REUTERS
"Tentative recovery signs in US manufacturing; consumer confidence steady"
By Lucia Mutikani
March 26, 2024
Summary
* Durable goods orders increase 1.4% in February
* Core capital goods orders rise 0.7%; shipments fall 0.4%
* Consumer confidence steady in March; house prices cooling
WASHINGTON, March 26 (Reuters) - Orders for long-lasting U.S. manufactured goods increased more than expected in February, while business spending on equipment showed tentative signs of recovery as the economy's growth prospects in the first quarter remained upbeat.
But November's presidential election, a rematch between incumbent Joe Biden and Republican challenger Donald Trump, looms large.
A survey from the Conference Board on Tuesday showed Americans growing increasingly concerned about the political environment and less worried about a recession over the next 12 months.
The rebound in durable goods orders recouped some of January's sharp losses, and implied manufacturing could be regaining its footing after struggling in the aftermath of the Federal Reserve's hefty interest rate hikes.
"The data suggest that business equipment investment is beginning to recover, and with corporate bond yields likely to fall a little further over the coming months while manufacturing activity appears to be picking up again, we suspect that recovery has further to run," said Andrew Hunter, deputy chief U.S. economist at Capital Economics.
Orders for durable goods, items ranging from toasters to aircraft meant to last three years or more, rose 1.4% last month, the Commerce Department's Census Bureau said.
Data for January was revised lower to show orders falling 6.9% instead of the previously reported 6.2%.
Economists polled by Reuters had forecast durable goods orders would rise 1.1%.
Orders advanced 1.8% on a year-on-year basis in February.
Transportation orders climbed 3.3% in February after dropping 18.3% in January.
They were boosted by a 24.6% increase in civilian orders after plummeting 63.5% in January.
Orders for motor vehicles and parts accelerated 1.8%.
Orders of primary metals rebounded 1.4% and those of fabricated metals rose 0.8%.
Machinery orders increased 1.9%.
The outlook for manufacturing, which accounts for 10.3% of the economy, is steadily improving amid expectations that the U.S. central bank will start cutting rates this year.
A survey from the Institute for Supply Management this month showed manufacturers were fairly upbeat in March about sales and business conditions.
Factory output rebounded in February.
The Fed has hiked its policy rate by 525 basis points to the current 5.25%-5.50% range since March 2022.
But the sector is not out of the woods yet.
Orders for computers and electronic products fell 1.4% last month, while those for electrical equipment, appliances and components decreased 1.5%.
Though Boeing reported on its website that it had received 15 orders for commercial aircraft, up from only three in January, last month marked a continued sharp slowdown from the end of 2023.
The planemaker is under pressure after a cabin panel blew out in mid-air on an Alaska Airlines jet in early January, with the Federal Aviation Administration barring Boeing from expanding production of its best-selling 737 MAX narrow-body planes to improve quality control.
Boeing announced on Monday that CEO Dave Calhoun would step down by the end of 2024 as part of a broad management shakeup.
"We continue to see some early signs of recovery from the production data, though we think we're still a few months out from a more sustained recovery," said Shannon Grein, an economist at Wells Fargo.
Stocks on Wall Street rose.
The dollar slipped against a basket of currencies.
U.S. Treasury prices mostly lower.
MIXED VIEWS
Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending plans, rose 0.7% in February after falling 0.4% in the prior month.
These so-called core capital goods orders were previously reported to have been unchanged in January.
Core capital goods shipments fell 0.4% after rising 0.8% in January.
Non-defense capital goods orders advanced 4.4%, while shipments in that category rose 2.7% after declining 3.0% in January.
Shipments of these goods go into the calculation of the business spending on equipment component in the gross domestic product report.
Economists were divided on what the shipments data meant for business spending investment in equipment this quarter.
Some were penciling in a mild rebound while others saw a further contraction, arguing that the rise had been eroded by the increase last month in producer prices.
Business spending on equipment contracted in the fourth quarter.
It has declined in four of the last five quarters.
"Core capital goods shipments have been growing at about a 2% pace so far in the first quarter, suggesting that business investment in equipment may make a mild positive contribution to GDP growth this quarter," said Lou Crandall, chief economist at Wrightson ICAP.
The Atlanta Fed left its first-quarter GDP growth estimate unchanged at a 2.1% annualized rate.
The economy grew at a 3.2% rate in the fourth quarter.
Consumers are noticing the economy's resilience, though that is being eclipsed by rising worries over the upcoming election.
In a separate report, the Conference Board said its consumer confidence index was little changed at 104.7 in March.
"Recession fears continued to trend downward," said Dana Peterson, chief economist at the Conference Board.
"Meanwhile, consumers expressed more concern about the U.S. political environment compared to prior months."
That mirrors findings in the University of Michigan survey earlier this month.
Consumers in the Conference Board survey were upbeat about the labor market.
The survey's so-called labor market differential, derived from data on respondents' views on whether jobs are plentiful or hard to get, widened to 32.2 from 30.1 in February.
This measure correlates to the unemployment rate in the Labor Department's closely followed employment report.
More consumers planned to buy motor vehicles and houses over the next six months.
There was some good news for potential homebuyers, with a separate report from the Federal Housing Finance Agency showing house prices slipped 0.1% in January, the first decline in 17 months, after gaining 0.1% in December.
They increased 6.3% year-on-year after advancing 6.7% in December.
But with supply still tight, house prices could remain high.
