It’s ‘America Now’ time, bringing you live news from America.
Host) What news is there today?
Reporter) The US consumer price index (CPI) rose 3.5% in March, exceeding market expectations. There are predictions that the Federal Reserve will take a cautious stance in lowering interest rates due to a rebound in prices. The US House of Representatives has failed to extend the Foreign Intelligence Surveillance Act (FISA), which allows the warrantless collection of communications information of foreign nationals.
Host) America Now, here is the first news. Are the prices in the US difficult to control?
Reporter) That’s right. Last month, prices reached their highest level in six months. The US Department of Labor announced on the 10th that the Consumer Price Index (CPI) in March rose 3.5% compared to the same month last year. This is higher than the increase of 3.2% in February, a month ago, and the highest increase since 3.7% in September last year. It also exceeded market expectations. Economists polled by Dow Jones and Reuters were both predicting 3.4%.
Host) Compared to a year ago, the inflation rate was in the mid 3% range. Compared to a month ago, how much has the price increased?
Reporter) The rate of increase compared to February, the previous month, is 0.4%. This is also more than the market forecast of 0.3%. In addition, the core consumer price index, excluding highly volatile food and energy, rose 0.4% compared to the previous month and 3.8% compared to the same month last year, also higher than the expectations.
Host) What is the reason why prices have risen so much?
Reporter) Housing and energy costs drove the price increase. Energy costs rose by 1.1% in March, following a 2.3% increase in February. And housing costs, which account for around a third of the weight of the CPI, rose 0.4% compared to the previous month and 5.7% compared to the same month last year. However, food prices, commonly known as ‘shopping cart prices’, did not rise much, being 0.1% compared to the previous month and 2.2% compared to the same month last year. However, egg prices showed a significant increase, rising 4.6% in a year.
Host) What do you think about the long-term inflation rate trend in the United States?
Reporter) The US consumer price inflation rate has continued to slow since peaking at 9.1% in June 2022. It has been fluctuating in the 3% range since June last year. In January this year, it fell to 3.1% and was about to enter the 2% range, but it rebounded to 3.2% in February. Prices rarely fall to the 2% level.
Host) If inflation continues like this, won’t it be a burden on consumers?
Reporter) That’s right. Furthermore, although prices are rising, there appears to be no significant difference in income. According to the Ministry of Labour, average hourly earnings were unchanged on a monthly basis in March. Compared to a year ago, it only increased by 0.6%.
Host) The public is also concerned about prices, but aren’t there organizations that pay particular attention to price trends?
Reporter) Yes, the Federal Reserve System, the central bank of the United States, pays attention to the price index. The Federal Reserve has shown that it will not lower interest rates until it is confident that inflation has reached its 2% target. However, as prices do not fall easily in March following January and February, there is speculation that the Federal Reserve will take a more cautious stance in lowering interest rates.
Host) Didn’t the Federal Reserve announce its intention to lower interest rates this year?
Reporter) That’s right. Therefore, the market expected that the Federal Reserve would start lowering interest rates in June and cut interest rates a total of three times this year. However, with the March inflation data released, experts expect the Federal Reserve to cut interest rates later and with less time. “These numbers do not completely eliminate the possibility of Fed action this year, but they certainly reduce the likelihood that the Fed will cut interest rates in the coming months,” said First Citizens director Philip Newhart , to Reuters. The Chicago Mercantile Exchange (CME) expected Federal Reserve interest rate cuts to begin in September following the release of the price index.
Host) Meanwhile, data has been released showing the views of members of the Federal Reserve on interest rate cuts?
Reporter) Yes, the Federal Reserve released the minutes of the Open Market Committee (FOMC) meeting held last month on the 10th. It is at this FOMC meeting that the base interest rate is set. At last month’s meeting, Fed members confirmed they would not cut interest rates until they had more confidence that inflation was returning to its 2% target.
Host) So there isn’t much difference from the current situation?
Reporter) That’s right. The minutes stated that it would be appropriate to ease austerity measures at some point in the year, but that uncertainty had increased. “In general, participants noted the uncertainty surrounding the continuation of high inflation and expressed the view that recent indicators have not strengthened confidence that inflation will continue to fall to 2%,” the minutes said.
Host) What are the current interest rates in the US?
