Just days beforejoining the S&P 500, Coinbase says it's been the victim of asignificant attack, with hackersbribing"rogue overseas support agents" to steal customer data, including addresses and masked bank account numbers. The criminals demanded a $20 million ransom, but Coinbase refused to pay, instead earmarking that cash as a reward for information on the culprits. The crypto exchange operator is also facing an S.E.C. probe into whether it previously misstated its user numbers,The New York Times reports, citing anonymous sources.
🔴 US authorities are preparing to announce one of the biggest cuts in banks’ capital requirements for more than a decade, marking the latest sign of the deregulation agenda of the Trump administration. 📢 Regulators are poised to reduce the supplementary leverage ratio, according to several people familiar with the matter. 👉 The rule requires big banks to have a preset amount of high-quality capital against their total leverage, which includes assets such as loans and off-balance sheet exposures such as derivatives. It was established in 2014 as part of sweeping reforms in the wake of the 2008-09 financial crisis. ✔️ Bank lobbyists have been campaigning against the rule for years, saying it punishes lenders for holding even low-risk assets such as US Treasuries, hinders their ability to facilitate trading in the $29tn government debt market, and weakens their ability to extend credit. 🎯 Lobbyists expect regulators to present reform proposals by the summer. The mooted loosening of capital rules comes at a time when the Trump administration is slashing regulations in everything from environmental policies to financial disclosure requirements. 😨 Critics, however, say it is a worrying time to cut bank capital requirements given the recent market volatility and policy upheaval under the administration of President Donald Trump. 🔥 A move to dial back the SLR would be a boon to the Treasury market, analysts say, potentially helping Trump achieve his goal of reducing borrowing costs by allowing banks to buy more government debt. ‼️ It would also encourage banks to begin taking a bigger role in trading Treasuries after the industry ceded ground to high-frequency traders and hedge funds as a result of rules put in place after the financial crisis.
Volley after volley oftariffs— and at timeson-again, off-again trade actions— have put companies worldwide on edge. And a handful of major retailers have already raised prices across the U.S., or warned of future hikes.
President Donald Trump has slapped new import taxes on nearly all of America’s trading partners and a range of sector-specific goods in recent months — all while some targeted countries, notably China, have responded with their own retaliatory duties. While many of the steepest tariffs have since been paused or reduced, scores of other remaining levies have piled up on businesses.
That’s because companies that buy products made abroad pay the tariffs imposed on them, and, as a result, face higher costs that are typically passed on to consumers. Trump has argued that his new duties will return manufacturing and money to the U.S. But since so much of what we buy today relies on a global supply chain, economists have long warned that such sweeping tariffs will mean more expensive prices from the grocery aisle to the auto repair shop.
Many businesses (and their customers) are already facing that reality. Here are some big-name retailers that have recently announced or anticipate price hikes amid the ongoing trade wars:
Walmart
Walmart became the latest to join the list on Thursday, when the nation’s largest retailer said it must raise prices due to higher costs from tariffs.
While Walmart has built in hedges against some tariff threats, with two-thirds of its merchandise sourced in the U.S., it still isn’t immune. Higher prices began to appear on Walmart shelves in late April and accelerated this month, company executives said Thursday. However, a larger sting will be felt in June and July, just when the back-to-school shopping season goes into high gear.
John David Rainey, the company’s chief financial officer, emphasized that prices are going up on many necessities. The price of bananas, imported from Costa Rica, went up to 54 cents per pound from 50 cents per pound, for example. And he thinks that China-made car seats, which currently sell for $350 at Walmart, will likely go up another $100.
“We’re wired to keep prices low, but there’s a limit to what we can bear, or any retailer for that matter,” Rainey told The Associated Press.
Mattel
Mattel Inc., the maker of Barbie dolls and Hot Wheels cars, said earlier this month that it would also have to raise prices “where necessary” to offset tariff costs.
The toymaker makes 40% of its products in China. It warned of price hikes on May 5 — prior to the U.S. and China agreeing to a 90-day reprieve to temporarily slash the bulk of their sky-high levies — but tariffs on the country still remain higher than before Trump started ramping them up last month.