"Spring home buying season will elevate home prices from winter lows, however the rate of annual gains is likely to slow given the difficult comparisons with last year's spring surge in home prices," said Selma Hepp, chief economist at CoreLogic.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao
https://www.reuters.com/markets/us/us-d ... 024-03-26/
THE ECONOMY
Re: THE ECONOMY
REUTERS
"US consumer confidence steady in March; inflation expectations creep up"
By Reuters
March 26, 2024
WASHINGTON, March 26 (Reuters) - U.S. consumer confidence was little changed in March as fading fears of a recession took a backseat to growing concerns about the nation's political environment ahead of November's presidential election, a survey showed on Tuesday.
The Conference Board said that its consumer confidence index dipped to 104.7 this month, essentially unchanged from a downwardly revised 104.8 in February.
Economists polled by Reuters had forecast the index nudging up to 107.0 from the previously reported 106.7.
"Recession fears continued to trend downward," said Dana Peterson, chief economist at the Conference Board in Washington.
"Meanwhile, consumers expressed more concern about the US political environment compared to prior months."
Consumers' inflation expectations ticked up to 5.3% from 5.2% in February.
Reporting by Lucia Mutikani
https://www.reuters.com/markets/us/us-c ... 024-03-26/
"US consumer confidence steady in March; inflation expectations creep up"
By Reuters
March 26, 2024
WASHINGTON, March 26 (Reuters) - U.S. consumer confidence was little changed in March as fading fears of a recession took a backseat to growing concerns about the nation's political environment ahead of November's presidential election, a survey showed on Tuesday.
The Conference Board said that its consumer confidence index dipped to 104.7 this month, essentially unchanged from a downwardly revised 104.8 in February.
Economists polled by Reuters had forecast the index nudging up to 107.0 from the previously reported 106.7.
"Recession fears continued to trend downward," said Dana Peterson, chief economist at the Conference Board in Washington.
"Meanwhile, consumers expressed more concern about the US political environment compared to prior months."
Consumers' inflation expectations ticked up to 5.3% from 5.2% in February.
Reporting by Lucia Mutikani
https://www.reuters.com/markets/us/us-c ... 024-03-26/
Re: THE ECONOMY
REUTERS
"Fed posts record loss of $114.3 billion in 2023"
By Michael S. Derby
March 26, 2024
March 26 (Reuters) - The Federal Reserve said on Tuesday that it officially saw a net negative income of $114.3 billion in 2023, a record loss tied to expenses related to managing the U.S. central bank's short-term interest rate target.
The loss last year follows $58.8 billion in net income in 2022, the Fed said.
The numbers released were an audited tally following preliminary numbers reported earlier this year.
The Fed has stressed repeatedly that net negative income does not impede its ability to operate or conduct monetary policy.
By law, the Fed hands over any profits after covering operational expenses to the Treasury.
The Fed earns income from services it provides the financial system and from interest income on securities it owns.
It has earned significant profits over recent years amid very low rates and large levels of bond holdings.
The Fed's move to aggressively boost the federal funds rate starting in the spring of 2022 has upended central bank finances.
To cool inflation pressures, the Fed lifted the target from near zero levels to its current 5.25% to 5.5% range.
The Fed maintains that target by paying banks, money funds and other financial firms to park cash at the central bank, and that is meant paying out substantially more in interest.
The Fed's audited interest expenses for banks' reserve balances hit $176.8 billion last year, up $116.4 billion from 2022's level, while interest payouts from its reverse repo facility was $104.3 billion last year, from $41.9 billion the prior year.
Meanwhile, the income the Fed earned from bonds it owns was at $163.8 billion last year, little changed from 2022.
The Fed can create money to fund its operations when dealing with operating losses which means it faces no obstacles to operate.
It captures its loss in an accounting device called a deferred asset.
The official level of the deferred asset stood at $133.3 billion at the close of 2023.
As of March 20, it had risen to $157.8 billion and it is unclear how much larger it will get.
When the Fed returns to profitability it will use excess earnings to reduce the deferred asset and when it is extinguished the Fed will start returning excess profits to the Treasury again.
Fed officials have noted they've handed back substantial sums to the Treasury over recent years.
A St. Louis Fed report last year said it could take years before the Fed is able to once again return profits to the government.
Reporting by Michael S. Derby; Editing by Marguerita Choy
https://www.reuters.com/markets/us/fed- ... 024-03-26/
"Fed posts record loss of $114.3 billion in 2023"
By Michael S. Derby
March 26, 2024
March 26 (Reuters) - The Federal Reserve said on Tuesday that it officially saw a net negative income of $114.3 billion in 2023, a record loss tied to expenses related to managing the U.S. central bank's short-term interest rate target.
The loss last year follows $58.8 billion in net income in 2022, the Fed said.
The numbers released were an audited tally following preliminary numbers reported earlier this year.
The Fed has stressed repeatedly that net negative income does not impede its ability to operate or conduct monetary policy.
By law, the Fed hands over any profits after covering operational expenses to the Treasury.
The Fed earns income from services it provides the financial system and from interest income on securities it owns.
It has earned significant profits over recent years amid very low rates and large levels of bond holdings.
The Fed's move to aggressively boost the federal funds rate starting in the spring of 2022 has upended central bank finances.
To cool inflation pressures, the Fed lifted the target from near zero levels to its current 5.25% to 5.5% range.
