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Yahoo
09-06-2025
- Business
- Yahoo
Sharp slowdown in intermodal rail a warning for H2: AAR
In May, U.S. rail freight volumes offered a complex picture of both resilience and caution within the industry. Total U.S. rail carloads increased by 5.9% compared to the previous year, according to a monthly update from the Association of American Railroads, marking a slight decline from April's growth of 6.2%. This upward trajectory was propelled by gains across 13 out of 20 carload commodity categories, suggesting a broad-based improvement in demand within various industrial sectors. Weekly carload originations hovered around an average of 224,000, just shy of the figures recorded in March and April, reflecting a stable flow of carloads across the nation. However, the intermodal sector, which encompasses containers and trailers, presented a more subdued picture. With marginal growth of just 0.6% year over year, intermodal traffic marked its weakest percentage increase in the past 21 months. This sluggish performance can be attributed to declines in port activities and a cooling global trade atmosphere, resulting in noticeably lower import volumes. The closing weeks of May saw an intermodal decline of approximately 1.5% to 1.8% from the previous year, hinting at caution from shippers and retailers possibly resulting in decreased inventory and import levels as consumer goods demand these varying freight dynamics, the AAR Freight Rail Index shed 3.2% in May from April, the most significant drop in five months, underscoring broad-based softness particularly in the economically sensitive intermodal categories. This decline suggests significant challenges facing consumer goods and intermediate materials traffic. Situating these freight dynamics within the broader economic context reveals a mixed picture. The U.S. labor market remains relatively robust, with 139,000 new jobs added in May. However, all of this growth occurred in health care and hospitality, sectors less immediately tied to freight rail demand. The unemployment rate steadied at 4.2%, yet indicators show the labor market may merely be maintaining its current level without indicating expansive growth. Consumer spending — a bellwether for economic health — grew a meager 0.1% in April, with a notable decrease in goods spending, signaling that households are becoming more frugal in response to persisting uncertainties. Moreover, the manufacturing sector continued its sluggish trend with the ISM Manufacturing PMI (Purchasing Managers Index) registering at 48.5%, a level below the threshold indicating growth. Ongoing stagnation in manufacturing output reflects a sector that remains idle with little sign of imminent expansion. Compounding these concerns, the service sector, a previous economic highlight, showed signs of faltering with the PMI slipping below 50%, signaling ahead to the second half of 2025, the rail industry faces uncertainty. Although strong carload growth in the coal, chemicals and grain sectors provides optimism, challenges remain. The persistence of high inventory levels, coupled with decreased consumer demand, is a key headwind that carriers must navigate. Manufacturing output and the housing market's stagnation further cloud prospects, AAR said. Subscribe to FreightWaves' Rail e-newsletter and get the latest insights on rail freight right in your inbox. Find more articles by Stuart Chirls here. Greenbrier: Elevating rail safety standards with state-of-the-art training Predicting the unpredictable for intermodal Regional Rail expands shortline roster, acquires Minnesota CommercialHow freight rail fueled a new luxury overnight train startup The post Sharp slowdown in intermodal rail a warning for H2: AAR appeared first on FreightWaves. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
USA Today
03-06-2025
- Business
- USA Today
How Trump tariffs make American manufacturers grate, not greater
How Trump tariffs make American manufacturers grate, not greater One of the key promises behind President Donald Trump's tariff strategy was to revive U.S. manufacturing. But the policies intended to lay that foundation are currently having the opposite effect. During the past three months, as President Donald Trump and his administration have worked to finalize tariff rates across dozens of countries and product categories, U.S. manufacturing has contracted—according to the Institute for Supply Management's May report. '57% of the manufacturing sector's GDP contracted in May," Susan Spence, chair of the Institute for Supply Management's Manufacturing Business Survey Committee, said during a press briefing Monday. "That's up from 41% in April. The contraction is deepening.' Exclusive: Trump pushes countries for best offers as tariff deadline looms Manufacturing continued to contract in May The institute's Purchasing Managers Index fell to 48.5% in May, 0.2 percentage points lower than April's 48.7%. A number consistently below 50% means manufacturing is contracting. \"The headwinds from tariff increases are starting to show up in economic data," wrote Bill Adams, chief economist for Comerica. "The ISM Manufacturing PMI reports that tariffs are a drag on business, as is the uncertainty about where tariffs will settle over the longer term." As part of its monthly reports, the Institute for Supply Management includes anonymous quote from its survey panel on current business conditions. In the latest release, every comment touched on tariffs. One manufacturing manager expressed cautious optimism over the easing of tariffs in May—but remained concerned about the ongoing uncertainty. 'Tariff whiplash continues while the easing of tariff rates between the U.S. and China in May was welcome news, the question is what happens in 90 days. We are doing extensive work to make contingency plans, which is hugely distracting from strategic work." What manufacturing managers said about tariffs in May Below, managers from various industries reported how tariffs affected their organization in May, according to those quoted in the Institute for Supply Management's release: Trump administration asks for countries' best offers 'Production is frozen," Spence said Monday. "Growth can't resume until we get clarity on tariff policy.' Could some of the uncertainty surrounding tariffs be resolved soon? An exclusive report from Reuters on Monday said the Trump administration has set a deadline of June 4 for countries to give the United States their best and final tariff offers. The deadline would give the administration five weeks before its July 8 deadline, or 90-day pause, that they set on April 9. US economy is still growing While Monday's report wasn't upbeat for manufacturers, it did show that the broader economy is still growing. If the manufacturing index remains over 42.3%, it generally indicates that the economy is still expanding. "Goods-producing sectors of the economy will likely contract in 2025," Adams wrote. "However, service-providing industries, which account for most economic activity and employment, are likely to keep growing and help the economy avoid a recession."
