FEDERAL RESERVE
Inflation is next worry as economy gains strength
The Federal Reserve is increasingly confident in the economy and is about to end a $600 billion program to support it. Now for the next step: figuring out how to keep inflation from taking off.
Since late last year, the Fed has bought government bonds to keep interest rates low. Fed Chairman Ben S. Bernanke and his colleagues are expected to signal this week that they will allow the program to expire as scheduled in June.
The end of the bond-buying program would mean that, aside from tax cuts, almost all of the extraordinary measures that the government took to prop up the economy are over. Congress is fighting over how deeply to cut federal spending, not whether to spend more for stimulus.
Since the Fed announced the plan in August, worries that the economy would fall back into recession have all but disappeared. The private sector is adding jobs, and the stock market is at its highest point since the summer of 2008.
But higher oil and food prices pose a threat. If companies are forced to raise prices quickly to make up for escalating costs, that could start a spiral of inflation. Exactly how much of a threat inflation poses to the economy right now is a matter of disagreement within the central bank.
LABOR
Arizona, South Dakota sued over union laws
The National Labor Relations Board says it will move ahead with lawsuits against Arizona and South Dakota over state constitutional amendments that require secret-ballot elections to form unions.
The move was announced after weeks of negotiations that failed to reach a settlement between the federal government and attorneys general for the two states.
The agency says the amendments conflict with federal law that gives employers the option to recognize a union if a majority of workers simply sign cards that support unionizing.
Both states say they plan to vigorously defend the changes to their state constitutions approved by voters on Nov. 2.
The agency also had threatened to sue South Carolina and Utah over the same issue. Federal officials say they reserve the right to bring those cases later.
AIRLINES
Boeing process eyed in inquiry of jet roof
Investigators trying to determine why the roof of a Southwest Airlines jet peeled open in flight this month are focusing on the manufacturing process at Boeing.
Government and industry officials say investigators noticed that the stricken jet and five other Southwest planes that had cracks in their metal skins were all built at about the same time in the same Boeing plant.
The officials cautioned Monday that no final determination has been made about why the planes developed cracks in an area of the fuselage many years before Boeing expected to see problems.
A 5-foot hole tore open in the roof of the Southwest Boeing 737 as Flight 812 climbed to 34,000 feet above Arizona on April 1. The pilot guided the plane to a safe emergency landing, and there were no serious injuries.
Metal fatigue was initially suspected to have caused tiny subsurface cracks in the aluminum skin, which gave way during flight. Now investigators think the seeds of the near-disaster might have been planted when the plane was built.
ACQUISITION
Yahoo buys software for TV viewers to share
SUNNYVALE, Calif. | Yahoo Inc. has bought the maker of mobile software that makes it easier for people to let their friends know what TV shows they’re watching.
The deal to buy IntoNow, announced Monday, is part of Yahoo’s effort to provide more information-sharing services. The company, which is based in Sunnyvale, is trying to give people more reasons to stay on its website and services instead of increasingly popular online hangouts such as Facebook and Twitter.
Financial terms weren’t disclosed.
IntoNow also lets viewers identify their favorite TV commercials, a feature that might open ways for Yahoo to sell more ads in its online videos.
COMMERCE
Diapers, toilet paper to cost consumers more
CINCINNATI | Shoppers could soon see higher prices for Pampers diapers, Charmin toilet paper and Bounty paper towels.
Procter & Gamble Co. said Monday that it raised U.S. list prices for those products because of rising costs for pulp, oil and gas.
The Cincinnati-based consumer products maker informed retailers of increases last week. Retailers will decide how much of those price increases to pass along to shoppers.
P&G said list prices for Pampers are up 7 percent on average, Pampers wipes up 3 percent, and Charmin and Bounty products are up 5 percent. P&G said Luvs, its lower-priced diaper brand, remains unchanged.
• From wire dispatches and staff reports
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