The Fed maintains that target by paying banks, money funds and other financial firms to park cash at the central bank, and that is meant paying out substantially more in interest.
The Fed's audited interest expenses for banks' reserve balances hit $176.8 billion last year, up $116.4 billion from 2022's level, while interest payouts from its reverse repo facility was $104.3 billion last year, from $41.9 billion the prior year.
Meanwhile, the income the Fed earned from bonds it owns was at $163.8 billion last year, little changed from 2022.
The Fed can create money to fund its operations when dealing with operating losses which means it faces no obstacles to operate.
It captures its loss in an accounting device called a deferred asset.
The official level of the deferred asset stood at $133.3 billion at the close of 2023.
As of March 20, it had risen to $157.8 billion and it is unclear how much larger it will get.
When the Fed returns to profitability it will use excess earnings to reduce the deferred asset and when it is extinguished the Fed will start returning excess profits to the Treasury again.
Fed officials have noted they've handed back substantial sums to the Treasury over recent years.
A St. Louis Fed report last year said it could take years before the Fed is able to once again return profits to the government.
Reporting by Michael S. Derby; Editing by Marguerita Choy
https://www.reuters.com/markets/us/fed- ... 024-03-26/
Re: THE ECONOMY
REUTERS
"Yellen to warn China on clean energy subsidies, excess production capacity"
By David Lawder
March 27, 2024
WASHINGTON, March 27 (Reuters) - U.S. Treasury Secretary Janet Yellen said on Wednesday she intends to warn China about the negative effects of Beijing's subsidies for its clean energy industries, including solar panels and electric vehicles (EVs), during a visit to the country.
"I intend to talk to the Chinese when I visit about overcapacity in some of these industries, and make sure that they understand the undesirable impact that this is having - flooding the market with cheap goods - on the United States but also in many of our closest allies," Yellen told MSNBC in a live interview.
Yellen is in the state of Georgia to visit a Suniva solar cell manufacturing plant that closed in 2017 due to competition from cheaper, subsidized solar panels from China, but which is now reopening because of anticipated demand fueled by tax credits for U.S.-made clean energy technology in the 2022 Inflation Reduction Act.
In excerpts of remarks to be delivered at the factory, Yellen said she planned to raise concerns that China is now overproducing EVs and lithium-ion batteries in the same way that it built too much capacity to make steel and aluminum, distorting global markets and hurting jobs in other industrial and developing economies.
Politico has reported that Yellen will travel to China in April.
The Treasury has declined to confirm her travel plans.
"I will convey my belief that excess capacity poses risks not only to American workers and firms and to the global economy, but also productivity and growth in the Chinese economy, as China itself acknowledged in its National People's Congress this month," Yellen said.
"And I will press my Chinese counterparts to take necessary steps to address this issue."
Reporting by David Lawder; Editing by Franklin Paul and Paul Simao
https://www.reuters.com/business/energy ... 024-03-27/
"Yellen to warn China on clean energy subsidies, excess production capacity"
By David Lawder
March 27, 2024
WASHINGTON, March 27 (Reuters) - U.S. Treasury Secretary Janet Yellen said on Wednesday she intends to warn China about the negative effects of Beijing's subsidies for its clean energy industries, including solar panels and electric vehicles (EVs), during a visit to the country.
"I intend to talk to the Chinese when I visit about overcapacity in some of these industries, and make sure that they understand the undesirable impact that this is having - flooding the market with cheap goods - on the United States but also in many of our closest allies," Yellen told MSNBC in a live interview.
Yellen is in the state of Georgia to visit a Suniva solar cell manufacturing plant that closed in 2017 due to competition from cheaper, subsidized solar panels from China, but which is now reopening because of anticipated demand fueled by tax credits for U.S.-made clean energy technology in the 2022 Inflation Reduction Act.
In excerpts of remarks to be delivered at the factory, Yellen said she planned to raise concerns that China is now overproducing EVs and lithium-ion batteries in the same way that it built too much capacity to make steel and aluminum, distorting global markets and hurting jobs in other industrial and developing economies.
Politico has reported that Yellen will travel to China in April.
The Treasury has declined to confirm her travel plans.
"I will convey my belief that excess capacity poses risks not only to American workers and firms and to the global economy, but also productivity and growth in the Chinese economy, as China itself acknowledged in its National People's Congress this month," Yellen said.
"And I will press my Chinese counterparts to take necessary steps to address this issue."
Reporting by David Lawder; Editing by Franklin Paul and Paul Simao
https://www.reuters.com/business/energy ... 024-03-27/
Re: THE ECONOMY
REUTERS
"US banks face loss risk from multi-family property loan exposure, says Fitch"
By Matt Tracy
March 27, 2024
WASHINGTON, March 27 (Reuters) - U.S. banks with significant lending exposure to some multi-family properties and particularly rent-controlled housing are vulnerable to posting losses this year on rising costs facing landlords, according to Fitch Ratings analysts.
On a Wednesday call, Fitch Ratings analysts highlighted the risks facing banks which have underwritten loans behind apartment complexes and other multifamily properties.
Lending by banks to multifamily borrowers grew 32% since 2020 to $613 billion at the end of 2023, according to a March 19 report by Fitch.
But supply has begun to outstrip demand, creating downward pressure on the rents landlords can charge, Fitch noted during Wednesday's call.
These landlords also face rising interest rates and insurance premiums, coupled with decreasing apartment values.
