Trump golfs in Scotland as Epstein questions persist
Trump arrived on Friday on a visit that has triggered protests in Scotland, with hundreds lining the streets of the capital Edinburgh waving placards saying: "NOT MY PRESIDENT."
The U.S. leader told reporters on arrival that he would visit his two golf properties in Scotland — one in Turnberry on the west coast where he is playing on Saturday and the other near Aberdeen on the country's eastern coast.
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Yomiuri Shimbun
5 minutes ago
- Yomiuri Shimbun
Trump Fires US Labor Official over Data and Gets Earlier Than Expected Chance to Reshape Fed
WASHINGTON/NEW YORK, Aug 1 (Reuters) – President Donald Trump on Friday fired a top Labor Department official on the heels of a market-shocking weak scorecard of the U.S. job market, accusing her without evidence of manipulating the figures and adding to already growing concerns about the quality of economic data published by the federal government. In a second surprise economic policy development, the door for Trump to make an imprint on a Federal Reserve with which he clashes almost daily for not lowering interest rates opened much earlier than anticipated when Fed Governor Adriana Kugler unexpectedly announced her resignation on Friday afternoon. The two developments further rattled a stock market already reeling from his latest barrage of tariff announcements and the weak jobs data. The benchmark S&P 500 Index .SPX sank 1.6% in its largest daily drop in more than two months. Trump accused Erika McEntarfer, appointed by former President Joe Biden, of faking the jobs numbers. There is no evidence to back Trump's claims of data manipulation by the Bureau of Labor Statistics, the statistical agency that compiles the closely watched employment report as well as consumer and producer price data. A representative for the BLS did not respond to a request for comment. Friday began with BLS reporting the U.S. economy created only 73,000 jobs in July, but more stunning were net downward revisions showing 258,000 fewer jobs had been created in May and June than previously reported. 'We need accurate Jobs Numbers. I have directed my Team to fire this Biden Political Appointee, IMMEDIATELY. She will be replaced with someone much more competent and qualified,' Trump said in a post on Truth Social. DATA CONCERNS A Trump administration official who requested anonymity said that while all economic data is noisy, the White House has been dissatisfied with how large the revisions have been in the recent data and issues with lower survey responses. The problem started during COVID and has not been addressed in the years since. 'There are these underlying problems that have been festering here for years now that have not been rectified,' the person said. 'The markets and companies and the government need accurate data, and like, we just weren't getting that,' the official said. The BLS has already reduced the sample collection for consumer price data as well as the producer price report, citing resource constraints. The government surveys about 121,000 businesses and government agencies, representing approximately 631,000 individual worksites for the employment report. The response rate has declined from 80.3% in October 2020 to about 67.1% in July, BLS data shows. A Reuters poll last month found 89 of 100 top policy experts had at least some worries about the quality of U.S. economic data, with most also concerned that authorities are not addressing the issue urgently enough. In addition to the concerns over job market data, headcount reductions at BLS have resulted in it scaling back the scope of data collection for the Consumer Price Index, one of the most important gauges of U.S. inflation, watched by investors and policymakers worldwide. Trump's move fed into concerns that politics may influence data collection and publication. 'Politicizing economic statistics is a self-defeating act,' said Michael Madowitz, principal economist at the Roosevelt Institute's Roosevelt Forward. 'Credibility is far easier to lose than rebuild, and the credibility of America's economic data is the foundation on which we've built the strongest economy in the world. Blinding the public about the state of the economy has a long track record, and it never ends well.' FED CHANGE SOONER THAN EXPECTED Meanwhile, Kugler's surprise decision to leave the Fed at the end of next week presents Trump an earlier-than-expected opportunity to install a potential successor to Fed Chair Jerome Powell on the central bank's Board of Governors. Trump has threatened to fire Powell repeatedly because the Fed chief has overseen a policymaking body that has not cut interest rates as Trump has demanded. Powell's term expires next May, although he could remain on the Fed board until January 31, 2028, if he chooses. Trump will now get to select a Fed governor to replace Kugler and finish out her term, which expires on January 31, 2026. A governor filling an unexpired term may then be reappointed to a full 14-year term. Some speculation has centered on the idea Trump might pick a potential future chair to fill that slot as a holding place. Leading candidates for the next Fed chair include Trump economic adviser Kevin Hassett, Treasury Secretary Scott Bessent, former Fed Governor Kevin Warsh and Fed Governor Chris Waller, a Trump appointee who this week dissented with the central bank's decision to keep rates on hold, saying he preferred to start lowering them now. Trump, as he was leaving the White House to spend the weekend at his Bedminster, New Jersey, estate, said he was happy to have the open slot to fill. 'I would not read any political motivation into what [Kugler is] doing, although the consequence of what she's doing is she's calling Trump's bluff,' said Derek Tang, an analyst at LH Meyer, a research firm. 'She's putting the ball in his court and saying, look, you're putting so much pressure on the Fed, and you want some control over nominees, well, here's a slot.'
