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Yahoo
05-07-2025
- Business
- Yahoo
Charting the Global Economy: US Jobs Data Eases Pressure on Fed
(Bloomberg) -- Fresh US jobs figures took pressure off the Federal Reserve to consider an interest-rate cut later this month, likely leaving the central bank on hold at least until the fall. Foreign Buyers Swoop on Cape Town Homes, Pricing Out Locals Massachusetts to Follow NYC in Making Landlords Pay Broker Fees NYC Commutes Resume After Midtown Bus Terminal Crash Chaos Struggling Downtowns Are Looking to Lure New Crowds What Gothenburg Got Out of Congestion Pricing While employers added more jobs in June than forecast and the unemployment rate ticked lower, growth in private payrolls weakened. Elsewhere, the manufacturing slowdown in Asia deepened. Survey data showed purchasing managers indexes for Taiwan, Indonesia and Vietnam firmly in contraction territory. Here are some of the charts that appeared on Bloomberg this week on the latest developments in the global economy, markets and geopolitics: US US job growth exceeded expectations in June as an unusual surge in public education employment masked a slowdown in hiring across the rest of the economy. Private payrolls rose the least since October, largely reflecting hiring in health care. The jobless rate declined to 4.1%, indicating employers remain reticent to lay off workers. A buildup of unsold houses sitting on the market for weeks is becoming a new reality in once-booming housing areas across the Sun Belt. Real estate agents in the South and Southwest say they're seeing more people list homes, giving up on hopes that mortgage rates will drop anytime soon. In Florida, homeowners are fleeing soaring insurance costs, and in Colorado, investors are culling rental properties. Europe Euro-area inflation settled at the European Central Bank's target in June, strengthening arguments to press pause on a year-long campaign of interest-rate cuts. A stronger euro and lower energy costs are helping keep price pressures in check — as is lackluster expansion by the region's 20-nation economy. The UK economy grew in the first quarter by the most in a year as Britons spent more and saved less before the Labour government's tax hikes and extra US tariffs came into effect. The outlook has darkened since the start of April amid a sharp drop in employment, weak retail sales and plunging exports to the US. Swedish retail sales fell the most in more than three decades in May, continuing a run of disappointing data and increasing pressure on the country's central bank to lower rates again. The slump compounds the recent below-forecasts data readings for Sweden including a surprise contraction in first-quarter economic output and a rise in the unemployment rate to 9% in May. Asia The slowdown in Asia's manufacturing activity deepened further in June, a warning sign for the region's growth prospects as tariffs on shipments to the US are poised to increase next week. Export-reliant economies including Taiwan and Vietnam saw their purchasing managers indexes deteriorate further, with factories reporting a continued decline in new orders, output and staffing as the trade war saps demand. Japan's annual wage negotiations concluded with the largest pay increase in 34 years, an outcome that supports the central bank's view that a cycle of higher wages and prices is emerging. Workers at 5,162 companies affiliated with the nation's largest union federation Rengo secured an average wage increase of 5.25%, according to the final update of pay deals announced by the union group US President Donald Trump floated the idea of keeping 25% tariffs on Japan's cars as talks between the two nations continued just before a slew of higher duties are set to kick in if a trade deal isn't reached. Emerging Markets Cargo thefts in Mexico topped 24,000 in 2024, up about 16%, data from transportation risk consultancy Overhaul show. That trails the US and Europe in total incidents. But in loss-ratio terms, which compare the number of thefts to economic activity, Mexico is the worst in the world. World Poland's central bank unexpectedly cut interest rates after a one-month pause and said inflation is likely to ease within its target in the coming months. A day after the Wednesday move, central bank Governor Adam Glapinski said the reduction was not the beginning of a cycle of monetary easing, even as he held out for another potential move in September. Tanzania also cut, while Ethiopia and the Bank of Central African States kept borrowing costs on hold. --With assistance from Irina Anghel, Maya Averbuch, Agnieszka Barteczko, Charlie Duxbury, Claire Jiao, Sakura Murakami, Andrea Navarro, Mark Niquette, Jana Randow, Michael Sasso, Zoe Schneeweiss, Erica Yokoyama, Craig Stirling and Jeremy Diamond. SNAP Cuts in Big Tax Bill Will Hit a Lot of Trump Voters Too America's Top Consumer-Sentiment Economist Is Worried For Brazil's Criminals, Coffee Beans Are the Target Sperm Freezing Is a New Hot Market for Startups Pistachios Are Everywhere Right Now, Not Just in Dubai Chocolate ©2025 Bloomberg L.P.
