized for the fiasco and blamed ticket scalping as the cause behind it.
“There are problems in the ticketing industry — problems that we believe can and should be addressed through legislation,” he said.
Last June, representatives from Live Nation met with President Joe Biden and later announced “upfront all-in” pricing that discloses fees when a consumer is shopping for a ticket.
The Federal Deposit Insurance Corp. (FDIC) headquarters in Washington, D.C., May 20, 2024. (Al Drago/Bloomberg via Getty Images)
(WASHINGTON) — The head of the Federal Deposit Insurance Corporation said this week that he would leave his role in the aftermath of a probe that documented widespread allegations of sexual harassment and discrimination at the federal agency.
Martin Gruenberg, a Democrat who began a five-year term in 2023, said he will remain in the top post at the FDIC until a replacement can be confirmed by the Senate, which could take months. President Joe Biden will announce a nominee for FDIC chair soon, the White House told ABC News in a statement this week.
“In light of recent events, I am prepared to step down from my responsibilities once a successor is confirmed,” Gruenberg said. “Until that time, I will continue to fulfill my responsibilities as Chairman of the FDIC, including the transformation of the FDIC’s workplace culture.”
The plan to maintain Gruenberg’s leadership until a replacement can be installed presents a setback for efforts to overhaul the organization’s toxic culture and prevent further harm, experts told ABC News. The toxic workplace culture at the FDIC took hold alongside complaints about Gruenberg’s own alleged temper, which may hinder his ability to establish trust with employees as the organization pursues the necessary changes, the report said.
The report acknowledged that Gruenberg’s conduct did not make up a “root cause” of the pervasive sexual harassment and discrimination at the agency. But, the report added, “culture starts at the top.”
A fix for the pervasive misconduct at the agency, experts said, requires long-term reform and employee protections that extend well beyond the departure of Gruenberg.
“Leaders underestimate the shadows that they cast,” Allison Gabriel, a professor of management in the business school at Purdue University, told ABC News. “We look to people at the top of an organization or anybody who holds a leadership role as a beacon for what behavior is accepted and rewarded.”
“The reality is that it will take a leadership change,” Gabriel added. “It will also take a lot of time.”
The FDIC and Gruenberg did not respond to ABC News’ requests for comment.
In a statement to ABC News, White House Deputy Press Secretary Sam Michel commended Gruenberg for his service at the FDIC and his commitment to implement workplace changes outlined in the investigation.
“In his long tenure of service at the FDIC, Chairman Gruenberg has helped protect the economy from financial instability and worked to ensure the banking system serves more Americans fairly,” Michel said. “While the FDIC is an independent agency, as we have said, the President of course expects the Administration to reflect the values of decency and integrity and to protect the rights and dignity of all employees.”
A 234-page report, issued by law firm Cleary Gottlieb Steen & Hamilton earlier this month, detailed a culture of widespread misconduct at the agency that disproportionately harmed women and minority workers.
Wrongdoers often avoided punishment and, in some cases, received promotions after their misbehavior had been reported, according to the report, which relied on testimony from 500 current and former employees. Hundreds of employees shared their complaints by calling a hotline set up by investigators, the report said.
In one field office, a supervisor routinely commented to women employees about their sexual relationships and bodies, the women told investigators, according to the report. In another instance, a woman examiner received a picture of a senior examiner’s genitals out of the blue while working in a field office, the report said, noting that the woman later found out that the senior examiner had a “reputation.”
Some allegations detailed in the report focused on Gruenberg, who led the agency for 10 of the last 13 years. Some people interviewed over the course of the investigation recounted “deeply unsettling exchanges during which he was extremely ‘harsh,’ ‘aggressive,’ and ‘upset,'” the report said.
Gruenberg told investigators that he did not recall ever getting angry with FDIC employees, the report said. In November, he told the Wall Street Journal that harassment and discrimination are “completely unacceptable” and the agency doesn’t tolerate them.
Lisa Avalos, a professor at Louisiana State University Law School who focuses on sexual offenses, said the preservation of Gruenberg as the head of the FDIC for the time being will hamstring efforts to prevent further misconduct and repair the agency’s culture.
“The person at the top is always setting an example for everybody else,” Avalos said. “Part of it is what he has actively done, which caused discomfort for people. The other part is how he’s contributed to the culture through his omissions.”
She added, “It’s very unlikely that anything is going to change during this time waiting for his replacement.”
Gabriel, of Purdue University, agreed.
“Keeping the status quo can continue to harm people,” Gabriel said. “It’s putting people in a really difficult position now that they’ve unearthed these problems.”
