Why Everyone Is Flocking To North Carolina’s Tech Hub

Will the U.S. allow Nvidia chip exports to Saudi Arabia?

How an ‘accidental businesswoman’ transformed one of Singapore’s oldest companies

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP-820x461.jpeg" alt="" class="wp-image-529707" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP.jpeg 1600w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



Inflation in August declined to its lowest level since February 2021, according to a Labor Department report Wednesday that also showed a key measure higher than expected, setting the stage for an expected quarter percentage point rate cut from the Federal Reserve.



The consumer price index, a broad measure of goods and services costs across the U.S. economy, increased 0.2% for the month, in line with the Dow Jones consensus, the Bureau of Labor Statistics reported.



That put the 12-month inflation rate at 2.5%, down 0.4 percentage point from the July level, slightly below the estimate for 2.6% and at its lowest level in 3½ years.



However, the core CPI, which excludes volatile food and energy prices, increased 0.3% for the month, slightly higher than the 0.2% estimate. The 12-month core inflation rate held at 3.2%, in line with the forecast.



The slight uptick in core CPI keeps the Fed on defense against inflation, likely negating the probability of a more aggressive interest rate when policymakers meet next Tuesday and Wednesday.



“This isn’t the CPI report the market wanted to see. With core inflation coming in higher than expected, the Fed’s path to a 50 basis point cut has become more complicated,” said Seema Shah, chief global strategist at Principal Asset Management.



Stocks slumped following the report, while Treasury yields were mixed. However, the market rebounded later in the day, recouping its losses as the major averages all turned positive.



In the fed funds futures market, traders priced in an 85% chance that the Federal Open Market Committee will approve a quarter percentage point, or 25 basis point, interest rate reduction when its meeting concludes Sept. 18, according to the CME Group’s FedWatch measure. A month ago, markets were leaning towards a 50 basis point cut.



“The number is certainly not an obstacle to policy action next week, but the hawks on the committee will likely seize on today’s CPI report as evidence that the last mile of inflation needs to be handled with care and caution – a formidable reason to default to a 25 basis points reduction,” Shah added.



While the numbers showed that inflation slowly continued to moderate, housing-related costs remain an issue. The shelter component of the CPI, which has about a one-third weighting in the index, climbed 0.5%, accounting for about 70% of the core increase. The shelter index was up 5.2% year over year.



Food prices rose just 0.1%, while energy costs slid 0.8%.



Elsewhere in the report, used vehicle prices decreased 1%, medical care services declined 0.1% and apparel prices increased 0.3%. Egg prices rose 4.8%.



Real earnings also increased for the month, with average hourly earnings outpacing the monthly CPI increase by 0.2%, the BLS said in a separate release. On a 12-month basis, inflation-adjusted average hourly earnings rose 1.3%.



The Fed’s attention of late, however, has turned to a slowing labor market. Job creation since April has slowed to nearly half what it was in the prior five months. Central bankers are saying that preventing a broader slowdown is now about as important as the fight against inflation, which in the summer of 2022 hit its highest level in more than 40 years.



Regardless of what the Fed decides when its meeting concludes next Wednesday, markets already are pricing in lower rates. Treasury yields, particularly at the 2- and 10-year duration, are at their lowest levels in more than a year. A recession indicator known as an inverted yield curve has reversed recently, a move that often portends both rate cuts from the Fed as well as a slowdown in the economy.



Wednesday’s report offered more evidence that inflation is waning, though it remains above the Fed’s 2% goal. There are pockets where prices either stayed elevated or turned higher.



“Although inflation has eased, it does not mean that the prices of things that people buy have actually fallen,” said Lisa Sturtevant, chief economist at Bright MLS. “It just means that prices are not increasing as fast. In fact, U.S. consumers now are paying more than 20% more for goods and services than they were before the pandemic.”



Airline fares, for instance, increased 3.9% in August after falling the previous five months. Motor vehicle insurance also continued its trek higher, rising 0.6% to push the 12-month increase to 16.5%. Hospital and related services costs jumped 0.4% and are up 5.8% from last year.



At the same time, a pullback in energy costs has helped bring down inflation figures. Gasoline was off 0.6% in August and is down 10.3% from a year ago, part of a 4% slide in the energy index that has included a 12.1% tumble for fuel oil prices.

