ReportWire

Tag: Economic policy

  • Gold prices soar to new records amid US government shutdown

    [ad_1]

    NEW YORK — As uncertainty deepens amid the U.S. government’s first shutdown in almost seven years, the gold frenzy continues to climb to new heights.

    The going price for New York spot gold hit a record $3,858.45 per troy ounce — the standard for measuring precious metals — as of market close Tuesday, ahead of the shutdown beginning overnight. And futures continued to climb on Wednesday, dancing with the $3,900 mark as of midday trading.

    Gold sales can rise sharply when anxious investors seek “safe havens” for parking their money. Before Wednesday, the asset — and other metals, like silver — have seen wider gains over the last year, particularly with President Donald Trump ‘s barrage of tariffs plunging much of the world into economic uncertainty.

    If trends persist, analysts have predicted that prices could continue to soar. Still, gold can be volatile and the future is never promised. Here’s what we know.

    Gold futures more than 45% since the start of 2025, trading at just over $3,895 by around 12:30 p.m. ET on Wednesday.

    Other precious metals have also raked in gains — with silver seeing an even bigger percentage jump year to date. Silver futures are up more than 59%, trading at nearly $48 per ounce as of midday Wednesday.

    A lot of it boils down to uncertainty. Interest in buying metals like gold typically spikes when investors become anxious.

    Much of the recent economic turmoil has spanned from Trump’s trade wars. Since the start of 2025, steep new tariffs the president has imposed on goods coming into the U.S. from around the world have strained businesses and consumers alike — pushing costs higher and weakening the job market. As a result, hiring has plunged while inflation continues to inch back up. And more and more consumers are expressing pessimism about the road ahead.

    The current U.S. government shutdown could add to those anxieties. A key jobs report from the Labor Department, scheduled for Friday, is likely to be delayed, for example. And the shutdown itself threatens to bring its own economic fallout nationwide. Roughly 750,000 federal workers were expected to be furloughed, with some potentially fired by Trump’s Republican administration. Many offices will also be shuttered, perhaps permanently, as Trump vows to “do things that are irreversible” to punish Democrats for voting down GOP legislation.

    The scope of impact could come down to how long the impasse lasts. Wall Street, meanwhile, has largely been unmoved by the shutdown so far — but Treasury yields dropped after discouraging hiring data from ADP Research Wednesday.

    Investments in gold have also been driven by other factors over time. Analysts have previously pointed to strong gold demand from central banks around the world — including amid rising geopolitical tensions, such as the ongoing wars in Gaza and Ukraine.

    Advocates of investing in gold call it a “safe haven” — arguing the commodity can serve to diversify and balance your investment portfolio, as well as mitigate possible risks down the road. Some also take comfort in buying something tangible that has the potential to increase in value over time.

    Still, experts caution against putting all your eggs in one basket. And not everyone agrees gold is a good investment. Critics say gold isn’t always the inflation hedge many say it is — and that there are more efficient ways to protect against potential loss of capital, such as derivative-based investments.

    The Commodity Futures Trade Commission has also previously warned people to be wary of investing in gold. Precious metals can be highly volatile, the commission said, and prices rise as demand goes up — meaning “when economic anxiety or instability is high, the people who typically profit from precious metals are the sellers.”

    And even gold’s current rally has seen some volatility. While still up significantly overall since the start of the year, there’s been a handful of short stretches with losses. Gold prices fell for several days following Trump’s sweeping “Liberation Day” announcement on April 2, for example.

    If you do choose to invest in gold, the commission adds, it’s important to educate yourself on safe trading practices and be cautious of potential scams and counterfeits on the market.

    [ad_2]

    Source link

  • Japan’s lead trade negotiator defends tariffs deal with the US

    [ad_1]

    TOKYO — Japan’s chief trade negotiator has defended a tariffs deal with the U.S., expressing respect for President Donald Trump and calling him a “tough negotiator.”

    Trade envoy Ryosei Akazawa noted that the pact setting on most Japanese exports to the U.S. at 15% was comparable to a deal between Washington and the European Union. Unlike the EU, Japan did not have to lower its tariffs on U.S. goods, he noted.

    Japan has also committed to investing $550 billion in U.S. projects.

    Trump initially set Japan’s tariff rate to increase by 25%.

    Critics in Japan had ridiculed Akazawa’s repeated trips to the U.S. to work toward a deal as a waste of taxpayer money, saying he should pitch a tent on the White House lawn.

    Akazawa said talks with his counterpart, U.S. Commerce Secretary Howard Lutnick, Trump and others in his administration were tense at first. By the time of his eighth trip, a rapport was established enabling the two sides to set an agreement by July.

    “President Trump was a tough negotiator, but I kept insisting, and he would listen graciously. I have all the respect for him,” he told reporters at the Foreign Correspondents’ Club of Japan. “It was a good round of negotiations.”

    “It goes without saying that, with any government negotiations, there will always be someone who says Japan lost out, no matter what,” Akazawa said.

    The double-digit tariffs Trump has imposed on imports from various nations were a bitter blow to Japan, a key U.S. ally in Asia. Tokyo especially objected to 25% tariffs Trump ordered for imports of steel and aluminum and automobiles.

    Japan’s economy depends heavily on exports. Shipments to the United States sank nearly 14% in August compared to a year earlier, the fifth straight month of declines, as auto exports were dented by the tariffs.

    U.S. tariffs on Japanese automobiles and auto parts are now set at 15%, way higher than the original 2.5%. Japanese automakers also produce many of the vehicles they sell in the U.S. in North America.

    The friction with the U.S. over tariffs was an added burden for Prime Minister Shigeru Ishiba’s administration. He is due to be replaced as leader of the ruling Liberal Democratic Party later this week.

    The Liberal Democrats have ruled Japan almost continuously since the 1950s but they have lost their majority in the lower house, which chooses the prime minister, and will need coalition partners.

    Akazawa brushed off concerns the U.S. understanding of the deal may differ from Japan’s. He said whoever becomes a next prime minister, Japan has an established tradition of respecting agreements, especially those forged with a foreign country.

    ___

    Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama

    [ad_2]

    Source link

  • Asian shares are mixed as traders brace for a possible US government shutdown

    [ad_1]

    TOKYO — Asian shares were mixed in narrow trading Tuesday as investors braced for a possible U.S. government shutdown.

    Japan’s benchmark Nikkei 225 declined nearly 0.3% to finish at 44,932.63.

    China reported lackluster data on factory activity for September that reflect persistent weakness in the world’s second largest economy as trade tensions with the U.S. weigh on exports.

    Hong Kong’s Hang Seng gained 0.3% to 26,694.10. The Shanghai Composite index added 0.5% to 3,882.07.

    Elsewhere in Asia, Australia’s S&P/ASX 200 edged down 0.2% to 8,847.00. South Korea’s Kospi slipped nearly 0.1% to 3,428.28.

    The U.S. federal government is nearing a budget deadline that could result in its shutdown.

    Past shutdowns have been shortlived and had minimal impact on markets and the economy. But if the stalemate between Democratic and Republican lawmakers persists, that could delay the collection and release of economic data, such as on jobs and inflation.

    This shutdown may also be different because the White House may push for large-scale firings of federal workers.

    “It feels as though the market has already flogged the government shutdown story from every conceivable angle, the way traders circle a fading theme until there’s nothing left but dust. Yet with the clock ticking down to less than 24 hours before the doors are slated to close in Washington, the narrative refuses to die,” said Stephen Innes. managing partner at SPI Asset Management.

    On Monday, Wall Street finished higher as technology stocks recovered some of their losses from late last week.

    The S&P 500 added 0.3% to 6,661.21 and the Dow Jones Industrial Average edged 0.1% higher, to 46,316.07. The Nasdaq composite climbed 0.5% to 22,591.15.

