U.S. Factory Orders Rise More Than Expected in May
New orders for U.S.-manufactured goods increased more than expected in May, bucking a slew of recent data showing a softening in the economy and underscoring that demand for products remains strong. The Commerce Department said on Tuesday that factory orders rose 1.6% in May after advancing 0.7% in April.
In May, there were increases in orders for primary metals, machinery and transportation equipment, among others. Orders for computers and electronic products also rose 0.5%. But orders for electrical equipment, appliances and components declined 1.0%. Shipments of manufactured goods gained 1.8% after accelerating 0.6% in April. Inventories at factories increased 1.3%. Unfilled orders rose 0.4% in May compared to a gain of 0.5% in April.
War in Ukraine Headlines
- Ukraine and Russia: the Latest News – CNN
- Swiss Give Cool Reply to Ukraine Call for Seizing Russian Assets – Reuters
- Russia Takes Steps Toward Mobilizing Economy for War – CNBC
- Microsoft Declines New Cloud Customers After Promise to Ukraine – Telegraph
- NATO Allies Sign Accession Protocols for Finland and Sweden in “Truly Historic Moment” – CBS
- High Cost of Russian Gains in Ukraine May Limit New Advance – Military Times
- US to Send Ukraine Advanced NASAMS Air Defense Weapons in $820 Million Package – Military Times
- Ukraine Prepares a Counter-offensive to Retake Kherson Province – The Economist
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
Biden Might Soon Ease Chinese Tariffs, Its a Decision Fraught With Policy Tensions
President Biden is expected to roll back some tariffs on Chinese imports soon, a decision constrained by competing policy aims: addressing inflation and maintaining economic pressure on Beijing. People familiar with the situation say what comes next has been pending with Mr. Biden in recent weeks and that he could announce his decision this week. It could include a pause on tariffs on consumer goods such as clothing and school supplies, as well as launching a broad framework to allow importers to request tariff waivers.
Among his own cabinet, Treasury Secretary Janet Yellen has called tariffs a drag on the economy, saying the administration is looking at ways to reconfigure them to help curb inflation. On the other side are U.S. Trade Representative Katherine Tai and National security adviser Jake Sullivan, who see tariffs as valuable leverage in getting concessions from China.
Falling Commodity Prices Raise Hopes That Inflation Has Peaked
A slide in all manner of raw-materials prices—corn, wheat, copper and more—is stirring hopes that a significant source of inflationary pressure might be starting to ease. Many raw materials remain historically high-price, to be sure. And there are matters of supply and demand behind the declines, from a fire at a Texas gas-export terminal to better crop-growing weather. Yet some investors are starting to view the reversals as a sign that the Federal Reserve’s efforts to slow the economy are reducing demand.
Natural-gas prices shot up more than 60% before falling back to close the quarter 3.9% lower. U.S. crude slipped from highs above $120 a barrel to end around $106. Wheat, corn and soybeans all wound up cheaper than they were at the end of March. Cotton unraveled, losing more than a third of its price since early May. Benchmark prices for building materials copper and lumber dropped 22% and 31%, respectively, while a basket of industrial metals that trade in London had its worst quarter since the 2008 financial crisis.
U.S. COVID – Maps Track Hospitalizations
Covid-19 hospitalizations are increasing again after a surge in December and January. These maps from NBC news tracks hospitalizations in states using an analysis of U.S. Department of Health and Human Services COVID hospitalizations data.
Since April 2020, there have been at least 16,800 people hospitalized for Covid in the U.S. over a seven-day period and as many as 159,000, a new peak set during the omicron surge. The country across the pandemic has averaged about 60,000 hospitalizations for COVID a day.
