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First Post
12 minutes ago
- First Post
Trump sacks labour statistics chief hours after job report showed a grim image
US President Donald Trump fired the federal government official who is in charge of the Labour statistics. The sacking came just hours after US job data revealed that the employment growth stalled this summer read more A sign advertising job openings is seen while people walk into the store in New York City, New York, U.S., August 6, 2021. Reuters File US President Donald Trump fired the federal government official who is in charge of Labour statistics. What was concerning was the fact that the news of the official's sacking came just hours after US job data revealed that the employment growth stalled this summer, prompting accusations that he is 'firing the messenger'. Soon after the White House made the firing official, the president claimed that Erika McEntarfer, commissioner of labour statistics, had 'faked' employment figures in the run-up to last year's election. Trump accused McEntarfer of forging numbers in a bid to boost former US Vice President Kamala Harris's chance of victory in the 2024 US Presidential Elections. STORY CONTINUES BELOW THIS AD Dimayed by the latest figures, Trump went on to claim: 'Today's Jobs Numbers were RIGGED in order to make the Republicans, and ME, look bad'. However, he gave no evidence to support his allegations and insisted that the US economy was, in fact, 'BOOMING' on his watch. US Job report paints a grim picture On Friday, the US employment report raised questions about the state of the labour market since Trump's return to the office. 'We need accurate job numbers,' he wrote on Truth Social. 'I have directed my Team to fire this Biden Political Appointee, IMMEDIATELY. She will be replaced with someone much more competent and qualified.' Shortly after the report was released, the Bureau of Labour Statistics (BLS) confirmed in a brief statement that McEntarfer had been dismissed and William Wiatrowski, the agency's deputy commissioner, would serve as acting commissioner. It is pertinent to note that Trump's abrupt announcement came as administration officials scrambled to explain a lacklustre employment report. Not only did job growth in the country fail to meet expectations in July, but the previous estimates in May and June were also revised significantly lower. The president went on to accuse the bureau of trying to hide accurate statistics. However, his move garnered criticism among experts. 'Trump is firing the messenger because he doesn't seem to like job numbers that reflect how badly he's damaged the economy,' said Lily Roberts, managing director for inclusive growth at the Centre for American Progress, a think tank. 'Politicising our country's collection of data on what's going on in the economy … will make it harder to create an economy that makes sure everyone has a good job,' added Roberts. 'Borrowing from the authoritarian playbook fuels more uncertainty that will cost Americans for years to come.' STORY CONTINUES BELOW THIS AD Meanwhile, Paul Schroeder, executive director of the Council of Professional Associations on Federal Statistics, described the president's allegation as 'very damaging and outrageous'. 'Not only does it undermine the integrity of federal economic statistics, but it also politicises data which needs to remain independent and trustworthy. This action is a grave error by the administration and one that will have ramifications for years to come," he added. The veteran who was dismissed It is pertinent to note that McEntarfer is a widely respected economist and veteran employee of the federal government. In the past, she had worked at the US Census Bureau under George W Bush and at the US Census Bureau under Barack Obama, Trump and Joe Biden. In January 2024, McEntarfer was confirmed to the post by the US Senate. In a letter also signed by organisations including the American Statistics Association and a string of senior economists, they said there were 'many reasons' to confirm McEntarfer as commissioner of labour statistics, citing her 'wealth of research and statistical experience'. She was ultimately confirmed by a vote in the Senate, with 86 votes cast in favour and eight against. Trump's decision to fire McEntarfer was 'outrageous but not surprising', said Julie Su, former acting US labour secretary under Biden. 'He hates facts, so he blames truth-tellers.' 'The US needs and deserves trustworthy economic data', added Su. 'This is a pathetic attempt by the president to gaslight everyone about the consequences of his disastrous economic policies.' STORY CONTINUES BELOW THIS AD
Hindustan Times
12 minutes ago
- Hindustan Times
Who's feeling the pain of Trump's tariffs?
