Evelyn Reynolds

The action aims to enhance American production of crucial materials for electric vehicles, defense systems and other technologies.WASHINGTON — President Biden took steps on Thursday to try to increase domestic production of critical minerals and metals needed for advanced technologies like electric vehicles, in an attempt to reduce America’s reliance on foreign suppliers.Mr. Biden invoked the Defense Production Act, a move that will give the government more avenues to provide support for the mining, processing and recycling of critical materials, such as lithium, nickel, cobalt, graphite and manganese. Those are used to make large-capacity batteries for electric cars and clean-energy storage systems. Yet except for a handful of mines and facilities, they are almost exclusively produced outside the United States.“We need to end our long-term reliance on China and other countries for inputs that will power the future,” Mr. Biden said during remarks at the White House, where he also announced the release of one million barrels of oil per day from the Strategic Petroleum Reserve.The Defense Production Act is a Cold War-era statute that gives the president access to funding and other enhanced powers to shore up the American industrial base and ensure the private sector has the necessary resources to defend national security and face emergencies.In a determination issued Thursday, the president said that the United States depended on “unreliable foreign sources” for many materials necessary for transitioning to the use of clean energy, and that demand for such materials was projected to increase exponentially.Mr. Biden directed his secretary of defense to bolster the critical mineral supply by supporting feasibility studies for new projects, encouraging waste reclamation at existing sites, and modernizing or increasing production at domestic mines for lithium, nickel, cobalt, graphite and other so-called critical minerals.The secretary of defense would also conduct a survey of the domestic industrial base for critical minerals and submit that to the president and Congress, the presidential determination said.A person familiar with the matter said the actions being contemplated wouldn’t be loans or direct purchases of minerals, but rather funding studies and the expansion or modernization of new and existing sites.The administration will also review potential further uses of the act in relation to the energy sector, according to a White House announcement on Thursday.The United States imported more than half its supply of at least 46 minerals in 2020, and all of its supply of 17 of them, according to the U.S. Geological Survey. Many of the materials come from China, which leads the world in lithium ion battery manufacturing and has been known to shut off exports of certain products in times of political tensions, including rare earth minerals.The Biden administration has warned that a dependence on foreign materials poses a threat to America’s security, and promised to expand domestic supplies of semiconductors, batteries and pharmaceuticals, among other goods. While the United States does have some unexplored deposits of nickel, cobalt and other crucial minerals and metals, developing mines and processing sites can take many years. Two-thirds of the world’s entire production of cobalt is in the Democratic Republic of Congo, where Chinese companies owned or financed 15 of the 19 largest mines as of 2020.But bipartisan support for expanding American mining and processing of battery components has grown in recent years. In a March 11 letter to Mr. Biden, senators including Lisa Murkowski, a Republican of Alaska, and Joe Manchin III, a Democrat of West Virginia, proposed invoking the Defense Production Act to accelerate domestic production of the components of lithium-ion battery materials, particularly graphite, manganese, cobalt, nickel and lithium.Todd M. Malan, the head of climate strategy for Talon Metals, which is developing a nickel mine in Minnesota, said Washington had reached a bipartisan consensus around providing more support for the domestic mining of electric vehicle battery minerals “driven by concern about reliance on Russia and China for battery materials as well as the energy transition imperative.”But some domestic developments may face opposition from environmentalists in Mr. Biden’s own party.Representative Raúl M. Grijalva, an Arizona Democrat who chairs the Natural Resources Committee, said in a statement Wednesday that mining companies were “making opportunistic pleas to advance a decades-old mining agenda that lets polluters off the hook and leaves Americans suffering the consequences.”“Fast-tracking mining under antiquated standards that put our public health, wilderness, and sacred sites at risk of permanent damage just isn’t the answer,” he added.Dionne Searcey More

