Economy

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South Sudan, where hundreds of thousands of people died as a result of civil war from 2013-2018, is experiencing one of the world’s worst humanitarian crises as a result of persistent conflict, natural disasters and poverty.U.N. missions there have said South Sudanese authorities are holding up United Nations fuel tankers over a tax dispute, jeopardizing the delivery of millions of dollars of aid during a humanitarian crisis.”Despite assurances, the government has yet to effectively reduce the unacceptably high costs, bureaucratic obstacles, and risks of providing humanitarian assistance to South Sudanese people in need,” State Department spokesman Matthew Miller said.”This raises questions about its willingness and capacity to abide by its 2018 peace agreement commitment to create an enabling environment for the delivery of humanitarian assistance and protection,” he said in a statement.The visa restrictions would make those cited ineligible entry into the United States.    More

Euro zone inflation dropped to a three-year low of 2.2% in August, flash figures from statistics agency Eurostat showed Friday.
The core rate — excluding the more volatile components of energy, food, alcohol and tobacco — fell to 2.8% in August from 2.9% in July, also matching a Reuters poll.
Markets have fully priced for the ECB to lower interest rates by another 25 basis points in September, after the institution made its first rate reduction in June, and for another 25 basis point cut before the end of the year.

A woman takes a selfie photo, with the Eiffel Tower in the background, at Surcouf street in Paris, on July 23, 2024, ahead of the Paris 2024 Olympic Games. 
Mauro Pimentel | Afp | Getty Images

Euro zone inflation dropped to a three-year low of 2.2% in August, flash figures from statistics agency Eurostat showed Friday, boosting expectations for a September rate cut from the European Central Bank.
The decline from 2.6% in July was in line with the forecast of economists polled by Reuters.

The core rate — excluding the more volatile components of energy, food, alcohol and tobacco — fell to 2.8% in August from 2.9% in July, also matching a Reuters poll.
The euro continued to slide against sterling following the release, trading 0.1% lower at 0.8408 pounds. The euro nudged 0.04% higher against the U.S. dollar to $1.1083 as investors gear up from a September rate cut from the Federal Reserve in its first step toward monetary easing in the current cycle.
It come after price rises in Germany, the euro area’s biggest economy, cooled more than expected to 2% for the month, on a euro zone harmonized basis.
Economists at ING expect euro zone core inflation to remain stubbornly above 2.5% for the rest of the year amid stickiness in goods and services.
Markets have fully priced for the ECB to lower interest rates by another 25 basis points in September, after the institution made its first rate reduction in June, and for another 25 basis point cut before the end of the year.

Kyle Chapman, foreign exchange markets analyst at Ballinger Group, said there were nonetheless details in the release that would concern ECB policymakers, particularly services inflation at 4.2%.
“The positive headline is purely down to energy price effects, and it masks the fact that little real progress in underlying pressures has been made here,” Chapman said in a note.
“Now at the highest level since last October, services inflation has been glued to the 4% area for almost a year now and has headed in the wrong direction since the spring.”
Speaking ahead of the latest data print, Ed Smith, co-chief investment officer at Rathbones Asset Management, told CNBC’s “Squawk Box Europe” on Friday the central bank was on track for further rate cuts, noting ECB President Christine Lagarde’s focus on wage inflation.

“Negotiated wages are a big thing in the euro zone, [they] account for about 80% of the workforce [who] have wage growth negotiated for them. Big drop in euro zone-wide negotiated wages in the second quarter, falls in other indicators like the Indeed.com listings … the ECB’s telephone survey of businesses … also points to falling wage intention.”
“But there is some stickiness, the latest [purchasing managers’ index] numbers, service sector surveys showed some stickiness in the price components of that,” he added, noting that would keep some ECB voting members cautious. More

The two presidential nominees are talking about their approaches for solving America’s affordability crisis. But would their plans work?America’s gaping shortage of affordable housing has rocketed to the top of voter worry lists and to the forefront of campaign promises, as both the Democratic nominee, Kamala Harris, and the Republican candidate, Donald J. Trump, promise to fix the problem if they are elected.Their two visions of how to solve America’s affordable housing shortage have little in common, and Ms. Harris’s plan is far more detailed. But they do share one quality: Both have drawn skepticism from outside economists.Ms. Harris is promising a cocktail of tax cuts meant to spur home construction — which several economists said could help create supply. But she is also floating a $25,000 benefit to help first-time buyers break into the market, which many economists worry could boost demand too much, pushing home prices even higher. And both sets of policies would need to pass in Congress, which would influence their design and feasibility.Mr. Trump’s plan is garnering even more doubt. He pledges to deport undocumented immigrants, which could cut back temporarily on housing demand but would also most likely cut into the construction work force and eventually limit new housing supply. His other ideas include lowering interest rates, something that he has no direct control over and that is poised to happen anyway.Economist misgivings about the housing market policy plans underline a somber reality. Few quick fixes are available for an affordable housing shortfall that has been more than 15 years in the making, one that is being worsened by demographic and societal trends. While ambitious promises may sound good in debates and television ads, actual policy attempts to fix the national housing shortfall are likely to prove messy and slow — even if they are sorely needed.Here’s what the candidates are proposing, and what experts say about those plans.Harris: Expand Supply Using Tax Credits.Ms. Harris is promising to increase housing supply by expanding the Low-Income Housing Tax Credit, providing incentives for state and local investment in housing and creating a $40 billion tax credit to make affordable projects economically feasible for builders.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

