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    I.M.F. Sees Signs of Cooling in U.S. Economy

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    The International Monetary Fund warned that inflation remained stubbornly high and that protectionism posed a risk to the global economic outlook.The United States economy is growing more slowly than expected and inflation remains stubbornly high around the world, two developments that pose risks to the global economy, the International Monetary Fund said on Tuesday.The I.M.F.’s most recent World Economic Outlook report underscored the lingering vulnerabilities that could derail a so-called soft landing for the world economy — one in which a global recession is avoided despite aggressive efforts by central banks to tame rapid inflation by making it more expensive to borrow money.The new report said the I.M.F. still expected growth in global output to hold steady at 3.2 percent in 2024. That would be unchanged from its April projections. The fund also expected growth to be slightly higher next year, at 3.3 percent. However, the closely watched projections included several caveats and warned that the global economy was in a “sticky spot.”Most notable were signs of weakness in the United States, which has helped power the global recovery from the pandemic. The I.M.F. now expects the United States economy to grow more slowly than it did previously as a result of weaker consumer spending and a softening job market.The report forecast that U.S. economic growth would increase to 2.6 percent in 2024 from 2.5 percent in 2023, a slight downgrade from its previous projection of 2.7 percent. “The United States shows increasing signs of cooling, especially in the labor market, after a strong 2023,” Pierre-Olivier Gourinchas, the I.M.F.’s chief economist, said in an essay that accompanied the report.Global inflation is still expected to ease to 5.9 percent this year from 6.7 percent in 2023. But the I.M.F. noted that prices for services remained hot. That could force central banks — which have raised interest rates to their highest levels in years — to keep borrowing costs elevated longer, putting growth at risk for both advanced and developing economies.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

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    Fed’s Powell Welcomes Cooler Inflation but Steers Clear of Rate Cut Timing

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    Jerome H. Powell, the chair of the Federal Reserve, avoided signaling when the Fed would cut rates at a time when some economists are wondering why officials would wait.Jerome H. Powell, the chair of the Federal Reserve, avoided sending a clear signal about when the central bank would begin to cut interest rates even as he welcomed a recent cool-down in inflation.“Today I’m not going to be sending any signals one way or the other on any particular meeting,” Mr. Powell said while speaking at the Economic Club of Washington on Monday. “Just to ruin the fun right at the beginning.”The Fed’s chair was speaking after several inflation reports in a row suggested that price increases were moderating in earnest, a development that had spurred some economists to think that it could make sense for officials to cut interest rates sooner rather than later. The Fed meets at the end of July and then again in September, and investors have been largely expecting that officials will begin to lower borrowing costs at the September meeting.Economists at Goldman Sachs wrote in a research note on Monday that cutting rates this month could be appropriate, given how much inflation had come down.“If the case for a cut is clear, why wait another seven weeks before delivering it?” Jan Hatzius, Goldman’s chief economist, wrote in the note, explaining that while his team still thinks that a rate cut in September is more likely, there is a “solid rationale” for an earlier move.But Mr. Powell did little to open the door to an earlier move during his Monday remarks. While he said recent inflation reports had added to central bankers’ confidence that price increases were coming down, he avoided giving a clear signal about when officials would have enough confidence to lower borrowing costs.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

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    Biden Policies Offer Benefits, but Little Political Payoff, in Pennsylvania

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    On a blighted industrial corridor in a struggling section of Erie, Pa., a long-abandoned iron factory has been humming with activity for the first time in decades. Construction crews have been removing barrels of toxic waste, knocking down crumbling walls and salvaging rusted tin roofing as they prepare to convert the cavernous space into an events venue, advanced manufacturing hub and brewery.The estimated $25 million project is the most ambitious undertaking the Erie County Redevelopment Authority has ever attempted. It was both kick-started and remains heavily funded by various pots of money coming from Biden administration programs.Yet there is no obvious sign of President Biden’s influence on the project. Instead, the politician who has taken credit for the Ironworks Square development effort most clearly is Representative Mike Kelly, a Pennsylvania Republican who voted against the 2021 bipartisan infrastructure law that is helping to fund the renovation.It is one example of a larger problem Mr. Biden faces in Pennsylvania, a swing state that could decide the winner of the 2024 election. In places like Erie, a long-struggling manufacturing hub bordering the Great Lake that is often an election bellwether, Mr. Biden is struggling to capitalize on his own economic policies even when they are providing real and visible benefits. Now, an assassination attempt on former President Donald J. Trump at a rally in Butler County, Pa., could further influence voters, though exactly how it will sway them remains unclear. But Mr. Biden’s standing in his home state was already growing precarious before a gunman opened fire on Saturday, killing one attendee and injuring Mr. Trump.In a poll of likely Pennsylvania voters conducted from July 9 to 11, just before the shooting, 48 percent said they would vote for Mr. Trump and 45 percent said they would vote for Mr. Biden in a two-way race.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