These factors have weighed on several regional banks with high exposure to the asset class, and in particular those most exposed to rent-controlled multifamily loans, where landlords face a ceiling on rent increases to offset rising costs.
"Especially in the more stringent rent-controlled areas, there is a limited ability to make up that difference," said Brian Thies, senior director at Fitch, on Wednesday's call.
"So I would say it can be a concern for loan performance at this point."
This was seen in late February, when regional bank New York Community Bancorp posted $2.7 billion in losses and a $552 million provision for credit losses in its fourth quarter, including on a New York-based rent-controlled multifamily loan.
Fitch highlighted 10 banks with the greatest multifamily loan exposure as of year-end 2023.
Flagstar Bank, which merged with New York Community Bancorp in 2022, topped the list with 43.6% of its loan portfolio in multifamily.
Other banks with a high proportion of multifamily loans include First Foundation Bank, Dime Community Bank, Pacific Premier Bank and Apple Bank for Savings, according to Fitch.
These and other banks are exposed to rent-controlled multifamily loan markets in states with stringent rent-control laws including California, New York, New Jersey and Oregon.
There were 49 banks at the end of 2023 with at least 5% of multifamily loans past due on their payments, the ratings agency noted.
Most of these consisted of regional and community banks.
The most capital-constrained banks will likely look to sell more of these loans - and at a loss, the Fitch analysts noted.
"We would consider most U.S. banks as well-reserved currently for multifamily lending," Thies said.
"But it's generally going to come down to the value of the collateral and how readily the bank can dispose of that."
Reporting by Matt Tracy; editing by Costas Pitas
https://www.reuters.com/business/financ ... 024-03-27/
"US banks face loss risk from multi-family property loan exposure, says Fitch"
By Matt Tracy
March 27, 2024
WASHINGTON, March 27 (Reuters) - U.S. banks with significant lending exposure to some multi-family properties and particularly rent-controlled housing are vulnerable to posting losses this year on rising costs facing landlords, according to Fitch Ratings analysts.
On a Wednesday call, Fitch Ratings analysts highlighted the risks facing banks which have underwritten loans behind apartment complexes and other multifamily properties.
Lending by banks to multifamily borrowers grew 32% since 2020 to $613 billion at the end of 2023, according to a March 19 report by Fitch.
But supply has begun to outstrip demand, creating downward pressure on the rents landlords can charge, Fitch noted during Wednesday's call.
These landlords also face rising interest rates and insurance premiums, coupled with decreasing apartment values.
These factors have weighed on several regional banks with high exposure to the asset class, and in particular those most exposed to rent-controlled multifamily loans, where landlords face a ceiling on rent increases to offset rising costs.
"Especially in the more stringent rent-controlled areas, there is a limited ability to make up that difference," said Brian Thies, senior director at Fitch, on Wednesday's call.
"So I would say it can be a concern for loan performance at this point."
This was seen in late February, when regional bank New York Community Bancorp posted $2.7 billion in losses and a $552 million provision for credit losses in its fourth quarter, including on a New York-based rent-controlled multifamily loan.
Fitch highlighted 10 banks with the greatest multifamily loan exposure as of year-end 2023.
Flagstar Bank, which merged with New York Community Bancorp in 2022, topped the list with 43.6% of its loan portfolio in multifamily.
Other banks with a high proportion of multifamily loans include First Foundation Bank, Dime Community Bank, Pacific Premier Bank and Apple Bank for Savings, according to Fitch.
These and other banks are exposed to rent-controlled multifamily loan markets in states with stringent rent-control laws including California, New York, New Jersey and Oregon.
There were 49 banks at the end of 2023 with at least 5% of multifamily loans past due on their payments, the ratings agency noted.
Most of these consisted of regional and community banks.
The most capital-constrained banks will likely look to sell more of these loans - and at a loss, the Fitch analysts noted.
"We would consider most U.S. banks as well-reserved currently for multifamily lending," Thies said.
"But it's generally going to come down to the value of the collateral and how readily the bank can dispose of that."
Reporting by Matt Tracy; editing by Costas Pitas
https://www.reuters.com/business/financ ... 024-03-27/
Re: THE ECONOMY
REUTERS
"Hydrogen industry pleads for easier path to US tax credits"
By Valerie Volcovici
March 27, 2024
WASHINGTON, March 27 (Reuters) - Some companies planning to use new U.S. tax credits to deploy hydrogen projects urged the Treasury Department this week to ease proposed environmental requirements, warning that they could hinder the nascent industry’s takeoff.
Treasury and the Internal Revenue Service hosted hearings this week on the guidance they released in December governing implementation of the Clean Hydrogen Production, or 45V, tax credit, one of the most lucrative incentives in the 2022 Inflation Reduction Act.
The credit would create a 10-year incentive for clean hydrogen production of up to $3.00/kilogram.
The credit has been at the center of heavy lobbying by industry groups seeking to build projects, as well as environmental advocates worried that a proliferation of hydrogen projects will backfire by boosting energy demand and raising greenhouse gas emissions.
The Treasury's proposal would require hydrogen producers seeking the 45v credits to prove they have used clean electricity that has been recently built and sourced from the same region as the project.
They would also need to show that the power was generated around the same time that the hydrogen was produced.
Australian firm Fortescue said the requirements would hurt a project it is pursuing the Pacific Northwest, which won Energy Department support last year.
“This investment would not qualify for the tax credit, because we plan to use a mix of surplus hydropower and other renewables," Fortescue North America CEO Andrew Vesey told the hearing.
