Author Archives: Reuters News Agency

Italy makes COVID-19 health pass mandatory for teachers

By Gavin Jones and Giuseppe Fonte

ROME (Reuters) – The Italian government ruled on Thursday that teachers must have proof of immunity from COVID-19 before entering the classroom, and also made the so-called Green Pass mandatory for travelers on trains, planes, ships and inter-city coaches.

The Green Pass is a digital or paper certificate that shows if someone has received at least one jab, has tested negative or has recently recovered from the coronavirus.

Looking to speed up vaccinations to counter the highly contagious Delta variant, the government had already decreed that from Aug. 6 the pass would be required to eat indoors in restaurants and use an array of services and leisure activities.

On Thursday, despite misgivings in the ruling coalition and small street protests, Mario Draghi’s cabinet widened the Green Pass requirement to all teachers, university students and long-distance transport from Sept. 1.

“The choice of the government is to invest as much as possible in the Green Pass to avoid closures and to safeguard freedom,” Health Minister Roberto Speranza told reporters.

Teachers will not be able to work without the certificate and after five days of absence they will no longer be paid.

Italy is following in the footsteps of France, which was the first European country to say it was making proof of immunity mandatory to access a range of services and venues.

The move by President Emmanuel Macron triggered larger protests than those that have been seen in Italy. Opponents of the measures say they trample on freedoms, discriminate against the unvaccinated, and flout European Union rules.

On Thursday France’s top court ruled that the health pass did not contravene the constitution.

Italy reported 27 coronavirus-related deaths on Thursday against 21 the day before, the health ministry said, while the daily tally of new infections rose to 7,230 from 6,596.

The country has registered 128,163 COVID deaths since its outbreak emerged in February last year, the second-highest toll in Europe after Britain and the eighth-highest in the world. It has seen 4.38 million cases to date.

In March, just a month after taking office, Draghi made it obligatory for health workers to be vaccinated.

A growing number of countries are seeking ways to convince reluctant sections of their populations to get COVID-19 jabs.

U.S. President Joe Biden said last week it will be compulsory for federal workers to get vaccinated or face regular testing, mask mandates and travel restrictions.

While France saw a surge in vaccinations following Macron’s announcement of the health pass requirement, the picture in Italy has been less clear.

The pace of inoculations actually slowed in the two weeks following Draghi’s July 22 announcement of the first Green Pass restrictions, but this may be due to the time lag between booking a jab and actually getting one, and to summer holidays.

“The vaccination hesitation among the over 50s persists,” Nino Cartabellotta, head of Italian public health think-tank GIMBE, told Reuters.

As of Aug. 4 some 65% of Italians had received at least one shot against COVID-19, of whom 54% were fully vaccinated. The figures are broadly in line with those of most European countries.

(Additional reporting by Giselda Vagnoni; Editing by Angus MacSwan)

Britain says China’s BGI must register prenatal tests by Sept 1

By Reuters Staff

LONDON (Reuters) – China’s largest gene company BGI Group must register its prenatal test with local regulators by Sept. 1 if it wants to keep offering products in Britain, a minister said on Thursday.

A Reuters report found BGI Group developed the tests in collaboration with China’s military and uses them to collect genetic data from millions of women round the world.

However, BGI says it alone produced the NIFTY test, has never shared data for national security or defense purposes, and complies with European privacy laws. Reuters found no evidence BGI violated privacy agreements or regulations.

British junior health minister James Bethell said the British Medicines and Healthcare products Regulatory Agency (MHRA) expected BGI’s devices to need oversight before being placed on the local market.

“The MHRA understand BGI genetic screening tests are currently available for sale in the UK. These devices do not appear to have been registered with the MHRA at this time,” Bethell said in a written response to a question on BGI’s tests from a member of Britain’s upper chamber of parliament.

“However, due to their risk classification, registration will be required from 1 September 2021 in order to continue placing the products on the market.”

Bethell said there had been no specific assessment of BGI’s tests, but that neither the state-run National Health Service (NHS) nor the Public Health England (PHE) agency used its technology.

The tests have been available in some private clinics in England since at least 2014, however.

“There are no grounds to prevent BGI Groups operating in the UK provided they comply with UK legislation and regulatory requirements,” Bethell added.

In an emailed statement, BGI said it “strictly complies with local laws, guidelines, and protocols, while adhering to internationally recognized ethical and legal standards.”

