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Latest inflation figures are good news – even if they give a lot of people heartburn • New Hampshire Bulletin

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Latest inflation figures are good news – even if they give a lot of people heartburn • New Hampshire Bulletin


The U.S. economy is slowing, but not crashing. In the dismal science, this is what counts as good news.

That’s the message I took away from the latest inflation data, released May 15, 2024, which showed U.S. consumer prices rising 3.4 percent in the 12 months to April 2024. This is down slightly from the 3.5 percent year-over-year increase reported in March 2024.

In other words, while prices are rising, they’re not going up as sharply as they once were. That’s good news for shoppers; the U.S. economy is far from the 9.1 percent annual inflation seen in June 2022.

While energy and shelter prices increased in April, these gains were relatively modest. Meanwhile, food prices remained steady compared to last year and even declined by 0.2 percent compared to March. What’s more, people in the market for a car were in luck: New and used vehicle prices fell 0.4 percent and 6.9 percent, respectively, in April.

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The “core” consumer price index – which doesn’t include volatile food and energy prices and is often considered better at predicting future inflation than so-called “headline” CPI figures – is also down slightly. After posting a year-over-year increase of 3.9 percent in January and 3.8 percent in February and March, it slowed to 3.6 percent in April.

So the overall report is relatively positive: It didn’t show the uptick in inflation that many consumers feared, and reported inflation rates were actually slightly lower than market expectations.

As an economist, I see this data report as yet more evidence that economic growth is slowing – in a good way. The economy grew at a lower-than-expected 1.6 percent rate in the first quarter of 2024, according to the most recent gross domestic product data from the Bureau of Economic Analysis. The most recent jobs report also showed a slowdown in hiring, and the latest data on job vacancies similarly showed the labor market cooling off.

Why the Fed is paying close attention

The Federal Reserve’s main objective is to strike a balance between two goals: maintaining stable employment and ensuring price stability. It does this by managing and influencing interest rates.

Lowering rates stimulates the economy, which encourages economic growth and job creation – but that can fuel inflation. Raising rates does the opposite: Economic growth slows, which dampens inflation, but also hinders employment.

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So, when inflation started increasing dramatically after the COVID-19 pandemic, the Federal Reserve responded with a two-year campaign of rate hikes – they’re currently at a 23-year high. Since this raises the cost of borrowing, investors and potential homebuyers are keen for the Fed to dial back its rates.

After May’s report, I don’t believe the Federal Reserve will be in any rush to cut interest rates from their current elevated level. There’s a slowdown, to be sure, but the slowdown is so steady that it’s not pulling prices down in any rapid fashion.

This is no doubt frustrating for the Fed – which has an inflation target of 2 percent – as well as for potential homebuyers. But it’s evidence that the economy is stable at the moment. Inflation isn’t surging, and consumer spending, according to the Bureau of Economic Analysis, is still growing. In March, consumer spending increased 5.8 percent year over year, up from February’s 4.9 percent rate.

All eyes on the American shopper

Going forward, hopes for a “soft landing” – economist-speak for when the Fed slows inflation without triggering a recession – will depend in large measure on U.S. shoppers. Consumer spending makes up roughly two-thirds of U.S. gross domestic product.

If American shoppers suddenly stop spending, then inflation will slow considerably, job vacancies will evaporate, and gross domestic product could contract. At that point, the Fed will turn attention away from inflation and toward economic stimulus, and rates will fall.

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I mention this because a recent report by the Federal Reserve Bank of St. Louis showed a troubling uptick in consumer credit card delinquency rates. If much of the recent increase in consumer spending is due to Americans relying more on credit cards, then the economy could be on shakier ground than it appears.

The good news is that delinquency rates are still way below where they were ahead of the Great Recession, which lasted from December 2007 through June 2009. So, while this data may be troubling, there’s no need to panic just yet.

In short, while inflation rates still aren’t to the Fed’s liking, the economy – for now – appears to be on a stable path.The Conversation

This article is republished from The Conversation under a Creative Commons license. Read the original article.



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New Hampshire

FAA investigating after small plane crashes into New Hampshire condominiums

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FAA investigating after small plane crashes into New Hampshire condominiums


NASHUA, N.H. (AP) — A pilot was taken to the hospital with injuries Wednesday after a small plane crashed into a residential neighborhood in southern New Hampshire, authorities said.

Emergency crews found the aircraft upside down in a snow bank in the parking lot of a wooded condominium complex in Nashua Wednesday afternoon.

