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(NEW YORK) — The artificially intelligent computer KITT from Knight Rider could do it all — drive solo, speak to humans, land quips and fight crime. It was sentient, funny and self-aware. KITT was a futuristic — but fictional — TV character that had Americans in awe.

There are no KITTS in real life yet. There are, however, vehicles that can independently change lanes and maneuver in traffic. Some automakers are pushing the limits even more — evolving conveyances into personal assistants that can keep tabs on our daily routines and make conversation on those lonely and tiresome drives home.

This is the future: Your vehicle’s AI calling into work meetings when you’re running late. Offering restaurant recommendations in foreign locales. Listening to you vent about life and offering reassuring adages to get you through the day.

“We’re enhancing the layers of communication between the MBUX virtual assistant and our customers … it’s our vision of the hyper-personalized experience inside the car,” Andreas Biehl, head of user interaction concepts for Mercedes-Benz AG, told ABC News. “Our AI system — our ‘brain’ — can learn scenarios … and use that to make the right suggestions.”

He added, “We see this as a must-have experience for our customers.”

Mercedes unveiled the generative AI virtual assistant earlier this year in Las Vegas. Models that run on the upcoming MB.OS platform, such as the Concept CLA Class, will include this advanced tech, which the company calls “the most human-like interface with a Mercedes-Benz yet.”

The virtual assistant, now seen on screen via a “living” star avatar and 3D graphics, can even express four personality traits (natural, predictive, personal and empathetic) and emotions ranging from excited to sensitive, according to Mercedes. Drivers no longer have to prompt the assistant by saying “Hey Mercedes” in the cabin; the car will engage with the driver automatically and can even recognize the driver’s voice, according to Biehl.

If the MB.OS system senses that you’re stressed or unhappy — either from your tone or driving style — it may cut the conversation short or start a seat massage to relax you.

“The virtual assistant is always listening,” said Biehl. “But we have to be very careful we’re not catching the wrong things. We want to be there when we are needed.”

German automaker Volkswagen is in the process of integrating ChatGPT into its vehicles’ IDA voice assistant, which can give drivers additional information beyond the voice assistant’s current capabilities: controlling the infotainment, navigation and air conditioning.

“Enriching conversations, clearing up questions, receiving vehicle-specific information … this is part of its continuously expanding capabilities,” a company spokesperson told ABC News. “Volkswagen always strives to offer the latest technology and will continue to do so in the future.”

The spokesperson gave an example of how ChatGPT could improve the user experience: “You ask your car to find you a Thai restaurant. The car then lists numerous nearby places. You then decide you are going to cook a meal yourself so ask the car for the ingredients that are in a Thai Green Curry. ChatGPT will look that up, and you can then ask where you can buy those ingredients.”

Erik Gordon, a business professor at the University of Michigan, questioned why automakers are fixated on AI driving systems.

“Car companies are trying to differentiate themselves not on styling, not on reliability, but on features that sometimes seem more like gadgets,” he told ABC News. “Automakers think consumers are enamored with this technology. They will need to find a way to add these driver-assistance features in way that doesn’t feel like we’re giving up control.”

He argued there may be “tremendous backlash” against the idea that vehicles can act like a human passenger.

“A lot of people don’t want their car or any machine to know that much about them,” Gordon said. “I predict 9 out of 10 consumers will turn it off.”

Biehl noted that customers can disable the MBUX virtual assistant.

“Users will have full control of this,” he said. “They can always opt out.”

Kelly Funkhouser, associate director of vehicle technology at Consumer Reports, said some drivers may not be alarmed to learn that their vehicles are spying on their conversations.

“Our devices are already listening — Alexa, our Google assistants — they’re waiting to hear that ‘wakeup’ word,” she told ABC News. Companies like Mercedes “must believe there’s a benefit to consumers,” she added.

Automakers, however, have to address the larger issue: So few customers actually utilize the voice commands.

“Historically those voice commands haven’t been very good,” Funkhouser said. “The systems have definitely improved in the past several years but they’re still not perfect. Telling your car to change the heat or radio tends to annoy drivers. You have to pause [what you’re doing] to interact with the AI. It’s easier to use 1 or 2 buttons.”