Poland says Belarus lets migrants cross border in ‘hybrid war’ with EU

WARSAW (Reuters) -Poland accused Belarus of sending a growing number of migrants over the border in retaliation for Warsaw’s decision this week to give refuge to Krystsina Tsimanouskaya, a Belarusian athlete who refused to return home from the Tokyo Olympics.

A deputy interior minister, Maciej Wasik, said on Thursday that Minsk was “waging a hybrid war with the European Union with the help of illegal immigrants.”

In recent weeks, neighbor and fellow EU member state Lithuania has reported a surge in illegal border crossings from Belarus and said Minsk was flying in migrants from abroad and dispatching them into the EU.

“There are both young men and women with children. Belarus is using these immigrants as a living weapon,” Wasik told online broadcaster Telewizja wPolsce.

“In recent days we have seen an increase (in migrants). We treat it as a reaction to the granting of asylum to the Belarusian sprinter.”

Tsimanouskaya’s Cold War-style defection has ratcheted up Western tensions with Minsk at a time when the EU has accused President Alexander Lukashenko of using migrants to hit back against EU sanctions.

Officials in the Belarusian government could not immediately be reached for comment.

Belarusian President Alexander Lukashenko on Thursday accused Lithuania and Poland of fueling the migrant issue on the border, saying Lithuania wanted to drive migrants into Belarusian territory by force.

Belarus in May decided to let migrants enter Lithuania in retaliation for EU sanctions meted out after Minsk forced a Ryanair flight to land on its soil and arrested a dissident blogger who was on board.

Lukashenko at the time said Belarus would not become a “holding site” for migrants from Africa and the Middle East.

The Polish Border Guard told Reuters it had detained a group of 71 migrants on the border with Belarus during the night from Wednesday to Thursday and another group of 62, mostly Iraqis, on Wednesday.

That is more that the total of 122 illegal migrants the Border Guard said were detained along the frontier in the whole of last year. Last month, 242 migrants were intercepted.

Wasik said migrants arriving recently had mainly been from Iraq but also from Afghanistan.

The interior ministry did not immediately respond to Reuters requests for comment.

The EU has summoned the Belarusian envoy in Brussels and held talks with the Iraqi government over the issue of illegal migration to the bloc.

(Reporting by Anna Wlodarczak-Semczuk and Agnieszka Barteczko in Warsaw, Matthias Williams in London, writing by Alan Charlish, Editing by William Maclean, Mark Heinrich and Steve Orlofsky)

U.S. COVID-19 cases hit six-month high, Florida grapples with surge

By Roshan Abraham and Maria Caspani

(Reuters) -The United States hit a six-month high for new COVID cases with over 100,000 infections reported on Wednesday, according to a Reuters tally, as the Delta variant ravages areas where people did not get vaccinated.

The country is reporting over 94,819 cases on a seven-day average, a five-fold increase in less than a month, Reuters data through Wednesday showed. The seven-day average provides the most accurate picture of how fast cases are rising since some states only report infections once a week or only on weekdays.

Seven U.S. states with the lowest COVID-19 vaccination rates – Florida, Texas, Missouri, Arkansas, Louisiana, Alabama and Mississippi – account for half of the country’s new cases and hospitalizations in the last week, White House COVID-19 coordinator Jeff Zients told reporters on Thursday.

In the coming weeks, cases could double to 200,000 per day due to the highly contagious Delta variant, said top U.S. infectious disease expert Dr. Anthony Fauci on Wednesday.

“If another one comes along that has an equally high capability of transmitting but also is much more severe, then we could really be in trouble,” Fauci said in an interview with McClatchy. “People who are not getting vaccinated mistakenly think it’s only about them. But it isn’t. It’s about everybody else, also.”

To combat the Delta surge, the United States plans to give booster shots to Americans with compromised immune systems, top U.S. infectious disease expert Dr. Anthony Fauci said Thursday.

The United States is joining Germany, France and Israel in giving booster shots, ignoring a plea by the World Health Organization to hold off until more people around the world can get their first shot.

FLORIDA SURGE

Southern states, which have some of the nation’s lowest vaccination rates, are reporting the most COVID-19 cases and hospitalizations. Florida, Texas and Louisiana were reporting the highest total number of new cases in the region over the last week, according to a Reuters analysis.

Florida, which has emerged as the nationwide hotbed of new infections, set yet another grim hospitalization record on Thursday with 12,373 confirmed COVID-19 patients in its hospitals, according to data from the U.S. Department of Health and Human Services (HHS).

