US growth likely to slow to 1.6% this year, hobbled by Trump's trade wars, OECD says
WASHINGTON (AP) — U.S. economic growth will slow to 1.6% this year from 2.8% last year as President Donald Trump's erratic trade wars disrupt global commerce, drive up costs and leave businesses and consumers paralyzed by uncertainty.
The Organization for Economic Cooperation and Development forecast Tuesday that the U.S. economy — the world's largest — will slow further to just 1.5% in 2026. Trump's policies have raised average U.S. tariff rates from around 2.5% when he returned to the White House to 15.4%, highest since 1938, according to the OECD. Tariffs raise costs for consumers and American manufacturers that rely on imported raw materials and components.
World economic growth will slow to just 2.9% this year and stay there in 2026, according to the OECD's forecast. It marks a substantial deceleration from growth of 3.3% global growth last year and 3.4% in 2023.
The world economy has proven remarkably resilient in recent years, continuing to expand steadily — though unspectacularly — in the face of global shocks such as the COVID-19 pandemic and Russia's invasion of Ukraine.
But global trade and the economic outlook have been clouded by Trump's sweeping taxes on imports, the unpredictable way he's rolled them out and the threat of retaliation from other countries.
Reversing decades of U.S. policy in favor of freer world trade, Trump has levied 10% taxes — tariffs — on imports from almost every country on earth along with specific duties on steel, aluminum and autos. He's also threatened more import taxes, including a doubling of his tariffs on steel and aluminum to 50%.
Without mentioning Trump by name, OECD chief economist Álvaro Pereira wrote in a commentary that accompanied the forecast that 'we have seen a significant increase in trade barriers as well as in economic and trade policy uncertainty. This sharp rise in uncertainty has negatively impacted business and consumer confidence and is set to hold back trade and investment.'
Adding to the uncertainty over Trump's trade wars: A federal court in New York last week blocked most of Trump's tariffs, ruling that he'd overstepped his authority in imposing them. Then an appeals court allowed the Trump administration to continue collecting the taxes while appeals worked their way through the U.S. courts.
China — the world's second-biggest economy — is forecast to see growth decelerate from 5% last year to 4.7% in 2025 and 4.3% in 2026. Chinese exporters will be hurt by Trump's tariffs, hobbling an economy already weakened by the collapse of the nation's real estate market. Some of the damage will be offset by help from the government: Beijing last month outlined plans to cut interest rates and encourage bank lending as well as allocating more money for factory upgrades and elder care, among other things.
The 20 countries that share the euro currency will collectively see economic growth pick up from 0.8% last year to 1% in 2025 and 1.2% next year, the OECD said, helped by interest rate cuts from the European Central Bank.
The Paris-based OECD, comprising 38 member countries, works to promote international trade and prosperity and issues periodic reports and analyses.
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Associated Press
11 minutes ago
- Associated Press
California's Yurok Tribe gets back ancestral lands that were taken over 120 years ago
ON THE KLAMATH RIVER, Calif. (AP) — As a youngster, Barry McCovey Jr. would sneak through metal gates and hide from security guards just to catch a steelhead trout in Blue Creek amid northwestern California redwoods. Since time immemorial, his ancestors from the Yurok Tribe had fished, hunted and gathered in this watershed flanked by coastal forests. But for more than 100 years, these lands were owned and managed by timber companies, severing the tribe's access to its homelands. When McCovey started working as a fisheries technician, the company would let him go there to do his job. 'Snorkeling Blue Creek ... I felt the significance of that place to myself and to our people, and I knew then that we had to do whatever we could to try and get that back,' McCovey said. After a 23-year effort and $56 million, that became reality. Roughly 73 square miles (189 square kilometers) of homelands have been returned to the Yurok, more than doubling the tribe's land holdings, according to a deal announced Thursday. Completion of the land-back conservation deal along the lower Klamath River — a partnership with Western Rivers Conservancy and other environmental groups — is being called the largest in California history. The Yurok Tribe had 90% of its territory taken during the California Gold Rush in the mid-1800s, suffering massacres and disease from settlers. 'To go from when I was a kid and 20 years ago even, from being afraid to go out there to having it be back in tribal hands … is incredible,' said McCovey, director of the Yurok Tribal Fisheries Department. ___ EDITOR'S NOTE: This is part of a series of on how tribes and Indigenous communities are coping with and combating climate change. ___ Land Back is a global movement seeking the return of homelands to Indigenous people through ownership or co-stewardship. In the last decade, nearly 4,700 square miles (12,173 square kilometers) were returned to tribes in 15 states through a federal program. Organizations are aiding similar efforts. There's mounting recognition that Indigenous people's traditional knowledge is critical to addressing climate change. Studies found the healthiest, most biodiverse and resilient forests are on protected native lands where Indigenous people remained stewards. Beth Rose Middleton Manning, a University of California, Davis professor of Native American Studies, said Indigenous people's perspective — living in relation with the lands, waterways and wildlife — is becoming widely recognized, and is a stark contrast to Western views. 