    Big Tech stocks ticked higher. Amazon added 1.1% following its 5.1% drop last week, and Microsoft rose 0.6% to recover some of its 1.2% decline. They were two of the strongest forces lifting the S&P 500 because they’re two of Wall Street’s most valuable stocks.

    A report is due Friday about how many jobs U.S. employers created and cut last month. The hope is that it will be balanced enough to keep the Federal Reserve on track to continue cutting interest rates.

    The Fed just delivered its first cut of the year, and officials have penciled in more through the end of next year. That’s critical for investors because U.S. stocks have shot to records from a low in April in large part because of expectations for several cuts from the Fed. Easier rates can give the job market a boost and make investors more willing to pay high prices for stocks and other investments.

    If Friday’s job numbers prove too strong, they could make the Fed less willing to cut rates. That could hurt stocks, which already face criticism that they’ve become too expensive following their big rally. If the job numbers are too weak, they could mean a recession that would hurt stock prices on its own.

    Electronic Arts climbed 4.5% after the video game maker confirmed rumors of a $55 billion buyout. A group of investors will pay $210 in cash for each share of EA, and they are calling it history’s largest all-cash deal to take a business private.

    Gold topped $3,850 per ounce to continue its record-breaking run amid expectations for cuts to interest rates by the Fed, along with worries about inflation and the mountains of debt that governments are carrying worldwide.

    In other dealings early Tuesday, benchmark U.S. crude fell 25 cents to $63.20 a barrel. Brent crude, the international standard, lost 39 cents to $67.58 a barrel.

    The U.S. dollar fell to 148.32 Japanese yen from 148.60 yen. The euro cost $1.1733, up from $1.1727.

    [ad_2]

    Source link

  • Asian shares trade mostly higher after Wall Street snaps its 3-day losing streak

    [ad_1]

    Shares were mostly higher Monday in Asia after Wall Street broke its three-day losing streak, trimming its losses for last week.

    China factory data are due out on Tuesday and a quarterly business sentiment survey by the Bank of Japan comes on Wednesday.

    The next big event for Wall Street could be a looming shutdown of the U.S. government, with a deadline set for this week. But such political impasses have had limited impact on the market before.

    U.S. jobs data also will be in the spotlight.

    U.S. futures edged higher early Monday and oil prices fell.

    Tokyo’s Nikkei was the regional outlier, giving up 1% to 44,892.52.

    Chinese markets advanced, with the Hang Seng in Hong Kong adding 1.5% to 26,518.03, while the Shanghai Composite index gained 0.1% to 3,832.65.

    Australia’s S&P/ASX 200 rose 0.7% to 8,545.70, while the Kospi in South Korea surged 1.3% to 3,430.57.

    On Friday, U.S. stocks trimmed their losses for the week after a report showed that inflation is behaving roughly as economists expected, even if it’s still high.

    The S&P 500 rose 0.6% to 6,643.70. The Dow Jones Industrial Average gained 0.7% to 46,247.29, while the Nasdaq composite added 0.4% to 22,484.07. All three indexes pulled closer to the all-time highs they set at the start of the week.

    Stocks got some help from the report showing inflation in the United States accelerated to 2.7% last month from 2.6% in July, according to the measure of prices that the Federal Reserve likes to use. While that’s above the Fed’s 2% target, it was precisely what economists had forecast.

    That offered some hope that the Fed could continue cutting interest rates in order to give the economy a boost. Without such cuts, growing criticism that stock prices have become too expensive by rising too quickly would become even more powerful.

    The Fed just delivered its first rate cut of the year last week but is not promising more because they could worsen inflation.

    Another report said sentiment among U.S. consumers was weaker than economists expected. The survey from the University of Michigan said consumers are frustrated with high prices, but their expectations for inflation over the coming 12 months also ticked down to 4.7% from 4.8%.

    One factor threatening to push inflation higher, adding to consumer woes, is President Donald Trump’s tariffs, and he announced more late Thursday. They include taxes on imports of some pharmaceutical drugs, kitchen cabinets and bathroom vanities, upholstered furniture and heavy trucks starting on Oct. 1.

    Details were sparse about the coming tariffs, as is often the case with Trump’s pronouncements on his social media network. That left analysts unsure of their ultimate effects, and the announcement created ripples in the U.S. stock market instead of huge waves.

    Paccar, the company based in Bellevue, Washington, that’s behind the market-dominant Peterbilt and Kenworth truck brands, revved 5.2% higher, for example.

    Big U.S. pharmaceutical companies nudged higher. Eli Lilly rose 1.4%, and Pfizer added 0.7%.

    In other trading early Monday, U.S. benchmark crude oil lost 49 cents to $65.23 per barrel. Brent crude, the international standard, declined 42 cents to $68.80 per barrel.

    Reports that the OPEC plus oil producing nations might raise their production limits next month have added to worries over oversupply, analysts said.

    The U.S. dollar slipped to 148.93 Japanese yen from 149.51 yen. The euro rose to $1.1727 from $1.1703.

    [ad_2]

    Source link

  • Trump finds new trade targets — pharmaceuticals, kitchen cabinets and heavy trucks

    [ad_1]

    WASHINGTON — Naturepedic, a mattress and furniture company based outside Cleveland, has been planning to introduce an upscale upholstered headboard late this year or early in 2026.

    But President Donald Trump has thrown those plans into disarray. On Thursday night, the president announced on social media that he was slapping a 30% tax on imported upholstered furniture. Naturepedic ships its headboards in from India and Vietnam.

    So what is the company to do?

    “Do we continue forth … and hope for the best?’’ asked Arin Schultz, Naturepedic’s chief growth officer. “Or do we feel like we’re priced out and drop it altogether?’’ And if Naturepedic decides to continue with the rollout, “do we eat the cost or pass it on’’ to customers?

    Across the United States, lots of executives were asking themselves similar questions as they came to work Friday morning.

    Upholstered furniture, after all, wasn’t the only import in Trump’s crosshairs Thursday night. In addition, the president posted on his Truth Social platform, he’s plastering import taxes – tariffs – of 100% on pharmaceutical drugs, 50% on kitchen cabinets and bathroom vanities and 25% on heavy trucks.

    And he’s not waiting around to do it. The tariffs, he said, would take effect Wednesday.

    Trump also raised eyebrows by justifying the levy on vanities and sofas as necessary for national security. “It’s hard to see how a kitchen cabinet industry is essential to winning the next war,’’ said Mary Lovely, senior fellow at the Peterson Institute for International Economics.

    Thursday’s social media barrage was j ust the latest in Trump’s push to upend American trade policy, which for decades pushed for lower trade barriers around the world.

    In place of an open market, Trump has built a tariff wall around the U.S. economy, slapping double-digit taxes on imports from almost every country on earth and targeting products (steel, aluminum, autos) with specific taxes of their own.

    Trump says the tariffs will protect U.S. industries from foreign competition, encourage companies to bring production to the United States and raise money for the U.S. Treasury.

    They certainly have become a moneymaker for the federal government. Since fiscal year 2025 began last Oct. 1, the U.S. Treasury has collected $172 billion in customs duties, up by $96 billion (or 126%) from the same period in fiscal 2024. Still, tariffs account for less than 4% of federal revenue.

    Businesses, lawyers and trade analysts are still wondering what to make of Trump’s Thursday night tariffs. “We’ve only seen the President’s Truth Social posts,” said Dan McCarthy, principal in McCarthy Consulting and a former official with the Office of the U.S. Trade Representative in the Biden administration. “We need to see the details.’’

    For example, Naturepedic isn’t sure whether the 30% levy on upholstered furniture will be stacked atop a separate and earlier 50% tariff on goods from India.

