Fed to keep hiking rates until it controls inflation and more business news

Fed to keep hiking rates until it controls inflation

Fed Chair Jerome Powell has underscored the Federal Reserve's determination to keep raising interest rates until it has brought inflation under control.

"What we need to see is inflation coming down in a clear and convincing way," Powell said in remarks to a Wall Street Journal conference. "And we're going to keep pushing until we see that."

The Fed chair, who was confirmed last week by the Senate to a second four-year term, suggested that the Fed would consider raising rates even faster if price increases fail to moderate.

It's a high-stakes effort that carries the risk of causing an eventual recession. The Fed's increases in its benchmark short-term rate typically lead, in turn, to higher borrowing costs for consumers and businesses, including for mortgages, auto loans and credit cards.

Argo A1 testing autonomous cars

An autonomous vehicle technology company that partners with Ford and Volkswagen says it has started driverless operations in two of eight cities where it is developing its technology.

Pittsburgh-based Argo AI has pulled drivers from its autonomous cars in Miami and Austin, Texas, though it is still in the testing phase. Its commercial partnerships with Walmart and Lyft still have backup drivers in both cities. The company is partnering with Lyft to use its autonomous test vehicles for their ride-sharing network in Miami Beach and grocery delivery for Walmart in Miami and Austin.

Argo says it is the first company to go driverless in two American cities, but Argo isn't the first company to go driverless. Waymo, the autonomous vehicle unit of Alphabet, Google's parent company, announced in March that it started carrying employees in electric Jaguar I-Pace SUVs in San Francisco without human backup drivers.

In February, General Motors and its autonomous vehicle subsidiary Cruise posted a signup page for anyone to reserve a free ride, also in San Francisco.

Netflix lays off 2% of its workers

Following Netflix's announcement last month that it lost subscribers for the first time in a decade, the streaming behemoth said Tuesday that it was laying off some 150 people across the company, primarily in the United States, representing 2% of its total workforce.

"As we explained on earnings, our slowing revenue growth means we are also having to slow our cost growth as a company," Netflix said in a statement. "These changes are primarily driven by business needs rather than individual performance, which makes them especially tough as none of us want to say goodbye to such great colleagues."

In the first quarter earnings call in April, Netflix's chief financial officer, Spencer Neumann, said that in the next two years the company intended to pull back on some of its spending. While Netflix will continue to dedicate some $17 billion annually to developing new television shows and movies, it will do so with fewer people working behind the scenes.

"We're trying to be smart about it and prudent in terms of pulling back on some of that spend growth to reflect the realities of the revenue growth of the business," Neumann said at the time.

Stocks rebound Tuesday after previous selloffs

Stocks rose steadily throughout the day and ended Tuesday with broad gains as traders got back to buying again after a mostly miserable few weeks on Wall Street.

Tech giants like Apple and Microsoft were among the biggest winners, and video game maker Take-Two Interactive jumped after forecasting better results than analysts were expecting. Paramount soared after Warren Buffett's Berkshire Hathaway disclosed a new stake in the media company.

The S&P 500 rose 2% and the tech-heavy Nasdaq added 2.8%. Small-company stocks rose more than the rest of the market, a signal investors are feeling bullish on the economy. Treasury yields rose.

- Compiled by Dave Flessner

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