Chinese factory activity improves slightly with delay on tariffs, but still lags
The purchasing managers index, which reflects new orders and other measures, rose to 49.7 from 49.5 in May, the National Bureau of Statistics reported. That's on a scale of 0 to 100 where 50 and above shows expansion.
Other reports showed similar trends in Japan and Korea.
Trump has said he's not planning to extend the 90-day pause on tariffs on most nations beyond July 9. The delay for imposing much higher tariffs on China, agreed to in early May, expires about a month later.
The hiatus for tariffs brought a revival of manufacturing activity as companies and individuals rushed to take advantage of lower import duties. But that mainly helped large manufacturers, with small and mid-size companies' output still contracting. Hiring also fell.
New export orders and exports also remained below the 50-level that marks expansion.
In Japan, manufacturing output edged 0.5% higher in May, well below analysts' estimates for a 3.5% increase.
'The subdued rise in industrial production in May means that firms were not benefitting from sky-high U.S. tariffs on Chinese imports, and their production forecasts point to continued weakness,' Marcel Thieliant of Capital Economics said in a report.
South Korea's government reported that its 'all industry' measure of output fell 2.9% from a year earlier in May, with production of computer chips falling 2%. Production of vehicles fell 2.3% year-on-year, after falling 4.1% in April.
In an interview with Fox News Channel's 'Sunday Morning Futures,' Trump said he's not planning to extend a 90-day pause on tariffs on most nations beyond July 9. The delay for imposing much higher tariffs on China, agreed to in early May, expires about a month later.
Trump said his administration will notify countries that the trade penalties will take effect unless there are deals with the United States. He had played down the deadline at a White House news conference Friday by noting how difficult it would be to work out separate deals with each nation. The administration had set a goal of reaching 90 trade deals in 90 days.
Details of the latest agreement to deescalate trade tensions are scarce and major issues between the world's two biggest economies remain unresolved.
'I think getting along well with China is a very good thing,' Trump said. 'China's going to be paying a lot of tariffs, but we have a big (trade) deficit, they understand that.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Bloomberg
12 minutes ago
- Bloomberg
Thune Believes Senate Has Votes to Pass Trump Tax Bill
Senate Majority Leader John Thune believes there is enough Republican support of President Donald Trump's tax and spending bill and said his chamber will soon vote on passage of the legislation. Kailey Leinz reports on Bloomberg Television. (Source: Bloomberg)
Associated Press
12 minutes ago
- Associated Press
Regulators approve plan for Georgia Power to freeze base rates through 2028
ATLANTA (AP) — Utility regulators on Tuesday approved a plan for Georgia Power Co. to freeze base power rates through the end of 2028, although opponents argue that customers could face risks later if costs to serve new computer data centers pile up. The five Republicans on the Georgia Public Service Commission voted unanimously for the plan after regulatory staff and the company agreed to it earlier. 'Freezing these rates shows that we're listening to ratepayers and we're doing all we can to protect them and continue to grow this economy in this state,' Commissioner Tim Echols said after the vote. Rates could still go up next year when commissioners consider how customers will pay for $862 million in storm damage, mainly due to 2024's Hurricane Helene. In testimony, Georgia Power Chief Financial Officer Aaron Abramovitz said the company hopes any rate increase to repay the damage could be offset with a decrease in the charge customers have been paying since 2023 to make up for higher costs of buying natural gas and coal. Customers have seen bills rise six times in recent years because of higher natural gas costs and construction projects, including two new nuclear reactors at Plant Vogtle near Augusta. A typical Georgia Power residential customer now pays more than $175 a month, including taxes. The agreement allows Echols and Commissioner Fitz Johnson to seek reelection this year without a rate increase threatening their campaigns. Echols will face Democrat Alicia Johnson in November. Democrats Peter Hubbard and Keisha Sean Waites are vying in a July 15 runoff to face Fitz Johnson in the general election. Georgia Power CEO Kim Greene called the rate freeze a 'great result for customers, balancing the mutual benefits of extraordinary economic growth among all stakeholders and helping to ensure that we remain equipped to continue supporting growth in this state.' Opponents said the deal didn't do enough to contain the high profits of Georgia Power, a unit of Atlanta-based Southern Co, and doesn't provide enough scrutiny of the company's operations. Commissioner Lauren McDonald on Tuesday unsuccessfully attempted to limit how much the company can earn on the money it has invested — called return on equity — to 11.5% instead of 11.9%. Return on equity is the key driver of the company's profits. Georgia Power is the state's only privately owned electrical utility, serving 2.3 million customers statewide. Last year, Georgia Power collected $11.3 billion in revenue and contributed $2.5 billion in profit to Southern Co. The company predicts rapidly increasing demand from computer data centers. Georgia Power has said regular customers won't pay for power plants and transmission lines needed to electrify data centers, a pledge now backed by commission rules. But the company said in talks with commission staff that it could ask for a rate increase of up to $2.6 billion over three years. Instead, the company and staff hashed out a deal for the company to use tax credits and other financial maneuvers to boost its return on equity without raising rates. Opponents noted that the company had promised 'downward pressure' on rates last year when the commission approved an unusual request for Georgia Power to build more power plants outside the regular schedule. They asked why rates were staying flat instead of going down. John Wilson, an expert witness for the Southern Alliance for Clean Energy and other environmental groups, called it a 'rate increase hidden in the shadows.' Some advocates had called for Echols, McDonald and Commission Chair Jason Shaw to recuse themselves from the vote, saying they violated the commissioners' quasi-judicial role by supporting the deal before hearing evidence. Shaw and Echols spoke in favor of the agreement and McDonald appeared at a news conference but didn't speak. All three commissioners declined to recuse themselves, saying they had done nothing wrong. The deal comes even as commissioners are still considering Georgia Power's three-year plan to generate enough electricity to meet the state's needs. That plan foresees a very large increase in electrical demand, requiring new power plants or new purchases from existing plants. Typically, a rate plan is approved after the integrated resource plan, ensuring the utility can pay for improvements. Instead, Georgia Power will either absorb the costs or seek to pass them on to customers beginning in 2029.
CBS News
12 minutes ago
- CBS News
Los Angeles Mayor Karen Bass set to speak amid Justice Department lawsuit over sanctuary policies
Los Angeles Mayor Karen Bass is expected to speak at City Hall on Tuesday morning, a day after the Department of Justice filed a lawsuit claiming that the city's sanctuary policies are illegal and "interfere with and discriminate against the Federal Government's enforcement of federal immigration law." In the lawsuit, Justice Department prosecutors argue that a city ordinance signed by Bass in December, Prohibition of the Use of City Resources for Federal Immigration Enforcement, prevents U.S. Immigration and Customs Enforcement and U.S. Customs and Border Protection agents from carrying out their duties under federal law in violation of the Constitution's Supremacy Clause. The lawsuit accuses city officials of working to "thwart the will of the American people" by codifying sanctuary policies into law shortly after President Trump's victory in the November 2024 election. Court documents also name the Los Angeles City Council and Council President Marqueece Harris-Dawson as defendants in the lawsuit. U.S. Attorney Bill Essayli for the Central District of California said Monday that the "lawsuit holds the City of Los Angeles accountable for deliberately obstructing the enforcement of federal immigration law." In June, the Trump administration ramped up immigration operations in Southern California, prompting protests in downtown Los Angeles that led to violence between some demonstrators and law enforcement.
