Another rate hike on the horizon

Alphabet says search business remains strong, the Fed wraps up meeting expected to end with another rate hike, 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. [Alphabet shares rise as Google Search weathers Bing challenge]( Alphabet's shares jumped nearly 7% in pre-market trading on Wednesday after the Google parent said its internet search business was strong despite ad market uncertainty. The company said Google Search hadn't suffered from competition with newly AI-powered rival Microsoft Bing. Alphabet shares have gained 39% this year as it generated enthusiasm with its push into artificial intelligence. Microsoft shares fell 4% in pre-market trading after the software giant posted slowing growth in its Azure cloud-services business, overshadowing optimism about its AI tools. "While Microsoft is better positioned than other cloud providers to monetize new AI investments, we think it can take a few quarters for that growth to kick in," said Bloomberg Intelligence analyst Anurag Rana. [[Reuters]( [Bloomberg]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Alphabet+shares+rise+as+Google+Search+weathers+Bing+challenge&body=Read the story here: utm_campaign=business_briefing_newsletter_20230726&utm_source=business_briefing_newsletter) 2. [Fed expected to announce its 11th interest rate hike since March 2022]( The Federal Reserve is expected to raise interest rates by a quarter percentage point on Wednesday at the conclusion of a two-day meeting, the 11th interest rate hike since March 2022 in an aggressive campaign to fight high inflation. This would give the federal funds rate a target range of 5.25% to 5.5%, a 22-year high. "Economic growth has likely been too firm in recent months for Fed Chair Jerome Powell to signal that Wednesday's increase in the Fed's benchmark short-term rate will be the last of the current tightening cycle, as investors anticipate," according to The Wall Street Journal, but the recent drop in the inflation rate "also makes it hard for central bank officials to firm up plans for any additional rate increase." [[USA Today]( [The Wall Street Journal]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Fed+expected+to+announce+its+11th+interest+rate+hike+since+March+2022&body=Read the story here: utm_campaign=business_briefing_newsletter_20230726&utm_source=business_briefing_newsletter) 3. [Gas prices make biggest daily jump in a year]( National gas prices jumped 4 cents to $3.64 on Tuesday in the biggest one-day increase since June 2022, according to AAA data. Gas prices are higher than they were in the same period in 2021 but far below what they were in June 2022, when the national average rose above $5 per gallon for the first time. The decline in gas prices in the last year has helped reduce inflation from its peak of 9.1% last summer to 3%, on an annual basis, last month. Oil prices also have risen recently. U.S. benchmark West Texas crude oil was up to $79.64 per barrel on Tuesday, nearly $4 a barrel more expensive than a week earlier but still far below the price of $95.54 on July 25, 2022. [[The Hill]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Gas+prices+make+biggest+daily+jump+in+a+year&body=Read the story here: utm_campaign=business_briefing_newsletter_20230726&utm_source=business_briefing_newsletter) 4. [Stock futures slip ahead of Fed decision, earnings]( U.S. stock futures edged lower early Wednesday ahead of more corporate earnings and the Federal Reserve's latest interest rate move. Futures tied to the Dow Jones Industrial Average were down 0.3% at 6:30 a.m. ET. S&P 500 and Nasdaq futures were down 0.2%. The three main U.S. indexes gained on Tuesday, with the Dow rising 0.1% to extend its winning streak to 12 days, its longest since February 2017. The S&P 500 and the tech-heavy Nasdaq rose 0.3% and 0.6%, respectively. The market has priced in a 98% chance that the Federal Reserve will raise interest rates by a quarter percentage point after pausing in June to assess how its campaign to hike rates was affecting inflation and the economy. [[CNBC]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=Stock+futures+slip+ahead+of+Fed+decision,+earnings&body=Read the story here: utm_campaign=business_briefing_newsletter_20230726&utm_source=business_briefing_newsletter) 5. [IMF says world economy showing resilience]( The International Monetary Fund said Tuesday in its latest World Economic Outlook that the world economy is recovering despite ongoing problems like stubborn inflation and China's slowing post-pandemic recovery, and could avoid a feared recession. The IMF raised its global growth forecast for this year to 3% from its April projection of 2.8%. It expects U.S. growth, which was 2.1% last year, to slow to 1.8% in 2023 and 1% in 2024. "The global economy continues to gradually recover from the pandemic and Russia's invasion of Ukraine, but it is not yet out of the woods," Pierre-Olivier Gourinchas, the IMF's chief economist, said Tuesday. [[The New York Times]( [Share to Facebook]( [Share to Twitter]( [Send in email](mailto:?Subject=IMF+says+world+economy+showing+resilience&body=Read the story here: utm_campaign=business_briefing_newsletter_20230726&utm_source=business_briefing_newsletter) [Read more business stories at theweek.com]( MOST POPULAR [Related image]( [Did Americans have anything to celebrate on Independence Day?]( Theara Coleman [Related image]( [Secret Service investigating after cocaine found in White House]( Brigid Kennedy [Related image]( [Brain disease linked to head injuries diagnosed in female athlete for first time]( Justin Klawans [Related image]( [The troubling rise of review bombing]( Theara Coleman [Related image]( [The movement to make A/C energy efficient]( Devika Rao [Speed reads banner] [Article image]( [Woody Allen and Roman Polanski to bring new movies to Venice Film Festival]( July 25, 2023 [Article image]( [Justice Department sues Texas over Mexico border buoys]( July 25, 2023 [Article image]( [Oncologists walk patient down the aisle: 'It was a huge honor']( July 25, 2023 [Article image]( [The remnants of an ancient ocean could be causing a 'gravity hole' in the Indian Ocean]( July 24, 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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