An economic soft landing for the US got a little harder on Friday, at least as far as consumer perceptions are concerned. The University of Michigan’s consumer sentiment index tumbled to 65.6 in June, defying economists’ estimates of a rise. The gloom that has held back President Joe Biden’s approval rating, despite a long and consistent list of positive indicators, just refuses to lift. A measure of consumers’ current assessments of their personal finances fell 12 points to 79, the lowest reading since October, and views on economic conditions are the worst since late 2022. That said, it’s become widely understood that America’s political polarization has become a prime mover of consumer sentiment, with Democrats more likely than Republicans to see things positively.

Fed Chair Jerome Powell departs following a news conference on June 12 in Washington. The central bank held rates steady for now. Photographer: Al Drago/Bloomberg

When you join those grim sentiment numbers with a surprise 0.2% decline in the producer price index for May, that makes for yet another curve ball in the big Fed rate-cut game. Expectations for 2024–once two, then one, maybe none?–may well be back to two again. Or even three, as Morgan Stanley is calling for. Yes, the central bank penciled in a single cut at its latest meeting, but that’s why our central bankers use pencil. Note that several components of the Fed’s favored inflation measure, the personal consumption expenditures price index, helped to drive the May producer price drop. It got cheaper to fly, to access health care and to have a pro manage your portfolio, among other things. Beyond prices, a surge in initial jobless claims sent the four-week moving average to 227,000, the highest since September–a further indication that overheating is no longer a primary concern and the Fed may feel a growing push to drop rates. And yet, US money-market funds soared to an all-time high on expectations that the Fed, while it may ease, is in little rush to do so. In other words, the game continues.

What was Emmanuel Macron thinking? That’s the question many are asking at the Group of Seven summit, where the French leader seems notably subdued after calling snap parliamentary elections. It was a risky— to some observers extreme—reaction to European Union elections in which the far-right trounced Macron’s party. His hope may be that French voters fearful of extremists will give him a renewed mandate, but dire warnings may not work this time. Marie Le Pen’s National Rally party would gain 31% in a recent poll, compared with 18% for Macron’s. Meanwhile France’s left-leaning parties have sealed an alliance that would pick apart Macron’s economic reforms and, Finance Minister Bruno Le Maire warned, possibly lead to France’s exit from the EU. 

Emmanuel Macron Photographer: Nathan Laine/Bloomberg

The US Supreme Court, controlled by Republican appointees who a few years ago erased the federal right to abortion, found rare agreement among its members and with the American public, preserving full access to the widely used abortion drug mifepristone. However, the ruling was on procedural grounds and leaves future access to the medicine wide open to attack, with a more dangerous challenge already brewing in the lower courts. The six Republican appointees, two of whom are under intense scrutiny for ethical lapses and allegations of political bias, later united to throw out a federal ban on bump stocks, the attachments that let a semiautomatic rifle fire at speeds rivaling a machine gun. The law was passed in the aftermath of a series of mass killings.

Tesla investors re-approved Elon Musk’s compensation and cleared the company to move its legal home to Texas, offering votes of confidence in the chief executive despite a sales slump and falling stock price. That does not mean Musk will necessarily get his $56 billion pay package: The vote has more symbolic weight than the legal power to reverse a judge’s ruling. Then there’s SpaceX. Fired engineers have sued Musk for sexual harassment and retaliation in California state court, escalating their multi-front legal battle with the billionaire The allegations are a reminder, Sarah Green Carmichael writes in Bloomberg Opinion, that “harassment is about power, and Musk is one of the most powerful men in the world.” 

Photographer: Bloomberg

South Africa’s political leaders agreed to a broad alliance to form the next government and back the reelection of Cyril Ramaphosa as president after the African National Congress lost its outright majority. The alliance would be led by the ANC and the business-friendly Democratic Alliance, a pairing that pushed the rand and the nation’s stocks higher. Bloomberg’s Next Africa newsletter notes that keeping a coalition of former foes together will be “tricky.” They still need to hammer out who will be in the new cabinet and agree on common policy positions.

Adding fruit or juice has been long been staple of craft beers: More and more are now using grapes for a beer-wine hybrid (Italy has 170 producers). The stone manor (below) in the UK that was the childhood home of Florence Nightingale is up for sale for $4.8 million. And here are 11 ideas for the perfect gift for the host of a summer gathering. 

The property was the home of the Nightingale family Source: Blue Book Agency

• Bank of England meets but is unlikely to cut interest rates.
• US reports retail sales, which are expected to stay flat. 
• Vladimir Putin visits North Korea and Vietnam.
• Chinese Premier Li Qiang visits Australia, senior-most visit since 2017.
• Boeing CEO Dave Calhoun testifies before the US Senate.

Once the pride of American aviation, Boeing keeps making headlines for all the wrong reasons. A panel that blew out midair in January triggered US officials to order a limit on the 737 Max aircraft’s manufacturing. In the Bloomberg Originals mini-documentary How Boeing’s Plane Turmoil May Make Summer Travel Worse, we explain how this may impact you and your family in the coming months—and not in a good way.

Photographer: Alex Kraus/Bloomberg

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