Funkhouser pointed out that advancements in AI assistants come as automakers replace buttons and knobs with giant screens that can be confusing to navigate, especially while driving.

“The HMI — human machine interface — is becoming more complicated,” she said. “Having a voice assistant is not a good solution to solving the problem of distracting controls and displays. There’s a bit of consumer pushback to bring back buttons.”

Biehl, of Mercedes, said the company’s new voice assistant is an “evolutionary step” of an already “successful product in the market.”

“There’s more human-like behavior and personality traits … the driver can talk to assistant and the assistant can react in an adequate way,” he said. “The assistant makes the life of our customers easier.”

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(WASHINGTON) — Senators from both sides of the aisle warned Wednesday that TikTok endangers millions of users in the United States — as Congress continues to weigh how to protect U.S. national security amid growing concern that the Chinese social media platform is a propaganda tool that could have a lasting impact on the coming U.S. election.

“TikTok is a gun aimed at Americans’ heads,” Sen. Richard Blumenthal, D-Conn., warned following a classified briefing in the Capitol. “The Chinese communists are weaponizing information that they are constantly surreptitiously collecting from 170 million Americans and potentially aiming that information using it through algorithms at the core of American democracy.”

Days after the House overwhelmingly passed bipartisan legislation to effectively ban TikTok in the United States if its Chinese owners do not sell the app, senior officials from the FBI, Justice Department and the Office of the Director of Intelligence held a classified briefing for members from the Senate Intelligence and Commerce committees.

“TikTok is a grave national security threat to Americans. It’s a threat to your privacy and the security of your data on your phone if you use Tik Tok. It’s also a threat for Chinese Communist propaganda,” Sen. Tom Cotton, R-Ark., said. “Tik Tok and ByteDance and Chinese leaders go to great lengths to try to conceal what they’re doing. But it’s clear right there in the terms and conditions what they can do. And it’s clear from two weeks ago, how TikTok is used to try to influence American politics.”

Senators leaving the closed-door briefing also called for the relevant intelligence to be declassified.

“I will say very emphatically, the American people need and deserve to hear what we’ve just been told. Because they would be deeply frightened,” Blumenthal said. “The American people should be told everything that we heard, there is absolutely no reason to keep it secret. There are no sources or methods that may be endangered. Its analysis by our people about what the Chinese communists are doing. They know what they’re doing. We don’t need to keep secret from them what they know they are doing right now. Only the American people don’t know and they deserve to hear.”

Senate Commerce Committee Chair Maria Cantwell, a Washington State Democrat, refused to put a timeline on advancing legislation through the Senate, though her committee would be expected to take the next step by holding a markup to make potential amendments to the House-passed measure.

“We’re gonna resolve this one way or another for sure, because it’s an important issue,” Cantwell said. “This is the information age, we need some new tools.”

Sen. Ted Cruz, the ranking Republican on the Commerce Committee, urged Cantwell to hold a mark-up on the House bill “expeditiously.”

“The content on TikTok in China is pushing things like math and science and education and hard work and discipline. And here in the United States, the Chinese Communist Party is pushing things to our kids like self-harm and suicide,” Cruz, R-Texas, said. “They’re studying math and science and they’re trying to get our kids to chew on Tide pods. That is deeply concerning.”

While there were some early indications that the bill could die in the Senate, it now appears that there is momentum building to tweak the House-passed bill later this spring.

As a full-press lobbying effort continues on Capitol Hill, senators advocated for legislation that compels ByteDance, TikTok’s parent company, to divest from Chinese ownership — whether it’s an American buyer or one from a country that is not hostile to the United States, such as Iran, North Korea, China and Russia.

“U.S. companies should buy TikTok and I think that we should pass the legislation promptly that will force ByteDance to sell TikTok to a company or a big group of investors or some entity that is not under the thumb of the Chinese Communist Party,” Cotton said.

“It doesn’t have to be an American,” Sen. Marco Rubio, the top Republican on the Senate Intelligence Committee, added. “In my view, it has to be a company that is not subject to the national security laws of China.”

Even though the social media platform has faced growing scrutiny from some government officials over fears that user data could fall into the possession of the Chinese government — and that the app could be weaponized by China to spread misinformation –cybersecurity experts have told ABC News there is little evidence that TikTok has shared U.S. user data with the Chinese government or that the Chinese government has asked the app to do so.

