The Fed takes a break

The Fed pauses interest rate hikes but signals more to come, E.U. antitrust regulators call for breaking up Google's ad business, and more [What makes a subscription to The Week so valuable now? Click here.]( [The Week Logo]( [Subscribe to The Week magazine]( [Subscribe to The Week magazine]( Daily business briefing 1. [Fed pauses interest rate hikes, for now]( The Federal Reserve on Wednesday paused its aggressive campaign to raise interest rates — but indicated it's likely to raise rates two more times this year to continue fighting high inflation. The decision leaves the Fed's benchmark short-term lending rate at 5.1%, its highest level in 16 years. The central bank's leaders said the pause will give them time to determine how the higher borrowing costs have affected the economy. The Fed hiked rates at its last 10 meetings. Data have shown that the economy remains stronger than expected. Inflation has fallen steadily, meanwhile, but not as sharply as hoped, and remains near 5%, excluding volatile food and energy costs, far above the Fed's 2% target. [[The Associated Press]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Fed+pauses+interest+rate+hikes,+for+now&body=Read the story here: utm_campaign=business_briefing_newsletter_20230615&utm_source=business_briefing_newsletter) 2. [E.U. antitrust regulators push for breakup of Google ad business]( European Union regulators on Wednesday accused Google of abusing its dominant position in online ad sales to favor its own services and hurt competitors. In their preliminary finding, E.U. competition regulators want Google to sell off part of its online advertising business to reduce anti-competition concerns. Google's vice president of global ads, Dan Taylor, responded in a blog post, saying the E.U. complaints are "not new" and only involve a "narrow part of our advertising business." The E.U. case came as Google faces antitrust challenges from regulators around the world, including in the United States. It's also part of a broad campaign by European authorities to check the power of U.S. tech giants. [[The Washington Post]( [Fox Business]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=E.U.+antitrust+regulators+push+for+breakup+of+Google+ad+business&body=Read the story here: utm_campaign=business_briefing_newsletter_20230615&utm_source=business_briefing_newsletter) ADVERTISEMENT BY ENBRIDGE [Is hydrogen the key to reducing GHG emissions? Learn more.]( [ADVERTISEMENT BY ENBRIDGE]( 3. [China's economic recovery sputtered in May]( China's industrial output and retail sales growth fell short of expectations in May. Industrial output grew 3.5% in May compared to the same month last year, down from a 5.6% increase in April, Beijing's National Bureau of Statistics said Thursday. Analysts polled by Reuters had expected 3.6% growth. The slowdown increased expectations that Beijing would take more steps to stimulate its pandemic recovery. China's economy bounced back earlier this year after it abruptly lifted restrictions it had imposed to limit the spread of Covid-19, but the momentum fizzled in the second quarter. "The post-Covid recovery appears to have run its course, an economic double dip is nearly confirmed," analysts at Nomura said in a research note. [[Reuters]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=China's+economic+recovery+sputtered+in+May&body=Read the story here: utm_campaign=business_briefing_newsletter_20230615&utm_source=business_briefing_newsletter) 4. [Stock futures slip after Fed meeting]( U.S. stock futures fell early Thursday after the Federal Reserve paused its aggressive interest rate hikes Wednesday but said it could have to raise rates later this year to continue fighting high inflation. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down 0.2% and 0.4%, respectively, at 6:45 a.m. ET. Nasdaq futures were down 0.7%. Fed Chair Jerome Powell's indication after the central bank's two-day policy meeting that more hikes would be necessary later this year "indicated more hawkishness than expected," and that "shocked markets," said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. Stocks fell initially but recovered. The Dow closed down 0.7% Wednesday, but the S&P 500 and the Nasdaq closed up 0.1% and 0.4%, respectively. [[CNBC]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Stock+futures+slip+after+Fed+meeting&body=Read the story here: utm_campaign=business_briefing_newsletter_20230615&utm_source=business_briefing_newsletter) ADVERTISEMENT BY ENBRIDGE [Is hydrogen the key to reducing GHG emissions? Learn more.]( [ADVERTISEMENT BY ENBRIDGE]( 5. [Mexico's Modelo dethrones Bud Light as top-selling U.S. beer]( Mexican-made Modelo Especial passed Bud Light to become the [top-selling beer in the U.S.]( in the four weeks that ended June 3, according to Nielsen IQ data analyzed by the consulting firm Bump Williams. Modelo, sold by Constellation Brands, accounted for 8.4% of U.S. retail beer sales in May, while Bud Light fell to 7.3% as it faced a conservative-led boycott. Bud Light, still the leading beer in the first half of 2023, has seen its share of sales fall 3% since the boycott started in April after Dylan Mulvaney, a transgender influencer, posted an Instagram video promoting a Bud Light contest. Modelo Especial also got a bump from last month's Cinco de Mayo holiday. [[The New York Times]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Mexico's+Modelo+dethrones+Bud+Light+as+top-selling+U.S.+beer&body=Read the story here: utm_campaign=business_briefing_newsletter_20230615&utm_source=business_briefing_newsletter) [Read more business stories at theweek.com]( MOST POPULAR [Related image]( [Mexico's Modelo dethrones Bud Light as top-selling U.S. beer]( Peter Weber [Related image]( [Actors who turned down iconic roles]( Brendan Morrow [Related image]( [3 extraordinary ways Trump could avoid punishment in Mar-a-Lago documents case]( Peter Weber [Related image]( [What happened at Trump's historic, camera-free Miami arraignment, and what happens next]( Peter Weber [Related image]( [Pulitzer Prize-winning author Cormac McCarthy dies at 89]( Justin Klawans [Speed reads banner] [Article image]( [Southern Baptists expel Saddleback, 2nd church over female pastors, approve further clampdown]( June 15, 2023 [Article image]( [Miami Mayor Francis Suarez becomes 3rd Floridian to join crowded GOP presidential race]( June 14, 2023 [Article image]( [Mexico's Modelo dethrones Bud Light as top-selling U.S. beer]( June 14, 2023 [Article image]( [What happened at Trump's historic, camera-free Miami arraignment, and what happens next]( June 14, 2023 [Read more of today's best articles at theweek.com]( [What makes a subscription to The Week so valuable now? 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