Still, the extensive misconduct at the agency will demand structural and cultural changes that go much further than a swap in leadership, according to recommendations in the report as well as expert analysis shared with ABC News.
The report advises several fixes, including the appointment of a team of staff devoted to addressing the cultural problems as well as bolstered policies covering sexual harassment and discrimination.
“My primary concern when I hear about cases like this is they’re going to fire this person and then they’re going to do company-wide harassment training and do some other thing that does not have long-term returns,” Jennifer Griffith, a professor of organizational behavior and management at the University of New Hampshire, told ABC News.
“I would really, really urge anyone who is trying to make actual, meaningful progress in this area to consider the structural elements in the organization,” Griffith added. “Who’s being rewarded and who’s being penalized, and what are people’s daily jobs like?”
(NEW YORK) — Wendy’s is enticing its customers with a new deal amid increased prices at fast food chains.
Beginning Monday, May 20, customers can get a breakfast combination deal from Wendy’s for only $3, according to a press release from the chain.
The meal combo includes a small portion of seasoned potatoes and a choice of either a bacon, egg and cheese English muffin or a sausage, egg and cheese English muffin, the release added.
Wendy’s did not immediately respond to ABC News’ request for comment.
Earlier this month, Wendy’s competitor McDonald’s announced that it would be launching a new $5 value meal that will hit the menu this summer.
The upcoming promotion offers four items including a McDouble or McChicken sandwich, small fries, small soft drink and four-piece Chicken McNuggets for just $5, beginning June 25 for a limited time, as first reported by the Wall Street Journal.
“We know how much it means to our customers when McDonald’s offers meaningful value and communicates it through national advertising. That’s been true since our very beginning and never more important than it is today,” the company said in an emailed statement to ABC News.
The new deals from the chains came amid complaints over surging fast food prices prompting consumers to express their frustration on social media.
Colleen Pipes, whose video went viral after she spent $14 on a fast food order, told ABC News, “I joked that this was fine dining now, because I might as well go at a sit down restaurant and be served [to] pay those type of prices.”
In March, fast food prices were 33% higher compared to 2019, according to the Department of Labor, while grocery prices were up 26%.
A Target store stands in Manhattan on March 5, 2024 in New York City. (Spencer Platt/Getty Images)
(NEW YORK) — Retail giant Target announced Monday it is lowering prices on around 5,000 items in its stores across the country.
The Minneapolis-based retailer said the price cuts are meant to both make sure its prices stay competitive and help consumers who are feeling financially strapped in today’s economy.
“We know consumers are feeling pressured to make the most of their budget, and Target is here to help them save more,” Rick Gomez, Target’s executive vice president and chief food, essentials and beauty officer, said in a statement announcing the price changes. “Our teams work hard to deliver great value every day, and these new lower prices across thousands of items will add up to additional big savings for the millions of consumers that shop Target each week for their everyday needs.”
Target said the price cuts will take effect “over the course of the summer,” and noted that prices on around 1,500 items in its stores have already been cut.
Lower prices to come on ‘everyday items’
The products that Target customers will soon see lower prices on include what Target describes as “everyday items,” including:
Milk
Meat
Bread
Soda
Fresh fruit
Vegetables
Snacks
Yogurt
Peanut butter
Coffee
Diapers
Paper towels
Pet food
Target said in some stores around the country, the price of a frozen pizza has already dropped to $3.99 from $4.19, for example.
A container of Clorox scented wipes is now $4.99 compared to $5.79, according to the company.
Target said the lowered prices will be found online and on the Target app as well as in stores.
Where else can shoppers find savings?
Target’s announcement of lower prices comes just weeks after Aldi announced its own price reduction on more than 250 grocery items.
The retail chain said customers will see lower prices this summer on items including meat, bread, organic avocado oil, organic granola bars and dried cranberries.
McDonald’s also announced a price reduction this month in the form of a $5 value meal that will hit menus in time for summer.
The fast food chain plans to offer a bundle that includes four items: a McDouble or McChicken sandwich, small fries, small soft drink and a four-piece Chicken McNuggets for just $5.
Overall, data shows that grocery prices are falling for the first time in one year.
In April, the food at home index — food purchased at grocery stores – decreased by 0.2%, according to the U.S. Department of Labor consumer price index findings.
Some staple food at home products, including bread, poultry and eggs, fell in April compared to a year ago, the CPI data showed.
Prices for other items like breakfast sausage and ice cream, however, increased at a pace near the level of overall inflation.
