Business Highlights: Prices jump, jobless claims drop

Another jump in prices tightens the squeeze on US consumers

WASHINGTON (AP) — American consumers absorbed another surge in prices in May — a 0.6% increase over the past month and 5% over the past year, the biggest 12-month inflation spike since 2008. The May rise in consumer prices reflected a range of goods and services now in growing demand as people increasingly shop, travel, dine out and attend entertainment events in a rapidly reopening economy. The increased consumer appetite is bumping up against a shortage of components, from lumber and steel to chemicals and semiconductors, that supply such key products as autos and computer equipment, all of which has forced up prices.

US unemployment claims fall to 376,000, sixth straight drop

WASHINGTON (AP) — The number of Americans applying for unemployment benefits fell for the sixth straight week as the U.S. economy reopens rapidly after being held back for months by the coronavirus pandemic. The Labor Department reported Thursday that jobless claims fell by 9,000 to 376,000, from 385,000 the week before. The number of people signing up for benefits exceeded 900,000 in early January and has fallen more or less steadily ever since. Still, claims are high by historic standards. Before the pandemic brought economic activity to a near-standstill in March 2020, weekly applications were regularly coming in below 220,000.

Many Americans moved to less pricey housing markets in 2020

LOS ANGELES (AP) — Many Americans who moved last year relocated to areas where homes were bigger and less expensive. On average, people who moved to a different city in 2020 ended up in a ZIP code where average home values were nearly $27,000 lower than in their previous ZIP code, according to an analysis of relocation data by Zillow. People who relocated last year also moved to ZIP codes where the average home sold was 33 square feet bigger than their previous home. The data suggests many Americans used the pandemic and remote working as an opportunity to flee from expensive metropolitan areas.

As children return to classrooms, stores expect strong sales

NEW YORK (AP) — As more children go back to the physical classroom and families look to restart their lives, back-to-school spending this year is expected to top pre-pandemic levels, according to one key spending measure. Mastercard SpendingPulse, which tracks spending across all payment forms including cash, forecasts that spending will be up 5.5% between July 15 and Sept. 6. That’s compared with the year-ago period when sales rose only 1.2% as the pandemic wreaked havoc on schools’ reopening plans and back-to-school shopping. In a more telling sign of a rebound, back-to-school sales should increase 6.7% on a two-year basis, according to Mastercard SpendingPulse. The figures exclude sales from autos and gas.

Wray: FBI frowns on ransomware payments despite recent trend

WASHINGTON (AP) — FBI Director Christopher Wray says the bureau discourages ransomware payments to hacking groups even as major companies in the past month have participated in multimillion-dollar transactions aimed at getting their systems back online. Wray tells the House Judiciary Committee that there are a number of reasons why FBI policy frowns on such payments. For one, it may encourage additional cyberattacks. And it may not result in victims getting their information back. Both Colonial Pipeline and meat processing company JBS SA have revealed that they paid multimillion-dollar ransoms. In ransomware attacks, hackers lock up and encrypt a victim’s data and demand a payment in order to return it. They have proliferated in scale over the past year.

US budget deficit for current year hits record $2.1 trillion

WASHINGTON (AP) — The U.S. budget deficit hit a record $2.06 trillion through the first eight months of this budget year as coronavirus relief programs drove spending to all-time highs. The Treasury Department said Thursday in its monthly budget report that the shortfall this year is 9.7% higher than the $1.88 trillion deficit run up over the same period a year ago. The report showed that spending from October through May totaled a record $4.67 trillion, up 19.7% from the same period a year ago. Government tax revenue was up 29.1% to $2.61 trillion, compared to the same period a year ago.

New federal COVID-19 safety rules exempt most employers

NEW YORK (AP) — The Biden administration has exempted most employers from long-awaited rules for protecting workers from the coronavirus. The move has angered labor advocates who have have spent more than a year lobbying for the protections. The Labor Department included only health care workers its new emergency temporary standard. The rules require employers to draw up a virus protection plan, and tighten requirements for recording and reporting COVID-19 cases among workers. They also require employers to provide workers with paid time off for COVID-19-related absences, including getting vaccinated and recovering from side effects.

US stocks end higher, erasing weekly loss for the S&P 500

NEW YORK (AP) — Stocks closed higher Thursday, bringing the S&P 500 index to another record high and out of the red for the week. The benchmark index rose 0.5%, led by gains in health care and technology companies. The Dow Jones Industrial Average edged up 0.1%. and the Nasdaq Composite rose 0.8%. Bond yields mostly fell despite a much-anticipated report showing a big jump in inflation last month. Consumer prices rose 5% in May, the biggest year-over-year increase since 2008 and more than economists had expected. The yield on the 10-year Treasury note fell to 1.45% from 1.49% a day earlier.

The S&P 500 rose 19.63 points, or 0.5%, to 4,239.18. The Dow Jones Industrial Average gained 19.10 points, or 0.1%, to 34,466.24. The Nasdaq added 108.58 points, or 0.8%, to 14,020.33 The Russell 2000 index of smaller companies fell 15.72 points, or 0.7%, to 2,311.41.

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