More children are hospitalized with the virus in Florida than in any other U.S. state, HHS data shows.

“23% of new COVID hospitalizations in the U.S are in Florida, and their hospitals are being overwhelmed again,” White House Press Secretary Jen Psaki said on Wednesday. Psaki urged the state’s governor, Republican Ron DeSantis, to “join us in this fight” after DeSantis accused Biden of singling out his state.

Louisiana and Arkansas are also grappling with record or near-record numbers of coronavirus patients occupying beds, according to a Reuters tally.

President Joe Biden on Tuesday urged Republican leaders in Florida and Texas – home to roughly a third of all new U.S. COVID-19 cases – to follow public health guidelines on the pandemic or “get out of the way.”

To try to halt the spread of the virus, New York City will require proof of vaccination at restaurants, gyms and other businesses.

Some private companies are also mandating vaccines for employees and customers.

As Delta spreads, some companies are delaying plans for workers to return to the office. Amazon.com, which had originally set Sept. 7 as the comeback date, on Thursday said it would not expect U.S. corporate employees to return to the office until next year, according to an internal note seen by Reuters.

(Reporting by Roshan Abraham in Bengaluru and Maria Caspani in New York; Additional reporting by Jeff Mason, Susan Heavey, Carl O’Donnell and Trevor Hunnicutt; Editing by Lisa Shumaker)

U.S. plans to give extra COVID-19 shots to at-risk Americans – Fauci

By Trevor Hunnicutt and Carl O’Donnell

WASHINGTON (Reuters) – The United States is working to give additional COVID-19 booster shots to Americans with compromised immune systems as quickly as possible, as cases of the novel coronavirus continue to rise, top U.S. infectious disease expert Dr. Anthony Fauci said Thursday.

The United States is joining Germany, France and Israel in giving booster shots, ignoring a plea by the World Health Organization to hold off until more people around the world can get their first shot.

U.S. regulators need to fully authorize the COVID-19 vaccines or amend their emergency use authorizations before officials can recommend additional shots, but the U.S. Centers for Disease Control and Prevention is working to make third doses available sooner under certain circumstances, officials said at a July meeting.

“It is extremely important for us to move to get those individuals their boosters and we are now working on that,” Fauci said on a press call, adding that immunocompromised people may not be sufficiently protected by their existing COVID-19 vaccinations.

Fauci said rising cases resulting from the spread of the contagious Delta variant in the United States can be turned around with additional vaccinations.

The Biden administration has been eager to thaw opposition by some Americans, including those who distrust the government, to taking the vaccine as the highly infectious Delta variant sweeps the country.

Seven U.S. states with the lowest COVID-19 vaccination rates account for half of the country’s new cases and hospitalizations in the last week, the White House said on Thursday.

The states are Florida, Texas, Missouri, Arkansas, Louisiana, Alabama and Mississippi, according to President Joe Biden’s COVID-19 coordinator, Jeff Zients, who spoke at the press briefing

Of those, Florida and Texas account for about a third of new coronavirus cases and an even higher share of hospitalizations in the country.

COVID cases are up about 43% over the previous week and daily deaths are up more than 39%, according to U.S. Centers for Disease Control and Prevention Director Dr. Rochelle Walensky, who also spoke on the call.

The United States hit a six-month high for new COVID cases with over 100,000 infections reported on Wednesday, according to a Reuters tally.

Some 864,000 vaccinations have been given in the past 24 hours, the highest since early July, the White House said.

Zients said the Biden administration supports U.S. businesses and other institutions requiring that their employees get vaccinated.

He added that the White House is considering requiring foreign visitors to be vaccinated as it plans to eventually reopen international travel but said it had made no final decision.

(Reporting by Jeff Mason, Susan Heavey, Carl O’Donnell and Trevor Hunnicutt; editing by Jonathan Oatis and Lisa Shumaker)

Thousands evacuate fast-moving California wildfire; homes burn

By Fred Greaves

COLFAX, California (Reuters) -A rapidly spreading wildfire burned homes and forced thousands to evacuate in two heavily wooded counties northeast of Sacramento in Northern California on Wednesday, generating a towering plume of smoke visible from at least 70 miles (110 km) away.

The so-called River Fire scorched 1,400 acres (566 hectares) in Placer and Nevada counties, with 1,000 acres burnt within the first two hours, the California Department of Forestry and Fire Protection (Cal Fire) said.