Police said the pilot was the only person on board and was the only person injured. The Federal Aviation Administration is investigating.

The Velocity V-Twin plane crashed at the Cannongate Condominiums shortly after departing from the nearby Nashua Airport around 2:10 p.m. local time, according to the FAA.

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Aerial video from NBC10 Boston showed damage to the roof of one of the condos near the crash site.



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New Hampshire

Brown University shooting suspect found dead in New Hampshire

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Brown University shooting suspect found dead in New Hampshire


NEW YORK (Gray Media) – Thursday night Law enforcement officials confirmed the suspect in last Saturday’s shooting at Brown University was found dead. Claudio Manuel Neves Valente, the man suspected of killing two Brown students and injuring nine, was found dead from a self-inflicted gunshot wound in Salem, NH. Officials believe the 48-year-old former Brown student was also connected to the killing of an MIT professor earlier this week.

Neves Valente was a student in the early 2000s at Brown and a fellow student of Dr. Nuno Loureiro, the MIT professor. His motive was unknown, but university officials said he likely spent a lot of time in the building where he carried out the attack.

A six-day manhunt led law enforcement to a storage unit where they found Neves Valente, who came to the U.S. from Portugal originally on a student visa, eventually receiving a green card to stay in the country. Rhode Island’s Attorney General Peter Neronha said tips from the public were crucial in finally identifying the suspect.

“When you do crack it, you crack it. And that person led us to the car. Which led us to the name. Which led us to the photographs of that individual renting the car, which matched the clothing of our shooter here in Providence,” said Neronha.

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In response to the tragedy and ensuing investigation, President Donald Trump paused the diversity visa lottery program the suspect used to get a green card. Some 50,000 visas per year are granted to students from countries with low rates of immigration to the US.



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Electioneering accusation against high-ranking N.H. Democrat cleared – The Boston Globe

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Electioneering accusation against high-ranking N.H. Democrat cleared – The Boston Globe


The New Hampshire Attorney General’s Office has closed a complaint after finding that Executive Councilor Karen Liot Hill did not engage in illegal electioneering.

At issue were a series of emails Liot Hill, a Lebanon Democrat, had sent from her official government account to help the partisan Elias Law Group connect with voters impacted by a new state voting law.

Republican lawmakers said that was an inappropriate use of official resources, threatening to impeach Liot Hill over her correspondence. James MacEachern, chairman of the New Hampshire Republican State Committee, reported his concerns to the Attorney General’s Office in August.

In August, the Elias Law Group, which represents Democrats and progressive causes, represented three visually-impaired plaintiffs who sued New Hampshire officials over the constitutionality of a new law that would tighten photo ID requirements for voters seeking an absentee ballot. That case was recently dismissed by a New Hampshire Superior Court judge.

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This week, the Attorney General’s Election Law Unit released its determination that Liot Hill’s emails did not constitute illegal electioneering, in a Dec. 18 letter to MacEachern.

The Election Law Unit said it reviewed five emails from Liot Hill’s official government account that MacEachern had provided.

It found the content of the emails did not meet the state’s definition of electioneering, “because it does not relate in any way to ‘the vote of a voter on any question or office,’ i.e., something to be voted on at an election,” Brendan A. O’Donnell, senior assistant attorney general in the Election Law Unit, said in the letter.

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“Moreover, it is not uncommon for elected officials to use their official capacity to take a position on the constitutionality of an enacted law that is being challenged in court,” O’Donnell said.

However, the letter noted that Liot Hill’s emails did raise the risk that its recipients — including two executive branch officials — could interpret her requests for help as commands.

“All executive branch officials should use care to avoid acting in any way that would create an appearance of impropriety,” said O’Donnell.

But, he continued, his office did not find in this case that there had been a misuse of position or that the emails otherwise violated the executive branch ethics code.

MacEachern said he still has concerns about Liot Hill, when reached for comment on the Election Law Unit’s findings.

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“This report, among others, continues to raise serious questions about Councilor Liot-Hill’s judgement and brazen willingness to push ethical boundaries with her conduct,” he said in an email.

But Liot Hill said the findings “underscore the partisan nature of the ongoing attacks” against her, including the impeachment proceedings Republicans have failed against her.

“I am being impeached not for wrong-doing, but for being a Democrat,” she said in an email.


Amanda Gokee can be reached at amanda.gokee@globe.com. Follow her @amanda_gokee.





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