Economy

Pfizer said it has not received any reports of adverse events related to the drug till date. Nitrosamines are common in water and foods, including cured and grilled meats, dairy products and vegetables. Exposure to the impurities above acceptable levels over long periods of time could increase the risk of cancer.However, there is no immediate risk to patients taking the drug, Pfizer said. Patients currently taking the products should consult with their doctor about alternative treatment options, the drugmaker said.Pfizer Canada earlier this month recalled Accuretic due to the presence of the same impurity.Last year, the drugmaker also recalled its anti-smoking treatment, Chantix, due to high levels of a nitrosamine in the pills. More

WASHINGTON (Reuters) – U.S. President Joe Biden’s warning of “consequences” for any aid China may give to Russia’s Ukraine war effort aims to force Chinese President Xi Jinping to choose a longstanding lucrative trade relationship with the West over a growing strategic partnership with Moscow. Based on trade flows alone, both China and the United States have a lot at stake after Biden’s nearly two-hour video call with Xi on Friday, with the White House confirming that sanctions on Beijing were an option. Despite growing trade ties to Southeast Asia and an economy that is less dependent on trade over the past decade, China’s economic interests remain heavily skewed to Western democracies, trade data reviewed by Reuters showed.Siding with political ally Russia would make little economic sense for China, according to analysts, as the United States and European Union still consume more than a third of China’s exports. “On the pure economic question, if China were to have to make the choice – Russia versus everyone else – I mean, it’s a no-brainer for China because it’s so integrated with all of these Western economies,” said Chad Bown, a senior fellow at the Washington-based Peterson Institute for International Economics think tank who tracks China trade closely.China’s ambassador to the United States, Qin Gang, on Sunday emphasized China’s close relationship with Russia. “China has normal trade, economic, financial, energy cooperations with Russia,” Qin told the CBS program “Face the Nation” when asked if Beijing would provide financial support to Moscow. “These are normal business between two sovereign countries, based on international laws, including WTO (World Trade Organization) rules.”Targeting Beijing with the type of broad economic sanctions that have been imposed on Russia would have potentially serious consequences for the United States and globally, given that China is the world’s second-largest economy and the largest exporter. As China’s economy has ballooned to $16 trillion in the past 20 years, its dependence on trade with other countries for its economic well-being has diminished. Title: Trade’s share of China’s economy eases to 1990s levels Trade’s share of China’s economy,https://graphics.reuters.com/USA-TRADE/CHINA/zdvxokzqzpx/chart.png As Chinese citizens become wealthier, domestic consumption and services are playing a bigger share in China’s economy. However, China is still more dependent on trade, at about 35% of GDP, than the United States at 23% or Japan at 31%.The wealthy G7 countries that form the heart of an anti-Russia alliance following last month’s invasion of Ukraine still consume more than a third of China’s exports. That is a drop from almost half of China’s exports nearly two decades ago, but a relatively steady share since 2014, when Russia annexed Ukraine’s Crimea region. Title: China exports still dominated by U.S. and Western allies, https://graphics.reuters.com/UKRAINE-CRISIS/TRADE-CHINA/jnvwebqbavw/chart.png The share of China’s exports to Association of Southeast Asian Nations (ASEAN) countries, with which China recently has forged new trade agreements, has doubled to about 15%, eclipsing Japan in importance. But China’s January-February 2022 trade data showed that exports to the European Union grew the most at 24%. OIL FOR CELLPHONESRussia’s overall trade with China has grown since the West first imposed sanctions on Moscow in response to its annexation of Crimea. But China’s exports to Russia have remained between 1% and 2% for the past 20 years.Russian imports from China track those of many other countries, with electronics and consumer goods including cellphones, computers, apparel, toys and footwear topping the list. Title: Russia’s top imports from China: electronics, apparel Russia’s top imports from China: electronics, apparel, https://graphics.reuters.com/UKRAINE-CRISIS/TRADE-CHINA/lgpdwarzavo/chart.png China exported 10 times as many cellphones, by value, to the United States alone, at $32.4 billion in 2020, based on UN Comtrade data. China’s imports from Russia are dominated by oil. At $27 billion in 2020, crude oil and other petroleum dwarfs all other imports from Russia, mainly commodities including copper, softwood lumber, liquefied natural gas, coal, metals and ores. Title: China’s top imports from Russia: all about the oil, https://graphics.reuters.com/UKRAINE-CRISIS/TRADE-CHINA/xmvjoezddpr/chart.png Turning Western sanctions against China would cause significant difficulties for the United States, which heavily depends on China for imports of key consumer goods from computers and cellphones to toys and textiles. Title: Few alternatives for top U.S. imports from China Few alternatives for top U.S. imports from China, https://graphics.reuters.com/UKRAINE-CRISIS/TRADE-CHINA/jnpwekgdnpw/chart.png “In America, we don’t depend on the Russian economy – hardly for anything,” Bonnie Glick, director of Purdue University’s Center for Tech Diplomacy, told a Commerce Department forum on Monday.”But an economic or a trade war with China would have tremendous impacts,” Glick said, adding that it was important for the United States to reduce trade reliance on China. More

