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Dow hits 2022 low as markets sell off on recession fears
NEW YORK (AP) — Markets are selling off around the world as the global economy weakens, as central banks ramp up the pressure with further hikes in interest rates. The Dow Jones Industrial Average closed at its lowest point of the year on Friday. The S&P 500 fell 1.7%, near 2022 lows. Energy prices also closed sharply higher as traders worry about a possible recession. Treasury yields, which affect bonds and other types of credit, are at multi-year highs. UK government bond yields rose after the country’s new government announced tax cuts.
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UK cuts taxes, increases spending, accelerates pound slide.
LONDON (AP) – The British pound suffered its biggest one-day drop in 2 1/2 years after the United Kingdom’s new government announced plans to cut taxes and increase spending. The rise in public debt has fueled fears that the country’s cost-of-living crisis will worsen. The British currency fell more than 3 percent on Friday. Treasury chief Kwasi Kwarteng announced tax cuts that would boost economic growth and not make corresponding spending cuts. They have already announced plans to cover energy bills for homes and businesses, which will be financed by loans. Critics have attacked the plan for pursuing business interests over workers and for failing to provide any figures on its impact on the government’s budget targets.
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The revamped Detroit Auto Show now features new flying technology
DETROIT (AP) – The Detroit Auto Show is back with a bang. And walking. The prestigious North American International Auto Show was held in 2019. It returned last week. Visitors can once again feast their eyes on the latest offerings from some of the world’s greatest automakers. But now you can see what the organizers are calling “a show beyond the program.” The Air Mobility Experience features exhibits and displays from six air mobility innovators, including an electric vertical takeoff and landing aircraft, a hoverboard, a hoverboard and a jet suit. The fair runs through Sunday at the downtown convention center.
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US to seek strong labor, environmental standards in Asia
WASHINGTON (AP) — The U.S. is outlining its goals for a new trade deal with Australia, Japan, South Korea and nine other countries. The Office of the United States Trade Representative announced its intention to negotiate the Indo-Pacific Economic Framework with the 12 countries in May. Among them, the US is taking steps to encourage Indo-Pacific countries to improve labor and environmental standards and ensure their markets are open to competition, and to ease supply chain disputes at border crossings.
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GM spent $760 million to build the Toledo plant into EV parts.
TOLEDO, Ohio (AP) – General Motors has announced it will spend $760 million to renovate a transmission plant in Toledo, Ohio, to build electric vehicle drive lines. It is the first GM engine or transmission plant to begin the long transition from internal combustion engines to EVs. GM has a goal of producing only electric passenger cars by 2035. The investment will keep about 1,500 hourly and salaried workers employed at the Toledo plant, which now has four transmissions used in pickup trucks and several other GM combustion vehicles. It’s good news for workers in Toledo who have been worried about the future of their plant.
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Bank directors have urged Trump officials to be fired over an ethics investigation
MIAMI (AP) – The chief executives of the Inter-American Development Bank have voted unanimously to fire a former Trump official as president of the Washington-based institution. The action follows an investigation that found Mauricio Claver-Caron breached ethics rules by supporting a senior aide with whom she had an affair. A person familiar with the vote said the decision to recommend Claver-Caron’s ouster was reached in a closed-door meeting Thursday. The Associated Press has obtained a confidential report by a law firm hired by the bank’s board, anonymously, into allegations of misconduct against Claver Caron. Investigators say the relationship dates back to at least 2019, when both held senior positions at the National Security Council.
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After 90 years, a German bakery is about to close due to rising energy prices
COLOGNE, Germany (AP) – A family-run bakery in the German city of Cologne is shutting down its ovens after 90 years because it can’t afford to raise energy prices as a result of Russia’s war in Ukraine. Engelbert Schlechtriemen’s grandparents founded the bakery before World War II, and the 58-year-old took it over from his father 28 years ago. His business is one of the victims of the European energy crisis caused by Russian natural gas cuts. The resulting increase in power and energy costs has led to rising inflation, straining businesses already struggling with rising other costs.
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Spain plans to increase taxes on millionaires to help those in need.
MADRID (AP) – Spain’s Socialist-led coalition government plans a temporary top tax rate on the richest 1% starting next year. This is in addition to the wind curtailment tax on large energy companies and banks. Socialist Prime Minister Pedro Sánchez said on Friday that the change was to support the welfare state in a crisis caused by high energy and food prices. Annual inflation in Spain rose to 10.5% last month. The government says the tax hike is only targeting millionaires. He says the exact increase and scope of the tax measure is still being worked out.
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Inflation and instability have challenged Bangladesh’s ‘miracle economy’.
DHAKA, Bangladesh (AP) — Bangladesh’s economic miracle is in deep trouble as rising fuel prices fuel food and other essentials, fueling public grievances. It has put pressure on Prime Minister Sheikh Hasina’s government, which is seeking help from the International Monetary Fund to protect the country’s finances. Experts say the problem in Bangladesh, where months of unrest forced its long-time president to flee the country, is not as severe as Sri Lanka’s. But it faces similar problems: overspending on projects, public anger over graft and corruption, and a weakening trade balance. Such trends are undermining Bangladesh’s progress as a wealthy middle-income country.
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The S&P 500 dropped 64.76 points, or 1.7%, to 3,693.23. The Dow Jones industrial average lost 486.27 points, or 1.6 percent, to 29,590.41. The Nasdaq fell 198.88 points, or 1.8%, to 10,867.93. The Russell 2000 index of smaller companies fell 42.72 points, or 2.5 percent, to 1,679.59.