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    Republican Party Rejects Free-Market Economics in Favor of Trump’s Signature Issues

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    Donald J. Trump’s presidency was a major turn away from the Republican Party’s long embrace of free-market economics. If the Republican platform is any indication, a second Trump term would be a near-complete abandonment.The 2024 platform, which was released last week and is expected to infuse the Republican National Convention that starts in Milwaukee on Monday, promises action on what have become Mr. Trump’s signature issues: It pledges to pump up tariffs, encourage American manufacturing and deport immigrants at a scale that has never been seen before.What it lacks are policy ideas that have long been dear to economic conservatives. The platform does not directly mention fiscal deficits, and, apart from curbing government spending, it does not make any clear and detailed promises to rein in the nation’s borrowing. Other policies it proposes — including cutting taxes and expanding the military — would most likely swell the nation’s debt.The Republican platform also does not mention exports or encouraging trade. And while the document insists that the party will lower inflation, long a pertinent issue for economic conservatives, it fails to lay out a realistic plan for doing that. Chapter One of the document, titled “Defeat Inflation and Quickly Bring Down All Prices,” suggests that oil-friendly policies, slashed government spending, decreased regulation, fewer immigrants and restored geopolitical stability will lower price increases. But few economists agree.In fact, many analysts have said Mr. Trump’s suggestions on the campaign trail so far could lift prices, particularly his proposals to deport immigrants en masse and apply tariffs of perhaps 10 percent on most imports and levies of 60 percent on goods from China.“Measures to reduce migration and to protect the economy through tariffs and trade blockages are all highly inflationary,” Steven Kamin, a former Fed staff official who is now at the conservative American Enterprise Institute, said in an interview last week. When it comes to both deficits and trade, he said, there is a “populist dismissal of the prescriptions of academics and elites.”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

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    Once a G.O.P. Rallying Cry, Debt and Deficits Fall From the Party’s Platform

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    Fiscal hawks are lamenting the transformation of the party that claimed to prize fiscal restraint and are warning of dire economic consequences.When Donald J. Trump ran for president in 2016, the official Republican platform called for imposing “firm caps on future debt” to “accelerate the repayment of the trillions we now owe.”When Mr. Trump sought a second term in 2020, the party’s platform pummeled Democrats for refusing to help Republicans rein in spending and proposed a constitutional requirement that the federal budget be balanced.Those ambitions were cast aside in the platform that the Republican Party unveiled this week ahead of its convention. Nowhere in the 16-page document do the words “debt” or “deficit” as they relate to the nation’s grim fiscal situation appear. The platform included only a glancing reference to slashing “wasteful” spending, a perennial Republican talking point.To budget hawks who have spent years warning that the United States is spending more than it can afford, the omissions signaled the completion of a Republican transformation from a party that once espoused fiscal restraint to one that is beholden to the ideology of Mr. Trump, who once billed himself the “king of debt.”“I am really shocked that the party that I grew up with is now a party that doesn’t think that debt and deficits matter,” said G. William Hoagland, the former top budget expert for Senate Republicans. “We’ve got a deficit deficiency syndrome going on in our party.”The U.S. national debt is approaching $35 trillion and is on pace to top $56 trillion over the next decade, according to the Congressional Budget Office. At that point, the United States would be spending about as much on interest payments to its lenders — $1.7 trillion — as it does on Medicare.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

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    Fed Chair Powell Welcomes Cooling Inflation