Frank Wolak, president of the Fuel Cell and Hydrogen Energy Association industry group, said the requirements had cooled investor interest in hydrogen projects.
The lobby group asked that projects launched before the guidance is finalized be exempted.
Dorothy Davidson, CEO of the DOE-backed Midwest hydrogen hub, asked Treasury to allow projects to source at least 10% of their power from pre-existing zero-carbon sources like nuclear, and also permit the use of renewable natural gas from farms and landfills.
The Midwest hub project relies on existing nuclear energy and natural gas.
Meanwhile, some green hydrogen companies and a number of NGOs urged the IRS to keep the requirements in place.
"Weak section 45V rules would undermine both the achievement of the Biden Administration’s climate goals and the credibility of the hydrogen industry," said Claire Behar, chief commercial officer of Hy Stor, a green hydrogen firm with a project in Mississippi.
Reporting by Valerie Volcovici; Editing by Nick Zieminski
https://www.reuters.com/sustainability/ ... 024-03-27/
"Hydrogen industry pleads for easier path to US tax credits"
By Valerie Volcovici
March 27, 2024
WASHINGTON, March 27 (Reuters) - Some companies planning to use new U.S. tax credits to deploy hydrogen projects urged the Treasury Department this week to ease proposed environmental requirements, warning that they could hinder the nascent industry’s takeoff.
Treasury and the Internal Revenue Service hosted hearings this week on the guidance they released in December governing implementation of the Clean Hydrogen Production, or 45V, tax credit, one of the most lucrative incentives in the 2022 Inflation Reduction Act.
The credit would create a 10-year incentive for clean hydrogen production of up to $3.00/kilogram.
The credit has been at the center of heavy lobbying by industry groups seeking to build projects, as well as environmental advocates worried that a proliferation of hydrogen projects will backfire by boosting energy demand and raising greenhouse gas emissions.
The Treasury's proposal would require hydrogen producers seeking the 45v credits to prove they have used clean electricity that has been recently built and sourced from the same region as the project.
They would also need to show that the power was generated around the same time that the hydrogen was produced.
Australian firm Fortescue said the requirements would hurt a project it is pursuing the Pacific Northwest, which won Energy Department support last year.
“This investment would not qualify for the tax credit, because we plan to use a mix of surplus hydropower and other renewables," Fortescue North America CEO Andrew Vesey told the hearing.
Frank Wolak, president of the Fuel Cell and Hydrogen Energy Association industry group, said the requirements had cooled investor interest in hydrogen projects.
The lobby group asked that projects launched before the guidance is finalized be exempted.
Dorothy Davidson, CEO of the DOE-backed Midwest hydrogen hub, asked Treasury to allow projects to source at least 10% of their power from pre-existing zero-carbon sources like nuclear, and also permit the use of renewable natural gas from farms and landfills.
The Midwest hub project relies on existing nuclear energy and natural gas.
Meanwhile, some green hydrogen companies and a number of NGOs urged the IRS to keep the requirements in place.
"Weak section 45V rules would undermine both the achievement of the Biden Administration’s climate goals and the credibility of the hydrogen industry," said Claire Behar, chief commercial officer of Hy Stor, a green hydrogen firm with a project in Mississippi.
Reporting by Valerie Volcovici; Editing by Nick Zieminski
https://www.reuters.com/sustainability/ ... 024-03-27/
Re: THE ECONOMY
REUTERS
"US solar factories strike deal to produce 'Made in USA' panels"
By Nichola Groom
March 27, 2024
March 27 (Reuters) - Two small solar manufacturers on Wednesday said they are joining forces to make panels that will enable their customers, U.S. solar project developers, to collect on a lucrative new federal subsidy for American-made clean energy equipment.
The agreement between Georgia-based solar cell producer Suniva and Canada's Heliene, which has panel-making operations in Minnesota, is being touted by the Biden administration as evidence that Inflation Reduction Act (IRA) subsidies are succeeding in building a domestic solar manufacturing industry to compete with China.
"Before this Administration, solar companies across the United States were struggling," Treasury Secretary Janet Yellen, who will visit Suniva's Norcross, Georgia, facility later on Wednesday, said in a statement provided to Reuters.
She noted that 20% of U.S. solar manufacturing jobs were lost between 2016 and 2020.
Suniva itself is restarting an idled factory.
"Now, though there remain significant challenges, Inflation Reduction Act tax credits are helping change the game," Yellen added.
Under the three-year, $400 million deal, Suniva will supply cells to Heliene, which will assemble them into panels.
The products will be able to supply about 2 gigawatts of solar projects, according to Suniva.
That would be enough capacity to power about 350,000 homes.
Solar project builders that use panels containing American-made cells will be able to claim a 10% tax credit for using domestic content, according to Treasury Department rules unveiled nearly a year ago.
That bonus credit, created in the 2022 IRA, has been regarded by developers as elusive because there is no current U.S. supply of silicon-based solar cells, the predominant industry technology.
Some solar manufacturers have lobbied for more stringent domestic content rules to counter a flood of Chinese-made products in the global market.
"This contract is a testament to the effectiveness of the Inflation Reduction Act and Treasury's May 2023 domestic content guidance," Suniva CEO Cristiano Amoruso said in a statement.
"We are proud to fulfill our long-standing promise to bring back cell manufacturing to the United States at our Norcross facility."