Malay Mail
04-07-2025
- Business
- Malay Mail
Global markets brush off deficit woes as Trump budget passes, US jobs impress
NEW YORK, July 4 — Wall Street stock indices finished at fresh records yesterday following solid US jobs data as President Donald Trump's sweeping budget bill successfully reached the congressional finish line. The US economy added 147,000 jobs in June while unemployment dipped to 4.1 per cent from 4.2 per cent, a sign of US labour market resilience despite the White House's wave of tariffs. 'We have a nice rally going, and the reason for that is that the employment data was stronger than expected,' said Peter Cardillo of Spartan Capital Securities, who noted that the market overlooked that the job additions included a heavy share of public sector posts. Markets also monitored progress on Trump's massive fiscal package, which extends tax reductions but also includes controversial cuts to social programmes and is projected to swell the US deficit. The House of Representatives approved the Bill yesterday shortly after the stock market closed, sending Trump a major legislative win. Both the S&P 500 and Nasdaq ended a holiday-shortened session at records. 'Market participants (and the economy) will be digesting the implications of the bill for some time, but it is fair to say that neither the stock market nor the Treasury market are living in fear of deficit forecasts,' said a note from Earlier, London's stock market and the pound recovered, having taken a knock Wednesday on rumours that British finance minister Rachel Reeves faced losing her job. Oil prices fell, with Opec and the cartel's crude-producing allies expected to announce a rise to output Sunday. Investors had been keenly awaiting the US government's monthly non-farm payrolls report, seen as one of the best data points on the health of companies and the labor market. 'The much stronger non-farm payrolls data means a July rate cut is now no longer in consideration, which is music to stock market bulls' ears', said City Index and analyst Fawad Razaqzada, because it indicates the economy is in good health. US markets are closed today for US Independence Day celebrations, but negotiators from several nations are racing to reach trade deals with Washington ahead of a July 9 tariff deadline imposed by Trump. Trump has said he will not push back his deadline to make more deals, though he and some of his officials have mentioned that a number were in the pipeline. — AFP
Globe and Mail
04-07-2025
- Business
- Globe and Mail
Trump has yet to kill the golden goose that is the U.S. economy. But he's working on it
The market was asked to digest two pieces on news about the U.S. economy on Thursday. One is about the past. The other is about the future. The news about the past is good. The news about the future is not. The good news is that the American economy added 144,000 jobs in June, and the unemployment rate dropped to 4.1 per cent. U.S. President Donald Trump's tariff threats have mostly not knocked the economy off course, yet, because they are still (mostly) threats. Even so, U.S. job gains were concentrated in local government and health care, while manufacturing employment fell for a second month. It may be a sign that tariffs are starting to bite. And as for that lower unemployment rate, it was caused by a drop in the number of Americans looking for work – also not a great sign. On Wednesday night, Mr. Trump posted on social media that 'the USA is on track to break every record on GROWTH.' Unfortunately, the U.S. economy is not even on track to beat 'GROWTH' during the Biden years. But so far at least, economic life in the Trump era is, for the average American, not much different from six months ago. The view from the side and rear windows is moderately sunny. And now for the clouds out the front window. U.S. Congress just passed Trump's massive tax and spending cuts bill. Here's what to know Trump's massive spending bill is set to become law. Now, the reckoning begins On Thursday, the House of Representatives passed Mr. Trump's signature 'one big beautiful' budget bill. It's basically a plan for large tax cuts, which will mostly benefit higher earners, combined with cuts to social spending that will, among other things, end health insurance for several million Americans. The bill also counts on new revenue from tariffs. Because the tax cuts are bigger than anything else, the result is an increase in the federal deficit of US$3.3-trillion over the next decade, according to the Congressional Budget Office, or US$5.5-trillion, according to the Committee for a Responsible Federal Budget. The CRFB estimate is higher, and likely more accurate, because it ignores accounting fictions and assumes that tax cuts intended to be permanent become permanent – as the bill does for Mr. Trump's 2017 tax cuts, which were set to expire. Even before this legislation, the U.S. budget deficit was in the stratosphere. In the last fiscal year, it weighed in at US$1.8-trillion, or 6.4 per cent of gross domestic product. Paying for tax cuts today through an IOU to the future will push U.S. deficits to new heights. That's why Mr. Trump is badgering Federal Reserve Chair Jerome Powell to cut interest rates. Earlier this week on social media he said 'Powell, and his entire Board, should be ashamed' for having 'FAILED' Americans. 