Editor's note (August 1st 2025): This article has been updated. Container ships are seen at the container terminal at Lianyungang port, in China's eastern Jiangsu province in the early morning on July 24, In the bygone age that was 2024, America charged levies averaging just 2% on its imports of goods. In the new era of trade wars, it now has an 'effective' tariff of over 16%, the highest since the 1930s (see chart 1). Rates look set to go even higher. On July 31st President Donald Trump signed an executive order that significantly raises tariffs on most of America's trading partners, with the increases due to go into effect on August 7th. Duties on most products from the European Union and South Korea, which recently struck deals with America, will rise to 15%. India faces a tariff of 25%; South Africa, 30%; Canada, 35%. As we published this, Mr Trump seemed inclined to extend America's tariff truce with China. But that still leaves the world's second-largest economy facing levies of around 40% on sales to the world's largest. Chart 1 Who pays for these tariffs, in all their infinite variety? Most economists reckon that ordinary Americans will lose out, as prices in shops rise. Mr Trump and his coterie, by contrast, blithely insist that the rest of the world will shoulder the load by cutting their selling prices. So far, the evidence is giving the know-nothings a glimmer of hope. Mr Trump's critics in the economics profession have history and research on their side. Studies show that when a country imposes duties on its imports, its foreign suppliers often keep their prices roughly the same. The tariff is layered on top. So it was during the first Trump administration, which slapped tariffs on China and others. A study from 2019 found 'complete pass-through of the tariffs into domestic prices of imported goods'. Some foreign firms are taking a similar stance in response to Mr Trump's new levies. In April Ferrari added up to 10% to the price of its cars. Britain's Ineos said it would charge more for its Grenadier off-roader. Canon, a camera-maker, has warned dealers to brace for price increases. But the broader pattern is more benign. There is, for example, surprisingly little evidence so far of tariff 'pass-through' into inflation. In June America's 'core' consumer prices (ie, excluding food and energy) rose by 0.2% on the previous month, below the consensus estimate of 0.3%. Economists have found some evidence of tariff-induced price rises—in car parts, for instance—but they have had to look harder for it than they had expected. What explains these surprising results? American firms, not consumers, may be paying for the trade war by accepting lower profits, suggests research by Deutsche Bank. Some firms also boosted inventories before the tariffs were implemented, allowing them to avoid raising their prices for now. America's foreign suppliers may also be sharing more of the load than they did in Mr Trump's first term. Nintendo, a Japanese electronics firm, is keeping the American price of the Switch 2 games console at $449.99. Many Chinese manufacturers seem prepared to follow Nintendo and absorb duties: Fuling, a supplier of cutlery, says its clients expect it to shoulder 'part of the increased tariff costs'. TIRTIR, a South Korean beauty brand popular with American Gen Zers, has signalled that it can absorb most of the tariffs. Games Workshop, a British manufacturer of war games, also seems resigned to taking the hit, warning investors that tariffs could reduce annual profits by £12m ($16m). 'We found tentative evidence that Korean auto exporters are shouldering the cost of higher US tariffs, at least for now,' wrote Kim Jin-Wook of Citigroup, a bank, in a recent note. The Bank of Japan tracks the prices of the country's car exports to America. In yen terms, they have fallen by 26% in the past year. Some of that decline may reflect exchange-rate movements. An unchanged dollar price brings in fewer yen when the American currency is weak. But that only raises another question: why are Japan's carmakers not raising their dollar prices more vigorously in response? More comprehensive data point in a similar direction. The Economist assembled a series on export prices from a number of America's largest trading partners, including Canada, Germany and South Korea. In the past exporters in these countries have been perfectly willing to raise prices: during the inflationary surge of 2021-22, they increased them by more than 15% over a 12-month span (see chart 2). Yet in the past year the average local-currency price of their exports has fallen by 3.6%. Nothing of the sort happened during Mr Trump's first trade war. Who-s-feeling-the-pain-of-Trump-s-tariffs- Some economists have noted a disconnect between what foreigners report and what American importers say they are paying. For instance, it is hard to find much evidence of plunging prices for Japanese car imports. Economists at Citi speculate that the time it takes to ship a foreign product to an American port may explain the puzzle. It 'implies a lag between falling export prices and when US import-price data would capture the decline', they say. Why might foreign suppliers be so forgiving? Some bosses worry more than before about the American consumer. With high inflation a recent memory, people already think that everything is too expensive. They have little tolerance for paying even higher prices. The opposite may be true of the foreign companies themselves. They are in a good financial position to withstand the tariffs. Aggregate margins of listed companies in emerging markets have become fatter over the past decade, increasing by over two percentage points. European firms have enjoyed similar gains. These companies can afford to take a small hit to profits, at least for now. Before long America's economy is likely to feel the pain of the trade war more acutely. Although some Chinese firms may have lowered their prices, these cuts are not nearly deep enough to offset the huge rise in tariffs they now face, points out Deutsche Bank's research. In addition, foreign companies that have borne the costs until now may not be able to bear them for ever—especially if tariff rates keep ratcheting up. The president loves defying his adversaries, in the economics profession and beyond. But he is always his own worst enemy. For more expert analysis of the biggest stories in economics,finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter.
