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U.S. consumer prices edged higher in July, the government reported Thursday, but underlying data signaled that inflation is not starting to resurge in the world’s biggest economy.

The Labor Department reported that the consumer price index rose 3.2% on an annualized basis in July, up from 3% in June. On a month-to-month basis, prices were up by two-tenths of a percent in July, the same figure as in June compared to May.

The U.S. central bank, the Federal Reserve, has raised its benchmark interest rate 11 times over the last 17 months, pushing it to a 22-year high to curb inflation, which a year ago topped 9%. Higher interest rates boost borrowing costs for businesses and consumers alike and can cut into spending.

The newest economic report could give Fed policymakers reason to put off another rate increase at its September meeting. The July figures lowered the three-month annualized rate of core inflation, which excludes volatile food and energy prices, to 3.1%, the lowest reading in two years.

Fed officials often focus on the core reading because they consider it a better barometer of future inflation than the overall rate.

Greg McBride, the chief financial analyst of Bankrate.com, said in a statement, “The monthly increase of 0.2% in the consumer price index is right on target and represents the kind of progress needed to get inflation down to a sustainable 2% annual rate.”

But he warned that “further increases in oil prices could throw up a detour on the journey to 2% inflation.”

“Everything we buy in a store or online has to be transported, and even some service categories add fuel surcharges or raise prices in response,” McBride said. “Easing inflation was aided by gasoline prices that had fallen nearly 20% in the 12 months ending July 31. But with a recent surge, gas prices are now closing in on $4 per gallon. Something to watch in the months ahead.”

The state of the U.S. economy is particularly important as the national November 2024 presidential election edges closer. While other issues are important to tens of millions of voters — abortion rights, immigration control, crime, Russia’s war in Ukraine, to name a few — the state of the American economy and the cost of living are often at the forefront of considerations in voters’ minds.

While the 3.5% U.S. unemployment rate remains at near a 50-year low, and hundreds of thousands of jobs have been added to the economy month after month, national polls show that voters do not think that President Joe Biden has managed the economy well.

Opposition Republican presidential contenders have often blamed Biden for too much government spending and the country’s ever-growing long-term debt total, which now is more than $32 trillion.
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Virgin Galactic rocketed to the edge of space with its first tourists Thursday, including a former British Olympian who bought his ticket 18 years ago and a mother-daughter duo from the Caribbean.

The space plane glided back to a runway landing at Spaceport America in the New Mexico desert, after a brief flight that gave passengers a few minutes of weightlessness.

Cheers erupted from families and friends watching from below when the craft’s rocket motor fired after it was released from the plane that had carried it aloft. The rocket ship reached about 88 kilometers high.

Richard Branson’s company expects to begin offering monthly trips to customers on its winged space plane, joining Jeff Bezos’ Blue Origin and Elon Musk’s SpaceX in the space tourism business.

Virgin Galactic passenger Jon Goodwin, who was among the first to buy a ticket in 2005, said he had faith that he would someday make the trip. The 80-year-old athlete — he competed in canoeing in the 1972 Olympics — has Parkinson’s disease and wants to be an inspiration to others.

“I hope it shows them that these obstacles can be the start rather than the end to new adventures,” he said in a statement.

Ticket prices were $200,000 when Goodwin signed up. The cost is now $450,000.

He was joined by sweepstakes winner Keisha Schahaff, 46, a health coach from Antigua, and her daughter, Anastatia Mayers, 18, a student at Scotland’s University of Aberdeen. Also on board: two pilots and the company’s astronaut trainer.

It was Virgin Galactic’s seventh trip to space since 2018, but the first with a ticket-holder. Branson, the company’s founder, hopped on board for the first full-size crew ride in 2021. Italian military and government researchers soared in June on the first commercial flight. About 800 people are currently on Virgin Galactic’s waiting list, according to the company.

Virgin Galactic’s rocket ship launches from the belly of an airplane, not from the ground, and requires two pilots in the cockpit. Once the mothership reaches a height of about 15 kilometers, the space plane is released and fires its rocket motor to make the final push to just over 80 kilometers up. Passengers can unstrap from their seats, float around the cabin for a few minutes and take in the sweeping views of Earth, before the space plane glides back home and lands on a runway.

In contrast, the capsules used by SpaceX and Blue Origin are fully automated and parachute back down.

Like Virgin Galactic, Blue Origin aims for the fringes of space, quick ups-and-downs from West Texas. Blue Origin has launched 31 people so far, but flights are on hold following a rocket crash last fall. The capsule, carrying experiments but no passengers, landed intact.