NYS Vaccine and COVID Update –
Vaccine Stats as of July 1:
One Vaccine Dose
- 91.1% of all New Yorkers – 16,678,442
- In the Hudson Valley 1,734,898
- 77.8% of all New Yorkers – 14,967,653
- In the Hudson Valley – 1,529,398
- All New Yorkers – 8,833,060
- In the Hudson Valley – 1,076,155
The Governor updated COVID data through July 1. There were 10 COVID related deaths for a total reported of 72,079
- Patients Currently in Hospital statewide: 1,987
- Patients Currently in ICU Statewide: 192
7 Day Average Positivity Rate – Cases per 100K population
- Statewide 6.37% – 28.02 positive cases per 100,00 population
- Mid-Hudson: 4.99% – 26.81 positive cases per 100,00 population
SCOTUS Won’t Hear Challenge to New York Vaccine Mandate for Health Care Workers
The Supreme Court declined Thursday to take up a legal challenge brought by health care workers in New York who oppose the state’s vaccine mandate on religious grounds. Last December, the Supreme Court declined to temporarily block the vaccine requirement in the case. Justices Clarence Thomas, Samuel Alito and Neil Gorsuch said then that the court should have granted the request to put the mandate on hold.
Lawyers for the state said the Covid mandate was similar to longstanding rules requiring health care workers to be vaccinated against measles and rubella. Those requirements, too, allow exemptions only for medical reasons. Since last fall, the court has declined to block other vaccine mandates that don’t provide for religious exemptions, applying to New York teachers, Navy sailors, health care workers in Maine and Massachusetts, and college students in Indiana.
BA.4 and BA.5 Variants Spur 20 Percent Rise in Cases Worldwide
WHO Director-General Tedros Adhanom Ghebreyesus stressed in his weekly briefing to journalists that the global figure overall remains “relatively stable”, but nobody should be under any illusion, that the coronavirus is on the way out. “This pandemic is changing but it’s not over. We have made progress but it’s not over.”
He warned that our ability to track the virus is under threat as reporting and genomic sequences are declining. The optimistic mid-year deadline for all countries to vaccinate at least 70 per cent of their populations is looking unlikely, with the average rate in low-income countries, standing at 13 per cent. On the bright side, in the past 18 months, more than 12 billion vaccines have been distributed around the world, and 75 percent of the world’s health workers and over-60s are now vaccinated.
Americans Tap Pandemic Savings to Cope With Inflation
From the start of the pandemic to the end of 2021, U.S. households built up $2.7 trillion in extra savings, according to Moody’s Analytics. Covid-19 lockdowns kept people at home with nowhere to spend money, and three rounds of stimulus payments boosted their incomes.
Now, with inflation at its highest point in decades and wage gains trailing behind, Americans are turning to that stash to cover costs.
The personal saving rate, a measure of how much money people have left over after spending and taxes, reached 5.4% in May. That figure is below the average of the last decade and far below the record of 34% in April 2020, according to the Bureau of Economic Analysis. Families have tapped about $114 billion of their pandemic savings so far, according to Moody’s Analytics, which analyzed government data.
Battle Over Big Tech bills Goes Down to the Wire
Lobbying both for and against legislation to crack down on U.S. tech giants is intensifying as the Senate enters a critical month for the antitrust bills. All eyes are on Senate Majority Leader Charles Schumer (D-N.Y.), who will need to decide whether to prioritize measures to regulate Google, Apple, Amazon and Meta over other key bills prior to the August recess.
The two bills, expected to be packaged together, take aim at the gatekeeper power of dominant tech companies. The American Innovation and Choice Online (AICO) Act would bar tech giants — most likely only those big four firms — from giving preferential treatment to their own products and services on the platforms they operate. The Open App Markets Act is more narrowly focused on mobile application stores. It would bar Apple and Google from favoring their own apps in stores, requiring developers to use their payment services or preventing users from downloading apps from third-party distributors
China’s GDP Set to Hit 2-Year Low
China’s economy is expected to post its lowest quarterly growth rate in more than two years next week, as it counts the cost of lockdowns and other hardline coronavirus control measures imposed during its “darkest hours” of April and May.