    Here’s what we know so far:

    The president has been threatening tariffs of 200% or more on pharmaceuticals. “It’s to force Big Pharma to move jobs and put new factories into the U.S,’’ said Barry Appleton, a senior fellow at the Center for International Law at New York Law School. “So it’s industrial policy.”

    In recent decades, drugmakers have moved many operations overseas – to take advantage of lower costs in China and India and tax breaks in Ireland and Switzerland.

    The COVID-19 experience – when countries were desperate to hang onto their own medicine and medical supplies — underscored the dangers of relying on foreign countries in a crisis, especially when a key supplier is America’s geopolitical rival China.

    The stock prices of pharmaceutical companies actually rose after Trump’s announcement Thursday night. The 100% tariff was lower than it might have been. And Trump said the tariffs would not apply to companies “breaking ground” or being “under construction.”

    Several big drugmakers like Merck & Co. Inc., Eli Lilly and Co. and Johnson & Johnson have already announced U.S. expansion plans.

    In his tariff announcement, Trump did not mention generic drugs, which account for the vast majority of U.S. prescriptions.

    Still, analysts warn, the tariffs are likely to mean higher prices. “The people who are punished the most are Americans who need the drugs so badly, especially those who don’t have full health care plans,” Appleton said. He called the tariff is a “simplistic but drastic” approach to a complicated problem. “We don’t know how it’s going to go, but it doesn’t look like it’s going to do well for consumers,” he said.

    The tariffs on kitchen cabinets, bathroom vanities and upholstered furniture come as the White House is investigating whether imports of lumber and other wood products pose a threat to U.S. national security. A report on that investigation is due Nov. 26 and could mean more and broader tariffs.

    The levies are likely to hurt big furniture exporters China and Vietnam.

    But they’re also likely to drive up the cost of new homes and apartments and of do-it-yourself redecorating projects.

    Homeowners are already scaling back due to high costs and a shaky economy. According to the Labor Department, the price of living room, kitchen and dining room furniture has risen nearly 10% over the past year.

    “Adding significant costs to furniture, cabinets, vanities and building materials will make the American dream of owning a home significantly more expensive,” said Jonathan Gold, the National Retail Federation’s vice president of supply chain and customs policy. “The speed at which these tariff announcements are made and implemented continues to wreak havoc on retail supply chains. The uncertainty makes it difficult for retailers to properly plan and mitigate the impact of tariffs.”

    Charles Clevenger, a supply chain specialist at the consultancy UHY, said tariffs on pharmaceuticals make sense because so much production has shifted away from the United States to Europe and Asia. Likewise, North Carolina and other states in the American South have also lost furniture factories to cheaper competitors in the China.

    But he was surprised by the tariffs on heavy trucks because “we do have a rather robust industry’’ – with manufacturers like Paccar (parent company of Peterbilt and Kenworth).

    But Appleton at New York Law School suspects the tariff is aimed at Mexico, where many heavy trucks are made. The U.S.-Mexico-Canada Agreement, a trade deal negotiated in Trump’s first term, is coming up for negotiation. “I don’t think that (the tariff) was done by accident, Appleton said. “They wanted to put some more pressure onto the Mexicans” to make concessions in the talks.

    Using Section 232 of the Trade Expansion Act of 1962, Trump had launched investigations into whether imports of pharmaceuticals, lumber and heavy trucks posed a threat to U.S. national security.

    He’d justified his broader tariffs another way: by declaring national emergencies under a 1977 law. But two courts have ruled that Trump overstepped his authority by invoking the International Emergency Economic Powers Act (IEEPA) to impose import taxes. The Supreme Court is hearing the case on appeal.

    Robert Lawrence, a professor of International trade and investment at Harvard University, said that using Section 232 gives the president a Plan B if the courts strike down his IEEPA tariffs. “He now has insurance and shows that he’s going to be able to get away with raising tariffs, even if he loses that case.”

    But Ted Murphy, co-leader of the trade practice at the Sidley Austin law firm, said: “It’s hard to discern much of a plan … What the administration does is they identify a problem and then the solution is a big tariff. The question is whether that’s really as nuanced or strategic as it could be. There could be a strategy but it’s hard to discern from a tweet.’’

    ___

    Anderson reported from New York.

    AP Health Writer Tom Murphy contributed to this story.

    [ad_2]

    Source link

  • How major US stock indexes fared Friday, 9/26/2025

    [ad_1]

    Wall Street broke its three-day losing streak and trimmed its losses for the week.

    The S&P 500 rose 0.6% Friday. The Dow Jones Industrial Average climbed 0.7%, and the Nasdaq composite gained 0.4%. All three indexes pulled closer to their records set at the start of the week.

    Stocks got some help from a report on inflation that suggested the Federal Reserve may be able to continue cutting interest rates. Such cuts would help justify high prices for stocks after their big rally. President Donald Trump’s latest tariffs caused waves for some stocks but not for the broad market.

    On Friday:

    The S&P 500 rose 38.98 points, or 0.6%, to 6,643.70.

    The Dow Jones Industrial Average rose 299.97 points, or 0.7%, to 46,247.29.

    The Nasdaq composite rose 99.37 points, or 0.4%, to 22,484.07.

    The Russell 2000 index of smaller companies rose 23.28 points, or 1%, to 2,434.32.

    For the week:

    The S&P 500 is down 20.66 points, or 0.3%.

    The Dow is down 67.98 points, or 0.1%.

    The Nasdaq is down 147.41 points, or 0.7%.

    The Russell 2000 is down 14.45 points, or 0.6%.

    For the year:

    The S&P 500 is up 762.07 points, or 13%.

    The Dow is up 3,703.07 points, or 8.7%.

    The Nasdaq is up 3,173.28 points, or 16.4%.

    The Russell 2000 is up 204.16 points, or 9.2%.

    [ad_2]

    Source link

  • Big pharma stocks rise as Street reacts to latest presidential tariff plan

    [ad_1]

    Shares of some big drugmakers jumped ahead of broader indexes Friday as Wall Street started sorting out President Donald Trump’s latest tariff announcement.

    The president said late Thursday that he would place 100% import taxes on pharmaceuticals starting Oct. 1, but those tariffs would not apply to companies building U.S. manufacturing plants. He defined that as either “breaking ground” or being “under construction.”

    Several big drugmakers like Merck & Co. Inc., Eli Lilly and Co. and Johnson & Johnson have announced U.S. expansion plans.

    Trump has talked about pharmaceutical tariffs for months, but he has said he would delay them for a year or a year and a half to give companies time to stockpile medicines here and shift manufacturing.

    Analysts have said companies started stockpiling medicines in the U.S. earlier this year.

    Jefferies analyst Akash Tewari said in a research note that Thursday’s announcement shouldn’t have a material impact on the big drugmakers, given their construction plans.

    Brand-name drug companies also have fat profit margins that can provide some flexibility to make investments and absorb tariff costs. Manufacturers of cheaper generic drugs — which account for most U.S. prescriptions — do not. Researchers and patient advocates have worried about the impact of any tariffs on those companies.

    David Risinger of Leerink Partners said smaller drugmakers also may be vulnerable to the new taxes, although he noted that it was hard to predict which ones.

    He said several questions remain unanswered after Thursday’s announcement. Those include whether the action will survive legal challenges and how the phrases “breaking ground” and “under construction” are defined for tariff enforcement.

    Risinger also questioned whether the new taxes might be a negotiating tactic tied to an investigation the administration launched in the spring over how importing drugs and their ingredients affects national security.

    Shares of Merck and Lilly both climbed more than 1% Friday morning, while J&J’s stock rose slightly. The S&P 500 also edged slightly higher.

    [ad_2]

    Source link

  • Fed’s favored inflation gauge accelerates slightly in August

    [ad_1]

    WASHINGTON — The Federal Reserve’s favored inflation gauge accelerated slightly in August from a year earlier.