In its latest earnings call, Mattel said it plans to move roughly 500 products this year from manufacturers in China to sources in other countries, compared to 280 products last year. And for some highly sought-after toys, the company said it would enlist factories in more than one country.
Microsoft’s Xbox
At the start of May, Microsoft raised recommended retailer pricing for its Xbox consoles and controllers around the world. It's Xbox Series S, for example, now starts at $379.99 in the U.S. — up $80 from the $299.99 price tag that debuted in 2020. And its more powerful Xbox Series X will be $599.99 going forward, a $100 jump from its previous $499.99 listing.
“We understand that these changes are challenging,” Microsoft wrote in a May 1 Xbox support update. The tech giant didn’t point to tariffs specifically, but cited wider “market conditions and the rising cost of development.”
Beyond the U.S., Microsoft also laid out Xbox price adjustments for Europe, the U.K., and Australia. The company said all other countries would also receive updates locally. And further down the road, Microsoft said it also expects to make some of its new, first-party games more expensive this holiday season, with a price tag of $79.99.
Shein and Temu
Last month, e-commerce giants Temu and Shein both announced price hikes in separate but nearly identical notices, citing “recent changes in global trade rules and tariffs.”
Customers began seeing higher prices for many items in late April, particularly leading up to the May 2 expiration of the so-called de minimis rule, a duty-free exemption on low-value imports from China that shopping sites have taken advantage of for years. This week’s deal between the U.S. and China later eased the burden somewhat, but these products still face duties, with low-value parcels from China that come through the U.S. Postal Service now tariffed at 54% (down from 120%).
Even before this reprieve, Temu appeared to halt shipments from China and tap into existing U.S. inventory. The retailer, owned by the Chinese e-commerce company PDD Holdings, continues to advertise scores of items from “local” warehouses that carry “no import charges” for U.S. shoppers. Meanwhile, Singapore-based Shein currently has a checkout banner that reads, “Tariffs are included in the price you pay. You’ll never have to pay extra for delivery.”
Stanley Black & Decker
Toolmaker Stanley Black & Decker said it raised prices in April and plans to do so again in the July-September quarter because of higher tariffs.
“We are accelerating adjustments to our supply chain and exploring all options as we seek to minimize the impact of tariffs on end users while balancing the need to protect our business,” CEO Donald Allan, Jr., said in a statement last month.
Procter & Gamble
Executives at Procter & Gamble — the consumer product giant that makes household brands such as Crest toothpaste, Tide detergent, and Charmin toilet paper — have also said it will likely have to pass on higher prices to consumers.
Last month, P&G said it was doing whatever it could to reduce higher costs from tariffs, including shifting sourcing to avoid duties. But the company said shoppers may still see price hikes as early as July.
Japan's economy shrank for the first time in a year and at a faster pace than expected, data for the March quarter showed on Friday, underscoring the fragile nature of its recovery now under threat from U.S. President Donald Trump's trade policies.
The data highlights the challenge policymakers face as steep U.S. tariffs cloud the outlook for the export-heavy economy, particularly for the mainstay automobile sector.
Real gross domestic product (GDP) contracted an annualised 0.7% in January-March, preliminary government data showed, much bigger than a median market forecast for a 0.2% drop.
The decline was due to stagnant private consumption and falling exports, suggesting the economy was losing support from overseas demand even before Trump's announcement on April 2 of sweeping "reciprocal" tariffs.
The data did highlight some brighter aspects, which included GDP growth being revised up slightly to 2.4% from 2.2% for the final quarter of last year.
Capital expenditure rose a faster-than-expected 1.4%, helping domestic demand add 0.7 percentage point to GDP growth.
Overall, however, analysts were cautious about the softer demand impulse and risks to the outlook from a Trump-led change to the global trade order.
"Japan's economy lacks a driver of growth, given weakness in exports and consumption. It's very vulnerable to shocks such as one from Trump tariffs," said Yoshiki Shinke, senior executive economist at Dai-ichi Life Research Institute.
"The data may lead to growing calls for bigger fiscal spending," he said, adding the economy could contract again in the second quarter depending on when the hit from tariffs intensifies.
On a quarter-on-quarter basis, the economy shrank 0.2% compared with market forecasts for a 0.1% contraction.