SpaceX, is the only private company flying customers all the way to orbit, charging a much heftier price, too: tens of millions of dollars per seat. It’s already flown three private crews. NASA is its biggest customer, relying on SpaceX to ferry its astronauts to and from the International Space Station. since 2020.

People have been taking on adventure travel for decades, the risks underscored by the recent implosion of the Titan submersible that killed five passengers on their way down to view the Titanic wreckage. Virgin Galactic suffered its own casualty in 2014 when its rocket plane broke apart during a test flight, killing one pilot. Yet space tourists are still lining up, ever since the first one rocketed into orbit in 2001 with the Russians.

Branson, who lives in the British Virgin Islands, watched Thursday’s flight from a party in Antigua. He had held a virtual lottery to establish a pecking order for the company’s first 50 customers — dubbed the Founding Astronauts. Virgin Galactic said the group agreed Goodwin would go first, given his age and his Parkinson’s.
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China’s exports plunged by 14.5% in July compared with a year earlier, adding to pressure on the ruling Communist Party to reverse an economic slump.

Imports tumbled 12.4%, customs data showed Tuesday, in a blow to global exporters that look to China as one of the biggest markets for industrial materials, food and consumer goods.

Exports fell to $281.8 billion as the decline accelerated from June’s 12.4% fall. Imports sank to $201.2 billion, widening from the previous month’s 6.8% contraction.

The country’s global trade surplus narrowed by 20.4% from a record high a year ago to $80.6 billion.

Chinese leaders are trying to shore up business and consumer activity after a rebound following the end of virus controls in December fizzled out earlier than expected.

Economic growth sank to 0.8% in the three months ending in June compared with the previous quarter, down from the January-March period’s 2.2%. That is the equivalent of 3.2% annual growth, which would be among China’s weakest in three decades.

Demand for Chinese exports cooled after the U.S. Federal Reserve and central banks in Europe and Asia started raising interest rates last year to cool inflation that was at multidecade highs.

The export contraction was the biggest since the start of the COVID-19 pandemic in 2020, according to Capital Economics. It said the decline was due mostly to lower prices, while volumes of goods were above pre-pandemic levels.

“We expect exports to decline further over the coming months before bottoming out toward the end of the year,” said Capital Economics in a report. “The near-term outlook for consumer spending in developed economies remains challenging.”

The ruling party has promised measures to support entrepreneurs and to encourage home purchases and consumer spending but hasn’t announced large-scale stimulus spending or tax cuts. Forecasters expect those steps to revive demand for imports but say that will be gradual.

“Domestic demand continues to deteriorate,” said David Chao of Invesco in a report. “Policymakers have pledged further policy support, which could buoy household spending and lead to an improvement in import growth for the coming few months.”

Exports to the United States fell 23% from a year earlier to $42.3 billion, while imports of American goods retreated 11.1% to $12 billion. China’s politically sensitive trade surplus with the United States narrowed by 27% to a still-robust $30.3 billion.

China’s imports from Russia, mostly oil and gas, narrowed by just under 0.1% from a year ago to $9.2 billion. Chinese purchases of Russian energy have swelled, helping to offset revenue lost to Western sanctions imposed to punish the Kremlin for its invasion of Ukraine.

China, which is friendly with Moscow but says it is neutral in the war, can buy Russian oil and gas without triggering Western sanctions. The United States and French officials cite evidence that China is delivering goods with possible military uses to Russia but haven’t said whether that might trigger penalties against Chinese companies.

Exports to the 27-nation European Union slumped 39.5% from a year earlier to $42.4 billion, while imports of European goods were off 44.1% at $23.3 billion. China’s trade surplus with the EU contracted by 32.7% to $19.1 billion.

For the first seven months of the year, Chinese exports were off 5% from the same period in 2022 at just over $1.9 trillion. Imports were down 7.6% at $1.4 trillion.
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Japan is due to start releasing wastewater used to cool the crippled reactors at the Fukushima nuclear plant as soon as the end of August. China has criticized the planned release and imposed restrictions on Japanese seafood — prompting accusations of hypocrisy, as Henry Ridgwell reports from Tokyo.
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Over the past year, inflation in the United States has tumbled from 9% all the way to 3%, softening most of the price pressures that have gripped the nation for more than two years.  

Now comes the hard part.  

Squeezing out the last bit of excess inflation and reducing it to the Federal Reserve’s 2% target rate is expected to be a much harder and slower grind.  

A measure called “core” inflation, which excludes volatile food and energy prices, is even higher than overall inflation. It, too, seems likely to slow only gradually. The Fed pays particular attention to core prices as a signal of where inflation might be headed. In June, core prices were up 4.1% from a year earlier, according to the Fed’s preferred gauge.  