Japan Times
6 minutes ago
- Japan Times
Trump fires data chief on bad job news and gets chance to tilt Fed
U.S. President Donald Trump got some bad economic news Friday, and responded by shooting the messenger. Trump fired the head of the Bureau of Labor Statistics, hours after it sent markets tumbling with a report that showed a dramatic slowdown in U.S. hiring. It's an escalation of his campaign against economic institutions long held to be above partisan politics — one that until now has principally targeted the Federal Reserve. And Trump got an unexpected opportunity that same afternoon to exert more influence at the central bank, too, when Gov. Adriana Kugler announced her imminent resignation, just as investors were still digesting the jobs numbers and the BLS news. He'll now get to name a replacement, likely one who's inclined to support his drive for lower interest rates. For a president who touts a hot U.S. economy, and claims his tariff hikes and tax cuts will make it stronger still, Friday's job numbers were a setback. They revealed the weakest employment growth since the pandemic. But his reaction — ousting BLS chief Erika McEntarfer, whom he accused without evidence of political bias — drew condemnation even from economists linked to his own party, and it's anxiety-inducing for investors, too. There's already widespread concern about Trump's relentless pressure on the Fed and its chief Jerome Powell to cut rates, since the consensus is that central banks do a better job of taming inflation when politicians leave them alone. His move against U.S. data agencies now risks damaging the integrity of the world's most important statistics — numbers that can move global markets by trillions of dollars at a time. Trump's targeting of the BLS will "spark general anxiety in the market that politics may bleed over into future economic considerations,' said Yung-Yu Ma, chief investment strategist at PNC Asset Management Group. "The bigger concern now for investors is what is the next step? Will Trump threaten to fire Fed Chair Powell again after this?' And these questions arise with the U.S. already facing a "nasty cycle,' Ma said, where growth slows and inflation starts to rise. Trump used Friday's hiring numbers to renew his attack on Powell, who'd cited a solid jobs market as one reason for holding interest rates steady earlier this week. There was a silver lining for the president: Markets immediately started pricing in a September cut when the data came in. Two-year Treasury bonds — which are tightly linked to short-term Fed rates — soared the most since 2023, sending yields down almost 30 basis points. The announcement of Kugler's departure, and the prospect of a Trump pick joining the Fed in her place, amplified rate-cut bets for later in the year. Meanwhile the S&P 500 index was slumping, the president was directing barbs at McEntarfer, and economists linked to both political parties were jumping to her defense. The BLS on Friday slashed its payroll estimates for the previous couple of months, as well as posting a below-forecast number for July. It's the latest in a series of unusually large revisions, which have drawn Trump's ire before — including in the run-up to last year's election. "Important numbers like this must be fair and accurate, they can't be manipulated for political purposes,' Trump posted Friday on social media. He later added that the figures "were RIGGED in order to make the Republicans, and ME, look bad.' But U.S. data agencies enjoy a global reputation for "gold standard' statistics — one Trump may now be putting in danger — and economists of all stripes dismissed the idea of politically motivated manipulation. "There's just absolutely no evidence' that McEntarfer had any desire to fake the numbers, said Michael Strain of the conservative-leaning American Enterprise Institute. William Beach, who was appointed to head the BLS during Trump's first term, called her firing "totally groundless' and said it sets a "dangerous precedent.' McEntarfer will be replaced at the BLS on an acting basis by William Wiatrowski, currently the deputy chief, the administration said. As for Kugler, whose term was due to end in January, it's not clear who'll be appointed to fill her seat — and it could be a decision with major consequences. Even before her early departure, Treasury Secretary Scott Bessent had suggested the administration might nominate a replacement for Kugler who'd then be elevated into the post of Fed chair. At the start of Friday, before all the drama that followed — the shock job numbers, BLS firing and Fed departure — Trump had issued a call to arms on social media, urging members of the central bank's board to defy their chair and vote for lower interest rates. "ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!' he wrote. Later on, departing the White House, the president told reporters he was "very happy' that he now has an open spot on the board — and posted that Powell should follow Kugler's example and resign.