The domestic content bonus credit is in addition to a 30% IRA tax credit for renewable energy facilities.
Reporting by Nichola Groom Editing by Bill Berkrot
https://www.reuters.com/business/energy ... 024-03-27/
"US solar factories strike deal to produce 'Made in USA' panels"
By Nichola Groom
March 27, 2024
March 27 (Reuters) - Two small solar manufacturers on Wednesday said they are joining forces to make panels that will enable their customers, U.S. solar project developers, to collect on a lucrative new federal subsidy for American-made clean energy equipment.
The agreement between Georgia-based solar cell producer Suniva and Canada's Heliene, which has panel-making operations in Minnesota, is being touted by the Biden administration as evidence that Inflation Reduction Act (IRA) subsidies are succeeding in building a domestic solar manufacturing industry to compete with China.
"Before this Administration, solar companies across the United States were struggling," Treasury Secretary Janet Yellen, who will visit Suniva's Norcross, Georgia, facility later on Wednesday, said in a statement provided to Reuters.
She noted that 20% of U.S. solar manufacturing jobs were lost between 2016 and 2020.
Suniva itself is restarting an idled factory.
"Now, though there remain significant challenges, Inflation Reduction Act tax credits are helping change the game," Yellen added.
Under the three-year, $400 million deal, Suniva will supply cells to Heliene, which will assemble them into panels.
The products will be able to supply about 2 gigawatts of solar projects, according to Suniva.
That would be enough capacity to power about 350,000 homes.
Solar project builders that use panels containing American-made cells will be able to claim a 10% tax credit for using domestic content, according to Treasury Department rules unveiled nearly a year ago.
That bonus credit, created in the 2022 IRA, has been regarded by developers as elusive because there is no current U.S. supply of silicon-based solar cells, the predominant industry technology.
Some solar manufacturers have lobbied for more stringent domestic content rules to counter a flood of Chinese-made products in the global market.
"This contract is a testament to the effectiveness of the Inflation Reduction Act and Treasury's May 2023 domestic content guidance," Suniva CEO Cristiano Amoruso said in a statement.
"We are proud to fulfill our long-standing promise to bring back cell manufacturing to the United States at our Norcross facility."
The domestic content bonus credit is in addition to a 30% IRA tax credit for renewable energy facilities.
Reporting by Nichola Groom Editing by Bill Berkrot
https://www.reuters.com/business/energy ... 024-03-27/
Re: THE ECONOMY
UPI News
"Though U.S. economy shows signs of strength, poll shows third of Americans rate it as poor"
Story by Doug Cunningham
28 MARCH 2024
March 27 (UPI) -- A Gallup Poll on Americans' view of the U.S. economy published Wednesday indicated that while most still have a negative view of things, public sentiment on the economy has improved since polling last year.
Gallup said its Economic Confidence Index was at -20 in March, but that was much improved from the -50 measured last fall.
The Gallup Poll of how people feel about the economy sharply contrasts with several actual economic results that show strong economic growth as reflected in job growth, falling inflation, low unemployment and strong GDP.
GDP was up 2.5% for 2023 and rose 3.3% in the fourth quarter of 2023.
Fed Chair Jerome Powell said in March that economic activity has been expanding at a strong pace and was sustainable and solid.
Unemployment has stayed below 4% and job creation is robust, with 275,000 new jobs created in February, according ot the U.S. Labor Department.
Inflation is also considerably lower, although not yet down to the 2% favored by the Federal Reserve.
Gallup's Wednesday poll, with +100 meaning Americans rate economic conditions as excellent and getting better to -100 meaning the economy is poor and getting worse, had the highest rating of +56 in January 2000.
The March 1-20 results were -20, with 30% saying the economy is good, 30% calling the economy fair and 39% saying it is poor.
Gallup said in a statement, "When asked about the economy's direction, 33% of Americans say conditions are getting better, while 63% say they're getting worse."
Although economic optimism is about the same as last month's 32%, it has been slowly expanding since October, when 21% said the economy was getting better."
How respondents see the U.S. economy is heavily weighted politically, according to Gallup.
While Democrats rate the economy at a +35, independents put it at -28 while Republicans rank it at -62.
Gallup found Republicans have an overwhelmingly negative view of the economy, with 87% believing it is getting worse and 58% of them rating the current economic conditions as poor.
That compares with 64% of Democrats who say the economy is getting better and 55% saying the economy is good now.
Gallup said George H. W. Bush lost reelection when Gallup's poll showed the ECI was at -37.
Bill Clinton won reelection when that Gallup economic number was at +23.
https://www.msn.com/en-us/money/markets ... bdc2&ei=45
"Though U.S. economy shows signs of strength, poll shows third of Americans rate it as poor"
Story by Doug Cunningham
28 MARCH 2024
March 27 (UPI) -- A Gallup Poll on Americans' view of the U.S. economy published Wednesday indicated that while most still have a negative view of things, public sentiment on the economy has improved since polling last year.
Gallup said its Economic Confidence Index was at -20 in March, but that was much improved from the -50 measured last fall.
The Gallup Poll of how people feel about the economy sharply contrasts with several actual economic results that show strong economic growth as reflected in job growth, falling inflation, low unemployment and strong GDP.
GDP was up 2.5% for 2023 and rose 3.3% in the fourth quarter of 2023.
Fed Chair Jerome Powell said in March that economic activity has been expanding at a strong pace and was sustainable and solid.