“We see some challenges in getting that all the way back to 2% quickly,” said Michael Hanson, senior global economist at J.P. Morgan.  

The stickiness of inflation could endanger the possibility that the Fed will achieve a rare “soft landing” — a scenario in which it manages to slow inflation down to its target level through higher interest rates without derailing the economy. If inflation were to remain elevated for too long, the Fed might feel compelled to further raise its key rate from its current 5.4%, a 22-year high. Most economists say they think the central bank is done hiking, but only if inflation continues to cool.  

At the same time, the Fed has acknowledged that inflation pressures have eased significantly over the past year. Encouragingly, that slowdown has occurred even while the economy has continued to expand and employers have steadily hired at a healthy pace.  

On Thursday, when the government will issue inflation data for July, economists expect it to show a slight pickup in year-over-year inflation to 3.3%. It would be the first such increase after 12 months of declines.

In part, any rebound in annual inflation for July will reflect higher gas prices. Unless they ease, gas prices could keep overall inflation above 3% through the end of the year. The national average pump price has jumped about 30 cents, to $3.83, in the past month, partly because the cost of oil has risen.  

One obstacle in bringing inflation down to the Fed’s 2% target is that the price slowdown so far has reflected mainly relatively painless changes not likely to be repeated. Until last month, for example, gas prices had already plunged from a peak national average of $5. And supply-chain snarls that had swollen the prices of cars, furniture, appliances and other physical goods have mostly unwound. The cost of long-lasing manufactured goods actually declined slightly in June from a year ago.  

Another factor is that prices had soared in the first half of 2022 before slowing in the second half. So any increase in July would have the effect of boosting the year-over-year inflation rate.  

What’s now sending prices up is mostly the cost of services — everything from dental care and auto insurance to restaurant meals and summer concerts. Those costs mostly reflect healthy wage gains for workers, which are often passed on to customers in the form of higher prices.  

“Energy prices are off, commodity prices off, core goods fell,” said Kristin Forbes, an economist at MIT and a former member of the Bank of England’s interest-rate setting committee. “That’s the quick, easy stuff. What’s left is this underlying wage-service inflation. And that’s the part that’s harder to slow down and will take take longer.”  

Many employees, especially in the economy’s service sector, could push for further raises in the coming months. With labor shortages still a problem for service industries, workers have leverage to demand higher pay. For most Americans, pay gains have trailed inflation over the past two years.  

Higher pay is one key issue driving strikes among Hollywood writers and actors. It was also a focus of the Teamsters union in its negotiations with UPS, which led to large pay gains. The United Auto Workers is also pushing for robust raises in its talks with U.S. automakers.  

Hanson, of J.P. Morgan, notes that measures of health insurance costs will start to rise this fall because of quirks in how the government measures them. And auto insurance and repair costs have been surging. A key reason is that vehicle prices soared after parts shortages developed when the pandemic erupted; costlier cars are more expensive to fix and insure. Auto insurance prices have soared nearly 17% in the past year.  

As a result, economists generally expect core prices, under the Fed’s preferred measure, to still rise at a 3.5% annual pace by year’s end — far above its 2% target. The Fed’s latest forecasts show that its policymakers expect core inflation to still be 2.6% at the end of 2024.  

Still, there are some hopeful signs that hiring and wages are slowing, which would cool inflation over time. On Friday, the government reported that employers added 187,000 jobs in July, a solid total but still reflective of a slowdown: Job growth over the past three months has averaged only about half the pace of the same period in 2022. And wage growth slipped to 4.6% in the April-June quarter, the government said, the slowest pace in a year and a half.

“That trajectory tells us where things will go in the next 12 months,” said Skanda Amarnath, executive director of Employ America, an advocacy group.  

At his most recent news conference, Fed Chair Jerome Powell sounded some cautious but hopeful notes about the prospect of a soft landing.  

“I wouldn’t use the term optimism about this yet,” he said. “I would say though that there’s a pathway….We’ve seen so far the beginnings of disinflation without any real costs in the labor market. And that’s a really good thing.”  

Yet a defining characteristic of the post-pandemic economy has been resilience, with consumers in particular showing a surprisingly persistent willingness to spend. Some economists worry that it will take a sharp rise in unemployment to reverse that trend and finally conquer inflation.  

The Fed has already been coming under some criticism for sharply raising rates and potentially putting the job market at risk. Sen. Elizabeth Warren, a Massachusetts Democrat, wrote Powell before the Fed met last month and urged him to forgo another rate increase. The central bank, though, went ahead with its 11th rate hike since March 2022.  

