The daily business briefing: January 31, 2023

Ford Motor Co. announced Monday it was cutting prices on its Mustang Mach-E electric crossover vehicles by up to $5,000. The move escalated an EV price war days after Tesla, which dominates the EV market, slashed prices on some vehicles by as much as 20 percent. "We are not going to cede ground to anyone," Marin Gjaja, a top Ford EV executive, said in a statement. Ford's Mach-E prices will range from roughly $46,000 to $64,000. Tesla Model Y prices now start as low as $53,500 without any options. Just five months ago, Ford announced it was hiking Mach-E prices by as much as $8,300 in 2023.

The International Monetary Fund on Monday upgraded its projections for economic growth in 2023 and 2024. The IMF said in its World Economic Outlook report that interest-rate hikes by central banks to curb high inflation would slow the global economy as intended, but that resilient consumers and China's reopening economy would help avoid a previously anticipated global recession. The fund warned that threats remained, particularly if central banks change course too soon. "The fight against inflation is starting to pay off, but central banks must continue their efforts," Pierre-Olivier Gourinchas, the IMF's chief economist, wrote in an essay accompanying the report.

A federal appeals court on Monday rejected Johnson & Johnson's effort to use a subsidiary created in October and placed in Chapter 11 bankruptcy proceedings to handle more than 38,000 lawsuits alleging that the company's talc products caused cancer. The U.S. 3rd Circuit Court of Appeals ruled that J&J improperly declared the subsidiary to be in need of bankruptcy protection even though it wasn't really in financial distress. Before the bankruptcy, Johnson & Johnson, which says its talc products are safe, faced $3.5 billion in verdicts and settlements over its talc products, including baby powder. Plaintiffs in the case said the company was improperly trying to manipulate the bankruptcy system to block lawsuits. The decision will let litigation against the company resume.

Twenty-four Senate Republicans, nearly half the GOP conference, has signed a letter expressing "outright opposition" to any effort to raise the debt limit that isn't linked to spending cuts. The letter, led by conservative Sens. Mike Lee (R-Utah) and Ted Budd (R-N.C.), said any deal must include "real structural spending reform that reduces deficit spending and brings fiscal sanity back to Washington." House Majority Leader Kevin McCarthy (R-Calif.) says he is meeting with President Biden on Wednesday to discuss the debt limit. Ben Harris, the Treasury Department's assistant secretary for economic policy, warned that "just the threat that the U.S. government might fail to meet its obligations may cause severe harm to the economy."

U.S. stock futures fell early Tuesday but Wall Street remained on track for its best January since 2019. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down 0.4 percent and 0.5 percent, respectively, at 6:30 a.m. ET. Nasdaq futures were down 0.7 percent. The three main U.S. indexes fell sharply on Monday. The Dow and the S&P 500 dropped 0.8 percent and 1.3 percent, respectively. The tech-heavy Nasdaq plunged 2.0 percent. Investors are watching a flurry of earnings reports from major companies this week. General Motors shares jumped 3 percent in premarket trading after the automaker released a stronger-than-expected quarterly report. The Federal Reserve on Tuesday starts a two-day meeting expected to end with a quarter-percentage-point interest rate hike.