Unemployment has stayed below 4% and job creation is robust, with 275,000 new jobs created in February, according ot the U.S. Labor Department.
Inflation is also considerably lower, although not yet down to the 2% favored by the Federal Reserve.
Gallup's Wednesday poll, with +100 meaning Americans rate economic conditions as excellent and getting better to -100 meaning the economy is poor and getting worse, had the highest rating of +56 in January 2000.
The March 1-20 results were -20, with 30% saying the economy is good, 30% calling the economy fair and 39% saying it is poor.
Gallup said in a statement, "When asked about the economy's direction, 33% of Americans say conditions are getting better, while 63% say they're getting worse."
Although economic optimism is about the same as last month's 32%, it has been slowly expanding since October, when 21% said the economy was getting better."
How respondents see the U.S. economy is heavily weighted politically, according to Gallup.
While Democrats rate the economy at a +35, independents put it at -28 while Republicans rank it at -62.
Gallup found Republicans have an overwhelmingly negative view of the economy, with 87% believing it is getting worse and 58% of them rating the current economic conditions as poor.
That compares with 64% of Democrats who say the economy is getting better and 55% saying the economy is good now.
Gallup said George H. W. Bush lost reelection when Gallup's poll showed the ECI was at -37.
Bill Clinton won reelection when that Gallup economic number was at +23.
https://www.msn.com/en-us/money/markets ... bdc2&ei=45
Re: THE ECONOMY
FOX News
"Janet Yellen walks back Biden’s comments US taxpayers on hook for Baltimore bridge collapse"
Story by Bradford Betz
28 MARCH 2024
U.S. Treasury Secretary Janet Yellen on Wednesday appeared to walk back comments from President Joe Biden that U.S. taxpayers would foot the bill for the Francis Scott Key Bridge collapse.
Appearing on MSNBC Wednesday, Yellen said money from the bipartisan infrastructure law could "potentially be helpful."
"My expectation would be that ultimately there will be insurance payments, in part, to cover this."
"But we don’t want to allow worrying about where the financing will come from to hold up reconstruction," Yellen said.
Her comments come a day after Biden said it was his "intention that the federal government will pay for the entire cost of reconstructing that bridge, and I expect the Congress to support my effort."
Biden said that, while the effort will take some time, the people of Baltimore "can count on us."
When asked by a reporter whether the company that manages the ship should be held responsible, Biden said the federal government would not wait for any decisions and would step in to get the bridge built and reopened.
The Francis Scott Key Bridge along I-695 in Maryland collapsed in the Baltimore harbor around 1:30 a.m. Tuesday after a cargo ship slammed into a support beam.
The collapse sent at least eight construction workers and multiple vehicles plunging into the Patapsco River below.
The cargo ship that hit the bridge was the Dali, a 95,000 GT Singapore-flagged container ship, per the Maritime and Port Authority (MPA) of Singapore.
There were 22 crew members onboard at the time of the incident.
The Synergy Group, a Singapore-based company that manages the ship, said in a statement that two pilots piloting the ship through the harbor and all crew members onboard were accounted for and there are no reports of any injuries.
The group also said that no pollution has been reported.
The large vessel appeared to catch fire before becoming disabled.
Footage of the incident shows the lights going out multiple times on the vessel in question prior to impact, suggesting the collision may have been due to a power failure.
Fox News Digital’s Landon Mion, Anders Hagstrom, and Stephen Sorace contributed to this report.
https://www.msn.com/en-us/news/us/janet ... bdc2&ei=88
"Janet Yellen walks back Biden’s comments US taxpayers on hook for Baltimore bridge collapse"
Story by Bradford Betz
28 MARCH 2024
U.S. Treasury Secretary Janet Yellen on Wednesday appeared to walk back comments from President Joe Biden that U.S. taxpayers would foot the bill for the Francis Scott Key Bridge collapse.
Appearing on MSNBC Wednesday, Yellen said money from the bipartisan infrastructure law could "potentially be helpful."
"My expectation would be that ultimately there will be insurance payments, in part, to cover this."
"But we don’t want to allow worrying about where the financing will come from to hold up reconstruction," Yellen said.
Her comments come a day after Biden said it was his "intention that the federal government will pay for the entire cost of reconstructing that bridge, and I expect the Congress to support my effort."
Biden said that, while the effort will take some time, the people of Baltimore "can count on us."
When asked by a reporter whether the company that manages the ship should be held responsible, Biden said the federal government would not wait for any decisions and would step in to get the bridge built and reopened.
The Francis Scott Key Bridge along I-695 in Maryland collapsed in the Baltimore harbor around 1:30 a.m. Tuesday after a cargo ship slammed into a support beam.
The collapse sent at least eight construction workers and multiple vehicles plunging into the Patapsco River below.
The cargo ship that hit the bridge was the Dali, a 95,000 GT Singapore-flagged container ship, per the Maritime and Port Authority (MPA) of Singapore.
There were 22 crew members onboard at the time of the incident.
The Synergy Group, a Singapore-based company that manages the ship, said in a statement that two pilots piloting the ship through the harbor and all crew members onboard were accounted for and there are no reports of any injuries.
The group also said that no pollution has been reported.
The large vessel appeared to catch fire before becoming disabled.
Footage of the incident shows the lights going out multiple times on the vessel in question prior to impact, suggesting the collision may have been due to a power failure.