“The Fed’s aggressive rate hikes disproportionately threaten Black workers and their families and risk fully reversing the extraordinary labor market gains we have seen,” Warren, a frequent Fed critic, wrote.  

With political pressure on the Fed rising, Powell and other officials may soon see the precipitous drop in inflation in the first half of this year as having been the easy part.  

“The Fed has got lucky so far in what it’s gotten,” said Steven Blitz, chief U.S. economist at GlobalData TS Lombard. “Most of the decline in inflation was going to happen anyway. They really own the part that’s to come.”
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The contours of the debate at the heart of the Federal Reserve’s policy decision next month came into clearer view on Monday as officials outlined the case for and against another interest rate hike.

“The debate is really about: Do we need to do another rate increase? Or not? … I think we’re pretty close to what a peak rate would be,” New York Fed President John Williams said in an interview with the New York Times in which he voiced some confidence that underlying inflation was on a downward path.

“I do think that we are moving to an environment already where the underlying inflation rate has come down quite a bit,” Williams said in the interview, conducted August 2 and released on Monday. Williams, the vice chair and a permanent voting member of the policy-setting Federal Open Market Committee, said that inflation measures developed by the New York Fed suggest the pace of price increases could slow to as little as 2.5% annually by the end of the year, within striking distance of the Fed’s 2% target.

In separate remarks to a “Fed Listens” community event in Atlanta, Fed Governor Michelle Bowman said the combination of still-elevated inflation and continued economic growth meant further rate increases are likely. 

“I supported raising the federal funds rate at our July meeting, and I expect that additional increases will likely be needed to lower inflation to the [Federal Open Market Committee’s] goal,” she said, referring to the central bank’s benchmark overnight interest rate, which is currently set in the 5.25%-5.50% range.

“I will be looking for evidence that inflation is on a consistent and meaningful downward path as I consider whether further increases in the federal funds rate will be needed, and how long the federal funds rate will need to remain at a sufficiently restrictive level,” Bowman said.

The Fed’s preferred headline measure of inflation, the personal consumption expenditures price index, was at 3% on an annual basis as of June, while the same measure stripped of volatile food and energy prices was at 4.1% and has shown slower progress in recent months back to the Fed’s target.

The Fed raised rates by a quarter of a percentage point at the end of its July 25-26 meeting, and the most recent projections by policymakers show most expect one more rate increase by the end of the year.

But recent data have shown inflation slowing faster than expected, with many analysts anticipating a “disinflationary” trend may be developing that will work in the Fed’s favor.

Investors in contracts tied to the Fed’s policy rate are currently betting against any further increases, and expect the central bank’s next move to be a rate cut in the first months of next year.

Williams said that if inflation does continue falling, rate reductions would be appropriate next year so that the inflation-adjusted “real” rate of interest doesn’t increase through inaction.

“Assuming inflation continues to come down … then if we don’t cut interest rates at some point next year, then real interest rates will go up, and up, and up. And that won’t be consistent with our goals,” Williams said. “From my perspective, to keep maintaining a restrictive stance may very well involve cutting the federal funds rate next year.” 
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The tidal wave of artificial intelligence (AI) barrelling toward many professions has generated deep anxiety among workers fearful that their jobs will be swept away — and the mental health impact is rising.

The launch in November 2022 of ChatGPT, the generative AI platform capable of handling complex tasks on command, marked a tech landmark as AI started to transform the workplace.

“Anything new and unknown is anxiety-producing,” Clare Gustavsson, a New York therapist whose patients have shared concerns about AI, told AFP.

“The technology is growing so fast, it is hard to gain sure footing.”

Legal assistants, programmers, accountants and financial advisors are among those professions feeling threatened by generative AI that can quickly create human-like prose, computer code, articles or expert insight.

Goldman Sachs analysts see generative AI impacting, if not eliminating, some 300 million jobs, according to a study published in March.

“I anticipate that my job will become obsolete within the next 10 years,” Eric, a bank teller, told AFP, declining to give his second name.

“I plan to change careers. The bank I work for is expanding AI research.”

Trying to ’embrace the unknown’

New York therapist Meris Powell told AFP of an entertainment professional worried about AI being used in film and television production — a threat to actors and screenwriters that is a flashpoint in strikes currently gripping Hollywood.

“It’s mainly people who are in creative fields who are at the forefront of that concern,” Gustavsson said.

AI is bringing with it a level of apprehension matched by climate change and the Covid-19 pandemic, she contended.

