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U.S. inflation picked up a bit last month as food costs rose, though overall inflation remained mostly tame.Consumer prices increased 2.4% in May compared with a year ago, according to a Labor Department report released Wednesday. That is up from a 2.3% yearly increase in April. Excluding the volatile food and energy categories, core prices rose 2.8% for the third straight month. Economists pay close attention to core prices because they generally provide a better sense of where inflation is headed.The figures suggest inflation remains stubbornly above the Federal Reserve’s 2% target, which makes it less likely that the central bank will cut its key short-term interest rate. President Donald Trump has repeatedly urged the central bank to reduce borrowing costs.There were scattered signs that Trump’s tariffs may have contributed to some price increases, but the cost of some imported goods, such as clothing, fell in May from the previous month and many services, such as airline fares and hotel rooms, also dropped in price.On a monthly basis, overall prices ticked up just 0.1% from April to May, down from 0.2% previous month. Core prices also dropped to 0.1% from 0.2%.Grocery prices rose 0.3% from April to May, and are up 2.2% in the past year. Fruits and vegetables, breakfast cereals, and frozen foods all rose in price. Egg costs fell 2.7%, their second straight drop though they are still more than 40% more expensive than a year ago.Last week, the Labor Department’s Bureau of Labor Statistics, which compiles the inflation data, said it is reducing the amount of data it collects for each inflation report. Economists have expressed concern about the cutback, and while it isn’t clear how sharp the reduction is, most analysts say it is likely to have a minor impact. Still, any reduction in data collection could make the figures more volatile.Inflation has cooled in the past year and, excluding the impact of tariffs, economists say it would be on track to return to the Fed’s target, which would allow the central bank to cut its key interest rates. Yet core prices have been more stubborn and were stuck between 3.2% and 3.4% for nearly a year until February, when they started to decline. They have now been at 2.8% for three straight months.Nearly all economists expect Trump’s duties will make many things more expensive in the second half of this year, including cars and groceries, though by how much is still uncertain. Trump said Wednesday the U.S. will place 55% tariffs on all imports from China, up from the previous level of 30%. He has also imposed a 10% baseline tariff on imported goods from every other country, and 50% import taxes on steel and aluminum.Given the potential for higher prices in the coming months, Fed Chair Jerome Powell and other Fed officials have made clear they will keep their key rate unchanged until they have a better sense of how tariffs will affect the economy. Christopher Rugaber and Anne D’Innocenzio, Associated Press Writers
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E-Commerce
Mark Zuckerberg has decided he wants to claw back lost ground in the AI race, and hes willing to spend heavily to do it. The Meta CEO is reportedly hiring staff personally for a new superintelligence lab within the company, offering massive salaries to attract top talent. Meta has also announced the acquisition of Scale AI, with founder Alexandr Wang joining the superintelligence team. I’m not surprised with the choice of Alex Wanghe is friends with Zuckerberg, says a former Meta employee, granted anonymity due to restrictions from their current employer. Wangs political leanings may help deflect regulatory scrutiny, the former staffer adds, and he also has a track record of executing whereas the new Meta AI leads have messed up Llama big time. The real challenge may be finding people to join them. AI talent is in high demand, with leading labs offering millions to top engineers. Meta, with its vast resources, is reportedly offering up to nine-figure compensation packages. Meta has been trying to pull in top-tier talent from other labs for a while now, like the big open source AGI announcement on Zucks Instagram, says another industry source who requested anonymity. I guess they felt they needed to mix it up for whatever reason. But Metas reputation could be a hurdle. What you have to understand about Meta is that it’s very Game of Thrones-like, with people constantly fighting over power and influence, says the former employee. Bloat and excessive middle management remain problems. That’s a major reason why their products are crap and now it’s affecting their AI research too, the former employee adds. (Meta did not immediately respond to a request for comment.) According to the anonymous industry source, one potential draw for candidates is Metas vast supply of GPUs. Meta has an absolutely massive stockpile of GPUs it doesnt seem to be using particularly well, so possibly they think that could turn some heads, they say. Still, the companys AI output has often trailed competitors. The hope would probably be that the new org completely clears house. Ray Wang, a Washington-based semiconductor and technology analyst, agrees hiring could be tough, especially given Metas recent stumbles in large language model development. Still, he sees reasons some might sign on. Meta still possesses deep hardware and software resources, platforms with tens of millions of users, and forthcoming AI-enabled products, which together should offer researchers and engineers a compelling environment for developing future cutting-edge models and implementing them in the companys products and platforms at scale, Wang says. The money is likely to be the biggest motivator. The main pull is probably compensationthough its possible some people could feel like they are getting in on the ground floor of a new org despite Meta being a giant, says the industry source. But for potential hires, a lingering concern may be Zuckerbergs direct involvement in the new lab. Im also not surprised Zuckerberg is deeply involved, says the former Meta staffer. Hes always done that when things he cares about go badly. Or he feels he can make them better by getting involved. Sadly, he has a poor track record: Rooms, e-commerce, metaverseall flops.
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E-Commerce
Elon Musk stepped back from his explosive feud with U.S. President Donald Trump, writing on X that he regrets some of his posts about his onetime ally and that they went “too far.”Early Wednesday morning, he posted “I regret some of my posts about President @realDonaldTrump last week. They went too far.”Musk’s break with a president whom he spent hundreds of millions of dollars to elect appeared to put an end to his influence in the White House and prompted concerns about effects on his companies. As a major government contractor, Musk’s businesses could be particularly vulnerable to retribution, and Trump has already threatened to cut Musk’s contracts.Musk earlier deleted a post in which he claimed without evidence that the government was concealing information about the president’s association with infamous pedophile Jeffrey Epstein. Meanwhile, other posts that irritated Trump, including ones in which Musk called the spending bill an “abomination” and claimed credit for Trump’s election victory, remained live.On Sunday, Trump told NBC’s Kristen Welker that he has no desire to repair their relationship and warned that Musk could face ” serious consequences ” if he tries to help Democrats in upcoming elections. Associated Press
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E-Commerce
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