Economic growth in China drops to 7.4%
China’s economic growth slowed to a 24-year low of 7.4 percent in the first quarter, raising the risk of job losses and a potential impact on its trading partners. The figure reported Wednesday by the government was down from the previous quarter’s 7.7 percent. It came in below the full-year official growth target of 7.5 percent announced last month. Beijing is trying to guide China to slower, more sustainable growth based on domestic consumption rather than trade and investment following a decade of explosive expansion. Growth in retail sales, factory output and investment also slowed, raising the possibility of politically dangerous job losses.
U.S. inflation remained in check last month
Lower U.S. gasoline prices kept consumer inflation in check last month, helping to offset higher costs for food and clothing. The Labor Department said that the consumer price index rose 0.2 percent in March, after scant 0.1 percent increases in the previous two months. Prices have risen just 1.5 percent year over year. That remains well below the Federal Reserve’s 2 percent target for inflation. Excluding the volatile food and energy categories, core prices increased 0.2 percent in March and 1.7 percent in the past year. Prices at the gas pump tumbled 1.7 percent in March, lowering costs for the overall energy category. But food prices jumped 0.4 percent, led by increases in eggs, milk, butter, oranges, pork chops, ground beef and poultry. Prices for clothing, used cars and cable television also rose.
Homebuilder confidence less than expected
Confidence among U.S. homebuilders rose less than forecast in April as sales and prospective buyer traffic stagnated, showing the residential real estate market struggled to improve after a harsh winter. The National Association of Home Builders/Wells Fargo builder sentiment gauge climbed to 47 this month from a revised 46 in March that was weaker than initially reported, figures from the Washington-based group showed. Readings greater than 50 mean more respondents report good market conditions. The median forecast in a Bloomberg survey called for 49. Tight credit for some home buyers and limited availability of lots are restraining builder sentiment months after snowstorms and freezing temperatures held back construction.
U.S. doesn’t label China currency manipulator
The Obama administration is raising concern about the value of China’s currency but is declining, as in recent years, to accuse Beijing of manipulating it. The Treasury Department said China’s currency, the renminbi, has appreciated but not as fast or as much as needed. Treasury reached that conclusion in its twice-yearly report on whether nations are manipulating currencies to gain trade advantages. China has announced a modest easing of exchange-rate controls, which have been criticized by Washington and other nations. The action last month was among a series of reform initiatives aimed at making its slowing economy more efficient. The issue has been a point of conflict because a weaker renminbi makes Chinese goods cheaper for Americans and U.S. goods costlier in China.
Heinz to offer buyout to Pittsburgh workers
The new management at H.J. Heinz Co. this month has acknowledged that the changes being made at the historic Pittsburgh company have not worked out for a lot of the workers that it inherited. Heinz, which was acquired for more than $28 billion last June by Berkshire Hathaway and 3G Capital, has offered employees — those who stayed around through the sale hoping that the new owners would be a good fit — a second chance to leave. Voluntary buyout offers were sent in letters to 775 employees in the Pittsburgh area last week, with deals that start at six months’ severance pay and increase depending on years of service. Workers have until Monday to make up their minds.
FROM NEWS SERVICES