But she said that she tries to get patients to “embrace the unknown” and find ways to use new technology to their advantage.

For one graphic animator in New York, the career-threatening shock came from seeing images generated by AI-infused software such as Midjourney and Stable Diffusion that rivaled the quality of those created by humans.

“People started to realize that some of the skills they had developed and specialized in could possibly be replaced by AI,” she told AFP, adding she had honed her coding skills, but now feels even that has scant promise in an AI world.

“I’ll probably lean into more of a management-level role,” she said. “It’s just hard because there are a lot less of those positions.

“Before I would just pursue things that interested me and skills that I enjoy. Now I feel more inclined to think about what’s actually going to be useful and marketable in the future.”

Peter Vukovic, who has been chief technology officer at several startups, expects just one percent or less of the population to benefit from AI.

“For the rest, it’s a gray area,” Vukovic, who lives in Bosnia, said. “There is a lot of reason for 99 percent of people to be concerned.”

AI is focused on efficiency and making money, but it could be channeled to serve other purposes, Vukovic said.

“What’s the best way for us to use this?” he asked. “Is it really just to automate a bunch of jobs?”
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New Australian Bureau of Statistics data reveals a record number of people are working multiple jobs as households try to keep up with the surge in the cost of living. Inflation has been at record highs, and Australians are paying some of the world’s highest power prices.

Sharp increases in power prices are making a cost-of-living crisis even worse. In some parts of the country, prices have risen by up to 25%.

Power prices in Australia have been fueled by various factors, including high inflation. There have also been expensive upgrades to aging transmission lines and distribution networks. Then there’s volatility in global energy markets caused by Russia’s war in Ukraine.

In Sydney, Diana Olmos, a migrant from Colombia, told local media that rising costs have made electricity almost unaffordable.

“The power prices will increase by 20 to 25%,” Olmos said. “I cannot afford that. I don’t know how we are going to survive this time with a huge cost-of-living rise, the rise of energy bills and really extreme weather.”

Almost a million Australians — or about 7% of the workforce — have multiple jobs, according to official data released this week by the Bureau of Statistics.

Gary Mortimer, a professor of marketing and consumer behavior at the Queensland University of Technology, told the Australian Broadcasting Corp. that many people are struggling financially, while others are taking advantage of record low unemployment.

“The main reason … is that cost-of-living crisis and being forced to pick up a second job, or a side hustle, but there are other groups involved there, too,” Mortimer said. “I mean, there is obviously the group that are actually taking advantage of the fact that we have got 3.5% unemployment. There is lots of work available.”

Food prices in Australia have increased by more than 7% in the past year. The cost of insurance has soared. So have mortgages. The Reserve Bank has raised interest rates 12 times since May 2022 as it tries to tame inflation, which currently stands in Australia at 6%, the same as neighboring New Zealand. In the United States, inflation — the general increase in prices — is at 4%, its lowest level since 2021, a decline mainly driven by a fall in fuel prices.

Australia’s inflation is, however, below that of the United Kingdom, where inflation fell to 7.9% in June, down from 8.7% in May.
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Pakistan and China are marking a decade of economic cooperation with much fanfare these days as the China-Pakistan Economic Corridor, popularly known as CPEC, completes 10 years. Experts say while the mega-project helped Pakistan develop much-needed infrastructure, the less-than-generous loans from Beijing coupled with Islamabad’s mismanagement has kept the project from turning Pakistan’s economy around.

Estimated to be the largest partnership of Beijing’s Belt and Road Initiative (BRI), a global investment and infrastructure project, CPEC launched in 2013 with more than $45 billion in planned investments. Over time, it grew to more than $62 billion, of which at least $25 billion was invested in Pakistan, according to both governments.

Mustafa Hyder Sayed, executive director of the Islamabad-based, nongovernmental Pakistan-China Institute, told VOA that the project came at a critical time for Pakistan.

“At that time, we had a lot of terrorism, there was a lot of turmoil and it [Pakistan] wasn’t seen as one of the best places to invest in, particularly,” he said. “And China reposed its trust in Pakistan at that time and dove right in. All in.”

Pakistani government data indicates CPEC has so far created 200,000 jobs, built more than 1,400 kilometers (897 miles) of highways and roads and added 8,000 megawatts of electricity to the national grid. The country’s deep-sea southwestern port of Gwadar, the centerpiece of CPEC, handled 600,000 tons of cargo in the last 18 months, according to officials.

At an event in Islamabad this week celebrating a decade of CPEC, Pakistani Prime Minister Shehbaz Sharif called the project a game-changer.