Reporter) The Federal Reserve ended the two-day FOMC meeting on the 20th of last month and announced that it would maintain the US benchmark interest rate at 5.25-5.50%. The last time the Federal Reserve raised its benchmark interest rate was in July last year. Since then, the base interest rate has been frozen five times in a row, from September, November and December last year, to January and March this year. “We have seen uneven inflation over the past two months,” Federal Reserve Chairman Jerome Powell said at a press conference following last month’s interest rate announcement. “We don’t know if there will be more like this.” He explained, “This is why we are taking a cautious approach.”
Host) What position did President Joe Biden express regarding prices in March?
Reporter) President Biden accepted related questions at a press conference held after the US-Japan summit on the 10th, and reaffirmed the forecast of a key interest rate cut within the year. However, he said there was a possibility of a delay of about a month. President Biden is looking at the economy and job creation as his main achievements before the presidential election in November, but the public opinion on the economy is not very positive. So, some say the March price index could be bad news for President Biden. Meanwhile, former President Donald Trump, the Republican presidential candidate, said on the social media site ‘Truth Social’, “Inflation is back. And it’s extreme,” he said, arguing that the Fed “will never be able to credibly lower interest rates” as it tries to protect President Biden.
Speaker of the House Mike Johnson holds a press conference at the Capitol on the 10th.
Host) This is the next news from America Now. Efforts in the US House of Representatives to extend key foreign intelligence collection laws have failed?
Reporter) That’s right. On the 10th, the House of Representatives held a procedural vote on whether to introduce a bill to extend the expiration date of the Foreign Intelligence Surveillance Act (FISA) to the full session. It was rejected by a vote of 193 in favor to 228 against. As a result, the opportunity to discuss the law in the plenary disappeared. Once again the leadership of Speaker of the House Mike Johnson was tested in pushing for the passage of the bill.
Host) Before learning more details, what is FISA?
Reporter) This law was enacted in 1978 to regulate the procedures by which the US government collects and analyzes information relating to foreign countries, organizations and individuals in various ways. Specifically, Article 702 of this law was enacted in the wake of the terrorist attacks of September 11, 2001. Allows the collection of communications information about aliens outside US territory without a warrant. The law was originally supposed to expire at the end of last year, but the National Defense Authorization Act passed in December of last year included provisions extending the effect of Section 702 of FISA until April 19 of this year.
Host) But there is some controversy about this law?
Reporter) Yes, FISA is evaluated as essential to espionage activities in the United States. However, a few years ago, controversy arose when it was revealed that the Federal Bureau of Investigation (FBI) had even looked into the communications information of Americans. Section 702 does not allow targeting of US citizens, but does allow access to data on US citizens if they have had contact with a foreign surveillance target. Critics say this allows people to be arrested using evidence gathered without court approval and violates constitutional rights against unreasonable searches.
Host) Efforts to extend this law have now failed in the House of Representatives? What is the position of the legislators on the measure?
Reporter) While the Republican Party has shown support for Section 702 of FISA, the Democratic Party has expressed opposition, saying that the law gives too much power to spy on American citizens. However, hardline Republican lawmakers joined the Democratic Party debate. Although it is currently by a narrow margin, the bill could have passed if all Republican lawmakers had approved it, as the majority party in the House is Republican. In the vote on the 10th, 19 hard-line Republican lawmakers voted against.
Host) Is there any background to the opposition from hard-line Republican lawmakers?
Reporter) This is because former President Donald Trump has put pressure on Republicans by demanding that Section 702 be repealed. The day before the vote, former President Trump claimed on the social media platform ‘Truth Social’ that they were “spying on my presidential campaign” and that “FISA 702 was used illegally against me and many others.”
Host) But Chairman Johnson, a Republican, pushed for the bill to pass, right?
Reporter) Yes, before the vote, Chairman Johnson said that the revision to be proposed this time includes new protections for Americans, and that “these reforms will actually eliminate the abuses that allowed spying on President Trump’s campaign.” However, he failed to persuade hardline lawmakers.
Host) The law’s expiration date is April 19, so there’s not much left, right?
Reporter) Yes, Chairman Johnson told reporters after the vote, “We will regroup and come up with another plan,” and “We cannot allow Section 702 of FISA to expire. “This is so important to our national security, and I think most members of Congress understand that.” Meanwhile, some say that this rejection confirms that former President Trump has considerable influence within the Republican Party and that the discord between the hardliners of the Republican Party and Chairman Johnson continues. US ‘ABC’ news reported that this is the fourth case where a vote has failed in the last six months since Johnson took office.
Host) America Now, we will listen to this today.
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