The daily business briefing: October 14, 2021
Inflation accelerates as supply shortages and high demand continue, Biden announces push to unclog ports before holidays, and more
Inflation accelerated due to supply disruptions, high demand
Inflation in the United States sped up in September, reaching its highest rate in more than a decade as the coronavirus pandemic continued to cause labor and material shortages. The Labor Department reported Wednesday that the consumer-price index jumped by 5.4 percent from a year earlier, slightly higher than in August, and the same rate seen in June and July as the economy reopened. The core price index, which factors out volatile food and energy prices, rose by 4 percent in September compared to a year earlier, the same as August's rate. On a monthly basis, the CPI increased by 0.4 percent in September, faster than August's rate of 0.3 percent. In Federal Reserve meeting minutes released Wednesday, Fed officials expressed concerns last month that supply disruptions could increase the risk of persistent high inflation.
Biden announces broad effort to unsnarl clogged ports before Christmas
President Biden on Wednesday announced agreements with the largest U.S. port, retailers, and freight haulers to expand operations in what administration officials called a "90-day sprint" to clear supply-chain bottlenecks before the crucial holiday shopping season. The Port of Los Angeles agreed to join its sister port, Long Beach, and start operating 24/7, the White House said, while Walmart, FedEx, UPS, Target, and Home Depot committed to sending more drivers to the ports in the expanded hours to remove shipping containers clogging the ports and get the products to shelves. Labor unions agreed to supply the workers. Analysts called it a good first step in resolving supply problems that have fueled rising inflation and caused random shortages of goods, but said there's only so much a U.S. president can do unsnarl a global logistical mess.
Biden administration unveils plan for more offshore wind farms
Interior Secretary Deb Haaland on Wednesday announced a Biden administration plan for putting large-scale wind farms along nearly all of the U.S. coastline. Haaland said the government would identify and eventually lease federal waters for electricity-producing offshore turbines in the Gulf of Mexico, the Gulf of Maine, and waters off the Mid-Atlantic, North and South Carolina, California, and Oregon, as well as in the New York Bight between Long Island and New Jersey. Just months ago, the administration approved the nation's first major commercial offshore wind farm off the coast of Martha's Vineyard in Massachusetts. A dozen other potential offshore wind projects are under review for other spots along the East Coast. The administration also has approved two areas off Central and North Carolina for commercial wind power.
Southwest, American stick with vaccine mandates despite Abbott ban
Texas-based Southwest and American airlines said Wednesday they would stick with requirements for their workers to get coronavirus vaccinations, despite a new executive order by Texas Gov. Greg Abbott (R) banning vaccine mandates in the state by any entity, including businesses. American Airlines, which has 102,700 employees and is based in Fort Worth, said the order "does not change anything for American." Dallas-based Southwest said it still intended to comply with the Biden administration's demand that federal contractors require workers to get vaccinated. "I've never been in favor of corporations imposing that kind of mandate," said Southwest CEO Gary Kelly. "But the executive order from President Biden mandates ... all federal contractors, which covers all the major airlines, have to have a [mandate] in place by Dec. 8."
Stock futures rise as stocks linked to recovery gain
U.S. stock index futures rose early Thursday as stocks linked to the economic recovery gained ground. Futures tied to the Dow Jones Industrial Average and the S&P 500 were up by about 0.6 percent several hours before the opening bell. Futures for the tech-heavy Nasdaq gained about 0.8 percent. Carnival led stocks that stand to gain from the recovery from coronavirus pandemic damage. Its shares jumped by 2 percent as falling COVID-19 cases fueled hopes of stronger growth. Minutes from the Federal Reserve's September policy meeting released Wednesday indicated the central bank might start tapering its efforts to boost the recovery in mid-November or mid-December. "We still think November but one month isn't going to matter to markets at this point," said Lawrence Gillum, fixed income strategist for LPL Financial.