'Management of a forest to grow conifers for sale is very different from thinking about the ecosystem and the different plants and animals and people as part of it and how we all play a role,' she said. The Yurok people will now manage these lands and waterways. The tribe's plans include reintroducing fire as a forest management tool, clearing lands for prairie restoration, removing invasive species and planting trees while providing work for some of the tribe's more than 5,000 members and helping restore salmon and wildlife. Protecting a salmon sanctuary One fall morning in heavy fog, a motorboat roared down the turbid Klamath toward Blue Creek — the crown jewel of these lands — past towering redwoods, and cottonwoods, willows, alders. Suddenly, gray gave way to blue sky, where an osprey and bald eagle soared. Along a bank, a black bear scrambled over rocks. The place is home to imperiled marbled murrelets, northern spotted owls and Humboldt martens, as well as elk, deer and mountain lions. The Klamath River basin supports fish — steelhead, coho and Chinook salmon — that live in both fresh and saltwater. The Klamath was once the West Coast's third largest salmon-producing river and the life force of Indigenous people. But the state's salmon stock has plummeted so dramatically — in part from dams and diversions — that fishing was banned for the third consecutive year. 'We can't have commercial fishing because populations are so low,' said Tiana Williams-Claussen, director of the Yurok Tribe Wildlife Department. 'Our people would use the revenue to feed their families; now there's less than one salmon per Yurok Tribe member.' Experts say restoring Blue Creek complements the successful, decades-long fight by tribes to remove the Klamath dams — the largest dam removal in U.S. history. This watershed is a cold-water lifeline in the lower Klamath for spawning salmon and steelhead that stop to cool down before swimming upstream. That's key amid climate-infused droughts and warming waters. 'For the major river to have its most critical and cold-water tributary … just doing its job is critical to the entire ecosystem,' said Sue Doroff, co-founder and former president of Western Rivers Conservancy. Altered lands, waterways For more than 100 years, these lands were owned and managed for industrial timber. Patchworks of 15 to 20 acres (6.07 to 8.09 hectares) at a time of redwoods and Douglas firs have been clear cut to produce and sell logs domestically, according to Galen Schuler, a vice president at Green Diamond Resource Company, the previous land owner. Schuler said the forests have been sustainably managed, with no more than 2% cut annually, and that old growth is spared. He said they are 'maybe on the third round' of clear cutting since the 1850s. But clear cutting creates sediment that winds up in streams, making them shallower, more prone to warming and worsening water quality, according to Josh Kling, conservation director for the conservancy. Sediment, including from roads, can also smother salmon eggs and kill small fish. Culverts, common on Western logging roads, have also been an issue here. Most 'were undersized relative to what a fish needs for passage,' Kling said. Land management decisions for commercial timber have also created some dense forests of small trees, making them wildfire prone and water thirsty, according to Williams-Claussen. 'I know a lot of people would look at the forested hillsides around here and be like, 'It's beautiful, it's forested.' But see that old growth on the hill, like way up there?' asked Sarah Beesley, fisheries biologist for the Yurok Tribe, sitting on a rock in Blue Creek. 'There's like one or two of those.' Fire bans, invasive plants and encroachment of unmanaged native species have contributed to loss of prairies, historically home to abundant elk and deer herds and where the Yurok gathered plants for cultural and medicinal uses. Western Rivers Conservancy bought and conveyed land to the tribe in phases. The $56 million for the conservation deal came from private capital, low interest loans, tax credits, public grants and carbon credit sales that will continue to support restoration. Restoration plans The tribe aims to restore historic prairies by removing invasive species and encroaching native vegetation. The prairies are important food sources for elk and the mardon skipper butterfly, said Kling from the conservancy. Trees removed from prairies will be used as logjams for creeks to create habitat for frogs, fish and turtles. The tribe will reintroduce fire to aid in prairie restoration and reestablish forest diversity and mature forests to help imperiled species bounce back. Members know its going to take decades of work for these lands and waterways to heal. 'And maybe all that's not going to be done in my lifetime,' said McCovey, the fisheries director. 'But that's fine, because I'm not doing doing this for myself.' ___ The Associated Press receives support from the Walton Family Foundation for coverage of water and environmental policy. The AP is solely responsible for all content. For all of AP's environmental coverage, visit
Yahoo
11 minutes ago
- Yahoo
Nintendo's Switch 2 could breathe new life into the video game giant—if Trump's trade war doesn't upend it all