“And this was the result of vision and commitment and friendship,” Sharif told an audience of Pakistani and Chinese dignitaries.

Visiting Chinese Vice Premier He Lifeng, who received Pakistan’s highest civilian honor for his services in promoting economic cooperation, called the project exemplary.

“It has set an example of common trust and mutual development,” Lifeng said.

While Pakistan is among the top recipients of China’s infrastructure and energy investments, Islamabad now owes nearly one-third of its overwhelming external debt to Beijing.

Research shows that Chinese investments, largely shrouded in secrecy, do not come cheap. A 2021 report by U.S.-based research lab AidData found that most Chinese development financing in Pakistan between 2000 and 2017 were loans, not grants, given at or near commercial rates.

Pakistan-based economist Ammar Habib Khan, a nonresident senior fellow with the Washington-based Atlantic Council, told VOA this financial burden is partly why Pakistan has struggled to stimulate its economy through CPEC.

“A lot of that infrastructure came at a fairly high cost, and a lot of that borrowing was essentially in dollar terms and fairly higher than market terms,” he said. “Because of that, Pakistan continues to make significant dollar payments for the Chinese debt. Because of that we continue to have a current account crisis and some serious debt issues.”

In 2018, complaining of unfavorable terms, then-Prime Minister Imran Khan’s government set out to review CPEC projects. By 2021, the government was promising to prioritize the projects, however, in a bid to revive cooling bilateral relations that observers believe stemmed from the Khan government’s unease with CPEC’s terms.

Economist Khan said Pakistan definitely has a debt problem but not a Chinese debt problem. He blamed Islamabad for mismanaging resources.

“We added a lot of generation capacity, but we did not make efficient the distribution channels, due to which whatever electricity is generated, a lot of it is wasted,” Khan said.

That wasted electricity is costing the government millions of dollars every year, and its debt to power plants built under CPEC is piling up.

Islamabad and Beijing reject Washington’s assertion that China’s development financing to Pakistan and other BRI recipients is a debt-trap.

Pakistan has plenty of say in CPEC projects, Sayed said, through the Joint Coordination Committee that includes Chinese and Pakistani officials.

“So, this perception of China coming in by predatory financing and weakening a host country and gaining political influence is unfounded,” he said.

A report last year by Taiwan-based anti-disinformation lab DoubleThink’s China in the World network placed Pakistan at the top of the list of countries most exposed to Chinese influence.

According to the AidData report, Chinese loan terms are less generous than what Western countries usually offer. Khan said a lack of Western funding for Pakistan left Islamabad with little choice.

“The choice was simply whether to have a power plant or whether to have 12 to 15 hours of electricity shutdown,” Khan said. “So, yes, CPEC did provide Pakistan with a base of necessary infrastructure required for industrial growth. Meanwhile, Western countries have not been able to provide the same over the last many years.”

Under the BRI, China is spending over eight times more in Pakistan than the United States is, according to AidData’s research. The U.S. spends on soft infrastructure in Pakistan such as education, governance, and law and order capacity building, while China spends on hard infrastructure there.

Pakistan is the biggest recipient of China’s energy investment in Asia, while its share of BRI’s transportation and storage projects is the highest in the world.

Along with being Pakistan’s biggest single creditor country, China also routinely rescues it from economic collapse. In the last few months, Beijing rolled over close to $8 billion in debt, according to the Pakistani government, preventing Islamabad from default.

Experts say that to lessen the debt burden stemming from CPEC, Pakistan must find ways to efficiently use the energy and infrastructure it acquired through the mega-project and strengthen domestic production and exports.
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President Joe Biden is expected to issue his long-awaited executive order to screen outbound investments in sensitive technologies to China early next week, according to people familiar with the matter.

A White House spokesperson declined to comment.

The goal of the order is to prevent U.S. capital and expertise from accelerating the development of technologies that would support China’s military modernization and threaten U.S. national security.

The order is expected to target U.S. private equity, venture capital and joint venture investments in China in semiconductors, quantum computing and artificial intelligence. Most investments captured by the order will require that the government be notified about them. Some transactions will be prohibited, sources have said.

“It fills a gap in our current regime,” said Cordell Hull, a former U.S. Commerce Department official. “We have prohibitions on exporting the technology. We have restrictions on in-bound investment. This will help to plug that gap on funding and know-how and give the government visibility into these capital flows.”

The regulations are not expected to take effect right away, and the administration will solicit comments on its proposals, according to sources. It has already conducted meetings with stakeholders and has been consulting with allies. The topic also came up during U.S Treasury Secretary Janet Yellen’s recent trip to China.