Fox News Digital’s Landon Mion, Anders Hagstrom, and Stephen Sorace contributed to this report.
https://www.msn.com/en-us/news/us/janet ... bdc2&ei=88
Re: THE ECONOMY
REUTERS
"Fed's Waller still sees 'no rush' to cut rates amid sticky inflation data"
By Michael S. Derby
March 27, 2024
NEW YORK, March 27 (Reuters) - Recent disappointing inflation data affirms the case for the U.S. Federal Reserve to hold off on cutting its short-term interest rate target, Fed Governor Christopher Waller said on Wednesday, but he did not rule out trimming rates later in the year.
"There is no rush to cut the policy rate" right now, Waller said in a speech at an Economic Club of New York gathering.
Recent data "tells me that it is prudent to hold this rate at its current restrictive stance perhaps for longer than previously thought to help keep inflation on a sustainable trajectory toward 2%."
Rate cuts are not off the table, however, Waller said, noting that further progress expected on lowering inflation "will make it appropriate" for the Fed "to begin reducing the target range for the federal funds rate this year."
It could take a few months of easing inflation data to gain that confidence, but until then, a strong economy gives the Fed space to take stock of how the economy is performing, Waller said.
Pushing back the start of rate cuts will likely affect how much easing happens this year, he said.
"It is appropriate to reduce the overall number of rate cuts or push them further into the future in response to the recent data."
Waller's comments were his first since last week's Fed policy meeting where officials, as expected, maintained the overnight policy rate at 5.25% to 5.5%.
Policy makers also affirmed forecasts from year-end 2023 for three rate cuts this year, based on the expectation that inflation will fall back toward 2% as the year moves forward.
However, unexpectedly strong inflation this year has called into question whether the Fed can deliver on its forecast.
Fed officials are waiting to see if recent data reflects a temporary setback in the effort to reduce price pressures, and if so, this could mean dialing back rate cut expectations for the year.
At the press conference following last week's policy meeting, Fed Chairman Jerome Powell said current policy risks are "two sided."
"We're in a situation where if we ease too much or too soon, we could see inflation come back, and if we ease too late, we could do unnecessary harm to employment and people's working lives," he said.
"We want to be careful" and the strength of the economy gives the Fed space to watch the data before deciding what to do with interest rate policy, he added.
At the end of February, Waller signaled he was among the officials with some skepticism about any near-term rate cuts, given that the economy is showing strong growth amid a very strong labor market.
In comments after his formal remarks on Wednesday, Waller said there is an extremely high bar to the central bank raising rates.
“Something would really have to dramatically change on the inflation front to think about" pushing rates higher, he said.
Instead, he said, the question before the Fed is when to ease rates and "it’s just a question of when you start."
Reporting by Michael S. Derby; Editing by Richard Chang and Leslie Adler
https://www.reuters.com/markets/us/feds ... 024-03-27/
"Fed's Waller still sees 'no rush' to cut rates amid sticky inflation data"
By Michael S. Derby
March 27, 2024
NEW YORK, March 27 (Reuters) - Recent disappointing inflation data affirms the case for the U.S. Federal Reserve to hold off on cutting its short-term interest rate target, Fed Governor Christopher Waller said on Wednesday, but he did not rule out trimming rates later in the year.
"There is no rush to cut the policy rate" right now, Waller said in a speech at an Economic Club of New York gathering.
Recent data "tells me that it is prudent to hold this rate at its current restrictive stance perhaps for longer than previously thought to help keep inflation on a sustainable trajectory toward 2%."
Rate cuts are not off the table, however, Waller said, noting that further progress expected on lowering inflation "will make it appropriate" for the Fed "to begin reducing the target range for the federal funds rate this year."
It could take a few months of easing inflation data to gain that confidence, but until then, a strong economy gives the Fed space to take stock of how the economy is performing, Waller said.
Pushing back the start of rate cuts will likely affect how much easing happens this year, he said.
"It is appropriate to reduce the overall number of rate cuts or push them further into the future in response to the recent data."
Waller's comments were his first since last week's Fed policy meeting where officials, as expected, maintained the overnight policy rate at 5.25% to 5.5%.
Policy makers also affirmed forecasts from year-end 2023 for three rate cuts this year, based on the expectation that inflation will fall back toward 2% as the year moves forward.
However, unexpectedly strong inflation this year has called into question whether the Fed can deliver on its forecast.
Fed officials are waiting to see if recent data reflects a temporary setback in the effort to reduce price pressures, and if so, this could mean dialing back rate cut expectations for the year.
At the press conference following last week's policy meeting, Fed Chairman Jerome Powell said current policy risks are "two sided."
"We're in a situation where if we ease too much or too soon, we could see inflation come back, and if we ease too late, we could do unnecessary harm to employment and people's working lives," he said.
"We want to be careful" and the strength of the economy gives the Fed space to watch the data before deciding what to do with interest rate policy, he added.
At the end of February, Waller signaled he was among the officials with some skepticism about any near-term rate cuts, given that the economy is showing strong growth amid a very strong labor market.
In comments after his formal remarks on Wednesday, Waller said there is an extremely high bar to the central bank raising rates.
“Something would really have to dramatically change on the inflation front to think about" pushing rates higher, he said.
Instead, he said, the question before the Fed is when to ease rates and "it’s just a question of when you start."
Reporting by Michael S. Derby; Editing by Richard Chang and Leslie Adler
https://www.reuters.com/markets/us/feds ... 024-03-27/