(NEW YORK) — Red Lobster has voluntarily filed for Chapter 11 bankruptcy, according to a recent press release shared with ABC News.
The largest seafood chain in the U.S., home to Cheddar Bay biscuits, Lobsterfest, Ultimate Endless Shrimp and more, filed the legal action on May 19 in the U.S. Bankruptcy Court for the Middle District of Florida, where the Orlando-based restaurant group is headquartered.
“The Company intends to use the proceedings to drive operational improvements, simplify the business through a reduction in locations, and pursue a sale of substantially all of its assets as a going concern,” Red Lobster said in part of its bankrupty filing.
“This restructuring is the best path forward for Red Lobster. It allows us to address several financial and operational challenges and emerge stronger and re-focused on our growth. The support we’ve received from our lenders and vendors will help ensure that we can complete the sale process quickly and efficiently while remaining focused on our employees and guests,” Red Lobster CEO Jonathan Tibus added about the bankrupty filing.
Red Lobster, which was founded in 1968, has been struggling financially and closed multiple locations this May, shuttering at least 99 restaurants in 27 states. But the seafood chain said its remaining open restaurants will continue to operate “as usual.”
The restaurant chain claimed its Ultimate Endless Shrimp promotion, which was launched nearly two decades ago and offered customers all-you-can shrimp dishes for just $20, has taken a major toll to its financial bottom line.
(NEW YORK) — The blazing hot stock market seems to set new records just about every day.
The Dow Jones Industrial Average stands above 40,000 for the first time in history, after climbing nearly 20% since October. Over that period, the S&P 500 and the Nasdaq have each soared even higher, climbing 23% and 27% respectively.
The market rally means a windfall for people with stock holdings but it poses a quandary for those on the sidelines: Is it time to jump in or too late to reap the gains?
Experts who spoke to ABC News encouraged investors to take advantage of the market upswing, saying the major indexes have room to rise even further.
The confidence stems from the nation’s sunny economic outlook, they added, as the Federal Reserve stands poised to make interest rate cuts that could boost an already robust economy. However, they cautioned, stubborn inflation or an economic downturn could bring losses.
“This is a pretty awesome environment to own stocks in right now,” Tom Essaye, president of financial data firm Sevens Report Research, told ABC News. “There is still time to get in.”
The economy is performing well on many key metrics. Unemployment stands near a 65-year low, while economic growth has remained solid and consumer spending has shown resilience.
All of these positive indicators have added up to strong corporate profits, the lifeblood of the stock market. “Growth is good and corporate earnings are good,” Essaye said.
Strong stock market performance, however, depends on where company results and economic output are headed rather than where they stand at the present time, experts said.
Fortunately, many observers hold an optimistic outlook about the coming months, since the Fed appears to be on the verge of interest rate cuts that could deliver a jolt to the economy.
In recent months, the Fed had all but abandoned its previous forecast of three quarter-point rate cuts this year. But a slowdown of price hikes offered hope of rekindling those plans.
Inflation data released last week showed that price increases slowed slightly from the annual rate recorded in the previous month, ending a surge of inflation that stretched back to the beginning of 2024.
“Front and center is what the Fed is going to do,” Marc Dizard, chief investment strategist at PNC Asset Management Group. “There is a bias here that they want to cut rates, which the market is really liking.”
Optimism about the stock market also owes to enthusiasm about the impact of artificial intelligence, experts said.
Major stock indexes drew a bump in recent months from investors favorable toward the newly prominent technology. Those gains were concentrated primarily in a handful of tech giants, known as the so-called “Magnificent 7”: Alphabet, Amazon, Apple, Meta, Microsoft, Tesla and Nvidia.
Shares of Nvidia have climbed nearly 120% since October; Microsoft has jumped almost 35% over that period.
Ed Yardeni, the president of market advisory firm Yardeni Research and former chief investment strategist at Deutsche Bank’s U.S. equities division, said adoption of AI in the coming months and years would help grow the economy and send the stock market higher.
“The market is right to get excited about technological innovations like artificial intelligence, robotics and automation,” Yardeni said. “I think those technologies will boost productivity and productivity boosts real economic growth.”
Dizard, of PNC, said the stock market retains the capacity to rise between 5% and 8%. While Essaye, of Sevens Report Research, said the S&P 500 could increase another 3% or more.
Meanwhile, Yardeni offered a longer-term view, saying he expects the major stock indexes to climb 50% by 2030.
Still, the experts warned of potential outcomes that could not only blunt future gains but incur significant losses.
