The Federal Reserve says consumers are borrowing more, yet it is not ready to raise interest rates just yet. Here are the top news stories for July 9, 2015.
Microsoft Cutting More Jobs
Microsoft Wednesday announced it is cutting about 7,800 jobs, most of them connected to the company’s phone business. This comes just one year after Microsoft cut 18,000 jobs in 2014. The company Wednesday said it will take an impairment charge of $7.6 billion related to its acquisition of Nokia’s telephone handset business for more than $7 billion, along with a restructuring charge of between $750 million and $850 million.
Consumer Borrowing Climbs
The Federal Reserve Wednesday reported that consumer borrowing in the United States climbed in May as a result of an improving labor market and cheap financing. There was a $16.1 billion increase in total credit after a $21.4 billion increase in the previous month. Non-revolving loans, including borrowing for tuition and automobiles, increased from the previous month while revolving credit numbers slowed. Americans are showing an increased desire to take on debt to purchase new cars as the interest rates remain low and they continue recovering from the recession almost a decade ago.
What the Fed Says
Minutes from the Federal Open Markets Committee meeting were released Wednesday and showed that there still needs to be more improvement in the economy before interest rates will be increased. While most members of the Federal Reserve’s police making committee stated that the economy is improving after a weak first quarter, there was continued expression that the recovery needs to continue before a decision will be made to raise interest rates. Still, most members believe an increase will come before the ne of 2015. Prime interest rates remain at 0 percent to 0.25 percent as they have been since December of 2008.
Airbags Yet Again
Honda announced Thursday it is recalling 4.5 million automobiles globally to deal with replacing air bag inflators supplied by Takata. Of the 4.5 million cars recalled, 1.6 million are being recalled in Japan, Honda said. None of the cars being recalled were purchased in North America. Takata has seen millions of recalls related to their air bag inflators because they explode with too much force and spray metal fragments inside vehicles. So far, eight deaths have been linked to the component, all in cars made by Honda.
Then, There are the Range Rovers
Land Rover recalled more than 65,000 Range Rovers to deal with issues related to doors that can open while being driven and sunroofs that leak or can fall out of their housings. The National Highway. The current recall is for 2013 to 2016 model Range Rovers and 2014 to 2016 Range Rover Sport models. Some are being recalled to replace faulty door latches while others are having sunroof housings replaced. The manufacturer said incorrect primer was used on the sunroofs, which sink due to poor adhesive on the roof that does not adhere properly to the roof assembly.
Several West Coast areas were the first to receive delivery service from Taco Bell, which began offering delivery from over 200 stores Wednesday. Los Angeles, Orange County, San Francisco and Dallas are the first areas to enjoy Taco Bell’s delivery service. The company is working with an independent delivery service named DoorDash to get the Americanized Mexican food to your door, and there is $3.99 fee for the deliveries, as well as a customary tip for the driver. Taco Bell said its experiment with delivery service found that it takes an average of 38 minutes to get the food to the door after the order is made.