Inflation check

Inflation was slightly hotter than expected in December, Hertz is selling a third of its EVs to buy more gas cars, and more [View this email in your browser]( [What makes a subscription to The Week so valuable now? Click the banner]( [The Week]( Daily business briefing 1. [Inflation ticked higher in December due to housing, fuel costs]( Inflation edged up in December thanks largely to higher housing and energy costs, the Labor Department reported Thursday. The consumer price index rose 3.4% in December from a year earlier, slightly more than economists had expected and up from November's 3.1%. Core inflation, excluding volatile fuel and food costs, fell slightly to 3.9% year-on-year, just above estimates but below 4% for the first time since May 2021. Inflation dropped by nearly half in 2023, The Wall Street Journal reported, while inflation-adjusted wages grew a robust 0.8%. The inflation declines in previous months fueled hope the [Federal Reserve would soon start cutting interest rates]( but December's data underscored the challenges to getting inflation down to the central bank's 2% target. [The Wall Street Journal]( [The Associated Press]( 2. [Hertz to sell 20,000 EVs, buy more gas cars]( Hertz plans to sell a third of its fleet of electric vehicles — about 20,000 cars, including Teslas — and use the proceeds to buy more gasoline-powered cars. Hertz, which invested heavily in EVs in recent years, said the vehicles cost less to maintain but were more expensive to repair and were hurting the company financially. "Collision and damage repairs on an EV can often run about twice that associated with a comparable combustion engine vehicle," Hertz CEO Stephen Scherr said in a recent analyst call. Hertz said in a filing with the Securities and Exchange Commission that it expected to take a $245 million loss due to high EV depreciation, as declining prices for new EVs reduce what people will pay for used ones. [CNN]( [Bloomberg]( 3. [Stock futures slip ahead of more inflation data]( Stock futures fell slightly early Friday ahead of the release of this week's second big inflation report, the producer price index. Futures tied to the Dow Jones Industrial Average and the Nasdaq were down 0.4% at 7 a.m. ET. S&P 500 futures were down 0.3%. Stocks were little changed Thursday after the December consumer price index showed inflation was slightly hotter than expected due to energy and food costs. Economists expect the December producer price index to show that wholesale prices rose 0.1% in December compared to November. On Thursday, investors jumped at the chance to invest in new U.S.-listed bitcoin exchange-traded funds, with $4.6 billion worth of shares trading hands. [CNBC]( [Reuters]( 4. [Discord cutting 17% of staff after pandemic expansion]( Discord told its employees Thursday it was laying off 17% of its staff, about 170 jobs, making the gamer-favored messaging startup the latest tech company to start 2024 by cutting workers. CEO Jason Citron said the move would help "sharpen our focus and improve the way we work together to bring more agility to our organization." Citron said the company [expanded too fast amid a surge of users during the pandemic](. "We grew quickly and expanded our workforce even faster, increasing by 5x since 2020," Citron wrote in an internal memo obtained by The Verge. "As a result, we took on more projects and became less efficient in how we operated." The cuts are Discord's largest so far. It laid off 4% of its workers in August. [The Verge]( Sponsored by Wise Bread [Earn $200 After Spending $500]( 5. [Oil prices rise after US, UK strikes against Houthis in Yemen]( Oil prices jumped nearly 4% in the United States and Britain early Friday after the two countries launched airstrikes against Houthi military targets in Yemen. The air and sea attacks came in response to recent attacks by Houthis on ships in the Red Sea, a crucial route for global shipping, in a show of the Iranian-backed group's support for Hamas in its war against Israel in Gaza. Chris Scicluna, head of economic research at Daiwa Capital Markets, described the market's response as "relatively measured," noting that global benchmark Brent crude was still in the $80-a-barrel range. 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