A Boeing 737 passenger plane with 132 people on board crashed in southern China yesterday, in what threatens to be the country’s worst air disaster in recent years. China Eastern Airlines said flight MU5735 crashed in a mountain range in Guangxi province an hour after take-off. The flight was travelling from Kunming to the city of Guangzhou. No information on casualties or the cause of the crash was immediately available. Flight tracking websites showed that the route was being flown by a 737-800 and not a Boeing 737 Max, which was grounded in 2019 after two fatal crashes. Shares in the US plane manufacturer fell more than 7 per cent to $181 in early morning trading in New York. Chinese state media quoted China Eastern as saying it would ground all of its 737-800s starting on Tuesday. Data from tracker Flightradar24 showed the six-year-old plane travelling at 29,100 feet before it began to rapidly lose speed and altitude. The flight was carrying 123 passengers and nine crew members, according to the Civil Aviation Administration of China. The aviation regulator said it had activated its emergency response measures and was sending a team to the crash site.Thanks for reading FirstFT Asia. Send your feedback on this newsletter to [email protected]. Here’s the rest of today’s news — EmilyThe war in Ukraine: The latest: Ukraine has rejected Russia’s ultimatum to surrender Mariupol, leaving hundreds of thousands of residents trapped in the besieged port city.China: The country’s ambassador to Washington said yesterday that Beijing “will do everything” to de-escalate the war in Ukraine but stopped short of condemning Russia. Refugees: As many as 10mn people have fled the fighting in Ukraine, the UN refugee agency said in its latest estimate.Global impact: Countries across the Arab world, dependent on Russia and Ukraine for grains and vegetable oil, are fearing food insecurity and political instability. Energy: The conflict has exposed the heavy bet Germany, Italy and other European countries made on Russian oil and gas. Can they now wean themselves off it? Opinion: Peace talks or turmoil in Russia could halt the conflict, but the likeliest outcome is many more months of fighting, writes Gideon Rachman. Keep up with the latest developments from Ukraine on our live blog and follow Russia’s invasion in maps.Five more stories in the news1. Hong Kong suspends trading in Evergrande Shares in the world’s most indebted property developer were suspended yesterday pending the release of “inside information”. The company borrowed more than $20bn in dollar-denominated bonds2. Saudi Arabia ‘will not bear responsibility’ for global oil shortages Saudi Arabia has said it will not be held responsible for shortages in the global energy market as it warned on Monday that missile attacks on oil installations by Iranian-backed Houthi rebels in Yemen will disrupt supply.3. Federal Reserve prepared to move aggressively to tighten policy Jay Powell has said the Federal Reserve needs to move “expeditiously” towards tighter monetary policy and is prepared to act even more aggressively if necessary to tackle excessive inflation.4. Chipmakers face two-year shortage of critical equipment Chipmakers’ multibillion-dollar expansion plans will be constrained by a shortage of critical equipment over the next two years as the supply chain struggles to step up production, according to one of the industry’s most important suppliers.5. Whistleblower alleges Johnson authorised Afghan animal airlift Boris Johnson personally authorised the airlift of staff from a former UK serviceman’s Kabul-based animal charity when the Taliban seized control of Afghanistan’s capital city last year, according to a British government whistleblower.Coronavirus digest Hong Kong’s leader said she would lift a flight ban from nine countries, including the US and UK, for Hong Kong residents and allow those travellers to quarantine in a hotel for seven rather than 14 days.Samsung Biologics, the biopharmaceutical unit of South Korea’s Samsung Group is seeking to build its first plants in the US and Europe as it rebalances its global supply chains following the pandemic.The day aheadNahdi Medical IPO listing Shares in the Saudi pharmacy company are set to begin trading. It’s part of a growing group of Saudi family-owned companies, long resistant to opening their books to outside shareholders, that are now lining up to list stakes as the country’s stock market booms.What else we’re reading Help wanted: tech firms in Vietnam seek Chinese speakers The rising demand for Vietnamese employees who speak Chinese is just the latest symptom of factories moving to the south-east Asian nation as higher costs and risks in China motivated companies from many countries to make the shift. (Nikkei Asia) How war is changing business The war in Ukraine has already disrupted countless lives. Now it’s disrupting business models as well. With the exodus of western multinationals from Russia and Ukrainian supply chain disruptions coupled with Covid-related disruptions in China, companies are having to rethink everything, writes Rana Foroohar.More from Rana on China’s calculus in Ukraine’s war in the latest Swamp Notes newsletter. Citi recruits’ future of work trade-off A new hub for fledgling investment bankers that Citigroup is setting up in Málaga is innovative — and its progress will be keenly watched. But ensuring it thrives will require some serious management effort.How Big Tech lost the antitrust battle with Europe Brussels is set to finalise stringent legislation targeting Silicon Valley giants, disabling their strategy to dominate markets and capture billions of euros in revenues, despite desperate lobbying that has fallen on deaf ears.