WASHINGTON — The Treasury Department on Thursday leveled new sanctions on Russian technology companies and illicit procurement networks that the country is using to evade existing sanctions, expanding the Biden administration’s effort to punish Russia for its invasion of Ukraine by crippling its economy.The new measures reflect the challenge that the United States and its allies continue to face in enforcing restrictions that have been imposed to cut off Russia’s central bank, financial institutions and oligarchs from the global financial system, and the need to disrupt Russian supply chains and efforts to conceal transactions.“Russia not only continues to violate the sovereignty of Ukraine with its unprovoked aggression, but also has escalated its attacks striking civilians and population centers,” the Treasury secretary, Janet L. Yellen, said in a statement. “We will continue to target Putin’s war machine with sanctions from every angle until this senseless war of choice is over.”Among the 34 organizations and individuals targeted are Serniya and Sertal, Moscow-based companies that illicitly procure dual-use equipment and technology for Russia’s defense sector.The Treasury Department is also imposing sanctions on several technology companies that produce computer hardware, software and microelectronics that are used by Russia’s defense sector. Among them is Joint Stock Company Mikron, Russia’s largest chip-maker.Adewale Adeyemo, the deputy Treasury secretary, foreshadowed the sanctions during a speech on Tuesday, when he said that Russia’s military industrial sector would be the next to face restrictions.“We are planning to target additional sectors that are critical to the Kremlin’s ability to operate its war machine, where a loss of access will ultimately undermine Russia’s ability to build and maintain the tools of war that rely on these inputs,” Mr. Adeyemo said in his speech at Chatham House, an international affairs think tank in London. “In addition to sanctioning companies in sectors that enable the Kremlin’s malign activities, we also plan to take actions to disrupt their critical supply chains.” More

Inflation continued to run at the fastest pace in 40 years in February, fresh data released on Thursday showed, at a moment when war in Ukraine and continued supply chain disruptions tied to the coronavirus promise to keep prices rising.Prices, as measured by the Personal Consumption Expenditures Index, rose by 6.4 percent in the year through February, the fastest inflation rate since 1982. They climbed 5.4 percent after stripping out food and fuel costs, which can be volatile, the data showed.That pace of increase is far faster than the 2 percent annual inflation that the Federal Reserve targets. While central bankers expect today’s rapid inflation to cool by the end of the year, falling to 4.3 percent by the final three months of 2022, that pace of increase would still be too quick for comfort.Central bankers began raising interest rates earlier this month, lifting them by a quarter percentage point, and have signaled more to come as they begin to wage an assault on rising prices. By making borrowing more expensive, the Fed can weigh on demand, allowing supply to catch up and eventually temper price increases.“There is an obvious need to move expeditiously to return the stance of monetary policy to a more neutral level, and then to move to more restrictive levels if that is what is required to restore price stability,” Jerome H. Powell, the Fed chair, said during a recent speech.Understand Inflation in the U.S.Inflation 101: What is inflation, why is it up and whom does it hurt? Our guide explains it all.Your Questions, Answered: Times readers sent us their questions about rising prices. Top experts and economists weighed in.Interest Rates: As it seeks to curb inflation, the Federal Reserve announced that it was raising interest rates for the first time since 2018.How Americans Feel: We asked 2,200 people where they’ve noticed inflation. Many mentioned basic necessities, like food and gas.Supply Chain’s Role: A key factor in rising inflation is the continuing turmoil in the global supply chain. Here’s how the crisis unfolded.The Personal Consumption Expenditures figures follow a more timely inflation release — the Consumer Price Index — and tend to be easy to forecast, so they do not come as a surprise to Wall Street. But because the gauge is the Fed’s preferred inflation measure, the fresh figures reinforce the challenge that economic officials face.While policymakers are watching for any sign that inflation is slowing down or is about to cool off, so far there is little to suggest a meaningful pullback. Supply chains remained stressed, and recent shutdowns in China could pose further strain. Apartment rents are climbing, elevating housing costs. Workers are in short supply and wages are rising, which could bolster inflation in other service categories.Russia’s invasion of Ukraine pushed up oil and gas prices, along with other commodity costs, which is likely to further elevate inflation when March data are released. While a few days of gas price increases happened in February, the bulk of them came this month.Companies are trying to navigate the complicated moment, gauging whether input cost increases will continue for a second year — and whether and how to pass that on to consumers.Chewy, the pet goods retailer, recently signed a new freight contract that will cost it more this year; and in the final quarter of 2021, it also faced higher labor costs. But it is hoping that those trends do not last, or that it can offset the climbing expenses through efficiencies.“As we close the book on 2021 and move forward in 2022, we are already seeing improvements in labor availability, inbound shipping costs and pricing, while out-of-stock levels and outbound shipping costs remain elevated,” Sumit Singh, the firm’s chief executive officer, said on an earnings call this week. “Ultimately, we believe most of these challenges are not permanent in nature.”Inflation F.A.Q.Card 1 of 6What is inflation? More