TikTok denies security or privacy risks and says a firewall has been established to prevent that.

South Dakota Republican Sen. Mike Rounds pointed out the obvious reality that nothing will happen this week or even within the next three weeks, given the looming congressional recess that begins at the end of the week — pending an averted government shutdown this weekend.

Congress returns from a two-week spring break on April 8.

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(NEW YORK) — After months of egg prices slowly falling, the staple Easter item is on the rise again in part due to a resurgence of Highly Pathogenic Avian Influenza (HPAI) in egg-laying flocks, commonly referred to as bird flu.

Since the start of November, the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service has reported 13.64 million table egg-laying hens lost to the disease.

Table egg prices are projected to increase as a result of the recent production losses, according to the USDA’s latest Livestock, Dairy and Poultry Outlook.

Experts agreed in a 2024 Easter report and analysis from Wells Fargo Agri-Food Institute, adding that the latest wave of bird flu has made the market highly variable and unpredictable.

“Egg prices have always been volatile throughout history, but HPAI has amplified the market response because of lower supplies of eggs,” Sector Manager Kevin Bergquist told ABC News’ Good Morning America. “Until the time when the nation’s egg-laying flock size recovers from HPAI, egg prices are likely to remain very changeable from week-to-week, sometimes dramatically so.”

Prices are also “historically higher” when seasonal demand spikes as Easter nears — as kids dip hard boiled eggs into colorful dye to hide for an egg hunt.

“We expect this will probably be true again this year. Although it’s hard to say whether consumers will find sales or bargain-priced eggs before Easter at their local grocer, they may find that conventional eggs are comparatively less expensive than specialty eggs,” Bergquist said.

With much uncertainty among farmers and their flocks, Bergquist added that consumers should “expect the unexpected” while egg prices “remain highly variable for the near future.”

“Eggs are often considered an essential food item, and the demand can be inelastic at times,” he said, adding “it’s a little hard to substitute anything else when dyeing Easter eggs, right?”

According to the USDA, an outbreak of HPAI physically reduces the number of egg-laying hens, and thus the available supply of eggs to the market.

The USDA data from the latest HPAI outbreak this winter shows that bird flu “is expanding at a similar pace to the previous major outbreak” widespread in regions across the U.S.

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(NEW YORK) — Earlier this week, the California General Assembly passed a bill that alters the Golden State’s new law raising the minimum wage for fast food workers to $20 an hour, which goes into effect on April 1.

Assembly Bill 610, written by Assemblymember Chris Holden to amend the Labor Code section of Assembly Bill 1228, clarifies “the scope of fast food restaurants and fast food restaurant workers covered by its terms.”

Gov. Gavin Newsom signed AB 1228 into law last September, which will apply to fast food chains with more than 60 locations nationally beginning next month.

California bill adds exemptions for fast food restaurants raising minimum wage

AB 610 adds exemptions for a wider array of establishments that would not be considered “fast food restaurants” and therefore would not be affected by implementing increased wages if Gov. Gavin Newsom passes this new bill.

“This bill would exempt additional restaurants from the definition of ‘fast food restaurant,’ including such restaurants in airports, hotels, event centers, theme parks, museums, and certain other locations, as prescribed,” the legislation states.

Among the proposed exemptions are restaurants located in office buildings or within a campus of buildings “primarily or exclusively by a single, for-profit corporation and its affiliates” that “primarily or exclusively serves employees of that corporation or its affiliates rather than the general public” and is “part of, or subject to, a concession or food service contract covering the building, group of buildings, or campus.”

“AB 610 makes technical amendments to clarify that certain workers at restaurants that are operated in conjunction with larger enterprises, many of whom have historically established compensation and working conditions in excess of the new standards set by AB 1228, do not fall within the fast food industry covered by the law,” Holden stated in a bill analysis last month.

According to Holden, certain workers at those establishments already have unions and may be making more than the $20 minimum set to be imposed by AB 1228.

“Examples include fast food workers at San Francisco International Airport who have wages starting at $22.50 per hour, plus benefits,” he said, speaking with ABC Sacramento affiliate KXTV. “Fast food workers at casinos who make $23 per hour, plus benefits.”