To gamers around the world, April 2—'Liberation Day'—meant something else. In a slick prerecorded video presentation, Nintendo unveiled the Switch 2, the long-awaited successor of its wildly popular Nintendo Switch handheld console. It was exactly what gamers were hungry for: details on the console's more powerful specs; expanded access to Nintendo's decades-old back catalog; and new entries in the popular Mario Kart and Donkey Kong series. Even a surprise price hike—$450 versus the Switch's $300—didn't dent enthusiasm. A U.S. president could, though. A few hours later, Donald Trump announced his Liberation Day tariffs, including steep taxes on imports from China, Vietnam, Japan, and Cambodia—Nintendo's manufacturing hubs. It upended plans years in the making. The Switch 2's June 5 launch was poised to be a shot in the arm for Nintendo and the video game industry. Nintendo needs 'something new and exciting out in the marketplace that kicks that can down the road on the tech stuff for another decade, so they can continue to make the games they want to make,' explains Jeff Gerstmann, a journalist who has covered the industry for decades. Now Nintendo (like nearly every other company) is trying to keep up, even as Trump has since suspended most of the tariffs amid negotiations. Two days after Liberation Day, Nintendo paused U.S. preorders to assess the 'potential impact of tariffs.' It reopened them a few weeks later, maintaining the $450 price point and June 5 launch—but hiked prices on everything else, like controllers, 'amiibo' figurines, and other accessories. Like many other manufacturers, Nintendo (which didn't respond to Fortune's request for comment) is trying to figure out how to roll out a new product as the world's largest consumer market takes a protectionist turn. The Switch 2 is still likely to be a success, even if not quite as much as Nintendo hoped a month ago. But it will also be one of the first tests of how consumer tech companies will stay afloat in a world of tariffs, decoupling, and protectionism. If the video game industry has a champion, it's Nintendo. Founded in 1889 as a playing-card maker, it has developed the most well-known portfolio of intellectual property apart from Walt Disney, thanks to franchises like Super Mario, The Legend of Zelda, and Pokémon. But it's also one of Asia's most prominent consumer-tech companies, an Asian brand with true global reach. After struggling to stay relevant in the 2010s, Nintendo unveiled the Switch in 2017: an affordable handheld console that could connect to a television, but could also function without one. It was a wildly successful move. With 150-million-plus units sold as of March 2025, the Switch is the third-bestselling console of all time, behind Sony's PlayStation 2 and the Nintendo DS. COVID lockdowns made it a true household name, as consumers occupied themselves with video games. Nintendo, with its affordable console and a new game in the Animal Crossing series of cozy life simulators, was well-placed to capture that demand. Nintendo sold over 27 million consoles in 2020 alone. But eight years is an eternity in the video game world, and the console was showing its age. Nintendo reported slowing sales as gamers tired of a system that struggled to run the newest games, even those specifically designed for the console. Nintendo was also holding back marquee releases, so many people put their Switches in a drawer and forgot about them. This embedded content is not available in your region. Nintendo reported 1.2 trillion Japanese yen ($7.6 billion) in sales for its most recent fiscal year, which ended in March, a 30% drop from the previous fiscal year. Its ordinary profit saw an even bigger dip, dropping 45% year on year to reach 372 billion yen ($2.4 billion). And the company sold 11.5 million consoles in 2024, less than half of what it sold during the COVID boom years. Still, investors have shrugged off Nintendo's slowdown in anticipation of the Switch 2. Nintendo shares have been at record highs since December. Its market value is over $90 billion, making it Japan's eighth-most-valuable firm and placing it ahead of many Japanese companies on the Fortune Global 500. Nintendo was one of the first companies to shift manufacturing out of China to nearby Vietnam and Cambodia in 2019, after the first Trump administration threatened to impose tariffs on video game consoles made in China. 'The majority of their production is still done in China, but they've now switched to Vietnam to focus pretty much entirely on U.S. console production,' says Daniel Ahmad, an analyst with gaming-industry consultancy Niko Partners. That puts Nintendo 'ahead of the game' compared with competitors Sony and Microsoft. As the second Trump administration started up, Nintendo began front-running shipments to get ahead of possible future tariffs. JPMorgan estimated in early April that Nintendo had enough inventory to meet demand for six months to a year. The Switch 2's initial numbers likely won't take a hit, even with the price hike. Preorders in markets like the U.S. and Japan sold out instantly, and the company is already apologizing for future shortages. Nintendo is even selling a cheaper version that works only with games bought in Japan, likely to avoid resellers trying to bring it to markets like mainland China, where the company doesn't have an official presence. The real question will come after the initial launch, when holiday shoppers start thinking about buying the latest version. 