Today’s Business Update: House Approves Debt Limit Increase, Regulators Resolve Privacy Disputes with Amazon, and More

1. House Passes Bipartisan Deal to Raise Debt Limit, Sending it to Senate
The House of Representatives successfully passed a bipartisan agreement on Wednesday to increase the debt ceiling, averting a potential default that could have had severe consequences for the economy. The bill now moves to the Senate, where it faces further challenges before the June 5 deadline, when the Treasury Department predicts a shortage of funds to meet financial obligations. Some conservative members of the House opposed the bill, arguing that the compromise lacked sufficient spending cuts in exchange for raising the $31.4 trillion debt limit over a two-year period. Nonetheless, the measure received a comfortable 314-117 majority vote, serving as a test of House Speaker Kevin McCarthy’s leadership within his party’s slim majority.
2. FTC Settles with Amazon over Privacy Violations Involving Ring and Alexa
The Federal Trade Commission (FTC) announced a settlement with Amazon on Wednesday, involving privacy breaches related to the Ring doorbell camera unit and Alexa. The FTC revealed that a former Ring employee had used Ring cameras to invade the privacy of female customers in 2017, leading to a $5.8 million settlement. Additionally, Amazon agreed to pay $25 million to resolve allegations of violating children’s privacy rights by failing to comply with requests to delete Alexa recordings. These settlements reflect the FTC’s ongoing efforts to address concerns about privacy infringements by major technology companies. While Amazon, which acquired Ring in 2018, committed to implementing changes, it expressed disagreement with the FTC’s assertions regarding Ring and Alexa.
3. Amazon Corporate Workers Stage Climate Protest
Employees from Amazon’s corporate headquarters in Seattle organized a lunchtime walkout on Wednesday to protest against the company’s environmental impact, recent layoffs, and the order for employees to return to the office. The demonstration, led by Amazon Employees for Climate Justice, took place one month after the company mandated that employees work in-person three days a week. Over 1,900 employees worldwide, including 900 in Seattle, participated in the protest. Workers criticized Amazon’s extensive distribution network for its significant carbon footprint and claimed that the company’s actions to address environmental concerns were inadequate. In response, Amazon stated that it respects the rights of employees to express their opinions.
4. Stock Futures Inch Upward Following House Approval of Debt Ceiling Proposal
Early Thursday, U.S. stock futures experienced a slight increase after the House passed the debt ceiling agreement, advancing it to the Senate for further consideration. Futures tied to the Dow Jones Industrial Average rose by 0.1%, while futures linked to the S&P 500 and Nasdaq climbed 0.3% and 0.2%, respectively, as of 7 a.m. ET. Concerns about a potential default had unsettled markets, as the Treasury Department warned of an imminent shortage of funds to cover the nation’s financial obligations. Additionally, investors are preparing for the upcoming Federal Reserve policy meeting scheduled for June 13-14. Philadelphia Fed President Patrick Harker expressed a leaning toward supporting a pause in the Fed’s aggressive interest rate hikes to address inflation concerns, with the May jobs report on Friday potentially influencing this decision.
5. Job Openings Surge Unexpectedly in April
In a surprising turn, the U.S. Labor Department’s Job Openings and Labor Turnover Survey (JOLTS), released on Wednesday, revealed a significant increase in job vacancies during April. Available positions rose from a revised 9.75 million in March to 10.1 million, marking the highest level in three months. Economists surveyed by Bloomberg had anticipated a more modest figure of 9.4 million job openings. This report has raised expectations that the Federal Reserve may proceed with another interest rate hike in June to temper the economy, rather than pausing due to easing inflation and concerns about the banking sector’s stability. The May jobs report, set to be released on Friday, will be closely monitored by Fed policymakers as it is expected to indicate a slowdown in hiring.