These charts depict Japan's GDP and its components over time.
TARIFF RISKS
Japan's Economic Revitalisation Minister Ryosei Akazawa said big pay hikes offered by companies will likely underpin a moderate economic recovery, but warned of risks to the outlook.
"We must be mindful of downside risks to the economy from U.S. tariff policy. The hit to consumption and household sentiment from continued price rises is also a risk to growth," Akazawa told a news conference after the GDP data.
Private consumption, which accounts for more than half of Japan's economic output, was flat in the first quarter, compared with market forecasts for a 0.1% gain.
The GDP deflator, which shows the extent to which firms can pass on rising costs, rose 3.3% in January-March from year-before levels, accelerating for the second straight quarter.
But external demand shaved 0.8 point off GDP as exports fell 0.6% and imports rose 2.9%, even before the impact of Trump tariffs begins to materialise in full force.
Trump imposed 10% tariffs on all countries except Canada, Mexico, and China, along with higher tariff rates for many big trading partners, including Japan, which faces a 24% tariff rate starting in July unless it can negotiate a deal with the United States.
Washington has also imposed 25% levies on cars, steel, and aluminium, dealing a huge blow to Japan's economy that relies heavily on automobile exports to the United States.
Japanese automakers are already feeling the pain.
Toyota Motor (7203.T), opens a new t, ab said it expects profit to decline by a fifth in the current financial year. Mazda (7261.T), opens a new tab, held off disclosing earnings estimates for the current year through March 2026 due to uncertainty over U.S. trade policy.
"The early-year (GDP) contraction serves as a reminder of Japan's economic struggles. Tariff pain and weak domestic momentum will weigh on growth in the quarters ahead," said Stefan Angrick, head of Japan and Frontier markets Economics, Moody's Analytics.
The gloomy GDP data could pile pressure on Prime Minister Shigeru Ishiba to heed lawmakers' demands to cut tax or compile a fresh stimulus package, though Akazawa said there were no such plans for now.
The global trade war touched off by U.S. tariffs has also complicated the Bank of Japan's decision on when and how far it can push up interest rates.
Having exited a decade-long stimulus last year, the BOJ hiked rates to 0.5% in January and has signaled its readiness to keep hiking borrowing costs if a moderate economic recovery keeps Japan on track to durably hit its 2% inflation target.
But fears of a Trump-induced global slowdown forced the BOJ to sharply cut its growth forecasts at its April 30-May 1 policy meeting, and cast doubt on its view that sustained wage hikes will underpin consumption and the broader economy.
While a de-escalation of U.S.-China trade tensions offered markets and policymakers some relief, there is uncertainty on whether Japan can win exemptions from U.S. tariffs in bilateral trade talks with Washington.
"If the impact of Trump tariffs is fairly light, the BOJ could raise interest rates again in September or October. But if the tariffs deal a severe blow to capital spending and exports, rate hikes could be put on hold," said Takeshi Minami, chief economist at Norinchukin Research Institute.
Walmart (WMT.N), opened a new tab and wheeled its trolley cart right into President Donald Trump’s ankles. The largest U.S. retailer and a bellwether for consumers said on Thursday that tariffs would force it to raise prices, just a month after it expressed confidence that it would keep them low. Boss Doug McMillon may be able to do both at once, on a relative basis, but it also sends a clear signal to the White House that shelves are stocked with only so many ways to shield shoppers.
Flagship U.S. Walmart locations open for at least a year generated 4.5% sales growth for the three months ending April 30 from the same stretch in 2024, a second consecutive quarterly slowdown. McMillon warned that import levies are starting to take a toll. Supply-chain pressure began in late April and accelerated in May. The $750 billion company is trying to hold the line on food even as the cost of bananas, coffee, avocados, and flowers increases, but it is unwilling to eat them everywhere.
Walmart US same-store sales
McMillon and his deputies took a markedly different tone a few weeks ago. The CEO told investors that U.S. duties, which at the time were 145% on Chinese goods, remained a question mark, but that Walmart would focus on “managing our inventory and our expenses well.” Following news that those levies would be slashed to 30%, at least temporarily, McMillon cautioned of a challenging environment, implying that he can squeeze suppliers only so much.