Exemptions under scrutiny

The exemptions have come under scrutiny from Assembly Minority Leader James Gallagher, Senate Minority Leader Brian Jones and other Republican lawmakers in the state, who sent a letter to Newsom earlier this month asking for records to be released to learn about how certain exemptions were determined.

Gallagher voted no on AB 610 on Monday. The assembly passed the bill by a margin of 55-5, sending the bill forward to Newsom.

“I guess it was a bit of a protest vote because of how shady the process surrounding AB 1228 was,” he said, speaking with KXTV. “There’s been all these exemptions, you know, the one that got the most attention was Panera-gate.”

Under the new law, any establishment that “operates a bakery that produces for sale on the establishment’s premises bread” is exempt from the $20 minimum, so long as it “produces for sale bread as a stand-alone menu item,” but not “if the bread is available for sale solely as part of another menu item.”

The carve-out attracted criticism after Bloomberg News reported in late February that Newsom had allegedly pushed for the exemption to benefit one of his political donors, Greg Flynn, who is a Panera Bread franchisee in the state.

Last month, a spokesperson for Newsom told the Los Angeles Times that Panera would not be exempt from the $20 minimum.

The rep called the Bloomberg report “absurd” and told the LA Times that after its legal team reviewed the legislation, “it appears Panera is not exempt from the law” as the restaurant’s bread dough is mixed off-site.

In a press conference on Sept. 28, 2023, Newsom also stated that carving out the exemption for bakeries was just part of “the sausage making” in politics.

A representative for Newsom did not immediately respond to ABC News’ request for comment.

Flynn, meanwhile, has denied requesting any special carve-outs, telling CNN in a statement that his restaurant locations will raise the minimum pre-tip wage to $20, regardless of any exemptions.

“At Flynn Group, we are in the people business and believe our people are our most valuable assets. Our goal is to attract and retain the best team members to deliver the restaurant experience our guests know and love,” he said.

ABC News has reached out to Flynn for additional comment.

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(NEW YORK) — The UnitedHealth Group — one of the nation’s largest health care providers — said it is making progress in its recovery from one of the worst cyberattacks on a health care system in United States history, its CEO said earlier this week.

On Feb. 21, UnitedHealth Group announced a hacking group called ALPHV — also known as “BlackCat” — breached its system. Its subsidiary Change Healthcare was hit hardest by the attack.

“Change Healthcare can confirm we experienced a cybersecurity issue perpetrated by a cybercrime threat actor who has represented itself to us as ALPHV/Blackcat,” according to a statement on UnitedHealth Group’s website.

Change Healthcare processes 15 billion health care transactions annually and touches 1 in every 3 patient records, according to a letter sent to the U.S. Department of Health and Human Services from the American Hospital Association. 

“These transactions include services that directly affect patient care and pharmacy operations,” and the attack “imposed significant consequences on hospitals and the communities they serve,” according to the letter.

Pharmacy, medical claims, and payment systems were targeted by the attack.

Change Healthcare will release medical claims software, which will be available to thousands of customers over the next several days. The company restored its electronic payments platform and 99% of its pharmacy network services are back, according to the statement from UnitedHealth Group.

UnitedHealth Group CEO Andrew Witty said in a statement Monday that it is continuing to “make significant progress in restoring the services impacted by this cyberattack.”

“We know this has been an enormous challenge for health care providers and we encourage any in need to contact us,” Witty said.

The company has paid more than $2 billion to assist health-care providers who’s finances have been impacted by the attack, Witty said.

Last week, the Department of Health and Human Services Office of Civil Rights said it is investigating the breach.

“Given the unprecedented magnitude of this cyberattack, and in the best interest of patients and health care providers, OCR is initiating an investigation into this incident,” a letter written by OCR’s Director Melanie Fontes Rainer. “OCR’s investigation of Change Healthcare and UHG will focus on whether a breach of protected health information occurred and Change Healthcare’s and UHG’s compliance with the HIPAA Rules.”

The American Hospital Association called the cyberattack “the most significant and consequential incident of its kind against the U.S. healthcare system in history.” The association said that the attack made it challenging for hospitals to provide patient care, complete prescriptions, submit insurance claims, and receive payment.