Farmers are spending more to keep tractors and combines running. Shipping and trucking companies are passing higher costs to retailers, which are beginning to pass them on to shoppers. And local governments are paying hundreds of thousands of dollars extra to fill up school buses. Construction costs could soon rise, too.The source is the sudden surge in the price of diesel, which is quietly undercutting the American and global economies by pushing up inflation and pressuring supply chains from manufacturing to retail. It is one more cost of the war in Ukraine. Russia is a major exporter of both diesel and the crude oil that diesel is made from in refineries.Car owners in the United States have been shocked by gasoline prices of more than $4 a gallon, but there has been an even bigger increase in the price of diesel, which plays a critical role in the global economy because it powers so many different kinds of vehicles and equipment. A gallon of diesel is selling for an average of $5.19 in the United States, according to government figures, up from $3.61 in January. In Germany, the retail price has shot up to 2.15 euros a liter, or $9.10 a gallon, from €1.66 at the end of February, according to ADAC, the country’s version of AAA.Fueling stations in Argentina have begun rationing diesel, jeopardizing one of the world’s leading agricultural economies, and energy analysts warn that the same could soon happen in Europe, where some businesses report spending twice as much on diesel as they did a year ago.“Not only is it a historic level, but it’s increased at a historic pace,” said Mac Pinkerton, president of North American surface transportation for C.H. Robinson, which provides supply chain services to trucking companies and other customers. “We have never experienced anything like this before.”The sharp jump is putting immense pressure on trucking firms, especially smaller operations that are already suffering from driver shortages and scarce spare parts. Many can pass increased fuel costs on to their customers only after a few weeks or months.Eventually consumers will feel the effect in higher prices for all manner of goods. While hard to quantify, inflation will be most visible for big-ticket items like automobiles or home appliances, economists say.“Really, everything that we buy online or in a store is on a truck at some point,” said Bob Costello, the chief economist for American Trucking Associations.Trucks lining up on Terminal Island between the Port of Long Beach and the Port of Los Angeles.Alex Welsh for The New York TimesManufacturers are also heavy users of diesel, leading to higher prices for factory goods. Food will go up in price because farm equipment generally runs on diesel.“It’s not just the fuel we put into pickups, tractors, combines,” said Chris Edgington, an Iowa corn farmer. “It’s a cost of transporting those goods to the farm, it’s a cost of transporting them away.”At the start of the pandemic, diesel prices dropped steeply as the global economy slowed, factories shut down and stores closed. But beginning in early 2021 there was a sharp rebound as truck and rail traffic resumed. Prices, which increased pretty steadily last year, picked up momentum in January as Russia massed troops near Ukraine and then invaded. Low stockpiles of the fuel, particularly in Europe, have added to the price pressures.“Diesel is the most sensitive, the most cyclical product in the oil industry,” said Hendrik Mahlkow, a researcher at the Kiel Institute for the World Economy in Germany who has studied commodity prices. “Rising prices will distribute through the whole value chain.”Refineries, which turn crude oil into fuels that can be used in cars and trucks, have tried to play catch-up on both sides of the Atlantic in recent months. But they have not been able to make more diesel, gasoline and jet fuel fast enough. That is in part because refineries have closed in Europe and North America in recent years and more of the world’s fuels are being refined in Asia and the Middle East.Since January 2019, refinery capacity has declined 5 percent in the United States and 6 percent in Europe, according to Turner, Mason & Company, a consulting firm in Dallas.Europe is particularly vulnerable because it relies on Russia for as much as 10 percent of its diesel. Europe’s own diesel production is also dependent on Russia, which is a big supplier of crude oil to the continent. Some analysts say Europe may have to begin rationing diesel as early as next month unless the shortage eases.Diesel prices and Germany’s dependence on Russian energy were among the factors that on Wednesday prompted Germany’s Council of Economic Experts to cut its forecast for growth in 2022 by more than half, to 1.8 percent.Russian diesel has been flowing to Europe since the invasion last month, but traders, banks, insurance companies and shippers are increasingly turning away from the country’s diesel, oil and other exports.Several large European oil companies have announced that they are leaving Russia. TotalEnergies, the French oil giant, said this month that it would stop buying Russian diesel and oil by the end of the year.The market for oil and diesel is global, and companies can usually find another source if their main supplier can’t deliver. But no oil company or country can quickly make up for the loss of Russian energy.Saudi Arabia, for example, has not increased diesel exports because one of its largest refineries is undergoing maintenance. The kingdom and its allies in OPEC Plus have also refused to ramp up crude oil production because they are happy to have oil prices stay high. Russia belongs to the group and has significant sway over its fellow members.Christine Hemmel is a manager of a trucking company in Ober-Ramstadt, Germany, that has been in her family for four generations. Her family’s business has almost all the challenges that medium-size haulers have faced since the pandemic’s outbreak.The Russia-Ukraine War and the Global EconomyCard 1 of 6Rising concerns. More