He's not alone either. JPMorgan boss Jamie Dimon warned, opens new tab on Thursday that recession remains a threat despite Trump’s trade truce. Taiwanese contract manufacturing giant Foxconn, which assembles iPhones and makes Nvidia servers, also slashed its full-year outlook this week, blaming the stronger Taiwan dollar and “rapid changes” in U.S. tariff policy.
Equity investors took comfort from the lower duty rates, pushing the S&P 500 Index up 5% this week, to higher than where it started the year. Business leaders are clearly less impressed. Sustained gloom from industry titans like Walmart will keep pressure on the president to reconsider his own pricing power.
Walmart said on May 15 that it will have to raise prices due to the impact of tariffs, after indicating in April that it planned to keep prices low.
The retailer reported that first-quarter sales at its flagship U.S. stores open for at least ya ear were up 4.5% from a year earlier. Overall net profit declined 12% to $4.5 billion on a 2.5% increase in revenue.
Walmart did not provide a forecast for second-quarter earnings because of the “dynamic nature of the backdrop.”
The United Arab Emirates and the United States have signed an agreement for the Gulf country to build the largest artificial intelligence campus outside the United States, a type of deal that previously faced restrictions over Washington's concerns that China could access the technology.
The countries did not say which AI chips from Nvidia (NVDA.O), opens new tab or other companies could be included in UAE data centres, but sources had said a deal would give the Gulf country expanded access to advanced AI chips. Nvidia Chief Executive Jensen Huang was seen in televised footage conversing with U.S. President Donald Trump and UAE President Sheikh Mohamed bin Zayed Al Nahyan at a palace in Abu Dhabi on Thursday.
Such a long-coveted deal, finalised during Trump's visit to Abu Dhabi on Thursday, is a major win for the UAE, which has been trying to balance its relations with its longtime ally, the U.S., and its largest trading partner, China. It reflects the Trump administration's confidence that the chips can be managed securely, in part by requiring data centres to be managed by U.S. companies.
The UAE, a major oil producer, has been spending billions of dollars in a push to become a global AI player. But its ties to China had limited access to U.S. chips under former President Joe Biden.
The AI agreement "includes the UAE committing to invest in, build, or finance U.S. data centres that are at least as large and as powerful as those in the UAE," the White House said.
"The agreement also contains historic commitments by the UAE to further align their national security regulations with the United States, including strong protections to prevent the diversion of U.S.-origin technology."
Reuters had earlier reported that the two countries had finalised a technology framework agreement and that it would require commitments on both sides to the security of the technology.
The UAE could be allowed to import 500,000 of Nvidia's most advanced AI chips per year starting in 2025, sources have told Reuters. Nvidia declined to comment. The UAE foreign ministry did not immediately respond to a request for comment.
Central to the agreement announced on Thursday is the 10 square mile (25.9 square kilometre) AI campus in Abu Dhabi with 5 gigawatts of power capacity for AI data centres, the U.S. Commerce Department said.
"That's bigger than all other major AI infrastructure announcements we've seen so far," Rand Corporation analyst Lennart Heim said on X. That is enough power to support 2.5 million of Nvidia's top-line B200 chips, he calculated.
The campus will be built by Abu Dhabi state-backed firm G42, but U.S. Secretary of Commerce Howard Lutnick said in a release that "American companies will operate the data centers and offer American-managed cloud services throughout the region."
The U.S. fact sheets also described chip company Qualcomm working on an AI-related engineering centre and that Amazon Web Services, the cloud unit of the tech and commerce company, would work with local partners on cybersecurity and fostering cloud adoption.
EASING RELATIONS
The U.S. has pursued protectionist policies for years to curb China's access to advanced semiconductors, including ensuring the chips do not end up in the country via third parties.
Regulations are easing under Trump, whose AI czar, David Sacks, said in Riyadh on Tuesday that the Biden administration's export controls were "never intended to capture friends, allies, strategic partners".
Granting the UAE more access to the most advanced chips, manufactured by firms such as Nvidia (NVDA.O), opens a new tab, marks a major turnaround.
"This shift enables (the UAE) to deepen its technology partnership with the U.S. while still preserving trade ties with China," said Mohammed Soliman, senior fellow at the Middle East Institute.
