Home Top News CPI, Apple's New iPhone and Holmes Trial: Live Updates

CPI, Apple’s New iPhone and Holmes Trial: Live Updates

Increases in airfares — a key factor in inflation earlier this year — might begin to ease as the rise in Delta variant coronavirus cases keeps some travelers at home, economists expect.
Credit…Joe Raedle/Getty Images

Consumer price gains are beginning to cool off slightly, data due on Tuesday should show — but they are probably still climbing quickly enough to keep pressure on the White House and Federal Reserve.

Prices for goods and services including airline tickets and hotel rooms probably increased more slowly in August, helping overall inflation to slow from its recent breakneck pace. Inflation most likely climbed by 5.3 percent in the year through August, according to expectations from economists surveyed by Bloomberg for the closely watched Consumer Price Index. The data will be released at 8:30 a.m. Monthly gains were expected to slow to 0.4 percent in August compared with 0.5 percent in July, making for the slowest pace of increase since February.

Consumer price inflation has been running hot this year as the economy reopens from the pandemic, causing prices for dinners out and office clothes to bounce back. At the same time, supply chain snarls have pushed shipping costs higher, feeding into prices for manufactured goods. Labor costs have climbed in some industries, pushing inflation higher around the edges, and rent prices are rising again as workers return to cities after fleeing in 2020.

That confluence of factors has created an inflationary burst that officials at the Fed and the White House expect — and hope — will prove temporary. Policymakers are betting that annual price gains will settle down toward the central bank’s 2 percent average target over time, as virus-related quirks work their way through the system.

The Fed defines its target using a different index, the Personal Consumption Expenditures measure. That gauge has also picked up this year, but by less than the C.P.I., climbing by 4.2 percent in the year through July.

Prices could remain higher for longer than economists anticipate, though, and in light of that risk policymakers are eagerly watching for any hint that moderation is underway. They would take heart in any cool-down, but even the slower pace of monthly growth — assuming it comes in at 0.4 percent as expected — would still produce a 4.9 percent pace of annual inflation if it continued for 12 months.

Officials will need to see it moderate by more than that before they can be comfortable with the rate of inflation.

Central bankers are hoping that inflation will fade before consumers come to expect persistently higher prices — which can become a self-fulfilling prophecy as shoppers accept loftier price tags and also demand higher pay. A closely watched tracker of households’ outlook for inflation, released by the Federal Reserve Bank of New York on Monday, showed that expectations rocketed up to 5.2 percent in the short term and 4 percent in the medium term.

That data point is disquieting, but it comes in contrast to inflation expectations in financial markets, which have been relatively stable after moving up earlier this year. And real-world prices may begin to ease in important categories in the months ahead.

Used car prices, which have been a big cause of inflation this year, should now be beginning to ease, helping to cool off the month-over-month increases. Airfares and hotel room rates might also pull back in the latest data because increasing virus cases kept some travelers at home.

But other price pressures may persist.

“We expect upward pressure from supply chain bottlenecks and wage pressures to boost prices of new cars, household furnishings, and recreation and personal care products and services in this week’s report,” Goldman Sachs economists wrote in a preview note.

Omair Sharif, founder and president of the research firm Inflation Insights, said he would be watching the interplay between the pandemic-affected categories that policymakers have been pointing to as a reason to expect inflation to slow and those that could fuel a more lasting price pickup, like rent costs.

“Will the Fed be vindicated in their view that a lot of this is transitory?” Mr. Sharif said. “The other thing I’m looking at: Are the stickier indexes starting to pick up steam?”

Tim Cook introducing the iPhone 11 in 2019. The new iPhones are expected to feature better screens.
Credit…Jim Wilson/The New York Times

It’s that time of the year again, when Apple unveils its latest gadgets ahead of the holiday season.

On Tuesday, the iPhone maker will hold its annual product event — virtually, because of the coronavirus pandemic — and present its newest lineup. The new products — including iPhones and Apple Watch — will have a strong focus on screens, in an era when people are increasingly glued to them.

The company plans to broadcast a video presentation starting at 10 a.m. Pacific time to show new iPhones with improved displays and Apple Watches with slightly larger screens, according to people briefed on the event, who were not authorized to speak publicly about the products. Apple declined to comment.

The aesthetic of the new iPhones will closely resemble that of last year’s models, the people said. The biggest change will be to the screen, which will have what is known as a higher “refresh rate” that will make videos and motion look smoother. The camera will also be improved, the people said.

The new Apple Watch will also look similar to last year’s models but will include slightly larger displays that can show more pixels, the people briefed on the products said. That will make images and text shown on the watch face look more compelling.

Apple issued emergency software updates on Monday after security researchers uncovered a flaw that allows highly invasive spyware to infect anyone’s iPhone, iPad, Apple Watch or Mac computer without so much as a click.

Apple has urged customers to run the latest software updates for the fixes to take effect, by installing iOS 14.8, MacOS 11.6 and WatchOS 7.6.2.


How to Fix Your iPhone’s Security Flaw 📱

Nicole Perlroth

Nicole PerlrothReporting from Silicon Valley

How to Fix Your iPhone’s Security Flaw 📱

Nicole Perlroth

Nicole PerlrothReporting from Silicon Valley

Gabby Jones for The New York Times

Apple issued a software update on Monday to fix a critical flaw in its products that had allowed governments to invisibly spy on Apple users without so much as a click.

Here’s how to update your iPhone with the software patch →

Item 1 of 5

“This spyware can do everything an iPhone user can do on their device and more.” READ MORE →

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