TelevisionWith Pachinko, Apple TV Plus has delivered a series that is both global in scope and its most entrancing to date. Adapted from Min Jin Lee’s bestselling novel, the new eight-part Korean family saga retains its literary texture. The detail is rich, the pacing deliberate, the characters complex and scenes are shot with a stillness that allows us to take in their beauty, writes critic Dan Einav More

Fed Chairman Jerome Powell vowed tough action on inflation, which he said jeopardizes the recovery.
Powell said the Fed will continue to hike rates until inflation comes under control, and could get even more aggressive than last week’s increase, which was the first in more than three years.
He noted those rate rises could go from the traditional 25 basis point moves to more aggressive 50 basis point increases if necessary.

Federal Reserve Board Chairman Jerome Powell testifies during a hearing before Senate Banking, Housing and Urban Affairs Committee on Capitol Hill November 30, 2021 in Washington, DC.
Alex Wong | Getty Images News | Getty Images

Federal Reserve Chairman Jerome Powell on Monday vowed tough action on inflation, which he said jeopardizes an otherwise strong economic recovery.
“The labor market is very strong, and inflation is much too high,” the central bank leader said in prepared remarks for the National Association for Business Economics.

The speech comes less than a week after the Fed raised interest rates for the first time in more than three years in an attempt to battle inflation that is running at its highest level in 40 years.
Reiterating a position the Federal Open Market Committee made Wednesday in its post-meeting statement, Powell said interest rate hikes would continue until inflation is under control. He said the increases could be even higher if necessary than the quarter-percentage point move approved at the meeting.
“We will take the necessary steps to ensure a return to price stability,” he said. “In particular, if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so. And if we determine that we need to tighten beyond common measures of neutral and into a more restrictive stance, we will do that as well.”
A basis point is equal to 0.01%. FOMC officials indicated that 25 basis point increases are likely at each of their remaining six meetings this year. However, markets are pricing in about a 50-50 chance the next hike, at the May meeting, could be 50 basis points.
Stocks slipped to their lows of the session after Powell’s remarks while Treasury yields rose.

