China’s Inflation Rate Eases
China’s inflation rate eased for the second consecutive month in March, despite signs of economic recovery after strict Covid-19 controls lasting nearly three years. Consumer prices only rose by 0.7% compared to the previous year, according to China’s National Bureau of Statistics. This was the lowest annual rate of inflation since September 2021 and lower than economists’ expectations. These figures suggest that the lifting of Covid-19 controls in China is not causing significant inflationary pressures, unlike in other major economies.
Low-Income Countries Face Debt Challenge
Low-income countries are facing a severe challenge this year as they grapple with the highest bills for servicing foreign debts in 25 years. A study by debt campaign group Debt Justice, which will be published on Tuesday, reveals that repayments on public debt owed to non-residents will account for more than 16% of government revenues on average in 2023 for a group of 91 of the world’s poorest countries. This figure is expected to rise to almost 17% next year, putting spending on health and education at risk. This increase in debt payments follows a rise in global borrowing costs last year due to central banks’ efforts to counter high inflation with rapid rate increases.
US Warehousing Employment Hits Low
Employment in the warehousing sector in the United States has reached its lowest level in over a year, with companies cutting payrolls due to a downturn in the goods-moving economy. According to the seasonally adjusted Labor Department preliminary jobs report, 11,800 warehouse and storage jobs were cut from February to March. Since June, warehousing companies have reduced employment by nearly 50,000 jobs as overstocked retailers scaled back inventories due to wavering consumer demand. Employment at U.S. warehouses had surged by nearly 700,000 jobs from April 2020 to June 2022 during the Covid-19 pandemic when consumers turned to online shopping, leading to a rush in job openings at fulfillment centers.
Taiwan VS China
Taiwan’s president, Tsai Ing-wen, has criticized China for its military drills around the island, calling them irresponsible. China recently conducted three days of military exercises, with 91 aircraft flying into Taiwan’s Air Defense Identification Zone, a buffer region. In a statement posted on Facebook, President Tsai expressed concern that these exercises have caused instability, while Japan’s defense minister described them as “intimidating”.
US and Philippines Military Exercise
The United States and the Philippines have begun their largest joint military exercise in 31 years, highlighting their efforts to strengthen their alliance in response to China’s growing assertiveness. The annual flagship drill, Balikatan, had been scheduled for months, but its opening on Tuesday, just after China concluded its three-day maneuvers around Taiwan, underscores the significance of the Philippines in the region. Additionally, the U.S. and Philippine foreign and defense ministers are set to hold the first 2+2 meeting in seven years in Washington on Tuesday, reflecting the increased security cooperation between the allies.
Mass Shooting in Kentucky
A mass shooting in Louisville, Kentucky, carried out by a bank worker, resulted in the death of five colleagues and the injury of nine others. The gunman live-streamed the massacre on Instagram before being shot dead by local police. This incident adds to the alarming trend of mass shootings in the United States, with 146 mass shootings recorded in 2023 so far, the highest number at this point in the year since 2016.
UK Consumer Spending Rises Slightly
Data published on Tuesday revealed that UK consumer spending increased slightly last month, but fell far behind the rising inflation rate. Households continued to tighten their belts due to high energy bills and other cost pressures. Barclays’ consumer spending index, which represents nearly half of credit and debit card transactions nationwide, showed a year-on-year increase of 4% in card spending in March. However, sales of household and DIY goods saw a boost as people undertook home renovations ahead of the summer season, and subscription purchases also increased due to the latest season premieres of popular television shows.
Wall Street Journal Reporter Wrongfully Detained
Evan Gershkovich, the Wall Street Journal reporter who has been detained in Russia, has been designated by America’s State Department as “wrongfully detained”. This official classification, which normally takes months to obtain, moves Mr. Gershkovich’s case to a specific section within the State Department and expands the government’s authority to work towards securing his release. Mr. Gershkovich was arrested on March 29th and charged with espionage, although the Wall Street Journal denies the allegations.
Pharma Industry Urges Reversal of Abortion Ruling
The US pharmaceutical industry is urging the reversal of a judicial ruling that could revoke regulatory approval for a commonly used abortion drug, arguing that it would weaken the authority of government agencies and pose risks to the industry. Last week, more than 400 senior pharma and biotech executives signed an open letter strongly condemning the ruling by Texas federal judge Matthew Kacsmaryk, as it could effectively ban the use of mifepristone for terminating pregnancies nationwide. Mifepristone, along with another pill, accounts for over half of all abortions in the US.
Thousands of Junior Doctors Strike in England
Thousands of junior doctors in England are set to go on an unprecedented four-day strike starting on Tuesday, resulting in the cancellation of an estimated 350,000 appointments and operations, as the National Health Service (NHS) focuses on urgent and critical care. Hospital trusts across the country are scrambling to cover the gaps in rotas, deploying consultants, nurses, and other health professionals to maintain essential services. However, many patients have already had their planned treatments cancelled, further exacerbating the already record-high waiting lists.
Biden Administration Reviews AI Accountability
The Biden administration has initiated a review of potential checks on artificial intelligence (AI) tools such as ChatGPT, amid growing concerns about the potential for discrimination and spread of harmful information. The Commerce Department issued a formal public request for comment on accountability measures, including the possibility of certifying potentially risky new AI models before their release. This marks a first step towards potential regulation to ensure responsible and ethical use of AI technology.
China and Australia Trade Dispute Resolution
China and Australia have taken steps to resolve their trade dispute over barley, indicating a possible improvement in bilateral relations despite Australia’s deepening military ties with the United States. Chinese officials have agreed to review the 80.5% duties on Australian barley imports in the coming months, and in return, Australia has agreed to suspend its case at the World Trade Organization challenging the barley restrictions during the review period. This agreement signals a positive development in repairing ties between Australia and China, following a diplomatic spat during the pandemic when Australia called for an investigation into the origins of Covid-19, resulting in China imposing restrictions on various Australian imports.
US Second-Home Mortgage Demand Declines
Lock-ins for second-home mortgages in the US have declined by 52.2% compared to pre-pandemic levels in March, as reported by Redfin on Monday. Mortgage rate locks for vacation homes reached their lowest point since 2016 in February and did not recover significantly in March, indicating a decreased demand for second homes. In contrast, mortgage rate locks for primary homes only dropped by 13.1% in March compared to pre-pandemic levels, as defined by January and February 2020, after adjusting for seasonality.