'The big questions are around value—$450 is not a small amount of money,' Gerstmann says. The cost of games, too, is going up: Nintendo is targeting $70 to $80, as opposed to the $60 that has been traditional across the industry. The company is trying to scale back expectations, forecasting lower-than-expected Switch 2 sales of 15 million (still roughly in line with how the first Switch sold after its launch in 2017). In a May briefing to investors, Nintendo president Shuntaro Furukawa said the company was factoring in a profit hit worth 'several tens of billions of yen,' but noted the calculation was made on the basis of 145% tariffs on China and 10% tariffs on everyone else. (Trump soon after lowered tariffs on China to 30% for a 90-day period.) Furukawa noted the company's 'basic policy' was to pass on tariffs to customers—but admitted a price hike might not be the greatest idea for a just-debuted console. Nintendo isn't alone in thinking about how to manage increasing costs and new tariffs. Citing costlier development and 'market conditions,' Microsoft implemented a $100 price hike for the Xbox Series X and plans to start selling $80 games. Sony has avoided hiking PlayStation prices in the U.S., but raised prices elsewhere. The video game industry has been grappling with higher costs for years. Ahmad first points to the COVID supply-chain shock, which pushed up prices of components like memory. Game development is also getting more expensive as graphics become more advanced, boosting staffing and technology costs. That rebounds in the real world; Ahmad notes that Nintendo uses cartridges, rather than discs. 'If your game is 64 gigabytes and you get a 64-gigabyte cartridge, that's going to cost more to publish.' By making the first move to $80, Nintendo might have done the industry a favor. 'I'm sure other publishers and manufacturers are super happy that Nintendo took the blow for them,' Gerstmann says. He speculates that Nintendo's lower-end hardware, compared with Sony and Microsoft, might appeal to studios now trying to keep costs low: 'There's real potential for the Switch to change a lot of things about the way games are made.' The world may have avoided the worst of U.S. tariffs for now—they stand at 30% on China and 10% on everyone else as U.S. officials try to negotiate with major trading partners. At those levels, tariffs are tough but manageable for global business. But if negotiations break down—or if Trump lets his 90-day pause expire—then tariffs will shoot back up again: 54% on China, 46% on Vietnam, and 49% on Cambodia, giving Nintendo a lot to contend with. Their struggles are indicative of a broader tension in Trump's tariff regime: Vietnam and Cambodia are two popular 'China plus one' destinations, countries where manufacturers based final assembly so as to avoid tariffs on China-made products. Trump officials are reportedly pressuring trading partners to limit trade with China in order to isolate Beijing. But a surge in exports by Vietnam, Cambodia, and others will hurt Trump's other goal: balancing U.S. trade with the rest of the world. Nintendo's customers are used to facing uncertain and hazardous environments in the company's games. The question now: Can Nintendo, and other Asian manufacturers, show that same skill in navigating a more geopolitically fraught world? This article appears in the June/July 2025: Asia issue of Fortune with the headline 'Game on!' 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The Hill
12 minutes ago
- The Hill
Israel says it has recovered the bodies of 2 hostages from the Gaza Strip
TEL AVIV, Israel (AP) — Israel has recovered the bodies of two hostages taken in Hamas' Oct. 7, 2023, attack that ignited the war in the Gaza Strip, officials said Thursday. Prime Minister Benjamin Netanyahu said the remains of Judih Weinstein and Gad Haggai were recovered and returned to Israel in a special operation by the army and the Shin Bet internal security agency. 'Together with all the citizens of Israel, my wife and I extend our heartfelt condolences to the dear families. Our hearts ache for the most terrible loss. May their memory be blessed,' he said in a statement. Kibbutz Nir Oz announced the deaths of Weinstein, 70, and Haggai, 72, in December 2023. The military said they were killed in the Oct. 7 attack and that their bodies were recently recovered from the southern Gaza city of Khan Younis. The couple were taking an early morning walk near their home in Kibbutz Nir Oz on the morning of Oct. 7 when Hamas militants stormed across the border and rampaged through several army bases and farming communities. In the early hours of the morning, Weinstein was able to call emergency services and let them know that both she and her husband had been shot and send a message to her family. Weinstein was born in New York and taught English to children with special needs at Kibbutz Nir Oz, a small community near the Gaza border. The kibbutz said she also taught meditation techniques to children and teenagers who suffered from anxiety as a result of rocket fire from Gaza. Haggai was a retired chef and jazz musician. The couple were survived by two sons and two daughters and seven grandchildren, the kibbutz said. Hamas-led militants killed some 1,200 people, mostly civilians, in the Oct. 7 attack and abducted 251 hostages. They are still holding 56 hostages, around a third of them believed to be alive, after most of the rest were released in ceasefire agreements or other deals. Israeli forces have rescued eight living hostages from Gaza and recovered dozens of bodies. Israel's military campaign has killed over 54,000 Palestinians, mostly women and children, according to the Gaza Health Ministry, which does not say how many of the dead were civilians or combatants. The offensive has destroyed large parts of Gaza and displaced around 90% of its population of roughly 2 million Palestinians. ___ Melzer reported from Nahariya, Israel. ___ Follow AP's war coverage at
