The daily business briefing: September 27, 2018

Justin Trudeau at the UN headquarters in NYC

(Image credit: PETER FOLEY/AFP/Getty Images)

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1. Fed hikes interest rates for third time this year
2. Trump rejects Trudeau meeting to resolve trade impasse with Canada
3. U.S., Japan announce talks on a bilateral trade deal
4. Stocks struggle after Fed announcement
5. Fox to sell remaining Sky shares to Comcast for $15 billion

published 27 September 2018

1. Fed hikes interest rates for third time this year

The Federal Reserve raised interest rates on Wednesday for the third time this year and signaled support for one more rate hike this year. The quarter-point hike — the eighth since 2015 — brings the Fed's benchmark overnight interest rate of 2 percent to 2.25 percent. The U.S. central bank forecast at least three more years of economic growth and signaled that it was pressing ahead with its plans to unwind the economy-boosting policies it used to help fuel the recovery from the Great Recession. The Fed removed the word "accommodative" from its statement on its monetary policy, which some analysts interpreted as the end of an era, but Fed Chairman Jerome Powell said the removal of the word did not signal a policy change.

President Trump said Wednesday that he had rejected a one-on-one meeting with Canadian Prime Minister Justin Trudeau on resolving an impasse on revising the North American Free Trade Agreement. Trump said Canada had treated the U.S. "very badly," and that he might move forward with a new deal struck with Mexico, and leave Canada out. Trump said he didn't like Foreign Affairs Minister Chrystia Freeland, Canada's chief representative in the trade negotiations. He also said he was displeased with Canada's dairy tariffs and repeated a threat to impose new tariffs on cars made in Canada, which he said would give the U.S. a "better" deal than a new trade pact.

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The U.S. and Japan said Wednesday that they would start negotiating a bilateral trade agreement. President Trump announced the decision after talking with Japanese Prime Minister Shinzo Abe during his trip to New York for the United Nations General Assembly. Japan has pushed for a multilateral Pacific trade pact, so discussing a bilateral deal between the world's No. 1 and No. 3 economies would mark a shift. Abe resisted the talks for nearly two years, but he reconsidered after Trump threatened to hit Japan with auto tariffs. No levies will be imposed on auto exports while the talks are ongoing, Abe said.

Global stocks were mixed on Thursday following a late decline on Wall Street Wednesday after the Federal Reserve announced its third interest rate hike of 2018. Japan's Nikkei 225 fell by 0.8 percent and the Shanghai Composite Index dropped by 0.5 percent, while South Korea's Kospi gained 0.4 percent. On Wednesday, the Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite all gave up modest gains late in the day after the Fed announcement. The Dow closed down by 0.4 percent, while the S&P and Nasdaq Composite fell by 0.3 percent and 0.2 percent, respectively. On Thursday morning, U.S. futures were edging higher.

21st Century Fox announced Wednesday that it would sell its remaining stake in U.K. broadcaster Sky to Comcast for about $15 billion. The news came just days after Comcast beat out Fox in an auction for a majority stake in Sky with a $39 billion bid. Under U.K. rules, Comcast was required to offer to buy other investors' Sky shares. Fox agreed to sell most of its other assets in December to Disney for $52 billion, and Disney consented to Fox selling its 39 percent stake in Sky to Comcast. Disney said the Sky sale would reduce the debt it incurred purchasing Fox.

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Harold Maass is a contributing editor at The Week. He has been writing for The Week since the 2001 debut of the U.S. print edition and served as editor of TheWeek.com when it launched in 2008. Harold started his career as a newspaper reporter in South Florida and Haiti. He has previously worked for a variety of news outlets, including The Miami Herald, ABC News and Fox News, and for several years wrote a daily roundup of financial news for The Week and Yahoo Finance.