The River Fire was less than 100 miles (160 km) south of the enduring Dixie Fire, which according to Cal Fire has consumed 278,000 acres and was only 35% contained three weeks after it started.

Social media images showed the Dixie Fire on Wednesday had destroyed multiple structures in one section of Greenville, a town of about 800 people in Plumas County.

The River Fire was not at all contained, but officials said they expected cooler overnight weather and a reversal of the wind direction to help.

At least four homes were destroyed in Colfax, a Placer County town of 2,000 people about 50 miles (80 km) northeast of Sacramento, according to a Reuters witness. Officials said they would have an estimate of the property damage on Thursday.

At least 2,400 people had evacuated their homes in Placer County, and another 4,200 people were under evacuation orders in Nevada County, fire and law enforcement officials told a news conference.

Evacuation centers were established in both counties, and an animal shelter for pets was set up at a fairground.

“If you received an evacuation warning, please go. If you received an order, get out,” Placer County Sheriff Devon Bell told the news conference.

“Our hearts are with our communities, our friends, our neighbors who have been impacted by this incident,” Bell said.

Carrie Levine, a fire ecologist from nearby Grass Valley, said her family had evacuated even without an official warning because the fire was moving so fast.

“There’s a big column of smoke. It’s pretty dark, kind of like a purple, gray, eerie smoke. It’s in a pretty steep river canyon, and they really like to just blow up river canyons with the wind,” said Levine, who studies fire fuels and develops models for a private company.

Another expert urged people to evacuate because the area was particularly risky.

“In an analysis we did a couple years ago for an insurer, the Colfax/Auburn/Grass Valley area was one of the highest risk areas in the state for a catastrophic loss wildfire,” Crystal Kolden, a pyrogeographer at the University of California Merced, said on Twitter.

More than a dozen wildfires were burning around the state, which typically experiences peak fire season later in the year. California was on pace to suffer even more burnt acreage this year than last year, which was the worst fire season on record.

(Reporting by Fred Greaves in Colfax, California, and Daniel Trotta in Carlsbad, California)

Some 40 bodies found in Myanmar jungle after army crackdown -U.N. envoy

A Myanmar soldier stands near Maungdaw, north of Rakhine state, Myanmar September 27, 2017. REUTERS/Soe Zeya Tun

(Reuters) -A Myanmar militia force fighting the army in a central part of the country and residents have found at least 40 bodies in jungle areas in recent weeks, including some showing signs of torture, said a militia member and Myanmar’s U.N. envoy.

Since the military overthrew the elected government of Aung San Suu Kyi on Feb. 1, hundreds of people have been killed as the army violently quelled protests, and in clashes between soldiers and often hastily assembled, lightly armed local militias.

The bodies were found in several different locations around Kani, a town in the Sagaing area, which has seen fierce fighting in recent months between the army and the militia groups set up by opponents of military rule.

Reuters could not independently verify the claims and a spokesman for the military did not answer calls seeking comment.

In a letter to U.N. Secretary-General Antonio Guterres, Myanmar’s U.N. envoy Kyaw Moe Tun – who represents the elected civilian government – said a total of 40 bodies were found and described three different incidents during July in Kani.

Kyaw Moe Tun described the incidents as “clearly amounting to crimes against humanity,” calling on the U.N. Security Council and international community to impose a global arms embargo on Myanmar’s military.

“There is no sign of easing atrocities, killing, arrest committed by the military,” he wrote. “We demand for urgent humanitarian intervention from the international community before it is too late.”

Fighting in the Sagaing area has now mainly stopped and it was unclear if more bodies would be found, said a member of the Kani militia, who asked not to be identified.

“Most villagers in the remote area had fled to the nearby town,” he said, accusing the military and a rival pro-junta militia of carrying out reprisal killings and looting.

The militia member also put the total number of bodies so far at around 40, found on several occasions.

A military information newsletter dated July 30 said security forces had been attacked by around 100 “terrorists” with small arms near Zeepindwin village in Kani. It said soldiers had retaliated and nine bodies had been retrieved, along with hunting rifles, homemade mines and a grenade.

Security forces have killed at least 946 people since the coup, according to the Assistance Association of Political Prisoners, a Thai-based activist group. The military has disputed the tally and also said many members of the security forces have been killed.

