Economics

While Trump did not explicitly name China in his tariff announcement, he did issue an overall warning of higher tariffs on transshipped goods, which typically originate in China.

Chinese state media warned the Trump administration Tuesday against striking deals that sideline China, after the president announced that Asian countries would face higher tariffs starting Aug. 1, unless other arrangements are agreed on before then.

“If such situations arise, China will not accept them and will resolutely take countermeasures to safeguard its legitimate rights and interests,” the People’s Daily, a state-run newspaper, said in a commentary.

Donald Trump said there would be 25% import tariffs on U.S. allies South Korea and Japan, 36% on Thailand and Cambodia, 35% on Bangladesh, 32% on Indonesia, 40% on Myanmar and Laos, and 25% on Malaysia.

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Elon Musk said he would form a new political party called the “America Party.”

Tesla shares fell Monday after Musk’s announcement.

Tesla shareholders have wanted Musk to stay away from politics, especially after his stint at the so-called Department of Government Efficiency, which many have said damaged the automaker’s brand.

Brussels and Berlin have launched a new initiative aimed at bypassing the long-standing paralysis of the World Trade Organization (WTO). But how viable is such a solution?

A proposal, introduced by European Commission President Ursula von der Leyen and German Chancellor Friedrich Merz, has sparked considerable attention.

Speaking at the end of a summit of EU leaders in Brussels on June 27, they floated the idea of the EU taking the lead in forming an alternative to the World Trade Organization (WTO), the world trade body that has been in place since 1995.

Merz said the idea was in its early stages but could include mechanisms to resolve disputes, as the WTO was meant to do.

"You all know that the WTO doesn't work anymore," he said, adding that a "new kind of trade organization" could gradually replace "what we no longer have with the WTO."

As Donald Trump cheered the passage of his self-styled, and officially named, Big Beautiful Budget Bill through Congress this week, long-sown seeds of doubt about the scale and sustainability of US borrowing from the rest of the world sprouted anew.

Trump's tax-cutting budget bill is expected to add at least $3 trillion (£2.2 trillion) to the US's already eye-watering $37tn (£27tn) debt pile. There is no shortage of critics of the plan, not least Trump's former ally Elon Musk, who has called it a "disgusting abomination".

The growing debt pile leaves some to wonder whether there is a limit to how much the rest of the world will lend Uncle Sam.

Donald Trump threatened to impose 17% tariffs on food and farm produce exports from Europe during talks in Washington this week, it has emerged.

Such tariffs would hit everything from Belgian chocolate to Kerrygold butter from Ireland and olive oil from Italy, Spain and France, all big sellers in the US.

First reported in the Financial Times, sources confirmed that the EU trade commissioner, Maroš Šefčovič, was given the warning on Thursday when he met the US treasure secretary, Scott Bessent, trade representative Jamieson Greer and commerce secretary Howard Lutnick.

As AI reshapes the labor market, the real threat may not be unemployment — it could be something subtler and more corrosive: the collapse in what skills are worth.

That's according to MIT economist David Autor, who made the comments in an interview released Wednesday on the "Possible" podcast, hosted by LinkedIn cofounder Reed Hoffman.

Autor warned that rapid automation could usher in what he calls a "Mad Max" scenario — a world where jobs still exist, but the skills that once generated wages become cheap and commoditized.

Economists surveyed by The Wall Street Journal forecast that 110,000 new payrolls were added in June. That would be the fewest since February.

The U.S. economy continues to send mixed signals. On Thursday, the Bureau of Labor Statistics will report job figures for June that may help clear up the picture.

Economists surveyed by The Wall Street Journal forecast that 110,000 new payrolls were added in June. That would be the fewest since February, and it would be the fourth monthly decline in the past six months. The unemployment rate, meanwhile, was expected to have climbed to 4.3%, the highest since October 2021.

Consumers and businesses are still grappling with the uncertainty caused by Donald Trump’s policies, something further reflected in volatile data.

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Federal Reserve Chair Jerome Powell said Tuesday that the U.S. central bank would have eased monetary policy by now if not for Donald Trump’s tariff plan.

When asked during a panel if the Fed would have lowered rates again this year had Trump not announced his controversial plan to impose higher levies on imported goods earlier this year, Powell said, “I think that’s right.”

“In effect, we went on hold when we saw the size of the tariffs and essentially all inflation forecasts for the United States went up materially as a consequence of the tariffs,” Powell said at European Central Bank forum in Sintra, Portugal.

Immigration enforcement operations on farms have left crops rotting and farm operations disrupted in major agricultural states including California, Texas, and Pennsylvania.

Farm owners and industry representatives report that up to 70 percent of workers stopped reporting to work following Immigration and Customs Enforcement (ICE) actions, resulting in significant crop losses and financial strain.

"We do not have enough workforce in the United States to do manual work, to do those jobs that other people are not qualified to do and do not want to do it," Alexandra Sossa, CEO of Farmworker and Landscaper Advocacy Project, told Newsweek. "For example, we are running into a problem where we do not have enough farm workers to grow the food we eat every day.

The US economy contracted in the beginning of the year at a much faster pace than previously reported, after new data factored in much weaker consumer spending.

Gross domestic product, the broadest measure of economic output, registered an annualized rate of -0.5% from January through March, the Commerce Department said Thursday in its third and final estimate. That’s worse than the 0.2% decline reported in the second estimate. GDP is adjusted for seasonal swings and inflation.

The latest estimate showed that consumer spending — the lifeblood of the US economy — was tepid in the beginning of the year. Spending in the first quarter grew at a rate of just 0.5%, down from 1.2% in an earlier estimate. That’s the weakest rate in more than four years.