See - Sada Elbalad
02-06-2025
- Business
- See - Sada Elbalad
Gold Gains EGP 85 as Fed Rate Cut Expectations Drive Rally
Waleed Farouk Gold prices in local Egyptian markets rose on Monday, supported by a global increase in gold ounce prices, a weaker US dollar, and growing expectations of a Federal Reserve interest rate cut. Gold prices in Egypt climbed by EGP 85 during today's trading compared to the closing levels on Saturday. The price of 21-karat gold reached EGP 4,685 per gram, while the global gold ounce price rose by $64 to reach $3,364. In detail: 24-karat gold: EGP 5,354 per gram 18-karat gold: EGP 4,016 per gram 14-karat gold: EGP 3,124 per gram Gold sovereign (8 grams of 21K): EGP 37,480 Last month, gold prices in local markets declined by EGP 130. The 21-karat gram opened May at EGP 4,730 and ended the month at EGP 4,600. Meanwhile, the global gold ounce fell by $10—from $3,300 to $3,290. The recent surge in gold prices is largely attributed to a weakening US dollar and increased market anticipation of a shift in the Federal Reserve's monetary policy. The dollar's decline followed the release of the April Personal Consumption Expenditures (PCE) Price Index, which showed that annual inflation slowed to 2.1%—its lowest since early 2021—while core inflation eased to 2.5% from 2.7% in March. These inflation readings have strengthened market expectations that the Federal Reserve could initiate a rate-cutting cycle as early as September, with a possible second cut in December. Supporting this view, Fed Governor Christopher Waller recently stated that rate cuts remain a possibility despite ongoing inflation risks. His remarks further boosted gold's momentum amid continued dollar weakness. Markets are now closely watching a series of statements expected this week from members of the Federal Open Market Committee (FOMC), including a highly anticipated speech by Fed Chair Jerome Powell, which may offer clearer signals on the direction of US monetary policy and its implications for the dollar and gold prices. Multiple factors continue to support the bullish outlook for gold, including a weak dollar, cooling inflation, and rising geopolitical tensions in Eastern Europe and Asia. Growing global uncertainty is also enhancing the appeal of gold and other precious metals as safe-haven investments. Additionally, investors are awaiting a slate of key economic data in the coming days, including Monday's ISM Manufacturing PMI, Tuesday's job openings data, the monthly jobs report, the European Central Bank's meeting, weekly US jobless claims on Thursday, and the Non-Farm Payrolls report on Friday—all of which may significantly influence Fed policy decisions. read more CBE: Deposits in Local Currency Hit EGP 5.25 Trillion Morocco Plans to Spend $1 Billion to Mitigate Drought Effect Gov't Approves Final Version of State Ownership Policy Document Egypt's Economy Expected to Grow 5% by the end of 2022/23- Minister Qatar Agrees to Supply Germany with LNG for 15 Years Business Oil Prices Descend amid Anticipation of Additional US Strategic Petroleum Reserves Business Suez Canal Records $704 Million, Historically Highest Monthly Revenue Business Egypt's Stock Exchange Earns EGP 4.9 Billion on Tuesday Business Wheat delivery season commences on April 15 News Ayat Khaddoura's Final Video Captures Bombardment of Beit Lahia News Australia Fines Telegram $600,000 Over Terrorism, Child Abuse Content Sports Former Al Zamalek Player Ibrahim Shika Passes away after Long Battle with Cancer Sports Neymar Announced for Brazil's Preliminary List for 2026 FIFA World Cup Qualifiers News Prime Minister Moustafa Madbouly Inaugurates Two Indian Companies Arts & Culture New Archaeological Discovery from 26th Dynasty Uncovered in Karnak Temple Business Fear & Greed Index Plummets to Lowest Level Ever Recorded amid Global Trade War Arts & Culture Zahi Hawass: Claims of Columns Beneath the Pyramid of Khafre Are Lies News Flights suspended at Port Sudan Airport after Drone Attacks News Shell Unveils Cost-Cutting, LNG Growth Plan
Business Standard
02-06-2025
- Business
- Business Standard
INR settles higher, Powell speech in focus
The Indian rupee appreciated 16 paise to settle at 85.39 (provisional) against the US dollar on Monday, supported by a weak American currency and on expectations of a further reduction in key interest rate by the Reserve Bank. The US dollar index sank under 99 mark on Monday amid renewed trade tensions between the United States (US) and China after the US President Donald Trump claimed on Friday that China had violated their trade agreement. The dollar index that measures the greenback against a basket of currencies is quoting at 98.63, down more than half a percent. Investors now await US Fed Chair Jerome Powell's speech and US ISM Manufacturing PMI for May. Powell will be speaking at the Federal Reserve Boards International Finance Division 75th Anniversary Conference in Washington. While INR rose today, a sharp gain in the local unit was prevented due to volatile equity markets, outflow of foreign funds and higher crude oil prices. RBI's Monetary Policy Committee (MPC) will begin the deliberations on its next bi-monthly policy on June 4 and the outcome is scheduled to be announced on June 6.
