IMF lowers estimate of US economic growth in 2014
WASHINGTON (AP) — The U.S. economy is poised to accelerate after a dismal start to the year even though the job market won’t return to full employment until 2017.
That was the forecast offered Monday in a report by the International Monetary Fund.
The IMF noted that steady job gains and other recent data suggest that the economy is rebounding. Employers have added 200,000-plus jobs for four straight months, and the unemployment rate has fallen to 6.3 per cent. Auto sales and factory activity are increasing.
Yet growth in 2014 won’t likely top last year’s lacklustre performance, the IMF says. The Washington-based organization foresees the economy growing a modest 2 per cent in 2014, below its previous estimate of 2.7 per cent. That would be nearly identical to the 1.9 per cent growth in 2013.
GM recalls 3.4M more cars for ignition problems
DETROIT (AP) — General Motors says it needs to change or replace the keys for about 3.4 million cars because they could cause the ignition switch to move out of position if they’re carrying too much weight.
GM said in a statement Monday that the switches can rotate out of “run” if the key has excess weight and the car “experiences some jarring event,” such as hitting a pothole or crossing a railroad track.
That can shut off the engines and disable power steering, causing drivers to lose control. Also, the air bags won’t work. The recall affects seven cars with model years ranging from 2000 to 2014.
Starbucks clears college degree path for workers
NEW YORK (AP) — Starbucks is giving its baristas a shot at an online college degree, an unusual benefit in an industry where higher education is often out of reach for workers.
The coffee chain is partnering with Arizona State University to make an online undergraduate degree available at a steep discount to any of its 135,000 U.S. employees who work at least 20 hours a week.
The program underscores the predicament of many workers who earn low wages, don’t have much job security and often hold down more than one job. It also highlights the stark disparities in advancement opportunities between the rich and poor, and how a traditional college education remains a near impossibility for so many.
Russia cuts gas supply to Ukraine as tensions soar
MOSCOW (AP) — Russia halted natural gas deliveries to Ukraine on Monday, spurning Ukraine’s offer to pay some of its multibillion-dollar gas debt and demanding upfront payments for future supplies.
The decision, coming amid deep tensions over eastern Ukraine, provoked strong words from both sides but does not immediately affect the crucial flow of Russian gas to Europe. Ukraine has enough reserves to last until December, according to the head of its state gas company Naftogaz.
Miss. sues credit-reporting firm, alleging errors
WASHINGTON (AP) — Mississippi has sued Experian, the world’s largest firm that collects detailed information about consumers to evaluate their financial trustworthiness. The lawsuit — and a separate investigation of the industry by 32 other states led by Ohio — represent a significant new legal challenge to the industry over allegations of paperwork errors and violations of consumer protection laws.
Errors can jeopardize people’s ability to get loans and pass job-related background checks. Experian has even wrongly reported that consumers are on a federal terrorism watch list, the lawsuit alleges.
US stocks manage meagre gains on mostly quiet day
NEW YORK (AP) — Investors nudged U.S. stocks into positive territory Monday, thanks in part to another round of corporate couplings.
Three proposed acquisitions, including medical device maker Medtronic’s $42.9 billion bid for rival Covidien, helped the market eke out a slight gain for the second trading day in a row.
Homebuilding stocks also got a boost from a survey showing that U.S. homebuilders’ outlook on the housing market improved this month.
Stocks mostly hovered between small gains and losses through much of the day as traders monitored the conflict in Iraq and considered its potential impact on oil prices.
US factory output rebounded in May after April dip
WASHINGTON (AP) — U.S. manufacturing output rose in May at a solid pace, boosting hopes that the economy is expanding briskly after a dismal first three months of the year.
Americans, buoyed by steady job gains, are buying more cars, while businesses are ordering more machinery and other equipment. Those trends are fueling factory production and driving growth.
Factory output rose 0.6 per cent in May after dipping 0.1 per cent the previous month, the Federal Reserve said Monday. April’s figure was revised upward from an initial estimate of a 0.4 per cent decline.
Overall industrial production, which includes manufacturing, mining and utilities, also rose 0.6 per cent in May. It had fallen 0.3 per cent in April.
US homebuilder confidence up in June, remains low
WASHINGTON (AP) — U.S. homebuilders are feeling more confident about the housing market but don’t think it is healthy yet.
The National Association of Home Builders/Wells Fargo builder sentiment index rose to 49 in June, highest since January and up from 45 in May. Readings below 50 indicate that builders view sales conditions are poor rather than good. The index has been stuck below 50 since January. The low numbers earlier this year reflected a bitter winter that chilled economic activity across much of the U.S.
But warmer weather hasn’t done much to help: Sales of new homes are running about half the rate of a healthy housing market.
Foreign holdings of US Treasury debt increase
WASHINGTON (AP) — Foreign buyers of U.S. Treasury securities increased their holdings in April to another record high even though China cut back on its holdings for a third straight month.
The Treasury Department reported Monday that total foreign holdings rose 0.2 per cent to a record $5.96 trillion, up from $5.95 trillion in March. It marked the ninth consecutive monthly increase.
China, the largest foreign buyer of U.S. Treasury debt, reduced its holdings for a third month, cutting them by 0.7 per cent to $1.26 trillion. Japan, the second largest buyer, boosted its holdings 0.8 per cent to $1.21 trillion.
Foreign demand for U.S. Treasury debt is expected to remain strong this year, helped by more borrowing certainty given the congressional agreement to suspend the debt limit until March 2015.
Obama’s economic focus seeks to unify Democrats
WASHINGTON (AP) — President Barack Obama is seeking to cut though the clamour of foreign policy crises to emphasize his economic message and unify Democrats behind an election-year message centred on jobs and better opportunities for the middle class.
The summer focus comes amid signs that the economy is steadily climbing out of the recession. But jobs and wages are still the main preoccupation for many voters.
Over the next four weeks the White House is planning to focus on several economic fronts, from manufacturing and innovation this week to working families next week to infrastructure and new plant openings. Obama themes will range from education and good wages, to job training and tax fairness.
By The Associated Press=
The Dow Jones Industrial average inched up 5.27 points to 16,781.01 points Monday. The Standard & Poor’s 500 index edged up a 1.62 to 1,937.78. The Nasdaq composite rose 10.45 points, or 0.2 per cent, to 4,321.11.
West Texas Intermediate, which is the US benchmark, fell a penny to $106.90. Brent crude, the international benchmark, rose 48 cents to $112.94. Wholesale gasoline rose 1.4 cents to $3.072 a gallon. Natural gas fell 3.2 cents $4.707 per 1,000 cubic feet. Heating oil rose a penny to $2.998 a gallon.