Japan Times
6 minutes ago
- Japan Times
U.S. and NATO developing novel funding mechanism for Ukraine arms transfers
The U.S. and NATO are working on a novel approach to supply Ukraine with weapons using funds from NATO countries to pay for the purchase or transfer of U.S. arms, according to three sources familiar with the matter. The renewed transatlantic cooperation on Ukraine comes as U.S. President Donald Trump has expressed frustration with Moscow's ongoing attacks on its neighbor. Trump, who initially took a more conciliatory tone toward Russia as he tried to end the more than three-year war in Ukraine, has threatened to start imposing tariffs and other measures if Moscow shows no progress toward ending the conflict by Aug. 8. The president said last month the U.S. would supply weapons to Ukraine, paid for by European allies, but did not indicate how this would be done. NATO countries, Ukraine, and the United States are developing a new mechanism that will focus on getting U.S. weapons to Ukraine from the Priority Ukraine Requirements List, known under the acronym PURL, the sources said. Ukraine would prioritize the weapons it needs in tranches of roughly $500 million, and NATO allies — coordinated by NATO Secretary-General Mark Rutte — would then negotiate among themselves who would donate or pay for items on the list. Through this approach, NATO allies hope to provide $10 billion in arms for Ukraine, said a European official, speaking on condition of anonymity. It was unclear over what time frame they hope to supply the arms. "That is the starting point, and it's an ambitious target that we're working towards. We're currently on that trajectory. We support the ambition. We need that sort of volume," the European official said. A senior NATO military official, also speaking on condition of anonymity, said the initiative was "a voluntary effort coordinated by NATO that all allies are encouraged to take part in." The official said the new plan included a NATO holding account, where allies could deposit money for weapons for Ukraine, approved by NATO's top military commander. NATO headquarters in Brussels declined to comment. The White House, Pentagon, and Ukrainian Embassy in Washington did not respond to requests for comment. Russian forces are gradually advancing against Ukraine, and control one-fifth of Ukraine's territory. If a NATO country decides to donate weapons to Ukraine, the mechanism would allow that country to effectively bypass lengthy U.S. arms sales procedures to replenish its own stocks, said one U.S. official, speaking on condition of anonymity. Money for the arms would be transferred into a U.S.-held account, possibly at the U.S. Treasury Department, or to an escrow fund, although the exact structure remains unclear, the official said. The new mechanism would be in addition to the United States' own effort to identify arms from U.S. stockpiles to send to Ukraine under the Presidential Drawdown Authority, which allows the U.S. president to draw from current weapons stocks to help allies in an emergency. At least one tranche of weapons for Ukraine is currently being negotiated under the new mechanism, two sources said, though it was unclear if any money has yet been transferred. Trump's fellow Republicans in Congress have introduced legislation, known as the PEACE Act, that aims to create a fund at the U.S. Treasury in which allies can deposit money that would pay to replenish U.S. military equipment donated to Ukraine. Ukraine's needs remain consistent with previous months — air defenses, interceptors, systems, rockets, and artillery. The last statement of need from Ukraine came in a July 21 video conference of the country's allies, known as the Ramstein group, now led by Britain and Germany.