Yellen last month described the potential restrictions as “highly targeted, and clearly directed, narrowly, at a few sectors where we have specific national security concerns.”

Laura Black, a former policy director for the Committee on Foreign Investment in the United States (CFIUS), which reviews certain transactions in the United States, said the order was not expected to establish a “reverse CFIUS,” because it would not involve a case-by-case review in which a committee would clear, mitigate or block a transaction. However, it is expected to prohibit certain investments, she said.

Two sources said briefings were expected Monday, with the announcement Tuesday. But the timing has slipped many times before and could do so again.

Sources have told Reuters the investments that will be restricted are expected to track export control rules for China issued by the U.S. Department of Commerce in October.

Emily Kilcrease, a former U.S. official who has worked on China investment policy, said the U.S. also has been trying to define what counts as artificial intelligence, and aiming to control offshore investments by U.S. people and companies.

She described the order as a major step in setting up a U.S. system of oversight to screen transactions to countries of concern and said that it was expected to expand in time.

She also said the United States should be prepared for retaliation by China.
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The regional economic forum APEC has begun hosting senior official and ministerial meetings in Seattle, Washington. This year, the United States will host the annual gathering as it navigates a range of complex topics and diplomatic challenges. Natasha Mozgovaya attended a ministerial on food security Thursday and has this report.
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WASHINGTON — U.S. employers added 187,000 last month, fewer than expected, as higher interest rates continued to weigh on the economy. But the unemployment rate dipped to 3.5% in a sign that the job market remains resilient.

Hiring was up from 185,000 in June, a figure that the Labor Department revised down from an originally reported 209,000. Economists had expected to see 200,000 new jobs in July.

Still, last month’s hiring was solid, considering that the Federal Reserve has raised its benchmark interest 11 times since March 2022. The Fed’s inflation fighters will welcome news that more Americans entered the job market last month, easing pressure on employers to raise wages to attract and keep staff.

The U.S. economy and job market have repeatedly defied predictions of an impending recession. Increasingly, economists are expressing confidence that inflation fighters at the Federal Reserve can pull off a rare “soft landing” — raising interest rates just enough to rein in rising prices without tipping the world’s largest economy into recession. Consumers are feeling sunnier too: The Conference Board, a business research group, said that its consumer confidence index last month hit the highest level in two years.

There’s other evidence the job market, while still healthy, is losing momentum. The Labor Department reported Tuesday that job openings fell below 9.6 million in June, lowest in more than two years. But, again, the numbers remain unusually robust: Monthly job openings never topped 8 million before 2021. The number of people quitting their jobs — a sign of confidence they can find something better elsewhere — also fell in June but remains above pre-pandemic levels.

The Fed wants to see hiring cool off. Strong demand for workers pushes up wages and can lead companies to raise prices to make up for the higher costs.
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FRANKFURT, Germany — Adidas brought in $437 million from the first release of Yeezy sneakers left over after breaking ties with Ye, the rapper formerly known as Kanye West, as the German sportswear maker tries to offload the unsold shoes and donate part of the proceeds to groups fighting antisemitism and other forms of hate.

The first batch of shoes released in June, which sold out, helped the company reach an operating profit of $192 million in the second quarter, better than it originally planned, Adidas said Thursday. A second sale started Wednesday.

After Ye’s antisemitic and other offensive comments led the company to end its partnership with the rapper in October, Adidas said it had sought a way to dispose of $1.3 billion worth of the high-end shoes in a responsible way.

“We will continue to carefully sell off more of the existing Yeezy inventory,” said CEO Bjørn Gulden, who took over in January.

“This is much better than destroying and writing off the inventory and allows us to make substantial donations to organizations like the Anti-Defamation League, the Philonise and Keeta Floyd Institute for Social Change and Robert Kraft’s Foundation to Combat Antisemitism,” Gulden said.

Adidas has already handed over $10.9 million to the groups and is expected to give an additional $109 million, with further donations possible depending on how future sales go, Chief Financial Officer Harm Ohlmeyer said.

Several Jewish civic leaders contacted by The Associated Press said they weren’t planning to buy a pair of Yeezys themselves but generally welcomed the plan to support anti-hate organizations, saying the company is trying to make the best of a bad situation.

The Adidas CEO said the Yeezy sales are “of course also helping both our cash flow and general financial strength.”

The first sale unloaded roughly 20% to 25% of the Yeezy sneakers that were left stacked up in warehouses, contributing $164 million of Adidas’ $192 million in operating earnings in the April-to-June quarter.