Stubborn inflation could force the Fed to shift its posture, holding rates elevated for longer than expected or even raising them altogether.
“You could see a curveball,” Dizard said. “That’s something investors need to be cautious about.”
Some economic indicators, meanwhile, have already shown signs of a slowdown. The labor market has continued to add jobs this year but at a slower pace than 2023. The economy grew at the outset of 2024 but cooled off from the final stretch of last year.
“An economic slowdown is the number one thing everybody has to worry about,” Essaye said, predicting that such an outcome could bring a market decline of 10% or more.
Even after noting risks, Dizard struck a positive note. “There is momentum to the upside,” he said.
(NEW YORK) — U.S. adults trust former President Donald Trump over President Joe Biden on the issue of inflation by a double-digit margin, according to a new ABC News/Ipsos poll this month, which found that price increases remain a top concern for voters, with less than six months to go until Election Day.
In all, 85% of poll participants said inflation is an important issue, making it the second-highest priority among adults surveyed. The top priority, the economy, also relates to individuals’ perceptions of price increases.
On each of those issues, the economy and inflation, adults surveyed by ABC News/Ipsos said they trusted Trump over Biden by a margin of 14 percentage points.
Price increases have slowed significantly from a recent peak of about 9%, but inflation still stands more than a percentage point higher than the Federal Reserve’s target rate of 2%.
Rising gasoline and housing costs accounted for 70% of the price increases last month, according to data this week from the U.S. Bureau of Labor Statistics.
“Inflation is something that affects absolutely everybody,” Elaine Kamarck, a senior fellow in the Governance Studies program at the Brookings Institution, told ABC News. “People notice it, whether they’re rich or poor.”
In response to ABC News’ request for comment, the Biden campaign provided a statement touting the president’s economic achievements
“President Biden has delivered where Trump failed the American people: 15 million new jobs and record-low unemployment, bringing down costs, and investing billions in communities that have been left behind for too long,” the statement said.
“All of this is on the line this November: If Trump sets foot in the Oval Office, he’ll make it his mission to undo this progress, ship jobs to China, and send costs through the roof. Voters want a candidate who will make their lives better, and Joe Biden is the only candidate who will,” the statement added.
The Trump campaign did not respond to ABC News’ request for comment.
Todd Fisher, 60, a retired automotive engineer who lives in Miami, Florida, said he’s noticed rapid price increases for everything from haircuts to groceries.
“Everything keeps going up and up and up,” Fisher, who lives on a pension, told ABC News. “I’m not broke or anything but I’d prefer it to be the other way. It’s more money for the bank.”
Trump is better equipped to address inflation, Fisher said, noting that the onset of elevated inflation in 2021 took place under Biden.
“It wasn’t happening when Trump was president,” said Fisher, who identifies as an independent. “I think he’s more aware of what’s going on.”
When asked about the cooldown of price increases that began in 2022, Fisher said it still amounts to price increases, given previous hikes.
“When inflation goes down, it doesn’t necessarily mean the store is going to take everything back to the way it was,” he added.
Analysts who spoke to ABC News said any president retains limited control over the trajectory of prices, but inflation poses a stiff political challenge because progress made on the issue often registers less with voters than the initial problem did.
“For voters, they feel increases in inflation are extremely salient,” Francesco D’Acunto, a Georgetown University finance professor who studies how people understand economic news, told ABC News. “They feel this is very problematic and negative for their own finances.”
“But there is no symmetric reaction on the decreasing end of inflation,” D’Acunto added. “Prices still keep growing but at a slower pace.”
Elevated inflation aside, the economy is performing well on other key metrics. Unemployment stands near a 65-year low, while economic growth remains solid and the major stock indexes are fresh off of record highs.
The robust performance has defied expectations amid a prolonged period of high interest rates, which have sent borrowing rates soaring for everything from mortgages to credit cards. The Fed earlier this month opted for the sixth consecutive time to hold interest rates steady, keeping them at a level last seen in 2001.
Still, 43% of respondents surveyed by ABC News/Ipsos said they’ve become worse off financially under the Biden presidency. Among those who say they’ve held steady financially, Biden leads by a wide margin of 66% to 21% percentage points, poll results showed.
Kenneth Vickers, 34, an elevator constructor who lives in Boston, Massachusetts, said his finances improved about a year ago when he joined a union. But, he added, inflation remains a top concern.
“I make a good amount of money but a lot of other people don’t,” Vickers said. “It’s difficult to get through the day to day, week to week and month to month issues that might come around when you’ve got to pay your bills.”