    The Commerce Department reported Friday that its personal consumption expenditures (PCE) price index was up 2.7% in August from a year earlier, a tick higher from a 2.6% year-over-year increase in July and most since February.

    Excluding volatile food and energy prices, so-called core PCE inflation showed a 2.9% increase in prices from August 2024, same as in July. The increases were what forecasters had expected.

    Inflation has come down since rising prices prompted the Fed to raise its benchmark interest rate 11 times in 2022 and 2023. But annual price gains remain stubbornly above the central bank’s 2% target.

    Last week, the Fed went ahead and reduced the rate for the first time this year, lowering borrowing costs to help a deteriorating U.S. job market. But it’s been cautious about cutting, waiting to see what impact President Donald Trump’s sweeping taxes on imports have on inflation and the broader economy.

    For months, Trump has relentlessly pushed the Fed to lower rates more aggressively, calling Fed Chair Jerome Powell “Too Late” and a “moron” and arguing that there is “no inflation.”

    Last month, Trump sought to fire Lisa Cook, a member of the Fed’s governing board, in an effort to gain greater control over the central bank. She has challenged her dismissal in court, and the Supreme Court will decide whether she can stay on the job while the case goes through the judicial system.

    The Fed tends to favor the PCE inflation gauge that the government issued Friday over the better-known consumer price index. The PCE index tries to account for changes in how people shop when inflation jumps. It can capture, for example, when consumers switch from pricier national brands to cheaper store brands.

    [ad_2]

    Source link

  • China launches an investigation into Mexico’s tariffs on imports from Asia

    [ad_1]

    BEIJING — China has opened an investigation into whether import tariffs being imposed by Mexico are a trade and investment barrier.

    Mexico plans to impose taxes as high as 50% on more than 1,400 products from Asia to protect factories at home, which are facing stiff tariffs imposed by President Donald Trump on exports to the United States.

    A Chinese Commerce Ministry statement posted Thursday said the tariffs would harm the interests of affected countries.

    “China believes that, against the backdrop of the current U.S. abuse of tariffs, all countries should jointly oppose all forms of unilateralism and protectionism and must not sacrifice the interests of third parties because of coercion,” the statement said.

    The Commerce Ministry also announced Thursday that it was launching an anti-dumping investigation into pecans imported from Mexico and the United States.

    Mexico has been under pressure from the Trump administration to limit Chinese imports, some of which the U.S. says use Mexico as a backdoor to the American market.

    Mexican President Claudia Sheinbaum has said that the tariffs are not the result of U.S. pressure.

    China will be the most affected as Mexico imported $130 billion worth of products from the country in 2024, second only to the what Mexico bought from the United States. Other countries hit will include South Korea, Thailand, India, Philippines and Indonesia.

    It’s not clear if the investigation into the Mexican tariffs would result in any concrete steps against Mexico.

    Under the regulation governing such investigations, a finding that a trade barrier exists can can lead to consultations with the other country, a settlement under a multilateral framework and other appropriate measures.

    [ad_2]

    Source link

  • Asian shares tumble after Trump says he will impose new tariffs on drugs and other goods

    [ad_1]

    MANILA, Philippines — Asian shares fell on Friday after President Donald Trump announced plans for new tariffs including 100% import taxes on pharmaceutical drugs starting Oct. 1.

    Trump said Thursday on his social media site that foreign makers of furniture and cabinetry were flooding the United States with their products and that tariffs must be applied “for National Security and other reasons.”

    He said foreign-made heavy trucks and parts are hurting domestic producers. However, most such trucks are either made in America or are U.S. brands made in Canada or Mexico.

    U.S. futures slipped while oil prices rose.

    Most Asian indexes were in the red, with Japan’s Nikkei 225 down around 0.3% to 45,629.79.

    Sumitomo Pharma Co.’s shares lost 5.2% while Chugai Pharmaceutical sank 3.9%.

    Government data on Friday showed inflation in the Tokyo area rose 2.5% year-on-year in September, matching the pace in August but falling below expectations of an uptick to 2.8%. Inflation, however, was still above the Bank of Japan’s 2% target, leading to speculation about a rate hike later this year.

    South Korea’s Kospi tumbled 2.5% to 3,384.58 in a third consecutive session of losses amid growing worries over prolonged tariff negotiations with the U.S.

    In Chinese markets, Hong Kong’s Hang Seng index fell 0.7% to 26,313.66 while the Shanghai Composite index was down 0.1% to 3,850.07.

    Australia’s S&P/ASX 200 rose 0.2% to 8,790.20. India’s BSE Sensex fell 0.7% while Taiwan’s Taiex lost 1.5%.

    On Thursday, Wall Street stumbled to a third straight loss as U.S. stocks gave back more of their big gains for the year so far.

    The S&P 500 fell 0.5% to 6,604.72, marking its longest losing streak in more than a month. The Dow Jones Industrial Average dropped 0.4% to 45,947.32, and the Nasdaq composite sank 0.5% to 22,384.70. All three indexes are still near their records set at the start of the week.

    Stocks felt pressure from reports showing the U.S. economy may be stronger than economists thought. While that’s encouraging news for workers and for people looking for jobs, it could make the Federal Reserve less likely to cut interest rates several times in the coming months.

    The Fed just delivered its first cut of the year last week, and officials had penciled in more through the end of next year. That was critical for Wall Street after U.S. stocks shot to records since April in large part because of expectations for rate cuts. Easier rates can boost the economy and make investors more willing to pay high prices for stocks and other investments.

    If the Fed doesn’t cut rates as often as investors expect, it would empower criticism that the U.S. stock market is too expensive after rising so much, so quickly.

    Treasury yields ticked higher in the bond market as traders pared bets for the number of upcoming cuts to rates by the Fed. The yield on the 10-year Treasury rose to 4.17% from 4.16% late Wednesday.

    “For Asia today, it means traders wake up to a market where gravity has reasserted itself. The global $15 trillion rebound year-to-date now feels stretched against yields rising even for all the ‘right’ reasons( stronger growth),” Stephen Innes of SPI Asset Management wrote in a commentary. “It doesn’t take much for enthusiasm to wobble, at lofty peaks, and in this tape, fatigue is dangerous.”

    In other dealings early Friday, benchmark U.S. crude added 30 cents to $65.28 per barrel. Brent crude, the international standard, climbed 25 cents to $69.67 per barrel.

    The U.S. dollar edged down to 149.73 Japanese yen, from 149.75 yen. The euro rose to $1.1676 from $1.667. ___

    AP Business Writer Stan Choe contributed.

    [ad_2]

    Source link

  • Greenspan, Bernanke and Yellen urge Supreme Court to let Lisa Cook keep her job as a Fed governor

    [ad_1]

    WASHINGTON — WASHINGTON (AP) — Alan Greenspan, Ben Bernanke, Janet Yellen and other former top economic officials appointed by presidents of both parties urged the Supreme Court on Thursday to preserve the Federal Reserve’s political independence and allow Lisa Cook to remain as a central bank governor for now.

    The justices are weighing an emergency appeal from the administration to remove Cook while her lawsuit challenging her firing by Republican President Donald Trump proceeds through the courts.

    The White House campaign to unseat Cook marks an unprecedented bid to reshape the Fed board, which was designed to be largely independent from day-to-day politics. No president has fired a sitting Fed governor in the agency’s 112-year history.

    Earlier in September, a judge determined that Trump’s move to fire Cook probably was illegal. An appeals court rejected an emergency plea to oust Cook before the Fed’s meeting last week when Cook joined in a vote to cut a key interest rate by one-quarter of a percentage point.

    A day after that meeting, the administration turned to the Supreme Court and again asked for her prompt removal.