Gross domestic product (GDP) is forecast to grow by 1.4 per cent from a year ago in the April-June period, according to Chinese data provider Wind.
Though not as bad as the 6.8 per cent contraction in the first three months of 2020, during the initial outbreak of the pandemic, it would mark the second slowest quarterly GDP expansion since 1992, when the data set first became available.
British Airways Cancels More Flights at ‘Most Challenging Period’ in History
British Airways is cancelling more flights scheduled for the summer holiday season, it said on Tuesday, at a time of widespread disruption at airports caused by staff shortages and a surge in travel demand. The airline said it would now reduce its April-October schedule by 11%, having said in May the cuts would amount to 10%.
The Telegraph newspaper reported late on Monday BA was cancelling more than 650 flights from London’s Heathrow and Gatwick airports to destinations including holiday spots in Spain, Portugal and Greece, affecting up to 105,000 travelers. Airlines and airports across Europe are struggling to keep up with strong post-pandemic demand from holidaymakers, causing chaos for travellers and forcing Heathrow and Gatwick to impose their own limits on capacity.
Oil Prices Pulled Lower by Dimming Demand
Contracts for Brent crude, the international benchmark, finished Tuesday down 9.5% to $102.77 a barrel. West Texas Intermediate, the U.S. standard, was down 8.2% to $99.50 a barrel, its first close below $100 since early May and its lowest settle value since April 25.
Traders’ attention is shifting to the possibility that a downturn in economic growth could cool demand for fuel, bringing prices lower. Some energy traders have zeroed in on indications that high prices and a slowing economy are already tempering gasoline demand. On a four-week-average basis, demand was down about 2% year-over-year through June 24, according to the federal Energy Information Administration.
Natural Gas Soars 700%, Becoming Driving Force in the New Cold War
One morning in early June, a fire broke out at an obscure facility in Texas that takes natural gas from US shale basins, chills it into a liquid and ships it overseas. It was extinguished in 40 minutes or so. No one was injured. It sounds like a story for the local press, at most — except that more than three weeks later, financial and political shockwaves are still reverberating across Europe, Asia and beyond.
That’s because natural gas is the hottest commodity in the world right now. It’s a key driver of global inflation, posting price jumps that are extreme even by the standards of today’s turbulent markets — some 700% in Europe since the start of last year, pushing the continent to the brink of recession. It’s at the heart of a dawning era of confrontation between the great powers, one so intense that in capitals across the West, plans to fight climate change are getting relegated to the back-burner.
Euro Nears 20-Year Low Against U.S. Dollar on Recession Fears
The euro neared a 20-year low against the dollar as investors worried that the eurozone may be approaching an energy shock that could tip it into recession. The bloc’s common currency fell 1.2% against the U.S. dollar to trade at $1.0301. The growing transatlantic interest-rate divide tends to reduce the attractiveness of holding euros versus dollars.
European policymakers usually tend to welcome a weaker currency, which helps to boost the region’s exports by lowering their cost in international markets. But a weak euro can also drive up inflation because it increases import prices. That is a problem when eurozone inflation is at a record high of 8.6%, especially since energy and commodities are often invoiced in dollars.
Ford’s US Car Sales Rise Despite Semiconductor Crunch
Ford reported higher U.S. auto sales Tuesday, bucking an industry-wide trend of declines in the latest quarter amid crimped supply of semiconductor and other key parts. The Michigan giant delivered 483,688 vehicles, up two percent from the year-ago level. While citing a continuation of supply constraints that have dogged the industry over the last year, Ford described vehicle demand as “strong.” Sales were dominated by larger vehicles, including pickup trucks and sport utility vehicles. The burden of limited inventories has been cushioned by strong pricing.
Ford’s sales figures came as rivals General Motors, Toyota and FCA (Stellantis) all reported quarterly sales drops of at least 15% amid supply chain problems.