Hans India
12 minutes ago
- Hans India
Amid IMF's enhanced growth projection, three caveats can't be ignored
The International Monetary Fund (IMF) has revised India's economic growth forecast upwards, reinforcing the country's status as a leading performer among major global economies. IMF's latest World Economic Outlook (WEO), released on July 29, points out that India is now expected to grow at 6.4 per cent in both 2025-26 and 2026-27, marking an increase of 0.2 and 0.1 percentage points, respectively, over the April projections. This upgrade mirrors a broader, albeit modest, improvement in its global growth forecast. As per the updated assessment, the IMF now anticipates global GDP to expand by three per cent in 2025 and 3.1 per cent in 2026—both figures slightly higher than those projected just three months ago. It has also raised its expectations for emerging market and developing economies, which are now projected to grow by 4.1 per cent, up from 3.7 per cent, a revision largely driven by improved prospects for China, the world's second-largest economy. The IMF attributes India's stronger outlook to a 'more benign external environment' than was assumed in its April forecast. While the report stops short of listing specifics, the phrase suggests a combination of factors: easing inflationary pressures in advanced economies, stable commodity prices, and continued global demand for goods and services—all of which are expected to provide a more favourable backdrop for India's growth. India's resilient performance continues to stand out. Even amid geopolitical volatility and uneven global recovery patterns, the country has maintained a robust growth trajectory, supported by public capital expenditure, an expanding services sector, and digital infrastructure gains. The IMF's revision reflects this resilience, though the path ahead may still be complicated by emerging external and domestic challenges. Meanwhile, three key caveats deserve closer scrutiny. First, US President Donald Trump's 25 per cent tariffs on goods imported from India, 'plus an unspecified penalty' for buying Russian oil and weapons, pose a major risk to India's growth rate, apart from straining bilateral ties between India and the United States, which have been steadily improving in the last few years. The new tariffs on certain imports could create headwinds for Indian exporters. Second, how India responds to these US moves will significantly influence its medium and long-term economic prospects. Whether New Delhi chooses a retaliatory stance or seeks a diplomatic compromise could affect investor perceptions, trade flows, and diplomatic goodwill. India's choices in navigating this delicate phase of economic diplomacy will be watched closely, not only in Washington but also in global markets. Third, and most crucially, the sustainability of India's growth momentum will depend on how the Narendra Modi government implements its domestic economic policies. While headline growth figures remain robust, challenges such as sluggish private investment, labour market rigidities, and regional disparities persist. Economic ministers and other senior government functionaries wax eloquent about liberalisation and the ease of doing business, but executing reforms in letter and spirit will make all the difference. Trump's tough stance can be a blessing in disguise if it forces India's decision makers to focus on effective policy execution. The IMF's upgraded forecast underscores India's strong economic fundamentals and its continued attractiveness as an investment destination. However, this positive outlook is tempered by emerging global risks and internal policy variables. Navigating these will be crucial to maintaining India's position as a bright spot.