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    Jerome H. Powell, the chair of the Federal Reserve, delivered optimistic remarks to Senators as inflation and the job market slow gently.Jerome H. Powell, the chair of the Federal Reserve, indicated on Tuesday that recent inflation data had given the central bank more confidence that price increases were returning to normal, and that continued progress along these lines would help to pave the way toward a central bank rate cut.“The Committee has stated that we do not expect it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2 percent,” Mr. Powell said.He added that data earlier this year failed to provide such confidence, but that recent inflation readings “have shown some modest further progress, and more good data would strengthen our confidence that inflation is moving sustainably toward 2 percent.”Mr. Powell delivered the remarks on Tuesday in an appearance before the Senate Banking Committee. While Mr. Powell avoided zeroing in on a specific month for when the Fed might begin to cut interest rates, he also did little to push back on growing expectations that a reduction could come in September. Fed officials meet in late July, but few economists expect a move that early.Mr. Powell said he was “not going to be sending any signals about the timing of any future actions” in response to a lawmaker question about when rate cuts might come.The chair’s congressional testimony came at a delicate moment for the central bank. Fed officials are trying to figure out when to begin cutting interest rates, which they have held at the highest rate in decades for roughly a year now. But as they weigh that choice, they must strike a careful balance: They want to keep borrowing costs high long enough to cool the economy and fully stamp out rapid inflation, but they also want to avoid overdoing it, which could crash the economy too much and cause a recession.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

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    Reliability of U.S. Economic Data Is in Jeopardy, Study Finds

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    A report says new approaches and increased spending are needed to ensure that government statistics remain dependable and free of political influence.Federal Reserve officials use government data to help determine when to raise or lower interest rates. Congress and the White House use it to decide when to extend jobless benefits or send out stimulus payments. Investors place billions of dollars worth of bets that are tied to monthly reports on job growth, inflation and retail sales.But a new study says the integrity of that data is in increasing jeopardy.The report, issued on Tuesday by the American Statistical Association, concludes that government statistics are reliable right now. But that could soon change, the study warns, citing factors including shrinking budgets, falling survey response rates and the potential for political interference.The authors — statisticians from George Mason University, the Urban Institute and other institutions — likened the statistical system to physical infrastructure like highways and bridges: vital, but often ignored until something goes wrong.“We do identify this sort of downward spiral as a threat, and that’s what we’re trying to counter,” said Nancy Potok, who served as chief statistician of the United States from 2017 to 2019 and was one of the report’s authors. “We’re not there yet, but if we don’t do something, that threat could become a reality, and in the not-too-distant future.”The report, “The Nation’s Data at Risk,” highlights the threats facing statistics produced across the federal government, including data on education, health, crime and demographic trends.But the risks to economic data are particularly notable because of the attention it receives from policymakers and investors. Most of that data is based on surveys of households or businesses. And response rates to government surveys have plummeted in recent years, as they have for private polls. The response rate to the Current Population Survey — the monthly survey of about 60,000 households that is the basis for the unemployment rate and other labor force statistics — has fallen to about 70 percent in recent months, from nearly 90 percent a decade ago.

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    Current Population Survey response rate
    Source: Bureau of Labor StatisticsBy 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

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    U.S. Job Growth Extends Streak, but Signs of Concern Emerge

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    A gain of 206,000 in June exceeded forecasts. Hiring was concentrated in a few parts of the economy, however, and unemployment rose to 4.1 percent.Halfway through the year, and four years removed from the downturn set off by the coronavirus pandemic, the U.S. job engine is still cruising — even if it shows increased signs of downshifting.Employers delivered another solid month of hiring in June, the Labor Department reported on Friday, adding 206,000 jobs in the 42nd consecutive month of job growth.At the same time, the unemployment rate ticked up one-tenth of a point to 4.1 percent, up from 4 percent and surpassing 4 percent for the first time since November 2021.The gain in jobs was slightly greater than most analysts had forecast. But totals for the two previous months were revised downward, and the uptick in unemployment was unexpected. That has led many economists and investors to shift from having full faith in the jobs market to having some concern for it.“These numbers are good numbers,” said Claudia Sahm, the chief economist for New Century Advisors, cautioning against overly negative interpretations of the report.But “the importance of the unemployment rate is it can actually tell us a bit about where we might be going,” she added, noting that the rate had been drifting up since hitting a half-century low of 3.4 percent early last year.Wage growth slowed in JuneYear-over-year percentage change in earnings vs. inflation More