The week in business: the housing market is squeezed

Mortgage rates hit 5% for the first time in more than a decade, the kind of rise that in the past has caused problems for the housing market. But in the current climate, the impact of higher rates is uncertain. During the pandemic, many people, with extra savings in their pockets and looking for more space, have driven up house prices. That, combined with supply chain issues that have slowed new home construction, fueled competition and made new homes hard to find. The inventory of homes for sale remains extremely low and there are still more interested buyers than homes. But if the market doesn’t feel the sting, potential buyers certainly will, especially those already struggling with rising prices for food, gas, cars and other daily necessities.

In less than two weeks, Elon Musk bought a more than 9% stake in Twitter, joined the board, left the board and, now, has submitted an offer to buy the company for 43 billion. of dollars. In a filing with the Securities and Exchange Commission on Thursday, Musk said he was not “playing the back and forth game” and had gone “straight to the end” with his offer. . But other “round trips” seem to arise. Twitter’s board adopted a so-called poison pill on Friday to thwart Mr Musk’s bid to acquire the company. Mr Musk has said he has a plan B if Twitter rejects his offer, but even so he is likely to face scrutiny from the SEC, especially given his track record of trouble with the agency and a new lawsuit accusing him of delaying his disclosure of his stake in Twitter. Mr Musk has repeatedly expressed a desire to make Twitter content less moderate, and in his filing on Thursday he said he did not trust the site’s current management to make free speech priority on the platform.

Inflation hit 8.5% in the United States in March, registering the effects of the war in Ukraine, which pushed up gasoline prices. It was the fastest 12-month pace of inflation since 1981. But economists say March could represent a spike as fuel costs start to fall and some researchers expect consumers to stop spending. to buy so many goods. And a silver lining in the report was that the core inflation rate, which is not distorted by volatility in food and fuel prices, was slightly lower in March than the previous month. Federal Reserve Governor Lael Brainard said it was “very welcome” to see moderation in that number.

Russia is facing a delay in payment and, due to Western sanctions, it may not be able to meet its obligations. This month, the Russian government paid off about $650 million of dollar-denominated debt in rubles. As a result, S&P Global placed the country under a “selective default” rating. Moody’s, another rating agency, said on Thursday that the country could be considered in default if it did not find a way to repay its foreign currency obligations in dollars instead of rubles. Russia has a 30-day grace period to find the money in dollars, but that window closes on May 4, when Russia could default on its foreign-currency debt for the first time in more than a month. a century.

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