"It doesn't mean abandoning China, but it does mean recalibrating tech strategy to align with U.S. standards and protocols where it matters most: compute, cloud, and chip supply chains," he said.
AI was top of the agenda when UAE President Sheikh Mohamed bin Zayed Al Nahyan visited Washington in December in the final days of Joe Biden's presidency. G42 and MGX, the state-linked vehicles picked to drive the UAE's AI investment push, have also invested in U.S. firms such as OpenAI and Elon Musk's xAI, while Microsoft last year agreed to invest $1.5 billion in G42.
The two companies said the deal was backed by security assurances, and under U.S. pressure, G42 had previously begun ripping out Chinese hardware it was using and selling off Chinese investments.
Still, major Chinese firms like Huawei and Alibaba Cloud are present in the UAE, and organised AI chip smuggling to China was tracked out of countries including Malaysia, Singapore, and the UAE, a source told Reuters in February.
- U.S. Federal Reserve officials feel they need to reconsider the key elements around both jobs and inflation in their current approach to monetary policy, given the inflation experience of the last few years and the possibility that supply shocks and the associated price increases may become more frequent in the years ahead, Fed chair Jerome Powell said Thursday.
"We may be entering a period of more frequent, and potentially more persistent, supply shocks—a difficult challenge for the economy and for central banks," Powell said in opening remarks at a two-day conference reconsidering the Fed's current approach to monetary policy, adopted in 2020 as the economy was still scarred by the pandemic.
"The economic environment has changed significantly since 2020, and our review will reflect our assessment of those changes," Powell said.
Powell did not focus on current monetary policy or the economic outlook. He did say he expected April personal consumption expenditures price inflation to have fallen to 2.2% -- a tepid reading but still likely not reflecting coming tariff-driven price increases.
Still, that reflects a "historically unusual result" of inflation falling from its pandemic peak without major damage to the economy, a "soft landing" that did take place under the Fed's current strategy. The current unemployment rate of 4.2% is higher than a year ago but remains around the level considered full employment by Fed officials.
But his comments suggest the Fed may be moving toward a strategic approach that makes more explicit its plans to stay in front of potential inflation shocks in the future -- something former officials and analysts have called for, given the central bank's slow response when inflation surged in 2021.
Caution around inflation is one reason the Fed has been cautious about drawing quick conclusions about the impact of the Trump administration's tariff policies, which have clouded their ability to judge the economy's strength and direction, and officials are also still wrestling over how the U.S. and global economies changed as a result of the pandemic.
The trend towards increasing globalization and market integration, which helped anchor low inflation up to the pandemic, for example, may be running in reverse as companies design more flexible supply chains and, now, respond to a developing tariff war.
The Fed, for now, has said it would stay on the sidelines, with interest rates held steady in the current 4.25% to 4.5% range until those questions get resolved.
At the same time, policymakers have since the start of the year been debating how to change their overarching approach to monetary policy, contained in a document that establishes things like the 2% inflation target and discusses how to achieve that and its other mandate of maximum employment.
Five years ago the Fed recast its approach to allow more room for lower unemployment rates and pledged to use periods of high inflation to offset years in which inflation was weak, a common occurrence from 2010 to 2019.
The inflation that took off after that, and the emerging state of the global economy, means that approach may need a rethink, Powell said.
"In our discussions so far, participants have indicated that they thought it would be appropriate to reconsider the language around shortfalls" of employment, a change adopted so the Fed would not consider a low unemployment rate in itself a sign of inflation risk, Powell said.
"At our meeting last week, we had a similar take on average inflation targeting. We will ensure that our new consensus statement is robust to a wide range of economic environments and developments."
His comments point to possibly extensive revisions to a strategy that had been viewed at its inception as a major shift for the Fed, with a willingness to take more risks in favor of a stronger job market and a willingness to tolerate higher inflation after periods of weakness.
But "the idea of an intentional, moderate overshoot proved irrelevant to our policy discussions and has remained so through today," following the near double-digit inflation that occurred during the pandemic reopening, Powell said.
Powell said amendments to the strategy will likely be made "in the coming months." The last framework was unveiled at the Kansas City Fed's annual August research conference in Wyoming.
