The Biden administration on Wednesday proposed new rules that would limit the fees credit card companies charge for missed payments.

The move was announced as part of the White House’s broader efforts to limit fees across a number of consumer-facing products, from airline fares to entertainment tickets.

The Consumer Financial Protection Bureau proposed capping credit card late fees at $8 Wednesday, which would be lower than the up to $41 that some companies charge on top of interest payments.

“We worry that credit card companies are actually hoping that consumers are a day or two late so that they can cash in on fees,” Biden-appointed CFPB Director Rohit Chopra told reporters.

The CFPB rule would tighten a regulation from a 2009 law known as the Credit Card Accountability Responsibility and Disclosure (CARD) Act, which requires companies to charge only “reasonable and proportional” fees to cover the cost of handling late payments.

Credit card companies were using the provision to charge as much as $41, which the CFPB estimates is five times greater than the cost of collecting late payments.

“Companies would be able to charge above the immunity provision so long as they could prove the higher fee is necessary to cover their incurred collection costs,” a CFPB document clarified.

Capping the fee at $8 would reduce late fees by as much as $9 billion a year, according to the CFPB.

The agency said in June it would try to cap late fees; Wednesday’s announcement starts the clock on a formal public comment period. Credit card companies like Synchrony Financial had expected the CFPB to issue the rule. Synchrony Financial CEO Brian Doubles said on an earnings call last week that there were avenues for the company to “offset the impact [of the rule] if there is one.”

The CFPB has faced challenges to its rules before. In 2017, a Republican-led Congress struck down a CFPB regulation seeking to ban companies from using mandatory arbitration clauses in consumer financial products.

The proposed credit card late-fee cap follows the fourth meeting of President Joe Biden’s Competition Council, a group of various administration officials and regulators assembled to address “overconcentration, monopolization, and unfair competition.”

As part of the meeting, the Commerce Department also released a report evaluating Apple’s and Google’s holds over their respective app stores. The report criticized the two tech giants for practices that it said limit competition and innovation. It recommended administration actions that would promote “alternative means” for downloading apps as well as more antitrust enforcement on the companies themselves.

The administration continues to call on Congress to address other consumer-facing fees. As part of a proposed “Junk Fee Prevention Act,” the Biden administration hopes to ban airline fees for family members to sit with young children, eliminate surprise resort and destination fees and end early termination fees for TV, phone and internet service.

The bill would also take aim at online ticket fees for concerts, sporting events and other entertainment.

Conagra Brands is recalling some 2.6 million pounds of canned meat and poultry that were potentially spoiled due to a packaging defect.

The recall primarily affects goods sold under the Armour brand, including Armour Vienna Sausage and Armour Chicken Vienna Sausage. Vienna Sausages sold under several other brands, including Goya, are also affected. The full list of items can be found here.

The meat and poultry products were produced between Dec. 12 and Jan. 13. 

The recall notice on the Agriculture Department’s website states that a Conagra establishment notified it ‘after observing spoiled and/or leaking cans from multiple production dates at the establishment’s warehouse.’

‘Subsequent investigation by the establishment determined that the cans subject to recall may have been damaged in a manner that is not readily apparent to consumers, which may allow foodborne pathogens to enter the cans,’ it said.

The Agriculture Department added it is ‘concerned that some product may be on retail shelves or in consumers’ pantries.’ Shoppers who have purchased these products should throw them away or return them to the place of purchase.

There have been no confirmed reports of adverse reactions due to the consumption of these products.

Bed Bath & Beyond is closing an additional 87 stores, as the troubled home goods retailer seeks to consolidate its assets ahead of a possible bankruptcy filing.

The company confirmed the closures in a statement, adding it was also closing all Harmon health and beauty store locations.

‘As we work with our advisors to consider multiple paths, we are implementing actions to manage our business as efficiently as possible,’ it said, adding that it is analyzing its store footprint ‘based on a variety of factors.’

The chain is also closing five buybuy BABY stores. In total, the company has announced 237 store closures since last year.

The latest closures affect stores nationwide; a full list of the latest locations shutting down can be found here.

On Tuesday, Reuters reported Bed Bath & Beyond could file for bankruptcy as soon as this week. Last week, the company said it defaulted on a loan to JP Morgan Chase and Co.

Sources have also told Reuters the company is considering skipping debt payments due Wednesday, a typical move that distressed companies take to conserve cash.

The Federal Reserve announced Wednesday that it had raised its key federal funds rate by 0.25% as it seeks to keep putting downward pressure on economic growth in its bid to slow inflation.

It was the smallest rate hike since the central bank began an aggressive campaign that has produced nearly monthly rate hikes since last March.

The Fed said in its statement Wednesday that more rate increases are most likely coming.

But in his news conference following the rate-hike announcement, chairman Jerome Powell said he and other Federal Reserve officials believed ‘a couple’ more hikes would likely suffice to reach a high enough interest rate at which the Fed would feel comfortable pausing the increases.

That helped send stocks higher in Wednesday trading.

It’s all part of an effort to slow price increases that have bedeviled U.S. consumers.

While there are now ample signs that inflation is, indeed, decelerating, some indications suggest that the economy is already reflating, which could send prices creeping up again.

According to a Bloomberg index, financial conditions in the U.S. have eased to their loosest level since last February, meaning it is becoming easier to borrow money and sell goods again. That’s reflected in declining average mortgage rates, which have fallen back to 6.13% after having hit a high of 7.08% in November.

In addition, rising prices of commodities like oil, as well as a weakening U.S. dollar and improvement in the performance in the stock market, have all contributed to some cautious optimism about the economy.