‘Widely underestimated’ inflation

The sudden policy tightening comes with inflation as measured by the consumer price index running at 7.9% on a 12-month basis. A gauge that the Fed prefers still has prices up 5.2%, well above the central bank’s 2% target.
As he has before, Powell ascribed much of the pressures coming from Covid pandemic-specific factors, in particular escalated demand for goods over services that supply could not meet. He conceded that Fed officials and many economists “widely underestimated” how long those pressures would last.
While those aggravating factors have persisted, the Fed and Congress provided more than $10 trillion in fiscal and monetary stimulus since the pandemic’s start. Powell said he continues to believe that inflation will drift back to the Fed’s target, but it’s time for the historically easy policies to end.
“It continues to seem likely that hoped-for supply-side healing will come over time as the world ultimately settles into some new normal, but the timing and scope of that relief are highly uncertain,” said Powell, whose official title now is chairman pro tempore as he awaits Senate confirmation for a second term. “In the meantime, as we set policy, we will be looking to actual progress on these issues and not assuming significant near-term supply-side relief.”
Powell also addressed the Russian invasion of Ukraine, saying it is adding to supply chain and inflation pressures. Under normal circumstances, the Fed generally would look through those types of events and not alter policy. However, with the outcome unclear, he said policymakers have to be wary of the situation.
“In normal times, when employment and inflation are close to our objectives, monetary policy would look through a brief burst of inflation associated with commodity price shocks,” he said. “However, the risk is rising that an extended period of high inflation could push longer-term expectations uncomfortably higher, which underscores the need for the Committee to move expeditiously as I have described.”
Powell had indicated last week that the FOMC also is prepared to begin running off some of the nearly $9 trillion in assets on its balance sheet. He noted the process could begin as soon as May, but no firm decision has been made.