$75 per monthComplete digital access to quality FT journalism with expert analysis from industry leaders. Pay a year upfront and save 20%.What’s included Global news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print edition More

$75 per monthComplete digital access to quality FT journalism with expert analysis from industry leaders. Pay a year upfront and save 20%.What’s included Global news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print edition More

A three-year analysis of unconditional cash stipends concluded that the initiative has had some success, but not the transformational impact its proponents hoped for.Silicon Valley billionaires and anti-poverty activists don’t have a lot in common, but in recent years they’ve joined forces around a shared enthusiasm: programs that guarantee a basic income.Tech entrepreneurs like Sam Altman, chief executive of OpenAI, have promoted direct cash transfers to low-income Americans as a way to cushion them from what the entrepreneurs anticipate could be widespread job losses caused by artificial intelligence. Some local politicians and community leaders, concerned about growing wealth inequality, have also put their faith in these stipends, known as unconditional cash or, in their most ambitious form, a universal basic income.Dozens of small pilot projects testing unconditional cash transfers have popped up in communities around the country, from Alaska to Stockton, Calif. Andrew Yang, an entrepreneur, put the idea of $1,000 monthly payments for all adults at the center of his 2020 presidential campaign. The idea of cash transfers gained broader popularity during the pandemic, as the federal government introduced stimulus checks and child tax credits, and child poverty declined.While some pilot projects have shown encouraging results, they have been small scale. That changed this summer, when a research project involving several thousand people, backed by Mr. Altman and called OpenResearch, released findings from what is so far the country’s largest experiment with unconditional cash transfers.If proponents of unconditional cash hoped the findings of the OpenResearch study would prove its benefits once and for all, their hopes were at least partly dashed. People gained flexibility to spend on basic needs, but the cash didn’t transform their net worth or their mental or physical health. Some researchers and guaranteed income proponents argue that the study shows that cash transfers are only a small piece of the larger puzzle of how to improve the financial well-being of low-income people.“Cash transfers probably do less to improve people’s lives than the proponents of them thought that they would,” said Sarah Miller, an author of the study and economist at the University of Michigan’s Ross School of Business. “The flip side is that they probably don’t have the harmful effects that detractors were concerned about.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

Central bankers are lowering borrowing costs, but that won’t be a cure-all for a widespread lack of affordable housing.To Moira Gallagher, 38, buying a house in Anchorage would be a step toward financial stability for her growing family. But even with a six-figure household income and stable jobs, she and her husband have struggled to make a purchase.High mortgage rates, limited housing supply and historically poor affordability have kept buying a home stubbornly out of reach for Ms. Gallagher, an economic researcher who is expecting her third child. Three- or four-bedroom homes in good school districts are both hard to come by and prohibitively expensive.“It makes it hard to feel secure,” she said. “It affects everything.”From Anchorage to Amsterdam, many developed and even emerging economies are confronting a similar problem: Housing supply is failing to meet demand, helping to push home prices to levels that are out of reach even for middle-income families.Affordability problems have been exacerbated by high central bank interest rates, which officials across the globe have been using to tackle rapid inflation. Those policy rates trickle through financial markets to elevate mortgage rates — making it even more expensive for borrowers to buy a home and for builders to finance construction for new houses and apartments.The second part of that equation is now poised to change. Central banks in many economies are lowering interest rates or preparing to do so imminently. The European Central Bank and Bank of England are already cutting borrowing costs, and the chair of the U.S. Federal Reserve signaled last week that it would start reductions in September.But those rate cuts are unlikely to be a panacea for housing affordability.While the shift in central bank stance is already translating into somewhat lower mortgage rates in many countries, borrowing costs are not expected to fall back to the levels that prevailed during the 2010s. Several economists said 30-year mortgage rates in the United States, for instance, could end up in the 5.5 to 6 percent range, down from their 7.5 percent peak last year but still up notably from the 4 percent that was normal before the pandemic.Home Prices Jump in Developed WorldHow inflation-adjusted home prices are shaping up across advanced economies.

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O.E.C.D. house price indexes, 2015=100
Data reflects first quarter of each year.Source: Organisation for Economic Co-operation and DevelopmentBy The New York TimesWhat Share of Income Does a Typical Home Cost? Across metro areas in the United States, the cost of owning a typical home has been rising as a share of the local median income.

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Share of income that would go to owning standard home
Source: The Atlanta Fed’s Home Ownership Affordability MonitorBy The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More