Economists have been waiting for Americans to shift from buying goods, like furniture and appliances, and toward spending on vacations, restaurant meals and other services as the pandemic fades, betting the transition would take pressure off supply chains and help inflation to moderate.Rapid wage growth could make that story more complicated. Demand for services is rising just as many employers are struggling to find workers, which could force them to continue raising wages. While positive for workers, that could keep overall inflation brisk as companies try to cover their labor costs, speeding up price increases for services even as they begin to moderate for goods.Heavy spending on goods during the pandemic has been a driver of the recent inflation burst. Consumers began snapping up items a few months after pandemic lockdowns began and have kept on buying. Spending on services also has recovered, but much more slowly. That shift in what people are purchasing has roiled supply chains, which were not built to produce, ship and deliver so many cars, treadmills and washing machines.Policymakers spent months betting that as the virus waned and consumers resumed more normal shopping patterns, prices of goods would slow their ascent or even fall. That would pull down inflation, which has been running at its fastest pace in 40 years.But that transition — assuming it happens — may do less to cool inflation than many had hoped. A big chunk of what the government defines as “services” inflation comes from rental housing costs, which often move up alongside wage growth, as households can afford more and bid up the cost of a limited supply of housing units. And when it comes to discretionary services, like salons and gyms, labor is a major cost of production. Rising pay likely means higher prices.Jason Furman, a Harvard economist who served as a top adviser to President Barack Obama, said the shortage of workers in many service industries means that if demand for services goes up, prices will too. That means a shift in spending back to services won’t necessarily result in an overall slowdown in the pace of price increases.“An awful lot of services are incredibly constrained,” he said. “As we shift back to services, we’ll get more services inflation and less goods inflation, and I don’t think it’s at all obvious that the result of that is less inflation.”While America has gotten used to thinking about shortages in products — couches are out of stock, shoes are back-ordered — labor shortfalls could mean that services will also end up oversubscribed, allowing providers to charge more.MaidPro, a home-cleaning firm, has seen a surge in demand from professionals who are spending more time at home. But it is having trouble finding workers to keep up, said Tom Manchester, the company’s president.“Our demand right now outstrips our supply of being able to service that demand,” he said. “Demand has just continued to be strong — like double-digit strong. And if we could find qualified pros to meet the demand, we’d be even more ahead than we are today.”An Amazon employee delivering packages in Manhattan. Americans have continued to buy goods even as services have rebounded.Gabby Jones for The New York TimesMr. Manchester said hourly wages were up $1 to $3, adding to costs at a time when cleaning products have gotten pricier and higher gas prices have made travel reimbursements more expensive. MaidPro franchisees have been able to pass those costs on to their customers, both via fuel surcharges and outright price increases that have more or less kept up with inflation.So far, they have lost few customers — in part because few competitors have capacity to take on new customers.Understand Inflation in the U.S.Inflation 101: What is inflation, why is it up and whom does it hurt? Our guide explains it all.Your Questions, Answered: Times readers sent us their questions about rising prices. Top experts and economists weighed in.Interest Rates: As it seeks to curb inflation, the Federal Reserve announced that it was raising interest rates for the first time since 2018.How Americans Feel: We asked 2,200 people where they’ve noticed inflation. Many mentioned basic necessities, like food and gas.Supply Chain’s Role: A key factor in rising inflation is the continuing turmoil in the global supply chain. Here’s how the crisis unfolded.“If someone has someone that they really like coming in to clean their home, they don’t want to lose them,” he said. “They don’t want to risk saying, ‘I want to move away from MaidPro and try to find someone else,’ because in nine out of 10 instances, that someone else isn’t available.”Some economists argue that if goods inflation slows, that could still help price gains overall to moderate, even amid rising wages. Prices for products that last a long time rose 11.6 percent in the year through January, and prices for shorter-lived products like cosmetics and clothing were up 7.2 percent, still much stronger than services inflation.“We have in mind a big decline in goods prices,” said Roberto Perli, the head of global policy research at the investment bank Piper Sandler. “It would take a lot of increase in service prices to actually offset that.”Outright declines in goods prices are not guaranteed. Take cars: Rapid price growth in new and used autos was a big driver of inflation last year, and many economists expect those prices to dip in 2022. But Jonathan Smoke, the chief economist at Cox Automotive, said continued shortages mean prices for new cars are likely to continue rising, and issues with new car supply could spill over to blunt the expected decline in used car costs.And services inflation is now also coming in fast. It ran at 4.6 percent in the year through January, the quickest pace since 1989, and it has been posting large monthly gains since autumn. That is enough to keep inflation above the Federal Reserve’s 2 percent goal even if product prices stop accelerating.While goods have taken up a bigger chunk of household budgets in recent months than they did before the pandemic, Americans still spend nearly twice as much on services as on goods overall.“You don’t need a lot of extra services inflation to make up for your lost goods inflation,” Mr. Furman said.Restaurants, hotels and other discretionary services aren’t the only places where persistent demand could run up against limited supply, Mr. Furman argued. Many nonurgent health care services saw a decline in demand during the pandemic and are now experiencing a rebound amid a shortage of nurses and other skilled workers.Inflation F.A.Q.Card 1 of 6What is inflation? More

