Latest news with #CommerceDepartment
&w=3840&q=100)
First Post
3 hours ago
- Business
- First Post
US recession fears rise as personal income and spending fall in May
Amid the tariffs introduced by US President Donald Trump, fears of a recession loom in America as the US witnessed a decline in personal income and consumer spending in May read more Amid the fears of recession and inflation, the US consumer spending declined for the first time since January. According to the new data released by the US Bureau of Economic Analysis, personal income decreased by $109.6 billion (0.4 per cent at a monthly rate) in May. The Commerce Department report also showed that consumer spending fell 0.1 per cent last month after rising 0.2 per cent in April. The 50 per cent drop-off in motor vehicle sales in May was a significant driver of the overall spending retreat. The vehicle industry saw a sharp decline in May because consumers rushed to dealerships to buy cars in March and April, fearing that President Donald Trump's tariffs would send those costs soaring. STORY CONTINUES BELOW THIS AD However, the Friday report also reflected that the consumers pulled back on spending at restaurants and hotels. It is pertinent to note that Consumer spending powers more than two-thirds of American economic activity. The sharp decline prompted concerns among economists who argue that the steep tariffs on imported goods will erode Americans' resiliency. Consumer economy plunders over fear of Trump Tariffs According to the data released by the US Bureau of Economic Analysis, Personal income fell more than expected for the month, sinking 0.4 per cent. However, the economists argued that the May decline was largely a reflection of Social Security payments returning to more typical levels. In March and April, former public workers received large retroactive payments made under the Social Security Fairness Act due to reduced benefits under the prior legislation. Gregory Daco, chief economist at EY-Parthenon, told CNN that despite the recent months' volatility in those income numbers, the trend is one where income growth 'remains quite subdued." 'Real disposable income (what's left after taxes) is currently trending at a pace of 1.7 per cent year over year,' he said. 'That will bring down consumer spending from the 3 per cent (annual) pace that we were accustomed to through most of 2024 closer to 1.5 per cent over the coming months and perhaps even below 1% in the back half of 2025.' He cautioned that the closer the spending growth gets to 1 per cent, the more vulnerable the US economy becomes. 'You're much more subject to a stalling,' he said. 'You're exposed to price shocks, oil price shocks, tariff shocks, interest rate shocks, stock market shocks, and therefore you're more at risk of experiencing a more significant slowdown or possibly a recession.' STORY CONTINUES BELOW THIS AD However, the figures are still concerning. Major economic forecasts now predict sharply slower growth for the rest of 2025, with real GDP expected to weaken to as low as 1.1 per cent by year-end, compared to 2.5 per cent in late 2024. Economists warn that persistent inflation, higher tariffs, and policy uncertainty are putting additional pressure on household budgets and business confidence. Some analysts caution the US could be facing stagflation — a combination of slow growth and stubborn inflation — rather than a typical recession. The probability of a US recession in 2025 remains significant, with estimates ranging from 25 per cent to 40 per cent depending on the model and scenario. While the latest data do not guarantee an imminent recession, the combination of falling income, weaker spending, and negative leading indicators has heightened risks and could signal more economic trouble ahead.
The Sun
5 hours ago
- Business
- The Sun
U.S. lawmakers urge probe into OnePlus phone security
WASHINGTON: Two U.S. lawmakers on Friday asked the Commerce Department to investigate whether devices sold by Chinese smartphone maker OnePlus in the United States pose security concerns, according to a letter seen by Reuters. WHY IT MATTERS Representative John Moolenaar, a Republican who chairs a House of Representatives committee on China, and the panel's top Democrat, Representative Raja Krishnamoorthi, noted that major U.S. retailers sell OnePlus devices for use on two U.S. wireless networks. The lawmakers said a recent analysis by a commercial company provided to the committee indicates that these devices may potentially collect and transmit extensive user data -including sensitive personal information to servers under Chinese jurisdiction without explicit user consent. Shenzhen-based OnePlus did not immediately respond to requests for comment. The U.S. Commerce Department also did not immediately comment. CONTEXT BestBuy and both sell OnePlus phones for U.S. consumers, which operate on the Verizon and T-Mobile networks, the committee said. The lawmakers asked the department to task its Information and Communications Technology and Services program with investigating OnePlus phones, including to determine user data types collected by OnePlus devices without explicit user consent "including potential transfers of sensitive personal information and screenshots." Washington in recent years has cracked down on Chinese telecoms, revoking the authorization for China Telecom's U.S. subsidiary and others to operate in the United States, citing national security concerns. The Federal Communications Commission in November 2022 banned approvals of new telecommunications equipment from Huawei and ZTE as well as telecom and video surveillance equipment from Hytera Communications, Hangzhou Hikvision Digital Technology Zhejiang Dahua Technology Co.