Some of BlackCat’s operations were disrupted by the FBI in December of 2023, and was responsible for such hacks as the MGM hack which shut down operations primarily along the Las Vegas strip at MGM properties.

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(NEW YORK) — Some of the world’s largest companies and richest people are fighting over a question that will help shape the future of AI: Should firms reveal exactly how their products work?

Elon Musk, the CEO of Tesla and SpaceX, upended the debate in recent days by opting to release the computer code behind his AI chatbot, Grok.

The move contrasts with the approach taken by OpenAI, the company behind popular AI text bot ChatGPT. OpenAI, part owned by tech giant Microsoft, opted to release comparatively few details about the latest algorithm behind its products.

Elon Musk did not respond to ABC News’ request for comment. Neither did OpenAI.

In a statement earlier this month, OpenAI rebuked claims that the company has kept its AI models secret.

“We advance our mission by building widely-available beneficial tools. We’re making our technology broadly usable in ways that empower people and improve their daily lives, including via open-source contributions,” the company said. “We provide broad access to today’s most powerful AI, including a free version that hundreds of millions of people use every day.”

Here’s what to know about Grok, why Elon Musk disclosed the computer code and what it means for the future of AI:

What is Musk’s AI chatbot, Grok?

Last year, Musk launched an artificial intelligence company called xAI, vowing to develop a generative AI program that competes with established offerings like ChatGPT.

On several occasions, Musk has warned against risks of political bias in AI chatbots, which help shape public opinion and risk the spread of misinformation.

However, content moderation itself has become a polarizing topic and Musk has voiced opinions that place his approach within that hot-button political context, some experts previously told ABC News.

In November, xAI debuted an early version of its first product, Grok, which responds to user prompts with humorous comments modeled on the classic sci-fi novel Hitchhiker’s Guide to the Galaxy.

Grok is powered by Grok-1, a large language model that generates content based on statistical probabilities learned from scanning vast amounts of text.

To access Grok, users must first purchase a premium subscription to X, the social media platform owned by Musk.

“We believe that it is important to design AI tools that are useful to people of all backgrounds and political views. We also want to empower our users with our AI tools, subject to the law,” xAI said in a blog post in November. “Our goal with Grok is to explore and demonstrate this approach in public.”

Why did Musk make the code openly available?

The decision to release the code behind Grok touches on two issues important to Musk: The threat posed by AI and an ongoing battle with rival company OpenAI.

For years, Musk has warned that AI risks significant societal harm. In 2017, he tweeted: “If you’re not concerned about AI safety, you should be.” And more recently, in March 2023, he signed onto an open letter warning of the “​​profound risks to society and humanity” posed by AI.

In remarks on Sunday, Musk appeared to frame the open-source decision as a means of ensuring transparency, protecting against bias and minimizing the danger posed by Grok.

“Still work to do, but this platform is already by far the most transparent & truth-seeking,” Musk said in a post on X.

The move also relates directly to a public feud between Musk and OpenAI.

Musk, who co-founded OpenAI but left the organization in 2018, sued OpenAI and its CEO Sam Altman earlier this month, alleging the company abandoned its mission of benefiting humanity in a sprint toward profits.

Days after filing the lawsuit, Musk said on X that he would drop the case if OpenAI changed its name to “ClosedAI.”

In a statement earlier this month, OpenAI said it plans to move to dismiss all of Musk’s legal claims.

“As we discussed a for-profit structure in order to further the mission, Elon wanted us to merge with Tesla or he wanted full control. Elon left OpenAI, saying there needed to be a relevant competitor to Google/DeepMind and that he was going to do it himself. He said he’d be supportive of us finding our own path,” OpenAI said.

What are the stakes of the fight over open vs. closed source AI?

The debate over whether to release the computer code behind AI products divides along two competing visions of how to limit harm, remove bias and optimize performance.

On the one hand, proponents of open source say that publicly available code allows a wide community of AI engineers to identify and fix flaws in a system, or tailor it for a purpose separate from its originally intended function.

In theory, the open-source code offers programmers an opportunity to improve the security of a given product while ensuring accountability by making everything visible to the public.

“Whenever somebody’s creating a piece of software, there can be bugs that can be exploited in ways that can cause security vulnerabilities,” Sauvik Das, a professor at Carnegie Mellon University who focuses on AI and cybersecurity, told ABC News. “It doesn’t matter if you’re the most brilliant programmer in the world.”