Business Times
20-05-2025
- Business
- Business Times
What's next for the Fed amid the US-China tariff dance?
[SINGAPORE] As widely expected, the US Federal Reserve kept its policy rates unchanged in the May meeting, with a target Fed funds range of 4.25 to 4.5 per cent. This was the third consecutive meeting in which the Federal Open Market Committee (FOMC) members kept policy rates on hold. While policymakers made some tweaks to the FOMC policy statement, there had been nothing major. That said, the press conference carried a more hawkish undertone and reinforces the Fed's comfort in staying cautious, in a wait-and-see mode. First, Fed chair Jerome Powell reaffirmed that the central bank is in a good place as the US economy remains solid, expressing that the right approach is to wait for further clarity. Second, he also highlighted that the Fed is not in a position to act pre-emptively, unlike the 2019 rate cuts. Third, the Fed acknowledged higher stagflation risks and the conflict between its dual mandate – price stability and maximum sustainable employment. When asked about this conflict, Powell mentioned that 'without price stability, we cannot achieve the long periods of labour market strength', suggesting that inflation might still be a key priority in this battle. Cautious stance We think macro developments since March's FOMC meeting further justify the Fed's cautious stance. Hard economic data (reported and measured data) has continued to diverge from soft data (surveys and sentiments). Broadly, the former remains resilient while the latter has steadily weakened, signifying growing economic weakness driven by concerns surrounding the trade and regulation uncertainties. Broadly, we see positive hard data across key economic areas such as labour market and inflation in April. Non-farm payroll continues to grow, with job creation averaging around 148,000 a month year-to-date. The US unemployment rate has remained flat over the past two months, while jobless claims remain range-bound. Meanwhile, US inflation prints – both the consumer price index (CPI) and personal consumption expenditures – have also softened in March (and even April for CPI), pointing to easing price pressure pre-tariff. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up On the other hand, soft data has demonstrated signs of weakness, fuelled by the trade uncertainties. The widely watched ISM Manufacturing PMI has stayed in contraction territory (below 50) for several months, while the National Federation of Independent Business' small business optimism index has also dropped to levels associated with economic weakness. Inflation Regarding inflation, the University of Michigan survey showed that inflation expectations – both short and long term – surged in April (and May). This can also be observed from April's consumer inflation expectation index from Conference Board's survey, which soared in April. Considering the recent macro developments and ongoing uncertainties, we think the Fed's recent decision to hold rates was no surprise. While the risk of a US stagflation has somewhat moderated given the recent US-China trade truce, we believe the situation remains fluid and do not discount the potential inflationary risk. To us, the Fed remains stuck between a rock and a hard place – holding rates to combat inflation or cutting rates to support growth. We expect the Fed to remain cautious and is in no rush to cut rates unless macro data deteriorates. With the Fed being data-dependent, we think an accelerated weakening in the labour market data may convince policymakers to cut rates. That said, we are not there yet and should the situation materialise, the room for rate cuts may likely be limited given the inflation concerns. Amid this policy and macro backdrop, we maintain our preference for shorter-duration fixed income, which should continue to generate attractive income while keeping duration risk low. Short-end rates, particularly one-year and below, should remain anchored and attractive given the cautious policy stance and potentially limited room for Fed rate cuts. At the same time, long-term inflation risks may also be underpriced if higher tariffs go through. This would not only put upward pressure on long-end yields but also spur greater interest rate volatility, which can create wilder price swings for longer-tenor fixed income. In our view, long-end rates are not offering sufficient yield over the short-end to justify such risk. For investors looking to add duration or lock in yields, we believe it pays to be selective. Corporate bonds provide better opportunities at the moment, as the yield pickup is more favourable on the longer end, with an upwards sloping corporate yield curve (compared to the US treasury curve). That said, amid the trade and growth uncertainties, it is prudent to climb up the credit ladder and we prefer higher-quality corporate bonds. The writer is a portfolio manager of the Bondsupermart team at iFast Financial, the Singapore subsidiary of SGX mainboard-listed iFast Corporation