ADP said private payrolls grew by 455,000 in March, slightly more than expected.
Leisure and hospitality led the job gains, adding 161,000 positions.
The release comes two days ahead of the government’s nonfarm payrolls report, which is expected to show growth of 490,000.

Companies added jobs at a solid pace in March, indicating that hiring is strong despite signs of a tightening labor market, payroll processing firm ADP reported Wednesday.
Private payrolls expanded by 455,000 for the month, the firm said, about in line with the Dow Jones estimate of 450,000 though it was the lowest since August 2021. The total was slightly below the upwardly revised 486,000 for February, and brought ADP’s first-quarter jobs count to 1.45 million.

The report comes two days before the more closely watched nonfarm payrolls report, with the Bureau of Labor Statistics expected to show jobs growth of 490,000 for the month, according to the Dow Jones consensus estimate. The ADP and BLS numbers can differ widely, as they did in February when the payroll firm’s count was about 200,000 below the government’s official tally.
ADP’s report for March indicated that hiring was spread evenly around sectors, with leisure and hospitality adding 161,000 to lead the way. Education and health services contributed 72,000 while professional and business services was next with 61,000 new jobs.
On the goods-producing side, manufacturing led with 54,000 while construction added 15,000.
Service-providing companies added 377,000 jobs while goods producers made up the balance of about 79,000.
By size, job gains also were spread fairly evenly, with companies employing 50 to 499 workers up 188,000 and large companies adding 177,000. Small businesses, which saw a decline in February, reversed that and added 90,000 in March.