“If you open source, then you have an entire community of practitioners who poke holes and gradually over time build up patches and defenses,” Das added.

By contrast, supporters of closed source argue that the best way to safeguard AI is to keep the computer code private so it stays out of the hands of bad actors, who might repurpose it for malicious ends.

Closed-source AI also affords a leg up to companies who may want to capitalize upon advanced products unavailable to the wider public.

“The closed-source systems are more difficult to redeploy for nefarious reasons simply because they already exist and there are only certain things you can do with them,” Kristian Hammond, a professor of computer science at Northwestern University who studies AI, told ABC News.

Last month, the White House announced it was requesting public comment on the benefits and dangers of open-source AI systems. The move came as part of a sweeping set of AI rules issued by the Biden administration through executive order in October.

Das, of Carnegie Mellon, said the open-source release by Musk may be motivated by both public and personal interests but the move has sparked a much-needed conversation about this facet of AI safety.

“Even if the motives aren’t necessarily totally pure, the fact that this is raising public consciousness around this idea of open versus closed — and the benefits versus the risks of both — is exactly what we need in society right now in order to raise public awareness,” Das said.

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(WASHINGTON) — The Federal Reserve held interest rates steady on Wednesday, opting to keep rates highly elevated as progress toward lower inflation has stalled. The move pushes back rate cuts that the central bank expects to make some time this year.

The Fed Funds rate remains between 5.25% and 5.5%, matching its highest level since 2001.

The decision arrives roughly a week after fresh inflation data showed inflation ticked up in February, the latest sign that progress toward cooling prices had struck a rough patch.

Inflation has fallen significantly from a peak of 9.1% but it remains more than a percentage point higher than the Fed’s target rate of 2%.

The move affords the Fed additional time to observe price movements before going forward with interest rate cuts.

Addressing House members at the Capitol earlier this month, Fed Chair Jerome Powell reaffirmed the Fed’s plans to cut rates this year but cautioned that the central bank first wants to see inflation fall lower.

“The economic outlook is uncertain, and ongoing progress toward our 2% inflation objective is not assured,” Powell told lawmakers.

This is the fifth meeting in a row at which the Fed has left rates unchanged, marking a prolonged pause of the aggressive rate hiking cycle that started in March 2022. The next rate decision will take place at the beginning of May.

Alongside stubborn inflation, the economy has largely defied expectations of a slowdown imposed by elevated borrowing costs. That combination of elevated price increases and stronger-than-expected economic performance puts the central bank in a difficult position.

Interest rate cuts would lower borrowing costs for consumers and businesses, potentially triggering a burst of economic activity through greater household spending and company investment.

But the Fed risks a rebound of inflation if it cuts interest rates too quickly, since stronger consumer demand on top of solid economic activity could lead to an acceleration of price increases.

U.S. job gains far exceeded expectations in February, U.S. Bureau of Labor Statistics data earlier this month showed.

The U.S. added 275,000 jobs in February, surpassing predictions of about 200,000 jobs added, but marking a substantial decline from the hiring of roughly 350,000 workers in January, according to BLS data.

The S&P 500 — the index that most people’s 401(k)’s track — reached a record high earlier this month.

Attitudes about the economy have improved in recent months. Consumer sentiment inched lower in February but preserved much of the large gains achieved in previous months, a University of Michigan survey found.

Still, some areas of the economy have cooled.

The housing market has slowed substantially due in large part to soaring mortgage rates.

The average interest rate for a 30-year fixed mortgage has soared to 6.74%, rebounding after a steady decline at the end of last year, according to a report from Freddie Mac on Thursday.

Taken together, economic performance has not shaken the Fed’s steadfast pursuit of lowering inflation down to its goal of 2%, Powell told federal lawmakers last week.

“We remain committed,” Powell said.

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(WASHINGTON) — The Federal Reserve is set to announce an interest rate decision on Wednesday, revealing its latest move in a yearslong battle to dial back price increases.

The decision arrives roughly a week after fresh inflation data showed inflation ticked up in February, the latest sign that progress toward cooling prices had struck a rough patch.

