Collins says solid economy gives Fed time to assess next move

INTEREST RATES

Federal Reserve Bank of Boston President Susan Collins said she continues to believe the US central bank can be patient in considering interest rate cuts, suggesting healthy business and household balance sheets may limit the impact of tariffs on the economy. “Continued overall solid economic conditions enable the Fed to take the time to carefully assess the wide range of incoming data,” Collins said Tuesday in remarks prepared for an event organized by the National Association for Business Economics in Washington. “Thus, in my view, an ‘actively patient’ approach to monetary policy remains appropriate at this time.” Fed officials have kept interest rates steady this year as they await the impact of aggressive policy changes by President Trump, particularly those related to trade. Most officials expect tariffs to raise inflation, but recent reports have been mixed, fueling a debate among policymakers over their ultimate impact. Consumer price data released Tuesday showed underlying inflation in June rose by less than expected for a fifth consecutive month, but also that tariffs were beginning to leave their mark on the prices of some goods. “In all, financial data point to the possibility that the impact of tariffs may be lessened somewhat by an ability for firms to decrease profit margins and for consumers to continue spending, despite higher prices,” Collins said. “As a result, the adverse impact of tariffs on labor market conditions and economic growth may be more limited.” Collins said the Boston Fed had developed a “a new methodology that quantifies how price increases at the US border transmit to domestic consumer prices.” She said she expects the central bank’s preferred gauge of underlying inflation will likely “be in the vicinity of 3 percent by year’s end, before resuming its decline.” In May, it stood at 2.7 percent. — BLOOMBERG NEWS

MEDIA

Nextdoor, the social media site that aims to create connections among neighbors, is trying to shake off an uneven past and a nagging sense it is being underutilized. How? It is turning to professional journalists for help. The company announced a partnership Tuesday with more than 3,500 local news providers who will regularly contribute material to the app. As part of a redesign, it is also expanding its ability to alert users about bad weather, power outages, and other dangers, along with using AI to improve recommendations for restaurants, services, and local points of interest. “There should be enough value that we are creating for neighbors that they feel like they need to open up Nextdoor every single day,” said Nirav Tolia, the company’s cofounder and CEO. “And that isn’t the case today.” The potential for Nextdoor to help itself and journalists at the same time is most intriguing. Nextdoor is carrying portions of local news stories from providers in the area where the user lives. If people want to learn more, a link to the news site is included. At launch, Nextdoor says it has more than 50,000 news stories available, representing just over three-quarters of the app’s “neighborhoods.” — ASSOCIATED PRESS

TECH

Three months after shutting down Nvidia’s artificial intelligence chip sales to China, the Trump administration has reversed course. On Monday, the Silicon Valley company said in a blog post that the US government had approved sales of a China-specific AI chip known as the H20. Nvidia will still need licensing approval from the US government to fulfill those orders, but the Trump administration “has assured Nvidia that licenses will be granted,” the company said. The decision came after Jensen Huang, Nvidia’s CEO, met Thursday with President Trump. Huang has spent months lobbying politicians across Washington to keep China open for AI chip sales. China has the potential to deliver billions of dollars in sales for the world’s most valuable public company, which last week became the first to reach a $4 trillion valuation. Huang has also visited China several times this year, including a trip to Beijing this week where he is scheduled to give a news conference Wednesday. The Commerce Department and White House did not immediately respond to requests for comment. — NEW YORK TIMES

FINANCE

A federal judge in Texas removed a Biden-era finalized ruled by the Consumer Financial Protection Bureau that would have removed medical debt from credit reports. US District Court Judge Sean Jordan of Texas’s Eastern District, who was appointed by Trump, found on Friday that the rule exceeded the CFPB ‘s authority. Jordan said that the CFPB is not permitted to remove medical debt from credit reports according to the Fair Credit Reporting Act, which protects information collected by consumer reporting agencies. Removing medical debts from consumer credit reports was expected to increase the credit scores of millions of families by an average of 20 points, the bureau said. The CFPB states that its research has shown outstanding health care claims to be a poor predictor of an individual’s ability to repay a loan, yet they are often used to deny mortgage applications. The three national credit reporting agencies — Experian, Equifax, and TransUnion — announced last year that they would remove medical collections under $500 from US consumer credit reports. The CFPB’s rule was projected to ban all outstanding medical bills from appearing on credit reports and prohibit lenders from using the information. The CFPB estimated the rule would have removed $49 million in medical debt from the credit reports of 15 million Americans. According to the agency, one in five Americans has at least one medical debt collection account on their credit reports, and over half of the collection entries on credit reports are for medical debts. The problem disproportionately affects people of color, the CFPB has found: 28 percent of Black people and 22 percent of Latino people in the United States carry medical debt versus 17 percent of white people. — ASSOCIATED PRESS

POLITICS

In the weeks since Zohran Mamdani’s stunning victory in the Democratic mayoral primary, some corporate and finance leaders have predicted an exodus of wealthy investors from New York City. They have called him a Marxist and an out of touch idealist, and have warned of rough times ahead for the city if Mamdani, a democratic socialist, wins the general election in November. On Tuesday and Wednesday, leaders on Wall Street and across the business world will have an opportunity to confront Mamdani directly in meetings with the Partnership for New York City, a consortium of 350 members representing banks, law firms, and corporations. The meetings were requested by Mamdani, an Assembly member from Queens who says he wants to work with the business community. Mamdani has recently moderated some of his stances that have generated the most controversy as he shifts his focus to the general election. Tuesday’s meeting will take place behind closed doors with no news media present, and more than 100 executives are expected to attend. The Partnership’s board is a who’s who of powerful business leaders including Henry Kravis of KKR, Rob Speyer of Tishman Speyer, and J.P. Morgan CEO Jamie Dimon. Dimon last week publicly criticized Democrats for “falling all over themselves” to support Mamdani’s policies including city-run grocery stores and a rent freeze on rent-stabilized apartments. “There’s the same ideological mush that means nothing in the real world,” Dimon said at an event in Europe. — NEW YORK TIMES