Ohlmeyer, however, cautioned that Adidas’ earnings from the Yeezy brand were smaller than the number made it seem because it did not include many of the company’s costs.

Adidas also warned that the first sale included the highest-priced shoes and sold out completely, but that it wasn’t clear whether the remaining releases would see similar price levels and demand.

The blowup of the Ye partnership put Adidas in a precarious position because of the popularity of the Yeezy line, and it faced growing pressure to end ties last year as other companies cut off the rapper.

The torn-up contract is in arbitration, “a process that is being taken care of by legal people” for both sides, and was surrounded “by a lot of uncertainty,” said Gulden.

Asked whether it must pay Ye royalties on the shoes, the company has said only that it will observe all its contractual obligations.

Yeezy revenue from June was “largely in line” with sales seen in the second quarter of last year, Adidas said. The boost has allowed the company to cut its expectations for this year’s operating loss to $492 million from the $766 million predicted previously.

On the amount of money given to anti-hate groups, Adidas said that the donations were not a fixed percentage of sales, but that it had discussed with the recipients what an appropriate amount would be.
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The Biden administration has recently been emphasizing the strength of the U.S. economy, but some small business owners remain skeptical. VOA’s Veronica Balderas Iglesias visited their shops and found out more about their economic struggles, ahead of election season.
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Pakistan and China are celebrating as the China-Pakistan Economic Corridor, the centerpiece of Beijing’s global Belt and Road initiative, completes 10 years. The investment project has grown to over $60 billion and provided Pakistan with crucial infrastructure, but it also has added to the country’s ballooning debt. VOA’s Pakistan bureau chief Sarah Zaman reports. (Produced by Malik Waqar Ahmed, Jon Spier)
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WASHINGTON — Washington added more China-based companies to a blacklist Tuesday, barring their goods from entering the United States as officials seek to remove forced labor — especially involving minorities such as the Uyghur people — from supply chains.

Battery maker Camel Group, along with spice and extract company Chenguang Biotech Group, are the latest to be included in the Uyghur Forced Labor Prevention Act (UFLPA) entity list, according to U.S. authorities.

The firms were targeted over accusations of working with China’s government to recruit, transport or receive forced labor or members of persecuted groups such as Uyghur minorities out of the Xinjiang region.

“Today’s additions demonstrate the United States’ unwavering commitment to eliminating forced labor, including by ensuring that goods made by forced labor are not imported into our country,” U.S. Trade Representative Katherine Tai said in a statement.

The U.S. government and lawmakers in other Western countries have labeled China’s treatment of the Uyghur minority in the northwestern Xinjiang region “genocide” — a charge Beijing vehemently denies.

Rights groups said at least 1 million people, mostly members of Muslim minorities, have been incarcerated in the region and face widespread abuses, including forced sterilization of women and coerced labor.

In a separate statement on Tuesday, Homeland Security Secretary Alejandro Mayorkas said, “We will continue to work with all of our partners to keep goods made with forced labor from Xinjiang out of U.S. commerce while facilitating the flow of legitimate trade.”

The UFLPA, adopted by Congress with bipartisan support in 2021, bans the import of all goods from the Xinjiang region unless companies offer verifiable proof that production did not involve forced labor.

Apart from Tuesday’s additions to the entity list, two other China-based companies — printer manufacturer Ninestar Corporation and chemical products firm Xinjiang Zhongtai Chemical Co. — were added earlier this year.
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The Teamsters said on Sunday that the union was served a notice that Yellow Corp. is ceasing operations and filing for bankruptcy. 

“Yellow has historically proven that it could not manage itself despite billions of dollars in worker concessions and hundreds of millions in bailout funding from the federal government,” Teamsters General President Sean M. O’Brien said in a statement. 

Yellow did not immediately respond to a Reuters’ request for comment. 

Earlier in the day, The Wall Street Journal reported about the closure of the trucking firm’s operations which cited notices sent to customers and employees. Last week, WSJ also reported that the company has laid off a large number of workers. 

Earlier this month Yellow averted a threatened strike by 22,000 Teamsters-represented workers, saying the company will pay the more than $50 million it owed in worker benefits and pension accruals. 

The company said on Thursday it is exploring opportunities to divest its third-party logistics company Yellow Logistics Inc. and is engaged with multiple interested parties. 

Its customers include large retailers like Walmart WMT.N and Home Depot, manufacturers and Uber Freight, some of which have paused cargo shipments to the company for fear those goods could be lost or stranded if the carrier went bankrupt. 

In 2020, the Donald Trump-led government rescued the company with a $700 million pandemic relief loan in exchange for a 30% stake. 
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