The Sun
5 hours ago
- Business
- The Sun
Lawmakers want US Commerce Department to probe Chinese smartphone maker OnePlus
WASHINGTON: Two U.S. lawmakers on Friday asked the Commerce Department to investigate whether devices sold by Chinese smartphone maker OnePlus in the United States pose security concerns, according to a letter seen by Reuters. WHY IT MATTERS Representative John Moolenaar, a Republican who chairs a House of Representatives committee on China, and the panel's top Democrat, Representative Raja Krishnamoorthi, noted that major U.S. retailers sell OnePlus devices for use on two U.S. wireless networks. The lawmakers said a recent analysis by a commercial company provided to the committee indicates that these devices may potentially collect and transmit extensive user data -including sensitive personal information to servers under Chinese jurisdiction without explicit user consent. Shenzhen-based OnePlus did not immediately respond to requests for comment. The U.S. Commerce Department also did not immediately comment. CONTEXT BestBuy and both sell OnePlus phones for U.S. consumers, which operate on the Verizon and T-Mobile networks, the committee said. The lawmakers asked the department to task its Information and Communications Technology and Services program with investigating OnePlus phones, including to determine user data types collected by OnePlus devices without explicit user consent "including potential transfers of sensitive personal information and screenshots." Washington in recent years has cracked down on Chinese telecoms, revoking the authorization for China Telecom's U.S. subsidiary and others to operate in the United States, citing national security concerns. The Federal Communications Commission in November 2022 banned approvals of new telecommunications equipment from Huawei and ZTE as well as telecom and video surveillance equipment from Hytera Communications, Hangzhou Hikvision Digital Technology Zhejiang Dahua Technology Co.
France 24
8 hours ago
- Business
- France 24
US inflation edges up as Trump renews criticism of Fed chief
"We have a guy that's just a stubborn mule and a stupid person," Trump told an event at the White House, referring to Fed Chair Jerome Powell. "He's making a mistake." With Powell's term as Fed chief coming to an end next year, Trump hinted at his choice of successor: "I'm going to put somebody that wants to cut rates." The president's remarks came after government data showed the personal consumption expenditures (PCE) price index climbing 2.3 percent last month from a year ago in May. This was in line with analyst expectations and a slight acceleration from April's 2.2 percent increase, but still a relatively mild uptick. Excluding the volatile food and energy sectors, the PCE price index was up 2.7 percent, rising from April's 2.6 percent uptick, the Commerce Department's report showed. But consumer spending declined, after Trump's fresh tariffs in April dragged on consumer sentiment. PCE dropped by 0.1 percent from the preceding month, reversing an earlier rise. While Trump has imposed sweeping tariffs on most US trading partners since returning to the White House in January -- alongside higher rates on imports of steel, aluminum and autos -- these have had a muted effect so far on inflation. This is in part because he held off or postponed some of his harshest salvos, while businesses are still running through inventory they stockpiled in anticipation of the levies. But central bank officials have not rushed to slash interest rates, saying they can afford to wait and learn more about the impact of Trump's recent duties. They expect to learn more about the tariffs' effects over the summer. 'Clear weakening' "The experience of the limited range of tariffs introduced in 2018 suggests that pass-through to consumer prices is intense three-to-six months after their implementation," warned economists Samuel Tombs and Oliver Allen of Pantheon Macroeconomics in a note. They flagged weakness in consumer spending, in part due to a pullback in autos after buyers rushed to get ahead of levies. And spending on services was tepid even after excluding volatile components, they said. "There has also been a clear weakening in discretionary services spending, notably in travel and hospitality," said Michael Pearce, deputy chief US economist at Oxford Economics, in a note. This reflects "the chilling effect of the plunge in consumer sentiment," he added. Between April and May, the PCE price index was up 0.1 percent, the Commerce Department report showed. As a July deadline approaches for higher tariff rates to kick in on dozens of economies, all eyes are also on whether countries can reach lasting trade deals with Washington to ease the effects of tariffs. For now, despite the slowing in economic growth, Pearce said risks that inflation could increase will keep the Fed on hold with interest rates "until much later in the year."
India Today
8 hours ago
- Business
- India Today
US lawmakers push for probe into OnePlus over China data leak fears
Two top US lawmakers have called on the Commerce Department to investigate whether smartphones made by Chinese tech company OnePlus pose national security risks by transmitting user data to servers in China without user a letter obtained by Reuters, Representative John Moolenaar, a Michigan Republican who chairs the House Select Committee on the Chinese Communist Party, and Representative Raja Krishnamoorthi, the panel's ranking Democrat from Illinois, said recent analysis provided to the committee raises significant lawmakers said a recent analysis by a commercial company provided to the committee "indicates that these devices may potentially collect and transmit extensive user data -- including sensitive personal information to "servers under Chinese jurisdiction without explicit user consent." Moolenaar and Krishnamoorthi are urging the Commerce Department to consider placing OnePlus on the Entity List, a US trade blacklist that restricts access to American-made technologies. Similar actions have been taken in recent years against companies like Huawei, DJI, and TikTok's parent company ByteDance over concerns about surveillance and state-sponsored data Commerce Department has not yet responded to the lawmakers' based in Shenzhen, China, is a subsidiary of BBK Electronics, which also owns Oppo, Vivo, and Realme. The company did not immediately respond to requests for comment.- EndsMust Watch