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(Reuters) -Federal Reserve Chair Jerome Powell on Monday delivered his most muscular message to date on his battle with too-high inflation, saying the central bank must move “expeditiously” to raise rates and possibly “more aggressively” to keep an upward price spiral from getting entrenched.In remarks that sent financial markets scrambling to recalibrate for a higher probability of the Fed lifting interest rates by a half-percentage point at one or more of its remaining meetings this year, Powell signaled an urgency to the central bank’s inflation challenge that was less visible than just a week ago, when the Fed delivered its first rate hike in three years.”The labor market is very strong, and inflation is much too high,” Powell told a National Association for Business Economics conference. “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.”In particular, he added, “if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so.”AIG (NYSE:AIG)’s global head of strategy, Constance Hunter, called it Powell’s “the buck stops here” speech. U.S. stocks fell, and traders — already betting on at least a quarter-point interest rate increase at each of the year’s remaining six Fed meetings — moved to price in a better-than even chance of half-point interest rate increases at each of the Fed’s next two meetings in May and June. That would lift the short-term policy rate – pinned for two years near zero – to a range of 2.25% to 2.5% by the end of the year, higher than the 1.9% that Fed policymakers just last week anticipated. Most Fed policymakers see the “neutral” level as somewhere between 2.25% and 2.5%.Powell repeated on Monday that the Fed’s reductions to its massive balance sheet could start by May, a process that could further tighten financial conditions.”This is not just going to be a near-term tactical phenomenon,” said Kevin Flanagan, head of fixed income strategy at WisdomTree Investments (NASDAQ:WETF) in New York. “This is a more strategic type of messaging, I think, from the Fed.”A consensus for more aggressive tightening – or at least an openness to it – appears to be growing.Atlanta Fed President Raphael Bostic, who expects a slightly gentler path of rate increases than most of his colleagues, said earlier on Monday he is open to bigger-than-usual rate hikes “if that’s what the data suggests is appropriate.”Speaking on Friday, Fed Governor Chris Waller said he would favor a series of half-percentage point rate increases to have a quicker impact on inflation.TIGHT LABOR MARKET, INFLATION RISKSThe U.S. unemployment rate currently is at 3.8% and per-person job vacancies are at a record high, a combination that’s pushing up wages faster than is sustainable. “There’s excess demand,” Powell said, adding that “in principle” less accommodative monetary policy could reduce pressure in the labor market and help stabilize inflation without pushing up unemployment, generating a “soft landing” rather than a recession.Inflation by the Fed’s preferred gauge is three times the central bank’s 2% goal, pushed upward by snarled supply chains that have taken longer to fix than most had expected and that could get worse as China responds to new COVID-19 surges with fresh lockdowns.Adding to the pressure on prices, Russia’s war in Ukraine is pushing up the cost of oil, threatening to move inflation even higher. The United States, now the world’s biggest oil producer, is better able to withstand an oil shock now than in the 1970s, Powell noted. Although the Fed in normal times would not likely tighten monetary policy to address what in the end may be a temporary spike in commodity prices, Powell said, “the risk is rising that an extended period of high inflation could push longer-term expectations uncomfortably higher.” Last year, the Fed repeatedly forecast that supply chain pressures would ease and then was repeatedly disappointed. “As we set policy, we will be looking to actual progress on these issues and not assuming significant near-term supply-side relief,” Powell said on Monday. Policymakers began this year expecting inflation would peak this quarter and cool in the second half of the year. “That story has already fallen apart,” Powell said. “To the extent it continues to fall apart, my colleagues and I may well reach the conclusion we’ll need to move more quickly and, if so, we’ll do so.”Fed policymakers hope to rein in inflation without stomping on growth or sending unemployment back up, and their forecasts released last week suggest they see a path for that, with the median view for inflation falling to 2.3% by 2024 but unemployment still at 3.6%. Powell said he expects inflation to fall to “near 2%” over the next three years, and that while a “soft landing” may not be straightforward, there is plenty of historical precedent. “The economy is very strong and is well-positioned to handle tighter monetary policy,” he said, adding that he doesn’t expect a recession this year.It is a difficult trick to finesse, analysts said. Powell was “reasonably forthcoming that there’s uncertainty,” said Seth Carpenter, chief global economist at Morgan Stanley (NYSE:MS). “If you keep going until you see the outcome that you desire, chances are you’ve gone too far.” More

Nearly a dozen Apple services were down for thousands of users.The company’s system status page had showed 11 outages including podcasts, music and arcade. It said Apple was investigating the issue and services may be slow or unavailable. According to outage tracking website Downdetector.com, more than 4,000 users reported issues with accessing Apple Music, while nearly 4,000 reported problems with iCloud.Users also flagged issues with “find my iPhone”, Apple store, maps and support.Downdetector tracks outages by collating status reports from several sources including user-submitted errors on its platform. The outage may be affecting a larger number of users. The company was responding to affected users on Twitter (NYSE:TWTR) but it was unclear what caused the outages.Bloomberg News reported that Apple’s corporate staff working from home and retail workers were also facing issues. The outage delayed product repairs, pickups and limited workers’ access to internal websites, the report said.According to the report, Apple told staff that the outage stemmed from domain name system, or DNS – an address book of the internet which enables computers to match website addresses with the correct server.In a number of incidents last year, DNS issues caused widespread outages on social media platforms including Facebook (NASDAQ:FB) and Instagram, and brought down websites of airlines and banks for several hours. More