    In their filing, lawyers for the former economic officials wrote that immediately ousting Cook “would expose the Federal Reserve to political influences, thereby eroding public confidence in the Fed’s independence and jeopardizing the credibility and efficacy of U.S. monetary policy.”

    Greenspan, Bernanke and Yellen served as successive chairs of the Fed’s seven-member board of governors, spanning six presidential administrations back to 1987. Greenspan and Bernanke were initially appointed by Republican Presidents Ronald Reagan and George W. Bush, respectively. President Barack Obama, a Democrat, nominated Yellen to the Fed and she was Democratic President Joe Biden’s treasury secretary.

    The list of signatories includes other treasury secretaries, heads of the Council of Economic Advisers and former Sen. Phil Gramm, R-Texas, a former chairman of the Senate Banking, Housing and Urban Affairs Committee.

    Trump sought to fire Cook on Aug. 25, but a judge ruled that she could remain in her job. Trump has accused Cook of mortgage fraud because she appeared to claim two properties, in Michigan and Georgia, as “primary residences” in June and July 2021, before she joined the board. Such claims can lead to a lower mortgage rate and a smaller down payment than if one of them was declared as a rental property or second home.

    Cook has denied any wrongdoing and has not been charged with a crime. According to documents obtained by The Associated Press, Cook did specify that her Atlanta condo would be a “vacation home,” according to a loan estimate she obtained in May 2021. In a form seeking a security clearance, she described it as a “2nd home.” Both documents appear to undercut the administration’s claims of fraud.

    The attempt to fire Cook differs from Trump’s dismissal of board members of other independent agencies. Those firings, including at the National Labor Relations Board, Federal Trade Commission and Consumer Product Safety Commission, have been done at will.

    In allowing those firings to proceed for now, the Supreme Court cautioned that it viewed the Fed differently. Trump has invoked the provision of the law that set up the Federal Reserve and allowed for governors to be dismissed “for cause.”

    [ad_2]

    Source link

  • Wall Street set to open higher after taking a break from its most recent rally a day earlier

    [ad_1]

    Wall Street was poised to open with small gains Wednesday, a day after markets took a break from their relentless record-breaking rally.

    Futures for the S&P 500 ticked up 0.1% before the bell, while Nasdaq futures rose 0.2%. Futures for the Dow Jones Industrial Average were unchanged.

    Shares of Alibaba soared nearly 10% after the Chinese e-commerce giant announced a partnership with Nvidia and an expansion of data center operations into a handful of countries to bolster its artificial intelligence infrastructure. Alibaba is the latest in a string of companies announcing that they were plowing money into AI, many of which are also partnering with AI-chipmaker Nvidia.

    U.S. markets paused from their recent rally on Tuesday after Federal Reserve Chair Jerome Powell said stock prices were “fairly highly valued.”

    In his first public remarks since the Fed cut its main interest rate last week for the first time this year, Powell said that the Fed is stuck in an unusual position because worries about the job market are rising at the same time that inflation has stubbornly remained above its 2% target.

    Analysts said his comments reiterated his stance that there is no risk-free path.

    “Essentially the Fed Chairman confirmed what we already knew, which is that the central bank remains somewhat ‘between a rock and a hard place’ when it comes to managing the risks of rising inflation and falling employment,” said Tim Waterer, chief market analyst at KCM Trade.

    Fed officials have penciled in more cuts to rates through the end of this year and into next, but they are remaining wary because lower rates can also give inflation more fuel.

    An update Friday will show how much prices are rising for U.S. households based on the Fed’s preferred measure of inflation, and economists expect it to show a slight acceleration for last month.

    Elsewhere, in Europe at midday France’s CAC 40 slipped 0.6%, while the German DAX and Britain’s FTSE 100 each fell 0.2%.

    Japan’s benchmark Nikkei 225 recouped morning losses to finish 0.3% higher at 45,630.31. Australia’s S&P/ASX 200 slipped 0.9% to 8,764.50. South Korea’s Kospi dropped 0.4% to 3,472.14. Hong Kong’s Hang Seng rose 1.4% to 26,518.65, while the Shanghai Composite gained 0.8% to 3,853.64.

    [ad_2]

    Source link

  • Trump’s Federal Reserve appointee seeks steeper rate cuts

    [ad_1]

    WASHINGTON — President Donald Trump’s appointee to the Federal Reserve’s Board of Governors said Monday that the central bank’s key interest rate should be much lower than its current 4.1% level, staking out a position far different than his colleagues.

    Stephen Miran, who is also a top economic adviser to Trump, said in remarks to the Economic Club of New York that sharp declines in immigration, rising tariff revenue, and an aging population all suggest that the Fed’s rate should be closer to 2.5% instead. According to projections released last week, that’s almost a full percentage point lower than any of his 18 colleagues on the Fed’s rate-setting committee, an unusually high divergence.

    Miran’s comments underscore the different perspective he brings to the Fed’s deliberations over interest rate policy. His appointment has been controversial because he has kept his position as the head of the White House’s Council of Economic Advisers while taking unpaid leave, raising concerns about the Fed’s traditional independence from day-to-day politics.

    His term on the Fed’s board expires in January, and Miran has said he expects to return to the White House after that, and is keeping his position because his Fed term is so short. But he could remain on the board until a successor is appointed. There hasn’t been a member of the executive branch on the Fed’s board since the 1930s.

    Concerns about the Fed’s independence are heightened because Trump has also repeatedly attacked Chair Jerome Powell and has called for the Fed to reduce its rate to as low as 1.2%. He he is now seeking to fire Lisa Cook, a Fed governor, who has fought her removal in the courts. It is the first time that a president has tried to fire a Fed governor.

    So far, courts have ruled that Cook can keep her job while her suit seeking to overturn her firing is considered. The Trump administration has appealed that ruling to the Supreme Court.

    During a question and answer session Monday, Miran said he would operate independently, and that Trump had not pushed him to follow any specific policy.

    “At the end of the day, I make my own analysis based on my own understanding of economics and how the economy works,” Miran said. In his conversations with Trump, the president “never asked me to set policy in a specific way.”

    In his speech, Miran said, “it should be clear that my view of appropriate monetary policy diverges from those of other” members of the committee. “I view policy as very restrictive,” he added, meaning that it is holding back the economy and “poses material risks” to the Fed’s congressional mandate of seeking maximum employment.

    Miran said that fewer immigrants should free up more housing and lower rental costs, reducing inflationary pressures. And tariff revenues — which may top $300 billion a year, according to Congressional Budget Office estimates — should reduce the deficit, he added. Over time, that would mean the Fed doesn’t have to keep its benchmark interest rate as high as it is now to bring inflation down.

    [ad_2]

    Source link

  • Asian shares are mostly higher after Wall Street’s record week

    [ad_1]

    TOKYO — Asian shares finished mostly higher Monday, cheered by a record finish last week on Wall Street, but European indexes were declining in early trading.

    France’s CAC 40 slipped 0.1% in early trading to 7,844.36, while the German DAX lost 0.6% to 23,504.07. Britain’s FTSE 100 was little changed, inching up less than 0.1% to 9,225.17. U.S. shares were set to drift lower with Dow futures down 0.3% at 46,524.00. S&P 500 futures shed 0.2% to 6,707.00.

    Earlier in Asia, Japan’s benchmark Nikkei 225 jumped 1.0% to finish at 45,493.66, rebounding from the decline late last week over concerns about the Bank of Japan’s selling its holdings. Such concerns abated as markets began to see any move as gradual.

    Australia’s S&P/ASX 200 rose 0.4% to 8,810.90. South Korea’s Kospi gained 0.7% to 3,468.65. Hong Kong’s Hang Seng slipped 0.8% to 26,344.14, while the Shanghai Composite rose 0.2% to 3,828.58.