108032514-1726060173981-gettyimages-2169789390-TARGET_FLAGSHIP

U.S. consumer prices rose 0.2% in August as annual inflation rate hits lowest since early 2021

Why All Eyes Are On Arkansas’ Lithium

How are German car brands holding up?

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking-820x461.jpeg" alt="" class="wp-image-529070" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking.jpeg 1858w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Illustration of a user browsing booking information for Huawei’s new foldable mobile phone in Suqian, Jiangsu province, China, Sept 8, 2024.  Cfoto | Future Publishing | Getty Images</figcaption></figure>



As Huawei tries to upstage Apple’s new iPhone with the launch of its own ‘trifold phone’ on Tuesday, its chip capabilities remain a weakness, despite recent breakthroughs, according to one analyst. 



Speaking to CNBC’s “Squawk Box Asia” on Tuesday, Martin Yang, senior analyst of emerging technologies at Oppenheimer &amp; Co., said Huawei’s chip remains two or three years behind the cutting edge.&nbsp;



The gap on technology for their systems-on-chip, or SoCs, that merge central processing with cellular connectivity,&nbsp;is “widening because [Huawei] still doesn’t have access to any below 7 nanometer processes,” said Yang.&nbsp;In chip manufacturing, a nanometer denotes the size of transistors on a processor.



The smaller the size of a transistor, the more can be fit on a chip, increasing its level of advancement.&nbsp;



Huawei had made a smashing breakthrough last year when it released its Mate 60 smartphone, which included an advanced 7-nanometer chip originating from China. 



The speed in which Chinese firms were able to reach this benchmark surpassed what many analysts thought possible under U.S. trade restrictions that limited China’s access to advanced semiconductor tech. 



On the back of this success, Huawei has been able to take back market share from Apple in China, the largest smartphone market in the world.&nbsp;



However, unlike with the Mate 50, Huawei has not announced a big chip breakthrough for its latest phone launch.&nbsp;&nbsp;



Meanwhile, Apple is now on its second generation of 3 nanometer processes, and are already showing a 10% to 15% performance boost on this year’s phone compared to last year’s first generation 3 nanometer process, according to Yang.&nbsp;



“I think the chip will not be a big focus area or big marketing point for Huawei’s upcoming phone this week,” Yang said.&nbsp;



Instead, the company will likely try to downplay this chip disadvantage in the coming launch week and instead try to highlight that its phone is the first trifold phone on the market, he added.&nbsp;



Huawei has been accepting preorders for the foldable phone, the Mate XT, since Sept. 7. According to its website, the phone had already received more than 3.5 million preorders as of Tuesday. 



However, the Mate 60 RS, which Huawei released last year similarly had respectable reservations numbers, but failed to transfer them to actual sales, according to Yang. 



“I wouldn’t expect real world shipments in the [3 million range],” he said.



Speaking to CNBC’s “Street Signs Asia,” on Tuesday, Navkendar Singh, of the International Data Corporation, said that while Huawei has dominated in sales of foldable smartphones, the market remains niche due to consumer concerns about price and functionality.

108031541-1725948491431-gettyimages-2170168255-Illustration_Huawei_Foldable_Phone_Booking

In Huawei’s battle against Apple, chips are still a weakness, says analyst

How Wingstop is outpacing its fast-food competitors

Why are so many data centers popping up in Malaysia?

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2-820x461.jpg" alt="" class="wp-image-528909" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2-820x461.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2-160x90.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2-1536x864.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108017785-1723066534822-GettyImages-1323542329_2.jpg 1858w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">oatawa | Getty</figcaption></figure>



Bitcoin jumped Monday evening and topped $57,000 after Wall Street’s rebound from its worst week of the year.



The price of the flagship cryptocurrency was last higher by 5.6% at $57,4449.00, according to Coin Metrics. Last week, bitcoin tumbled 9% for its worst weekly performance since August 2023.&nbsp;



In regular trading, Coinbase and MicroStrategy climbed 5.2% and 9.2%, respectively, on Monday. Those stocks rose as the S&amp;P 500 broke a four-day losing streak and the Nasdaq Composite gained more than 1%. The three major averages last week posted their worst weekly performance in 2024.