Real-terms gains of $33.9tn for world’s richest 1% ‘enough to end annual global poverty 22 times over’, charity says

The wealth of the world’s 3,000 billionaires has surged by $6.5tn (£4.8tn) in real terms over the past decade, according to Oxfam, equivalent to 14.6% of global output.

In total the richest 1% of the global population has gained at least $33.9tn in real terms, which the charity said was “enough to end annual global poverty 22 times over”.

The figures come as various governments face growing calls to introduce a wealth tax on the international elite.

U.S. consumer confidence unexpectedly deteriorated in June as households increasingly worried about job availability, another indication that labor market conditions were softening against the backdrop of rising economic uncertainty because of the Trump administration's tariffs.

The ebb in confidence reported by the Conference Board on Tuesday was across all age cohorts and nearly all income groups. It was also across the political spectrum, with the largest decline among Republicans.

Consumers remained pre-occupied with the import duties and were mostly undecided on big-ticket purchases. There was a decline in the share expecting their incomes to increase, though perceptions of the current financial situation remained solid.

How well — or how poorly — Americans are managing their Buy Now, Pay Later loans soon could be reflected in their credit scores.

FICO plans to launch a suite of credit scores later this year that incorporate BNPL data, providing lenders a window into what’s been a big blind spot: consumers’ repayment behavior on these increasingly popular installment loans.

BNPL loans can serve as an alternative to credit cards and are used by consumers who are seeking more flexible payment options, who want to overcome a tight financial spot, or who are looking to smooth out some bigger transactions to better meet their budgets.

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Nippon Steel and U.S. Steel said Wednesday they have finalized their “historic partnership,” a year-and-a-half after the Japanese company first proposed its deal to buy the iconic American steelmaker for nearly $15 billion.

The pursuit by Nippon Steel for the Pittsburgh company was buffeted by national security concerns and presidential politics in a premier battleground state, delaying the transaction for more than a year after U.S. Steel shareholders approved it. It also forced Nippon Steel to expand the deal, including adding a so-called “golden share” provision that gives the federal government a say in some matters.

The combined company will become the world's fourth-largest steelmaker, and bring what analysts say is Nippon Steel's top-notch technology to U.S. Steel's antiquated steelmaking processes. In exchange, Nippon Steel gets access to a robust U.S. steel market, strengthened in recent years by tariffs under Donald Trump and Joe Biden, analysts say.

The U.S. Federal Reserve announced on Wednesday that it is not lowering interest rates, keeping them steady at 4.25 to 4.5%.

"Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace," the Federal Open Market Committee (FOMC) said in a press release. "The unemployment rate remains low, and labor market conditions remain solid. Inflation remains somewhat elevated."

The Federal Reserve last cut interest rates in December. Despite increasing pressure from Donald Trump, Chair Jerome Powell has refused to lower them further.

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Americans are feeling a hangover from their tariff-fueled buying frenzy early in the spring.

Retail sales fell by 0.9% in May from the prior month, the Commerce Department said Tuesday, down sharply from April’s downwardly revised 0.1% decline. That was the steepest monthly decline since January and worse than the 0.7% decrease economists projected in a poll by data firm FactSet.

The figures are adjusted for seasonal swings but not inflation.

In a corner of Kentucky just outside of Louisville, family-owned shoe company Keen is opening a new factory this month.

The move fits neatly into the "America First" economic vision championed by the Trump administration - an emblem of hope for a manufacturing renaissance long promised but rarely realised. Yet beneath the surface, Keen's new factory tells a far more complicated story about what manufacturing in America really looks like today.

With just 24 employees on site, the factory relies heavily on automation -sophisticated robots that fuse soles and trim materials - underscoring a transformation in how goods are made today.

Manufacturing is no longer the labour-intensive engine of prosperity it once was, but a capital-heavy, high-tech enterprise.

Out of all 50 states, Massachusetts finished at the top with an overall score of 70.84, beating second-place Utah (69.18) by more than a point. As well as ranking first in terms of innovation potential, Massachusetts placed sixth in economic activity and 17th in economic health.

Washington placed third at 68.97, thanks largely to its innovation potential, leading position in the new technology space and high tech-sector employment.

California, which recently overtook Japan to become the world's fourth largest economy in terms of GDP, ranked fourth at 67.43.

At the bottom of the rankings were Hawaii (33.09), West Virginia (32.34) and Iowa (31.61) in 51st place (results included the District of Columbia in 12th place).

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Remote work, steep mortgage rates and new types of rental properties are fueling demand far from urban downtowns.

Renting is taking off in the suburbs as homeownership remains out of reach for many would-be buyers.

Between 2018 and 2023, rentership surged by at least 5 percentage points in 11 out of 20 suburbs surrounding the largest U.S. metro areas, according to a recent analysis by Point2Homes, a rental market research company.

During the same period, 15 suburbs went from being predominantly composed of homeowners to majority-renter communities. The trend spans fast-growing Sun Belt metros like Dallas, Houston and Miami as well as Northeastern cities like Boston and Philadelphia.

In five of those top 20 metro areas — Dallas, Minneapolis, Boston, Tampa and Baltimore — the suburbs are gaining renters faster than the urban centers they surround, Point2Homes found. The share of residents who rent surged in the Dallas suburbs by 17.6% from 2018 to 2023, while that rate rose just 7.9% in the city itself — with the nearby suburbs of Frisco, McKinney and Grand Prairie each gaining over 5,000 renter households apiece during that period.