“Businesses are hiring, specifically among the service providers which had the most ground to make up due to early pandemic losses,” said Nela Richardson, chief economist at ADP. “However, a tight labor supply remains an obstacle for continued growth in consumer-facing industries.”
Indeed, in February there were a record 5 million more jobs than available workers, according to BLS data released Wednesday. Workers continue to leave their jobs in search of better opportunities, with 4.35 million more taking part in the so-called Great Resignation during the month.
Friday’s report is expected to show the unemployment rate contracted further, to 3.7%.
Federal Reserve officials are watching the jobs numbers closely as the central bank battles inflation at 40-year highs. Job growth has come with a sharp acceleration in wages, and the Fed is expected to raise interest rates at a brisk pace this year to combat rising prices.
Correction: Leisure and hospitality added 161,000 jobs in March. An earlier version misstated the figure.

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The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 4.80% from 4.50%.
Refinance applications fell 15% for the week and were down 60% from a year ago.
Homebuyer mortgage demand rose 1% for the week but was down 10% from a year ago.

Mortgage rates took another jump higher last week, taking their toll on current borrowers who might have wanted to refinance. Demand from homebuyers, however, appears to be hanging in for now.
Total mortgage application volume decreased 6.8% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. This, as the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 4.80% from 4.50%, with points decreasing to 0.56 from 0.59 (including the origination fee) for loans with a 20% down payment.

“Mortgage rates jumped to their highest level in more than three years last week, as investors continue to price in the impact of a more restrictive monetary policy from the Federal Reserve,” said Michael Fratantoni, MBA’s chief economist.
Driving the downturn in overall mortgage demand was a 15% weekly drop in refinance applications. They are now down a whopping 60% from a year ago. The refinance share of mortgage activity decreased to 40.6% of total applications from 44.8% the previous week.
Mortgage applications to purchase a home increased 1% for the week but were 10% lower than the same week one year ago. Homebuyers today continue to face sky-high prices and record low supply, in addition to rising mortgage rates. Affordability is weakening dramatically, but some real estate agents say the competition is not letting up.
“I will say I have had more cash buyers this this year than I’ve ever had, and they’re borrowing from parents. They’re just finding that cash because they know that it’s more competitive with cash offers,” said Kelly Theriot McMahon, a real estate agent with Compass in Dallas.
At an open house held last Sunday, she said buyers were steeling themselves for a bidding war.
“You have to look at it knowing you’re probably going to have to offer like $40,000 over asking price,” said Lauren Poey, a potential buyer touring the home.

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Job openings edged lower to about 11.3 million in February, about 5 million more than the level of unemployed workers.
Quits increased to 4.35 million as the Great Resignation persisted.

Pedestrians walk past a Now Hiring sign in Arlington, Virginia, on March 16, 2022.
Stefani Reynolds | AFP | Getty Images

An increasing number of Americans quit their jobs in February, while the gap between available positions and the unemployed grew even wider, the Bureau of Labor Statistics reported Tuesday.
The Job Openings and Labor Turnover Survey showed that 4.35 million workers left in February, an increase of 94,000 from the previous month. It’s also a slightly higher level as a percentage of the workforce, up to 2.9% from 2.8%.

At the same time, there were 11.27 million openings in the month, down just slightly from January. However, with the total level of those counted as unemployed contracting further to 6.27 million, that left a record 5 million more openings than available workers. There were 1.8 jobs for every person unemployed.
Education and health services had the highest level of job openings for the month, at 2.23 million, followed by professional and business services with 2.1 million, and trade, transportation and utilities with 1.86 million.
The quits level was off its November 2021 high of 4.51 million, which amounted to 3% of the overall workforce. The highest level came in trade, transportation and utilities, at 1.06 million. Leisure and hospitality, a critical proxy for the pandemic-era economic recovery, saw its quits rate unchanged at 5.6%.

The elevated level of quits is part of what some term the “Great Resignation,” in which workers have been able to leave their current positions for better opportunities.
Hires increased by 263,000 in February, nudging the rate up to 4.4%, while layoffs and discharges edged lower to 1.39 million. Separations overall were slightly higher, rising to just under 6.1 million.

Federal Reserve officials watch the JOLTS report closely for signs of labor market slack. The extremely tight jobs picture has helped drive inflation higher, which in turn has pushed the Fed to start raising interest rates.
An important snapshot of the labor market comes Friday, when the BLS releases its nonfarm payrolls count for March. Economists surveyed by Dow Jones are expecting growth of 490,000 and an increase in average hourly earnings of 0.4% for the month and 5.5% on a 12-month basis.

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