    The recent Wall Street rally has come on expectations the Federal Reserve will continue to cut interest rates in order to give the economy a boost. The central bank lowered them for the first time this year on Sept. 17.

    If the Fed keeps cutting interest rates, that could give the struggling housing market a boost. But the growing expectations mean the market could be in for a disappointment and drop sharply if the Fed does not cut as much as traders expect.

    Fed officials have said more rate cuts are likely this year and next. Fed Chair Jerome Powell said last week that the central bank may have to react quickly because inflation is remaining stubbornly high in the American economy while the job market is slowing, all the while as President Donald Trump’s tariffs threaten to push inflation higher.

    “Every time the market seems to be running out of momentum, it fools most of us by pushing to higher heights,” said Jay Woods, chief market strategist at Freedom Capital Markets.

    “As traders continue to monitor new highs on a daily basis, they are really focused on what Fed officials will have to say as they make the speaking rounds this week.”

    In energy trading, benchmark U.S. crude rose 63 cents to $63.04 a barrel. Brent crude, the international standard, added 15 cents to $66.83 a barrel.

    In currency trading, the U.S. dollar fell to 147.87 Japanese yen from 147.91 yen. The euro cost $1.1766, up from $1.1745.

    [ad_2]

    Source link

  • Japan’s central bank holds steady on key interest rate

    [ad_1]

    Japan’s central bank has kept its key interest rate unchanged at 0.5%, in a decision that was widely expected, given recent inflation trends that have stayed above target

    TOKYO — Japan’s central bank kept its key interest rate unchanged at 0.5% Friday, in a decision that was widely expected, given recent inflation trends that have stayed above target.

    The Bank of Japan issued its decision on the overnight call rate after a two-day meeting by its policy board.

    “Japan’s economy has recovered moderately, although some weakness has been seen in part. Overseas economies have grown moderately on the whole,” it said in a statement.

    The U.S. Federal Reserve cut its policy rate by 0.25 percentage points earlier this week, the Fed’s first cut since December, and lowered its short-term rate to about 4.1%, down from 4.3%.

    Japan had been ailing from deflationary trends in recent years, but prices are gradually rising. Recent government data show consumer prices rising above the central bank’s target of 2%, at between 2.5% and 3%.

    The Bank of Japan noted exports will be hit by higher tariffs, which have come about because of U.S. President Donald Trump’s policies. There was an increase in trade in anticipation of the tariffs, but those rises are now tapering off, it said.

    Also mentioned as a risk factor was the uncertainty in domestic politics. Prime Minister Shigeru Ishiba is stepping down, and the ruling party is holding an election to choose a new leader.

    Five candidates are expected to enter the race, with a party vote coming early next month. The grip on power by the Liberal Democratic Party, which has ruled postwar Japan almost incessantly, appears to be unraveling lately.

    The Japanese stock market has been booming recently, with the benchmark Nikkei 225 hitting another record Thursday, cheered by the Fed’s rate cut. Shares were falling slightly in Friday morning trading.

    ___

    Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama

    [ad_2]

    Source link

  • Asian shares climb after US stocks remained near record levels following rate cut

    [ad_1]

    Strong overnight gains have Wall Street poised to open at record highs Thursday following the Federal Reserve’s first interest rate cut in nine months.

    Futures for the S&P 500 rose 0.8% before the bell, while futures for the Dow Jones Industrial Average added 0.7%. Nasdaq futures jumped 1.1%.

    Intel shares soared more than 28% after Nvidia announced it was investing $5 billion in the California chipmaker as part of a collaboration to ramp up custom data center and personal computer products. Nvidia shares rose 2.6%.

    Cracker Barrel shares slid 8.2% after the restaurant chain said that it expects lower sales and weaker customer traffic in the coming year as the controversy over its planned logo change continues to play out.

    In a conference call with investors on Wednesday, Cracker Barrel said traffic at its restaurants was down 1% in early August, before it announced it was adopting a more simplified logo that upset many of its loyal customers. The company eventually relented and went back to the old logo.

    Walt Disney shares were largely unchanged after the entertainment giant announced that its ABC television division had suspended Jimmy Kimmel’s late-night show indefinitely after comments that he made about Charlie Kirk’s killing led a group of ABC-affiliated stations to say they would not air the show.

    Earlier in the day, FCC Chairman Brendan Carr called Kimmel’s comments “truly sick” and said his agency has a strong case for holding Kimmel, ABC and network parent Walt Disney Co. accountable for spreading misinformation.

    As expected on Wednesday, the Federal Reserve cut its main interest rate, but even more important was the set of projections that U.S. central bank officials published showing where they expect interest rates to go in upcoming years.

    That indicated the typical member sees the Fed cutting the federal funds rate two more times by the end of this year and once more in 2026.

    Markets initially rose after the rate cut announcement and projections, but quickly gave back gains after Fed Chair Jerome Powell stressed that the projections could change and warned against taking them as guarantees of future conditions.

    What’s making things difficult for the Fed is that the job market is slowing as inflation is remaining stubbornly high. The Fed is in charge of fixing both, but it has only one tool to do that. And helping one by moving interest rates often hurts the other in the short term.

    The Fed had been holding rates steady this year because of the threat that U.S. President Donald Trump’s tariffs will raise prices for all kinds of products. Inflation has so far refused to go back below the Fed’s 2% target, and Fed officials don’t see that happening for a few years.

    In midday European trading, Germany’s DAX and France’s CAC each climbed 1.1%. Britain’s FTSE 100 added 0.3% in cautious trading ahead of a Bank of England interest rate decision later in the day.

    Asian shares were mixed, with Japan’s Nikkei 225 closing nearly 1.2% to 45,303.43 as the Bank of Japan started its two-day policy meeting, with rates expected to be left unchanged.

    South Korea’s Kospi added 1.4% to 3,461.30, with chipmakers SK Hynix and Samsung Electronics among advancers.

    The Chinese markets were down. Hong Kong’s Hang Seng slipped nearly 1.4% to 26,544.85, while the Shanghai Composite index trimmed earlier gains, losing over 1.1% to 3,831.66.

    Australia’s S&P/ASX 200 dipped 0.8% to 8,745.20 with data released Thursday showing the jobless rate was unchanged at 4.2% in August, but headline employment fell by 5,400 while full-time jobs declined by 40,900.

    India’s BSE Sensex was up 0.1%, while Taiwan’s Taiex added 1.3%.

    ——-

    [ad_2]

    Source link

  • Will mortgage rates drop further after the Fed’s rate cut? Not necessarily

    [ad_1]

    LOS ANGELES — Hoping that mortgage rates will keep dropping following the Federal Reserve’s first rate cut since last year? Don’t bank on it.

    As expected, the central bank delivered a quarter-point cut Wednesday and projected it would lower its benchmark rate twice more this year, reflecting growing concern over the U.S. job market.

    Here’s a look at factors that determine mortgage rates and what the Fed’s latest move means for the housing market:

    Mortgage rates have been mostly falling since late July on expectations of a Fed rate cut. The average rate on a 30-year mortgage was at 6.35% last week, its lowest level in nearly a year, according to mortgage buyer Freddie Mac.

    A similar pullback in mortgage rates happened around this time last year in the weeks leading up to the Fed’s first rate cut in more than four years. Back then, the average rate on a 30-year mortgage got down to a 2-year low of 6.08% one week after the central bank cut rates.

    But it hasn’t come close to that since.

    Mortgage rates didn’t keep falling last year, even as the Fed cut its main rate two more times. Instead, mortgage rates rose and kept climbing until the average rate on a 30-year home loan reached just over 7% by mid-January.

    Like last year, the Fed’s rate cut doesn’t necessarily mean mortgage rates will keep declining, even as the central bank signals more cuts ahead.