Vickers, who identifies as an independent, said he trusts Trump to handle the issue better than Biden.
“Trump is a businessman,” Vickers added. “He’s been through the wringer as far as running a business and maintaining wealth.”
Even so, Vickers said he remains undecided about who he’ll vote for in November, noting other issues of importance to him, such as immigration and foreign policy.
(TUSCALOOSA, Ala.) — Thousands of Mercedes-Benz workers in Alabama voted against joining the United Auto Workers (UAW) on Friday, delivering a significant defeat for the union one month after it prevailed at a Volkswagen facility in nearby Tennessee.
Workers at a Mercedes-Benz plant near Tuscaloosa, Alabama cast ballots against joining the union by a margin of 2,642 to 2,045, or 56% to 44%, the National Labor Relations Board said.
The result hinders the UAW’s momentum as it seeks to organize additional plants throughout the South, where it has struggled for decades to gain a foothold.
Analysts expected a difficult contest at the Alabama Mercedes-Benz facility because the company conducted an anti-union campaign, whereas officials at Volkswagen had remained neutral toward worker organization efforts.
Still, the union’s landslide victory last month at a Volkswagen facility in Chattanooga, Tennessee came as a surprise to many observers. The breakthrough marked the first car plant in the South to unionize with a vote since the 1940s.
In both recent campaigns, the union faced stiff opposition from local elected officials. Six Southern governors, including Alabama Gov. Kay Ivey and Tennessee Gov. Bill Lee, both Republicans, issued a statement last month condemning UAW organization efforts in the region.
“We want to keep good paying jobs and continue to grow the American auto manufacturing sector here,” the governors wrote. “A successful unionization drive will stop this growth in its tracks, to the detriment of American workers.”
In recent months, UAW officials have touted an aggressive campaign to expand the union’s membership. Over 10,000 non-union auto workers have signed cards in support of the UAW, and organizing campaigns have begun at more than two dozen facilities, the union said in a statement in March.
The burst of activity followed a high-profile strike carried out by UAW workers against the Big Three U.S. automakers last fall: Ford, General Motors, and Stellantis, formerly known as Chrysler.
The standoff contributed to billions of dollars in losses for the companies and put thousands of workers temporarily out of work. But the gamble paid off, helping the UAW achieve historic wage gains and other long-sought reforms.
In recent years, the U.S. labor movement has grown in popularity and made headlines with attention-grabbing strikes, but it has overall failed to increase the share of the national workforce that belongs to a union.
Sixty-seven percent of Americans approve of unions, a Gallup poll last year showed, putting the favorability of unions near its highest level since 1965.
Still, union membership has declined. Only 10% of U.S. workers belonged to unions last year, which is little changed from the year prior, U.S. Bureau of Labor Statistics data showed. However, that figure marks a steep drop from a peak of nearly 25% in the 1950s.
The UAW’s defeat in Alabama on Friday amounts to a missed opportunity for membership gains, since a vote to join the union would have added about 5,000 workers to its membership rolls. The UAW presently has declares a membership of roughly 400,000 workers.
(NEW YORK) — The Dow Jones Industrial Average crossed 40,000 for the first time in history on Thursday.
This is a significant and symbolic milestone for the index that tracks 30 of the most valuable publicly traded companies in the U.S.
The Dow is now up about 6% so far this year.
The recent rally in the Dow, S&P 500 and Nasdaq has been fueled by data showing inflation is cooling, which would allow the Federal Reserve to begin its long-awaited interest rate cuts.
Inflation data released on Wednesday showed that price increases slowed slightly from the annual rate recorded in the previous month, ending a surge of inflation that stretches back to the beginning of 2024.
In recent months, the Fed had all but abandoned its previous forecast of three quarter-point rate cuts this year. But the slowdown of price hikes offered hope of rekindling those plans.
“The combination of the Fed likely to be lowering interest rates because inflation is moderating with a resilient economy is a beautiful scenario for a bull market,” Ed Yardeni, the president of market advisory firm Yardeni Research and former chief investment strategist at Deutsche Bank’s U.S. equities division, told ABC News.
“It’s more enjoyable to say the market is going to these nice, round numbers in record-high territory than coming back down to them,” Yardeni added.
The inflation news on Wednesday sent each of the major stock indexes up more than 5% for the day, propelling all of them to record highs. In early trading on Thursday, the Dow had ticked up a quarter of a percentage point.
Observers have also attributed this year’s stock market rally to the rise in value of some major tech firms, driven largely by enthusiasm about artificial intelligence.