Bitcoin has been trading range bound for most of the year. Last week, it briefly fell below its floor of about $55,000. Analysts have warned that cryptocurrency lacks major catalysts at the moment and that in their absence, prices are likely to be sensitive to macro factors and continue to consolidate.



Seasonality is also a factor. For bitcoin, similar to other risk assets, September is a historically weak month.



“For bitcoin to experience some upside in the upcoming week, it is essential for the U.S. equity markets to find some stability or positive momentum, potentially leading to a decrease in [crypto] ETF outflows,” Bitfinex analysts said in a note Monday. “This relief in the equity markets could help alleviate selling pressure on bitcoin, providing a conducive environment for a recovery.”

108017785-1723066534822-GettyImages-1323542329_2

Bitcoin rebounds from its worst week in more than a year, jumping above $57,000

How Your Taxes May Change After 2025

Why this company is building hydrogen-electric engines for planes

These companies are teaming up to create hydrogen on the moon

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161-820x461.jpeg" alt="" class="wp-image-528645" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108024800-1724414538815-gettyimages-2164056363-5ah02161.jpeg 1858w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Federal Reserve Chairman Jerome Powell. Andrew Harnik | Getty Images</figcaption></figure>



The U.S. Federal Reserve can afford to make a jumbo 50 basis points rate cut next week without spooking markets, an analyst has suggested, as opinion on the central bank’s forthcoming meeting remains hotly divided.



Michael Yoshikami, CEO of Destination Wealth Management, said Monday that a deeper cut would demonstrate that the central bank is ready to act without signalling deeper concerns of a broader downturn.



“I would not be surprised if they jumped all the way to 50 basis points,” Yoshikami told CNBC’s “Squawk Box Europe.”



“That would be considered, on one hand, a very positive sign the Fed is doing what is needed to support jobs growth,” he continued. “I think the Fed at this point is ready to get out ahead of this.”



His comment follow similar remarks Friday from Nobel Prize-winning economist Joseph Stiglitz, who said the Fed should deliver a half-point interest rate cut at its next meeting, arguing that it went “too far, too fast” with its previous policy tightening.



Policymakers are widely expected to lower rates when they meet on Sept. 17-18, but the extent of the move remains unclear. A disappointing jobs print on Friday stoked fears of a slowing labor market and briefly tipped market expectations toward a larger cut, before shifting back.



Traders are now pricing in around a 75% chance of a 25 bps rate cut in September, while 25% are pricing in a 50 bps rate reduction, according to the CME Group’s FedWatch Tool. A basis point is 0.01 percentage point.



Yoshikami acknowledged that a larger cut could reinforce fears that a “recessionary ball” is coming, but he insisted that such views were overblown, noting that both unemployment and interest rates remain low by historic levels and company earnings have been strong.



He said the recent market sell-off, which saw the S&amp;P 500 notch its worst week since March 2023, was based on “massive profits” accrued last month. August saw all the major indices post gains despite a volatile start to the month, while September is traditionally a weaker trading period.



Thanos Papasavvas, founder and chief investment officer of ABP Invest, also acknowledged a “rise in concern” around a potential economic downturn.



The research firm recently adjusted its probability of a U.S. recession to a “relatively contained” 30% from a “mild” 25% in June. However, Papasavvas said that the underlying components of the economy — manufacturing and unemployment rates — were “still resilient.”



“We’re not particularly concerned that we’re heading into a U.S. recession,” Papasavvas told CNBC Monday.



The perspectives stand in stark contrast to other market watchers, such as economist George Lagarias, who told CNBC last week that a bumper rate cut could be “very dangerous.”



“I don’t see the urgency for the 50 [basis point] cut,” Forvis Mazars’ chief economist told CNBC’s “Squawk Box.”



“The 50 [basis point] cut might send a wrong message to markets and the economy. It might send a message of urgency and, you know, that could be a self-fulfilling prophecy,” Lagarias added.