    “Rates could come down further, as the Fed has signaled the potential for two more rate cuts this year,” said Lisa Sturtevant, chief economist at Bright MLS. “However, there are still risks of a reversal in mortgage rates. Inflation heated up in August and if the September inflation report shows another bump in consumer prices, it’s possible we could see rates rise.”

    No. Mortgage rates are influenced by several factors, from the Fed’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation.

    Mortgage rates generally follow the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans.

    That’s because mortgages are typically bundled into mortgage-backed securities that are sold to investors. To keep mortgage-backed securities attractive to investors, their yield — or annual return — is adjusted to be competitive with the yield offered by the U.S. on its 10-year government bonds. When those bond yields rise, they tend to push up mortgage rates, and vice-versa.

    The 10-year Treasury yield has been mostly easing since mid-July as growing signs that the job market has been weakening fueled expectations of a Fed rate cut this month.

    Until now, the Fed had kept its main interest rate on hold this year because it was more worried about inflation potentially worsening due to the Trump administration’s tariffs than about the job market.

    At the same time, inflation has so far refused to go back below the Fed’s 2% target.

    When the Fed cuts rates that can give the job market and overall economy a boost, but it can also fuel inflation. That, in turn, could push up mortgage rates.

    “It’s not just about what the Fed is doing today, it’s about what they’re expected to do in the future, and that’s determined by things like economic growth, what’s going to happen in the labor market and what do we think inflation is going to be like over the next year or so,” said Danielle Hale, chief economist at Realtor.com.

    “If the Fed keeps lowering rates, it doesn’t necessarily mean mortgages will go down,” said Stephen Kates, financial analyst at Bankrate. “It means that they probably could go down more, and they may trend in that direction, even if they don’t move in lockstep.”

    Ahead of the Fed’s rate cut, the futures market had priced in expectations that the central bank would cut its key interest rate at upcoming policy meetings this year and into 2026. But the Fed’s latest projections show a less aggressive path of rate cuts than the market has been expecting.

    “This ongoing gap between market and Fed expectations means that some risk of upward pressure on mortgage rates remains,” said Hale, adding that the decline in mortgage rates “is likely to continue at least through this week.”

    Hale recently forecast that the average rate on a 30-year mortgage will be between 6.3% and 6.4% by the end of this year. That’s in line with recent projections by other economists who also don’t expect the average rate to drop below 6% this year.

    The late-summer pullback in mortgage rates has been a welcome trend for the housing market, which has been in a slump since 2022, when mortgage rates began climbing from historic lows. Sales of previously occupied U.S. homes sank last year to their lowest level in nearly 30 years and have remained sluggish so far this year.

    While lower rates give home shoppers more purchasing power, mortgage rates remain too high for many Americans to afford to buy a home. That’s mostly because home prices, while rising more slowly than in years past, are still up by roughly 50% nationally since the start of this decade.

    “While lower rates will bring some buyers and sellers into the market, today’s cut will not be enough to break up the housing market logjam,” said Sturtevant. “We will need to see further drops in mortgage rates and much slower home price growth, or even home price declines, to make a dent in affordability.”

    If mortgage rates continue to ease, home shoppers will benefit from more affordable financing. But lower mortgage rates could also bring in more buyers, making the market more competitive at a time when sellers across the country are having a tougher time driving a hard bargain.

    Predicting when mortgage rates will decline and by how much is daunting because so many variables can influence their trajectory from one week to the next.

    Home shoppers who can afford to buy at current rates may be better off buying now if they find a property that fits their needs, rather than attempt to time the market, said Kates.

    Many homeowners looking to refinance have already seized on the decline in rates, sending applications for refinance loans sharply higher in recent weeks.

    One rule of thumb to consider when refinancing is whether you can reduce your current rate by at least one percentage point, which helps blunt the impact of refinancing fees.

    [ad_2]

    Source link

  • Wall Street edges back from its record heights

    [ad_1]

    NEW YORK — U.S. stocks edged back from their record heights on Tuesday as the countdown ticked toward what Wall Street expects will be the first cut of the year to interest rates by the Federal Reserve.

    The S&P 500 fell 0.1% from its latest all-time high. The Dow Jones Industrial Average dipped 125 points, or 0.3%, while the Nasdaq composite slipped 0.1% from its own record set the day before.

    Stocks have run to records on expectations that the Fed will announce the first of a series of cuts to rates on Wednesday in hopes of giving the economy a boost. The job market has slowed so much that traders believe Fed officials now see it as the bigger danger for the economy than the threat of higher inflation because of President Donald Trump’s tariffs.

    The Fed has been holding off on cuts to rates because inflation has remained above its 2% target, and easier interest rates could give it more fuel.

    A report on Tuesday said shoppers increased their spending at U.S. retailers by more last month than economists expected. A chunk of that could be due to shoppers having to pay higher prices for the same amount of stuff. But it could also indicate solid spending by U.S. households could continue to keep the economy out of a recession.

    The data did little to change traders’ expectations for a cut to interest rates on Wednesday, followed by more through the end of the year and into 2026.

    Such high expectations have sent stocks to records, but they can also create disappointment if unfulfilled. That’s why more attention will be on what Fed Chair Jerome Powell says about the possibility of upcoming cuts in his press conference following Wednesday’s decision than on the decision itself.

    Fed officials will also release their latest projections for where they see interest rates and the economy heading in upcoming years, which could provide another potential flashpoint.

    For now, global fund managers are tilting their portfolios toward stocks at the highest level in seven months, according to the latest survey by Bank of America. That’s even though a record 58% of them are also saying that stocks look too expensive at the moment.

    On Wall Street, Dave & Buster’s fell 16.7% after the entertainment chain reported a weaker profit for the latest quarter than analysts expected.

    New York Times Co. fell 1.6% after Trump filed a $15 billion defamation lawsuit against the newspaper and four of its journalists on Monday. The lawsuit points to several articles and a book written by Times journalists and published in the lead up to the 2024 election as “part of a decades-long pattern by the New York Times of intentional and malicious defamation against President Trump.”

    On the winning end of Wall Street was Steel Dynamics, which climbed 6.1% after it said it’s seeing improved earnings across its three business units. It credited strong demand for steel from the non-residential construction and auto industries, among other things.

    Chipotle Mexican Grill added 1.9% after its board said the company could buy back an additional $500 million of its stock. Such a move can send cash directly to investors and boost per-share results.

    Oracle rose 1.5% on speculation that it could be part of a deal that would keep TikTok operating in the United States.

    All told, the S&P 500 fell 8.52 points to 6,606.76. The Dow Jones Industrial Average dropped 125.55 to 45,757.90, and the Nasdaq composite sank 14.79 to 22,333.96.

    In stock markets abroad, indexes fell in Europe following a mixed showing in Asia.

    Japan’s Nikkei 225 added 0.3% to finish at another record. The rally comes despite political uncertainty after Japanese Prime Minister Shigeru Ishiba said he is stepping down. An election within the ruling Liberal Democratic Party to pick a new leader is expected Oct. 4.

    In the bond market, the yield on the 10-year Treasury eased to 4.03% from 4.05% late Monday.

    ___

    AP Business Writers Yuri Kageyama and Matt Ott contributed.

    [ad_2]

    Source link

  • How much for matcha? Prices for the popular powdered tea soar due to global demand

    [ad_1]

    The world’s fondness for matcha is about to be tested by steep price increases.

    Global demand for the powdered tea has skyrocketed around the world, fueled by consumer interest in its health benefits and by the bright green matcha lattes bubbling up on social media. In the U.S., retail sales of matcha are up 86% from three years ago, according to NIQ, a market research firm.

    But the matcha market is troubled. In Japan, one of the biggest matcha producers, poor weather reduced this year’s harvest. Matcha is still plentiful in China, another major producer, but labor shortages and high demand have also raised prices there.

