The daily business briefing: December 15, 2016
The Fed raises interest rates, Yahoo says 1 billion accounts exposed by data breach, and more
Fed raises interest rates for second time since 2008 financial crisis
Federal Reserve policy makers raised interest rates a quarter of a percentage point as expected on Thursday at the close of a two-day meeting. The hike, putting the federal funds rate between 0.5 percent and 0.75 percent, was just the second since the 2008 financial crisis. The last increase came in December 2015. The Fed's Open Market Committee signaled that it would step up the pace of rate increases in 2017, forecasting three more hikes next year instead of the two envisioned as of September. Fed Chairwoman Janet Yellen said the committee was adapting to expectations of Trump administration tax cuts, deregulation, and stimulus spending, but that the "very modest adjustment" to the Fed's plans on interest rates should be "understood as a reflection of the confidence we have in the progress the economy has made."
Yahoo discloses data breach potentially exposing 1 billion accounts
Yahoo said Wednesday that an August 2013 data breach might have resulted in the theft of personal data from more than 1 billion user accounts. The breach was separate from one disclosed in September that exposed information from 500 million accounts. Until the latest revelation, the earlier breach was believed to be the biggest on record. The news came as the CIA's accusation that Russia used hackers to influence the U.S. presidential election increased fears of cybercrime. "We truly are under major siege and we're unprepared for it. It really is a national emergency," said Avivah Litan, vice president at Gartner Research.
Trump promises to help tech leaders in bid to end feuding
President-elect Donald Trump met with leading Silicon Valley executives in New York on Wednesday to talk about jobs, and smooth over tensions that erupted during the presidential campaign. Trump struck a conciliatory tone, greeting the tech leaders with lavish praise and telling them his goal is "to help you folks do well." "We want you to keep going with the incredible innovation," Trump said. "There's nobody like you in the world." The executives also reportedly made nice. Jeff Bezos, CEO of Amazon and owner of The Washington Post, and a target of past Trump attacks, said he was "super excited about the possibility that this can be the innovations administration."
Mondelez shares soar after report on possible Kraft-Heinz acquisition offer
Shares of snack maker Mondelez International jumped by about 5 percent before the bell on Thursday, adding to Wednesday gains following reports that Kraft-Heinz was planning to make a takeover offer. Neither company made any immediate comment on the report, although people familiar with the matter said Kraft and Mondelez were not currently involved in talks about an acquisition. The report surprised some analysts, because Mondelez, which makes Oreo cookies, used to be a part of Kraft, but they split in 2012.
Ashley Madison dating site agrees to $1.6 million data-breach settlement
Ruby, the Canadian company that owns dating site Ashley Madison, has agreed to pay $1.6 million to settle a Federal Trade Commission investigation and state charges connected to its 2015 data breach. "This case represents one of the largest data breaches that the FTC has investigated to date, implicating 36 million individuals worldwide," FTC Chairwoman Edith Ramirez said in a statement released Wednesday announcing the settlement. Ashley Madison also will have to revamp its data security practices as part of the deal. Ruby CEO Rob Segal said the settlement "closes an important chapter" for the company.