Inflation has fallen significantly from a peak of 9.1% but it remains more than a percentage point higher than the Fed’s target rate of 2%.

The Fed is expected to leave interest rates unchanged at its meeting on Wednesday, keeping borrowing costs at their current level of between 5.25% and 5.5%, the highest level since 2001.

The move would afford the Fed additional time to observe price movements before undertaking interest rate cuts expected later this year.

Addressing House members at the Capitol earlier this month, Fed Chair Jerome Powell reaffirmed the Fed’s plans to cut rates this year but cautioned that the central bank first wants to see inflation fall lower.

“The economic outlook is uncertain, and ongoing progress toward our 2% inflation objective is not assured,” Powell told lawmakers.

Alongside stubborn inflation, the economy has largely defied expectations of a slowdown imposed by elevated borrowing costs. That combination of elevated price increases and stronger-than-expected economic performance puts the central bank in a difficult position.

Interest rate cuts would lower borrowing costs for consumers and businesses, potentially triggering a burst of economic activity through greater household spending and company investment.

But the Fed risks a rebound of inflation if it cuts interest rates too quickly, since stronger consumer demand on top of solid economic activity could lead to an acceleration of price increases.

U.S. job gains far exceeded expectations in February, U.S. Bureau of Labor Statistics data earlier this month showed.

The U.S. added 275,000 jobs in February, surpassing predictions of about 200,000 jobs added, but marking a substantial decline from the hiring of roughly 350,000 workers in January, according to BLS data.

The S&P 500 — the index that most people’s 401(k)’s track — reached a record high earlier this month.

Attitudes about the economy have improved in recent months. Consumer sentiment inched lower in February but preserved much of the large gains achieved in previous months, a University of Michigan survey found.

Still, some areas of the economy have cooled.

The housing market has slowed substantially due in large part to soaring mortgage rates.

The average interest rate for a 30-year fixed mortgage has soared to 6.74%, rebounding after a steady decline at the end of last year, according to a report from Freddie Mac on Thursday.

Taken together, economic performance has not shaken the Fed’s steadfast pursuit of lowering inflation down to its goal of 2%, Powell told federal lawmakers last week.

“We remain committed,” Powell said.

Copyright © 2024, ABC Audio. All rights reserved.

(NEW YORK) — The push in Washington, D.C., for a potential TikTok ban has drawn mounting scrutiny toward the app over data privacy risks tied to Chinese-owned parent company ByteDance.

In making their case, some critics point to an allegedly tamer version of the app in China, suggesting that ByteDance unleashed a more potent product in the U.S. to hook consumers and vacuum up their data.

Experts who spoke to ABC News, however, downplayed the content-related differences between TikTok and its Chinese counterpart, Douyin, saying the distinctions largely owe to stiff regulations in China centered on youth social media use and political dissent.

The differences between the two apps highlight a comparatively permissive legal environment for social media in the U.S., protecting free expression but also leaving some users — especially young ones — vulnerable to addictive behavior, the experts said.

TikTok did not immediately respond to ABC News’ request for comment. In response to a previous request, TikTok condemned the push for a possible U.S. ban as an infringement on the right to express oneself freely.

“This legislation has a predetermined outcome: a total ban of TikTok in the United States. The government is attempting to strip 170 million Americans of their Constitutional right to free expression. This will damage millions of businesses, deny artists an audience and destroy the livelihoods of countless creators across the country,” a TikTok spokesperson said.

TikTok has faced growing scrutiny over fears that user data could fall into the possession of the Chinese government and the app could be weaponized by China to spread misinformation.

There is little evidence that TikTok has shared U.S. user data with the Chinese government or that the Chinese government has asked the app to do so, cybersecurity experts previously told ABC News.

The version of Douyin used by Chinese adults resembles U.S.-based TikTok, except for some propaganda in favor of the Chinese Communist Party and a lack of alternative viewpoints on hot-button topics, said Kaiser Kuo, the host of “Sinica Podcast,” a U.S.-based podcast on current affairs in China.

“It’s essentially the same stuff,” Kuo told ABC News. “It’s shredding guitarists and funny skits. People showing off the material accouterments of life. People doing clever recipes.”

“It’s people doing dance moves or unboxing or whatever the hell you find on TikTok here you find there, except that it’s censored,” Kuo added.

