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Good morning and welcome back. We start with the longest State of the Union address of modern times and here are the other stories we are covering this morning:
China’s new growth target
Germany’s historic commitment to increase defence spending
An alternative plan for Gaza
And why Ghanaian farmers are ditching cocoa for gold
Donald Trump admitted tariffs would cause “a little disturbance” for the US economy as he boasted about the achievements of his administration after its first six weeks in office in the longest annual address to the joint houses of Congress of modern times.
The US president promised to balance the federal budget while insisting he would press ahead with tax cuts and thanked Elon Musk for slashing government costs in a deeply partisan 99-minute speech that took a swipe at his predecessor Joe Biden for his “horrible” Chips Act and the soaring price of eggs.
But he was more conciliatory when it came to Ukraine, thanking President Volodymyr Zelenskyy for an “important letter” indicating that he was ready to negotiate a peace deal with Russia and sign a pact giving the US access to critical Ukrainian minerals.
We are “just getting started” Trump declared as he touted a list of domestic and international achievements. “We have accomplished more in 43 days than most administrations accomplish in four years or eight years,” he said.
His speech was met with heckles from some Democrats, including Al Green from Texas who was removed. Others held up signs displaying messages like “that’s a lie” and “false” while Republicans cheered continuously in the divided chamber. Here’s more coverage of the address.
Highlights: The key moments of the marathon address to Congress.
Instant Insight: The speech was neither libertarian nor traditionally conservative, or even conventionally nationalist, writes Edward Luce. It was pure Trumpian personalism.
Here’s what else we’re keeping tabs on today:
Economic data: The monthly employment report from ADP, the payroll company, will be closely watched ahead of Friday’s data from the government. The Institute for Supply Management releases its non-manufacturing PMI index for February.
Results: Campbell’s releases second-quarter revenues while Abercrombie & Fitch is expected to report fourth-quarter results. Jack Daniel’s parent, Brown-Forman, reports on its third-quarter performance.
Five more top stories
1. German borrowing costs have surged today after chancellor-in-waiting Friedrich Merz agreed a historic deal with his probable coalition partners that would relax the country’s strict “debt brake” to fund investment in the military and infrastructure. The yield on the 10-year Bund rose 0.18 percentage points to 2.66 per cent, its biggest one-day move since 2020. Read more on Merz’s historic announcement.
2. China has announced an ambitious 2025 growth target of “around 5 per cent” despite a slowdown in the domestic economy and trade tensions with the US. Delivering the new target, Premier Li Qiang also said borrowing would have to rise to stimulate the economy and inflation would fall. Here’s more on Qiang’s address to the National People’s Congress.
3. Arab leaders have adopted a plan for the postwar administration and reconstruction of Gaza in a bid to provide an alternative to Trump’s proposal for the war-shattered enclave to be emptied of Palestinians and taken over by the US. Egypt has been leading efforts to devise an alternative that ensures Hamas is no longer in power in Gaza. This is what we know about the plan so far.
4. BlackRock has agreed to buy two major ports on the Panama Canal from their Hong Kong-based owner as part of a $22.8bn deal, following pressure from Donald Trump over alleged Chinese influence at the vital waterway. The deal, announced yesterday, also includes an 80 per cent stake of CK Hutchison’s ports subsidiaries, which run 43 ports in 23 countries. Here’s how the agreement will work.
5. Deloitte has told staff in its US tax practice that it will now consider office attendance figures as part of their performance reviews, according to an email seen by the Financial Times. Performance reviews are used by the Big Four firm to help determine bonuses. Read more of the email which was sent by Katie Zinn, the tax practice’s chief talent officer.
The Big Read
Two of the biggest names in global macro trading, Alan Howard and Chris Rokos, embody different approaches to a perennial issue of hedge funds with a talented individual at their centre: how to create a sustainable business without their star trader founders.
We’re also reading . . .
Chart of the day
Ghana’s cocoa farmers are abandoning beans for bullion in an illegal gold mining boom known as “galamsey”. Ghana is the world’s second-largest cocoa producer and a shortage of the commodity has helped drive global chocolate prices to historic highs. Aanu Adeoye reports from Ghana’s eastern region of Atiwa West on the plight of farmers forced to give up their land.
Take a break from the news . . .
A company aiming to revive extinct animal species has unveiled genetically engineered “woolly mice” that it says are an important milestone in its quest to bring back mammoths.
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Source: Economy - ft.com
