The daily business briefing: December 15, 2022
The Fed slows its interest rate hikes, Twitter bans account tracking Elon Musk's private jet, and more
Fed slows interest rate hikes but signals more increases in 2023
The Federal Reserve on Wednesday raised its benchmark short-term interest rate by 0.5 percent, easing back after four straight 0.75 percent hikes but continuing to aggressively increase the cost of borrowing to cool the economy and bring down the highest inflation in decades. The latest change, which came at the end of a two-day policy meeting, brought the federal-funds rate to a range between 4.25 percent and 4.5 percent, the highest level in 15 years. With inflation falling slightly, Fed Chair Jerome Powell indicated after the meeting the central bank would continue raising rates but probably slow its increases further to a more common 0.25 percent hike at its next meeting, scheduled for Jan. 31-Feb. 1.
Twitter suspends account tracking Elon Musk's private jet
Twitter on Wednesday suspended the account that tracked the location of Elon Musk's private jet. Musk previously used the @ElonJet account as an example of his free speech absolutism, saying he wouldn't ban it after his $44 billion takeover of the social media platform. Musk tweeted Wednesday that the account made it easier for someone to stalk his family, and said "real-time posting of someone else's location violates doxxing policy." Twitter also blocked the personal account of Jack Sweeney, the University of Central Florida student and Musk fan who set up the account in 2020. Musk asked Sweeney to take down the account last year, even offering to buy it for $5,000, saying he didn't "love the idea of being shot by a nutcase."
Biden says U.S. 'all in on Africa's future,' countering China's rising influence
President Biden on Wednesday vowed to step up U.S. involvement in Africa, telling a group of African leaders at a summit in Washington that America is "all in on Africa's future." "African success and prosperity is essential for a better future for all of us, not just for Africa," Biden added. Biden's comments were part of an effort to boost trust among African leaders who have felt abandoned by the United States. China and Russia have capitalized on Washington's listless Africa policies, increasing their influence across the continent. Biden did not mention China by name, Politico noted, "but much of his speech was squarely aimed at starting a continental competition with that other global superpower, which has invested billions upon billions in Africa."
Stock futures fall after Fed statement
U.S. stock futures fell sharply early Thursday after the Federal Reserve's latest interest-rate hike and update on its plan to continue raising the cost of borrowing to fight high inflation. Futures tied to the Dow Jones Industrial Average and the S&P 500 were up 0.7 percent and 0.9 percent, respectively, at 6:45 a.m. ET. Nasdaq futures were down 1.3 percent. The Fed ended a two-day meeting by raising its benchmark short-term interest rate by 0.5 percent. That marked a slowdown from its four straight 0.75 percent increases, but the central bank projected a higher-than-expected terminal rate of 5.1 percent. The current range of 4.25 percent to 4.5 percent is already the highest in 15 years.
Musk sells another $3.6 billion worth of Tesla stock
Elon Musk has sold another $3.6 billion in Tesla shares, a U.S. securities filing showed Wednesday. With the most recent sale, Musk has now unloaded nearly $40 billion worth of the electric-car company's stock this year. It's the second big share sale Musk has made since completing his $44 billion deal to take over Twitter in October, although it wasn't immediately clear whether the latest move was directly linked to Twitter. Several analysts said Tesla investors are angry because it looks like Musk is focusing too much of his time and money on Twitter, at Tesla's expense. "It doesn't put a lot of confidence in the business," said Tony Sycamore, an analyst at brokerage IG Markets.