More noticeable differences between TikTok and Douyin arise when the respective apps are looked at through the lens of young users, some experts said. In the U.S., children experience the same version of TikTok as adults, while children in China see a modified version of Douyin that includes more educational content, they said.

In recent years, China has cracked down on internet use among children. In 2021, the Chinese government enacted a law calling for “the creation and broadcast of online content conducive to the healthy growth of minors.”

That same year, Douyin imposed a 40-minute daily limit for users under 14. Last year, Chinese regulators introduced a rule that would limit children under age 18 to two hours of smartphone screen time each day.

“There are very different laws about how companies in China can target children,” Aynne Kokas, a professor of media studies at the University of Virginia and author of Trafficking Data: How China is Winning the Battle for Digital Sovereignty, told ABC News.

“The U.S. regulatory environment is highly permissive and allows for profoundly addictive apps to emerge,” Kokas added.

Due to comparatively strict data privacy regulations in China, ByteDance accesses less user data from Douyin than from TikTok, Kokas said. However, she added, Chinese privacy protections limiting corporate conduct do not bar the government from accessing a wealth of data.

“That’s a really important caveat,” Kokas said.

While Congress has yet to regulate youth social media use, lawmakers in some states have begun to push for reforms. In June, Connecticut amended its data privacy law to mandate online platforms undertake child safety assessments and assist young users in staying away from damaging posts. Legislators in a handful of states have followed suit with similar proposals.

Mark Jia, a professor of Law at Georgetown University Law Center, pointed out “substantial similarities” between TikTok and Douyin overall, except for some differences tied to e-commerce and search functions.

But, he added, a prevalence of educational content on the youth version of TikTok likely stems from strict regulations and demand for such videos among children preparing for high-stakes, competitive exams.

The content on the children’s version of Douyin results from “top-down pressure from authorities, as well as bottom-up demand from its users,” Jia said.

While acknowledging similarities between TikTok and Douyin, experts who spoke to ABC News differed over the threat to U.S. security posed by TikTok.

Kokas, of the University of Virginia, said dependence upon TikTok for U.S. economic activity and political dialogue could end up “fundamentally destabilizing.” By contrast, Kuo, of the “Sinica Podcast,” dismissed the backlash against TikTok as a “moral panic.”

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(NEW YORK) — Easter is on the horizon, but the price of chocolate may leave a bitter aftertaste for some people leading up to the sweet holiday.

Two popular chocolate brands recently indicated they may raise prices on products again due to the rising cost of cocoa, which has gone up following torrential rain in major cocoa-growing regions that affected production.

Executives from Hershey and Cadbury each pointed to possible additional price hikes in recent earning calls, identifying rising cocoa costs as a main culprit behind the increases.

“Given where cocoa prices are, we will be using every tool in our toolbox, including pricing, as a way to manage the business,” said Michele Buck, president and CEO of the Hershey Company, in a Feb. 8 earnings call.

Hershey has already raised prices on some grocery and food service items this year, with the latest increase last month, according to executives.

Mondelēz International, the company behind Cadbury chocolates, announced the possibility of a similar price hike for its products in a fourth quarter earnings call in late January.

Dirk Van de Put, CEO of Mondelēz International, called rising cocoa prices one of the “issues” on the company’s mind and identified the “need to price as needed.”

According to Van de Put, the price of Mondelēz chocolate increased 12% to 15% in Europe last year.

ABC News has reached out to Mondelēz International and The Hershey Company for comment on the possible price increases.

The price of cocoa had skyrocketed to around $8,000 per metric ton as of Monday, more than doubling the price of cocoa from one year ago, according to Trading Economics.

In February, the International Cocoa Organization issued its first quarterly predictions for the year, forecasting “significant declines in [cocoa] production” due to “unfavourable weather conditions and diseases.”

It also noted that “old trees in these countries are producing with lower yields.”

“The low availability of cocoa beans has led to significant increases in cocoa prices. With costs of raw materials increasing, this is likely to affect the operations of processors,” the organization stated.

“Compared to the 2022/23 season, global cocoa supply is anticipated to decline by almost 11% to 4.449 million tonnes. Global cocoa demand is projected to decrease by almost 5% to 4.779 million tonnes,” the organization noted.

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