108024800-1724414538815-gettyimages-2164056363-5ah02161

Jumbo 50 basis points Fed rate cut should not raise alarm, analyst says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl-820x461.jpeg" alt="" class="wp-image-528528" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl.jpeg 1858w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">U.S. Secretary of the Treasury Janet Yellen speaks listens to a presentation during a tour at the IRS Processing Facility on September 06, 2024 in Austin, Texas.  Brandon Bell | Getty Images</figcaption></figure>



Treasury Secretary&nbsp;Janet Yellen&nbsp;sought to reassure the public on Saturday that the U.S. economy remains strong, despite a string of weak job reports that have rattled investors and weighed on the stock market. “We’re seeing less frenzy in terms of hiring and job openings, but we’re not seeing meaningful layoffs,” Yellen said at the&nbsp;Texas Tribune Festival&nbsp;in Austin. “I’m attentive to downside risk now on the employment side, but what I think we’re seeing, and hope we will continue to see, is a good, solid economy.”



Yellen said job growth has slowed compared to the “hiring frenzy” when the U.S. reopened after the Covid-19 pandemic, but the economy is “deep into a recovery” and “basically operating at full employment.”



The treasury secretary’s comments come a day after the&nbsp;Bureau of Labor Statistics&nbsp;reported another month of cooler-than-expected jobs data.



Nonfarm payrolls, a measure of U.S. job creation, increased by 142,000 in August, lower than the Dow Jones forecast of 161,000. The miss renewed worries about a slowing labor market, with the S&amp;P 500 falling Friday to finish out the&nbsp;worst week since March 2023.



The unemployment rate, however, edged lower to 4.2% and job growth in August was higher than July. The stock market&nbsp;sold off steeply early last month, after the weak July report touched off renewed fears of a recession in the U.S.



Yellen on Saturday tried to calm jitters about the state of the economy: “I don’t see red lights flashing.”



The jobs data has raised worries about whether the Federal Reserve can clinch a so-called “soft landing,” raising interest rates to bring inflation under control and then executing cuts before the economy enters a recession. The Fed is widely expected to lower interest rates this month.



Yellen said the U.S. is on that path: “It really has been amazing to be able to get inflation down as meaningfully as we have. This is what most people would call the soft landing,” she said.

108030594-1725652477107-gettyimages-2170574271-bb2_4502_cdgy76wl

Yellen says U.S. economy remains solid, on path to ‘soft landing’ with no meaningful layoffs

Why Rivian And VW Both Need Each Other

CNBC

Why Everyone Is Flocking To North Carolina’s Tech Hub

Will the U.S. allow Nvidia chip exports to Saudi Arabia?

How an ‘accidental businesswoman’ transformed one of Singapore’s oldest companies

U.S. consumer prices rose 0.2% in August as annual inflation rate hits lowest since early 2021

Why All Eyes Are On Arkansas’ Lithium

How are German car brands holding up?

In Huawei’s battle against Apple, chips are still a weakness, says analyst

How Wingstop is outpacing its fast-food competitors

Why are so many data centers popping up in Malaysia?

Bitcoin rebounds from its worst week in more than a year, jumping above $57,000

How Your Taxes May Change After 2025

Why this company is building hydrogen-electric engines for planes

These companies are teaming up to create hydrogen on the moon

Jumbo 50 basis points Fed rate cut should not raise alarm, analyst says

Yellen says U.S. economy remains solid, on path to ‘soft landing’ with no meaningful layoffs

Why Rivian And VW Both Need Each Other

Airplane engines are in short supply. The business of fixing older ones is booming

News Tips

Advertise With Us

CNBC

Why Everyone Is Flocking To North Carolina’s Tech Hub

Will the U.S. allow Nvidia chip exports to Saudi Arabia?

How an ‘accidental businesswoman’ transformed one of Singapore’s oldest companies

U.S. consumer prices rose 0.2% in August as annual inflation rate hits lowest since early 2021

Why All Eyes Are On Arkansas’ Lithium

How are German car brands holding up?

In Huawei’s battle against Apple, chips are still a weakness, says analyst

How Wingstop is outpacing its fast-food competitors

Why are so many data centers popping up in Malaysia?

Bitcoin rebounds from its worst week in more than a year, jumping above $57,000

How Your Taxes May Change After 2025

Why this company is building hydrogen-electric engines for planes

These companies are teaming up to create hydrogen on the moon

Jumbo 50 basis points Fed rate cut should not raise alarm, analyst says

Yellen says U.S. economy remains solid, on path to ‘soft landing’ with no meaningful layoffs

Why Rivian And VW Both Need Each Other

Airplane engines are in short supply. The business of fixing older ones is booming

News Tips

Advertise With Us

Newsletters