'We should be paying 1% Interest, or better!' The reason: 'Our Country would be saving Trillions of Dollars in Interest Cost.' Mr. Trump is right about the rising cost of carrying all that debt, though his solution – he wants Mr. Powell to resign – can't solve the problem. Washington will spend nearly US$1-trillion on interest this year, and the CRFB estimates that Mr. Trump's budget bill will raise that to US$2-trillion by 2034. Simply ordering the Fed to lower interest rates won't work. The Fed sets short term rates, but the market gets a vote on long-term borrowing costs. And those have been rising. The yield on the U.S. 10-year bond is up three-quarters of a percentage point since last September, even though the Fed lowered short-term rates by a percentage point. The global era of ultra-cheap debt appears to be over. The yield on the 10-year U.S. bond is back to where it was in 2007. The Great Recession triggered almost two decades of near zero-borrowing costs, but that's history. Mr. Trump and Team MAGA are taking a very large budget deficit and pushing it higher, which will stimulate the economy in the short term but in the long-run will cause interest costs to eat away at U.S. finances. In response to this problem of his own making, Mr. Trump is demanding that the Fed take actions likely to provoke inflation and undermine investor appetite for lending to Washington. Both of these moves would put further upward pressure on interest rates. And all of this is being done to finance tax cuts for the wealthy, paired with a dose of trade-sapping, inflation-powering, alliance-destroying tariffs, plus a side order of cuts to services for many of the blue collars who are the Republican Party's base. Happy Fourth of July, y'all. The U.S. economy is a goose that lays golden eggs. And Mr. Trump wants to feed it rocks.
Daily Mail
03-07-2025
- Business
- Daily Mail
US jobs growth dashes hopes of July rate cut as Fed takes 'wait and see' approach on Trump tariffs impact
Hopes of a US interest rate cut later this month appeared to have been dashed yesterday after better-than-expected official jobs figures. Closely-watched non-farm payrolls data showed the world's biggest economy added 147,000 jobs in June, beating economists' forecast of 110,000. In contrast, the UK labour market darkened, adding to predictions of a Bank of England rate cut this summer. Experts said the US figures closed the door on the possibility of the US Federal Reserve cutting rates this month. The central bank has come under intense pressure to make cuts from President Donald Trump, who even resorted to personally insulting Fed chief Jerome Powell as a 'stupid person' and 'numbskull'. It has so far resisted, taking a 'wait and see' approach to the impact of Trump's tariffs on inflation and growth. Recently, key officials had seemed open to a change of heart, to head off a downturn in the labour market. But yesterday's figures appear to quash that possibility, which was raised by the Fed's governing board members Christopher Waller and Michelle Bowman. Seema Shah, chief global strategist at Principal Asset Management, said: 'Today's data of higher-than-expected payrolls, a drop in unemployment rate and a fall in jobless claims completely dispels the case for imminent rate cuts.' In Britain, central bankers' worries about jobs are backed up by data and markets see an 80 per cent chance of a Bank of England rate cut, from 4.25 per cent, next month. Yesterday, a monthly purchasing managers' index business survey showed employment in the UK's dominant services sector fell for the ninth month in a row. And while overall private sector growth picked up pace in June, growth for the second quarter will be much slower than the robust 0.7 per cent pace seen at the start of the year. Thomas Pugh, chief economist at accountancy firm RSM, pointed to likely growth of just 0.2 per cent in the April-June period. That, together with evidence of reduced price pressure, 'makes a rate cut in August even more likely', he said. Rob Wood, chief UK economist at Pantheon Macroeconomics, said: 'Happy days as growth improves and inflation slows; the MPC [the Bank of England's monetary policy committee] could welcome the news with another cut in August.'
Bloomberg
03-07-2025
- Business
- Bloomberg
Here Are the Key Takeaways From the US Jobs Report for June
Here are key takeaways from the US employment report for June, released Thursday: To access the full live blog, click here to read on the Terminal and here online.