Powell said on Monday the Fed must move “expeditiously” to bring too-high inflation to heel, and will, if needed, use bigger-than-usual interest rate hikes to do so.In late afternoon trading, rate futures showed a 63% chance that the Fed will raise interest rates by 50 basis points in May to 0.75%-1.00%, less than a week after the Fed hiked by a quarter-point to 0.25%-0.50%.”Fed Chair Powell was a more hawkish than we, and the market expected, emphasizing the need to attack inflation rather than take a cautious approach due to the various uncertainties over growth,” said Action Economics in its latest blog.”Is he setting the markets up for a 50 basis-point hike in May? It is also the case that balance sheet reduction is expected to be announced in May, with some insights before that to be seen in the minutes due on April 6.”For the year, futures have priced in 184 basis points of policy tightening.Futures had priced in a roughly 52% chance of a 50 basis- point hike at the May meeting just before the text of Powell’s comments to a National Association of Business Economics conference was released.Other metrics such as the CME FedWatch tool showed a 48.4% probability of a 50-basis-point hike in May.(This story inserts dropped name, Powell, in 2nd paragraph) More

Jerome H. Powell, the Federal Reserve chair, said on Monday that the central bank was prepared to more quickly withdraw support from the economy if doing so proved necessary to bring rapid inflation under control.Mr. Powell signaled that the Fed could make big interest rate increases and push rates to relatively high levels in its quest to cool off demand and temper inflation, which is running at its fastest pace in 40 years. His comments were the clearest statement yet that the central bank was ready to forcefully attack rapid price increases to make sure that they do not become a permanent feature of the American economy.“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,” Mr. Powell said during remarks to a conference of business economists.Policymakers raised interest rates by a quarter point last week and forecast six more similarly sized increases this year. On Monday, Mr. Powell foreshadowed a potentially more aggressive path. A restrictive rate setting would squeeze the economy, slowing consumer spending and the labor market — a move akin to the Fed’s hitting the brakes rather than just taking its foot off the accelerator.“If we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so,” Mr. Powell said. “And if we determine that we need to tighten beyond common measures of neutral and into a more restrictive stance, we will do that as well.”Asked what would keep the Fed from raising interest rates by half a percentage point at its next meeting in May, Mr. Powell replied, “Nothing.” He said the Fed had not yet made a decision on its next rate increase but noted that officials would make a supersized move if they thought one was appropriate.“The expectation going into this year was that we would basically see inflation peaking in the first quarter, then maybe leveling out,” Mr. Powell said. “That story has already fallen apart. To the extent that it continues to fall apart, my colleagues and I may well reach the conclusion that we’ll need to move more quickly.”Stocks fell in response to Mr. Powell’s comments and were down 0.6 percent by the time he finished speaking in the early afternoon; the S&P 500 index closed the day down 0.4 percent. Higher interest rates can push down stock prices as they pull money away from riskier assets — like shares in companies — and toward safer havens, like bonds, and as they make money more expensive to borrow for businesses. The yield on the benchmark 10-year Treasury note rose as high as 2.3 percent as Mr. Powell was speaking, and the yield on two-year Treasurys rose above 2 percent for the first time since 2019.Rising rates can especially hurt share prices if they tank economic growth or cause the economy to contract.While the Fed has often caused recessions by raising interest rates in a bid to slow down demand and cool off price increases, Mr. Powell voiced optimism that the central bank could avoid such an outcome this time, in part because the economy is starting from a strong place. Even so, he acknowledged that guiding inflation down without severely hurting the economy would be a challenge.“No one expects that bringing about a soft landing will be straightforward in the current context,” Mr. Powell said.But getting price gains under control is the Fed’s priority, and while the central bank had been hoping for inflation to fade as pandemic disruptions abate, Mr. Powell was adamant that it could no longer watch and wait for that to happen.In addition to raising rates, the Fed plans to reduce its large bond holdings by allowing securities to expire, which would push up longer-term borrowing costs, including mortgage rates, helping to take steam out of the economy. Mr. Powell emphasized that the balance sheet shrinking could begin imminently.Action on the balance sheet “could come as soon as our next meeting in May, though that is not a decision that we have made,” Mr. Powell said.The Fed is preparing to pull back support even as Russia’s invasion of Ukraine stokes economic uncertainty. The conflict has pushed energy prices higher, something that the Fed would typically discount, since it is likely to fade eventually. But Mr. Powell said it could not ignore the increase when inflation was already high.The Russia-Ukraine War and the Global EconomyCard 1 of 6Rising concerns. More