    For Americans, there’s the added impact of tariffs. Imports from China are currently subject to a 37.5% tariff, while the U.S. has a 15% tariff on imports from Japan. It’s not clear if tea will be exempted from tariffs because it’s a natural product that’s not grown in significant quantities in the U.S. — an accommodation that the Trump administration has made for cork from the European Union. The Commerce Department and the U.S. Trade Representative didn’t respond to messages left by The Associated Press.

    Aaron Vick, a senior tea buyer with California-based tea importer G.S. Haly, says he paid 75% more for the highest-grade 2025 crop of Japanese matcha, which will arrive in the U.S. later this fall. He expects lower grades of matcha to cost 30% to 50% more. Chinese matcha — while generally cheaper than Japanese matcha — is also getting more expensive because of high demand, he said.

    “People should expect an enormous increase in the price of matcha this year,” Vick said. “It’s going to be a bit of a tough ride for matcha devotees. They will have to show the depth of their commitment at the cash register.”

    Even before this year’s harvest, growing demand was straining matcha supplies. Making matcha is precise and labor intensive. Farmers grow tencha — a green tea leaf — in the shade. In the spring, the leaves are harvested, steamed, de-stemmed and de-veined and then stone ground into a fine powder. Tencha can be harvested again in the summer and fall, but the later harvests are generally of lower quality.

    There are ways to cut corners, like using a jet mill, which grinds the leaves with high pressure air. But Japan has other issues, including a rapidly aging workforce and limited tencha production. And despite Japanese agricultural ministry trying to coax tea growers to switch to tencha from regular green tea, many are reluctant to do so, concerned that the matcha boom will fade.

    That’s giving an opening to China, where matcha originated but fell out of favor in the 14th century. Chinese matcha production has been growing in recent years to meet both domestic and international demand.

    Chinese matcha has historically been considered inferior to Japanese matcha and used as a flavoring for things like matcha-flavored KitKat bars instead of as a drinking tea. But the quality is improving, according to Jason Walker, the marketing director at Firsd Tea, the New Jersey-based U.S. subsidiary of Zhejiang Tea Group, China’s largest tea exporter.

    “We are seeing more and more interest in Chinese matcha because of capacity issues and changing perception,” Walker said. “It used to be the idea that it has to be Japanese matcha or nothing. But we have a good product too.”

    Starbucks is among the companies using matcha from China for its lattes. The company said it also sources matcha from Japan and South Korea. Dunkin’ and Dutch Bros. didn’t respond when asked where they source the matcha.

    Josh Mordecai, the supply chain director for London-based tea supplier Good & Proper Tea, said he is approached almost daily by Chinese matcha suppliers. For now, he only buys matcha from Japan, but the cost to acquire it has risen 40% so he’ll have to raise prices, he said.

    Mordecai said he saw more demand for matcha in the last year than in the previous nine years combined. If matcha prices continue to rise, he wonders if consumers will switch to other tea varieties like hojicha, a roasted Japanese green tea.

    “We’ll see if this is a bubble or not. Nothing stays on social media that long,” Mordecai said.

    Julia Mills, a food and drink analyst for the market research company Mintel, expects the social media interest in matcha to die down. But she thinks matcha will remain on menus for a while.

    Mills said matcha appeals to customers interested in wellness, since it contains antioxidants and l-theanine, an amino acid known for its calming effects, and it’s less caffeinated than coffee. Millennials and Generation Z customers are more likely to have tried matcha than others, Mills said.

    The traditional way of preparing it, whisking the powder together with hot water in a small bowl, also appeals to drinkers who want to slow down and be more intentional, Mills said.

    That’s true for Melissa Lindsay of San Francisco, who whisks up some matcha for herself every morning. Lindsay has noticed prices rising for her high-end matcha, but it’s a habit she’d find hard to quit.

    “It’s not just a tea bag in water,” Lindsay said. “It’s a whole experience of making it to your liking.”

    David Lau, the owner of Asha Tea House in San Francisco, hopes to keep customers drinking matcha by limiting price increases. Lau raised the price of his matcha latte by 50 cents after the cost the matcha he buys from Japan more than doubled. He’s also looking into alternate suppliers from China and elsewhere.

    “We’re in the affordable luxury business, you know, just like any other specialty cafe. We want people to be able to come every day, and once you reach a certain price level, you start to price people out,” he said. “We want to be really cognizant and aware of not doing that.

    ___

    AP Video Journalist Haven Daley contributed from San Francisco.

    [ad_2]

    Source link

  • Global shares trade mixed as markets eye Fed decision

    [ad_1]

    Wall Street inched a tad higher early Monday as markets look ahead to what most expect will be an interest rate cut by the U.S. Federal Reserve later this week.

    Futures for the S&P 500 and Dow Jones industrials each ticked up 0.2% before the bell, while futures for the Nasdaq were up just 0.1%.

    Nvidia dipped 1.5% in premarket after China accused the company of violating the country’s antimonopoly laws. China said it would step up scrutiny of the world’s leading chipmaker, escalating tensions with Washington as the two countries hold trade talks this week.

    Chinese regulators said a preliminary investigation found that Nvidia didn’t comply with conditions imposed for its $6.9 billion purchase of Mellanox Technologies, a network and data transmission company. The one-sentence statement from Chinese regulators didn’t mention punishment, but said it would carry out “further investigation.”

    Tesla shares climbed 8.5% after CEO Elon Musk disclosed the purchase of more than 2.5 million shares worth approximately $1 billion.

    Musk purchased various amounts of shares at different prices on Friday, according to a regulatory filing. Markets tend to view such insider purchases as the confidence in the company’s future.

    With earnings season effectively wrapped up, investors are looking ahead to Wednesday, when the Federal Reserve is widely expected to cut its benchmark interest rate for the first time this year, despite inflation that remains above the central bank’s 2% target.

    Even as prices remain high, Fed officials have publicly acknowledged that a slowing labor market is now their biggest concern. That’s what is primarily driving market optimism for a rate cut this week.

    The central bank will also release its quarterly economic projections Wednesday, and economists forecast that they will show one or two additional cuts this year followed by several more next year.

    Also coming this week is the latest government data on retail sales, which will give a glimpse into whether Americans are still spending freely against the headwinds of still-elevated inflation and a weakening job market..

    Elsewhere, in Europe at midday, France’s CAC 40 jumped 1.2%, while the German DAX gained 0.5%. Britain’s FTSE 100 was unchanged.

    In Asia, Hong Kong’s Hang Seng added 0.2% to 26,446.56. The Shanghai Composite edged down 0.3% to 3,860.50.

    Worries are simmering about China’s economy, as analysts say the data for August aren’t strong enough to reflect ongoing dynamic growth, especially given the damage from U.S. President Donald Trump’s tariff policies.

    “China’s economy continued to slide in August, with all key activity readings falling short of market forecasts once more,” Lynn Song of ING Economics said in a report.

    “Given the slowdown of the past few months, we expect that there’s a strong case for additional short-term stimulus efforts,”

    China’s industrial production grew 5.2%, a 12-month low that was down from 5.7% in July and 6.8% in June. Retail sales rose 3.4%, the slowest pace since last November.

    “The underlying flow is shifting. For years, Beijing leaned on exports as the carry trade that kept growth rolling even as property cracked. But with Trump’s tariffs slicing through supply chains, that leg of the trade is gone,” said Stephen Innes, managing partner at SPI Asset Management.

    Australia’s S&P/ASX 200 lost 0.1% to 8,853.00, while South Korea’s Kospi gained 0.4% to 3,407.31. Stock trading was closed Monday for a national holiday in Japan.

    ___

    Associated Press writer Ken Moritsugu in Beijing contributed to this report.

    [ad_2]

    Source link