For now, economists say that recession fears appear to be unwarranted and that, if anything, there remains a risk that the Fed will have to continue its monetary tightening to prevent the economy from growing too fast again.

‘The Fed is staring down the barrel of an upturn in economic activity,’ Neil Dutta, the head of U.S. economics at Renaissance Macro financial group, wrote in a recent note to clients. A 0.25% interest rate hike may end up proving too small, Dutta said — with the risk that the Fed will have to return to a stricter policy later. ‘The Fed’s story only works if the economy is slowing down. Sorry, but I don’t see it.’

Economists at Bank of America agree.

‘Passing peak inflation is welcome and policymakers appear to have increased confidence that inflation is on a downward path,’ the bank’s analysts wrote in a note to clients Tuesday, ‘but the Fed is not yet convinced that inflationary pressures will dissipate quickly.’

The Fed did get a favorable data point Tuesday in its effort to slow inflation, although it came at the expense of workers: Private wages and salaries climbed by just 1% in the last three months of 2022, down from a 1.2% gain in the quarter before that, according to the Bureau of Labor Statistics.

Economists say the Fed will continue to emphasize that it will keep interest rates higher for longer, even if it comes at the expense of gains in wages and employment — although it will most likely point out that the unemployment rate remains historically low to keep making the case for its rate-hiking agenda.  

‘We expect Fed Chair Powell will insist on the need [to] hold policy at a restrictive level for some time to bring inflation down toward the 2% target,’ Gregory Daco, the chief economist at Ernst & Young’s EY-Parthenon consultancy, said in a note to clients in advance of Wednesday’s announcement, adding: ‘Powell will also stress that history cautions strongly against prematurely loosening policy.’

The Federal Reserve is still raising interest rates, meaning homebuyers will still face high mortgage rates after a rough 2022 for the housing market.

The past year has been a rollercoaster ride for homebuyers and sellers alike. In early 2022, homes in Atlanta were getting as many as 32 offers with bids averaging $85,000 over asking price, according to one real estate agent based in the fast-growing city.

“We were getting one, two offers towards the summer,” said Courtney Phillips of EXP Realty.

But by the fall, mortgage rates had more than doubled from the start of the year, as the Fed began raising interest rates to tackle surging inflation.

“And then it just kind of slowed,” Phillips recalled, “where you’re on the market a couple of weeks and you get one really strong offer at list price.” By November and December, she said home sellers were cutting prices.

While cheaper list prices could help push more would-be buyers off the sidelines across the country this year, pressure on the slowing housing market is unlikely to let up anytime soon.

The Fed lifted interest rates by 0.25% on Wednesday, a move that increases the borrowing costs consumers face on everything from home mortgages to auto loans and credit card payments. And Fed Chairman Jerome Powell signaled that the central bank may not be done raising rates as it continues to deliberately slow the economy to cool inflation, which is currently pacing at a yearly rate of 6.5%.

“We expect ongoing hikes will be appropriate,” Powell told reporters Wednesday afternoon, later adding, “I don’t see us cutting rates this year.”

Mortgage rates do not move directly in line with the Fed’s rate-setting decisions, but experts say high mortgage rates are unlikely to come down dramatically through much of 2023. While rates have been ticking down slightly from recent highs, economists at Fannie Mae expect 30-year fixed mortgage rates to end the year at 6%, little reprieve from the 6.13% recorded on Jan. 26.

“We’re past the 3% era,” said Odeta Kushi, deputy chief economist at First American, which provides title insurance to real estate transactions.

Those high interest rates have weighed on sellers, who watched a hot housing market fizzle, as well as on buyers who might otherwise want to take advantage of falling prices.

Existing home sales tumbled over the course of last year, from an annualized rate of 6.5 million homes in January 2022 to a little over 4 million in December — the slowest pace since 2010. And home prices notched their fifth straight monthly decline last November, the S&P CoreLogic Case-Shiller National Home Price Index showed this week, reflecting slower demand in a climate of pricier mortgages.

Homebuilders are also growing concerned about cascading cancellations of home-purchasing deals under contract, a sign that some prospective buyers are balking. KB Homes reported a 68% cancellation rate in the fourth quarter of last year, substantially higher than normal and above the rates observed during the 2008 financial crash.

“While we recognize that price is the most effective sales lever to generate new orders, we also know that if we lower the base price in the community on new sales, many buyers in backlog will expect to receive a similar reduction, regardless of the rate in which they may have locked their loan,” KB Homes Chief Operating Officer Rob McGibney said on a Jan. 11 earnings call.

There are signs that the drop in home sales may have bottomed out, as the slight retreat from 7% mortgage rates lures some prospective homebuyers back into the market. Mortgage applications are up 28% from early November, and real estate company Redfin noted in January that bidding wars are popping up in markets like Seattle and Tampa, Florida.

Still, Kushi points out that prices will have to be attractive for homebuyers to take on interest rates that remain elevated. Home sellers have already resorted to mortgage buydowns — a type of deal allowing buyers to secure lower rates, at least in the first few years of homeownership — or concessions like new appliances to persuade buyers to sign on the dotted line.

“We’re likely to see more price declines to allow the housing market to rebalance fully,” Kushi said.

In Atlanta, Phillips said there are signs of a recovery as homebuyers have started coming back into the market in recent weeks. But as is always the case with real estate, she said, it depends on the property.

“If the home is priced correctly, and it’s presenting well and it’s in a great area, then you’re getting multiple offers,” she said. “Otherwise, it is sitting.”