(Reporting by Reuters Staff; Writing by Ed Davies; Editing by Kim Coghill and Jonathan Oatis)

Biden offers temporary ‘safe haven’ to Hong Kong residents in U.S

By Michael Martina

WASHINGTON (Reuters) -President Joe Biden on Thursday offered temporary “safe haven” to Hong Kong residents in the United States, allowing potentially thousands of people to extend their stay in the country in response to Beijing’s crackdown on democracy in the Chinese territory.

In a signed memo, Biden directed the Department of Homeland Security to implement a “deferral of removal” for up to 18 months for Hong Kong residents currently in the United States, citing “compelling foreign policy reasons”.

“Over the last year, the PRC has continued its assault on Hong Kong’s autonomy, undermining its remaining democratic processes and institutions, imposing limits on academic freedom, and cracking down on freedom of the press,” Biden said in the memo, using the acronym for the People’s Republic of China.

“Offering safe haven for Hong Kong residents who have been deprived of their guaranteed freedoms in Hong Kong furthers United States interests in the region. The United States will not waver in our support of people in Hong Kong,” Biden said.

The vast majority of Hong Kong residents currently in the United States are expected to be eligible for the program, according to a senior administration official, but some legal conditions apply, such as individuals not having been convicted of felonies.

The White House said in a statement that the move made clear the United States “will not stand idly by as the PRC breaks its promises to Hong Kong and to the international community.”

Those eligible may also seek employment authorization in the United States, Secretary of Homeland Security Alejandro Mayorkas said in a statement.

The measure is the latest in a series of actions Biden has taken to address what his administration says is the erosion of rule of law in the former British colony, which returned to Beijing’s control in 1997.

The U.S. government in July applied more sanctions on Chinese officials in Hong Kong, and issued an updated business advisory warning companies of risks of operating under the national security law, which China implemented last year to criminalize what it considers subversion, secessionism, terrorism or collusion with foreign forces.

Critics say the law facilitates a crackdown on pro-democracy activists and a free press in the territory, which Beijing had agreed to allow to operate under considerable political autonomy for 50 years after it regained control.

China retaliated against the U.S. actions last month with its own sanctions on American individuals, including former U.S. commerce secretary Wilbur Ross.

U.S. lawmakers have sought legislation that would make it easier for people from Hong Kong fearing persecution after joining protests against China to obtain U.S. refugee status, and Secretary of State Antony Blinken has said the United States should accept people fleeing the Hong Kong crackdown.

(Reporting by Michael Martina; editing by Gerry Doyle and Jonathan Oatis)

Taliban target provincial Afghan cities in response to U.S. strikes, commanders say

KABUL/PESHAWAR, Pakistan (Reuters) – Taliban militants have switched strategy from targeting rural areas of Afghanistan to attacking provincial cities, in response to increased U.S. air strikes after the United States said it was ending its longest war, three militant commanders said.

The Taliban have stepped up their campaign to defeat the U.S.-backed government as foreign forces complete their withdrawal after 20 years of conflict.

A regional U.S. commander said late last month the United States had increased air strikes to counter growing Taliban attacks, a move condemned by the Islamist group.

Fighting has been particularly heavy inside the city of Herat, near the western border with Iran, Lashkar Gah, capital of Helmand province in the southwest, and Kandahar in the south.

The three Taliban commanders, who spoke on condition of anonymity, told Reuters that they were focused on capturing Herat and Kandahar, with Lashkar Gah in their sights.

“Mullah Yaqoob argued that when U.S. didn’t fulfill their commitment why should Taliban be made to follow the accord?” said one of the commanders, based in Kandahar, referring to the group’s military chief.

“Mullah Yaqoob has decided to capture Kandahar and Herat and now Helmand and then it could be Kunduz, Khost or any other province,” said the commander, saying the military leader’s arguments had won over the group’s political office.

A Taliban spokesman did not respond to a request for comment. Taliban negotiator Suhail Shaheen told Reuters the group was continuing its policy of seizing control of rural areas and implementing Islamic Sharia there, rather than focusing on cities.

The Taliban, who ruled with an iron hand from 1996 until 2001, had said previously they would focus on lucrative border crossings and large rural areas, though they have encircled and at times entered provincial capitals.

The group has been waging a massive nationwide offensive since April when President Joe Biden announced troops would withdraw by September and as officials warned peace talks in Doha were failing to make substantive progress.

In recent weeks, there have been sustained attacks on Herat, Kandahar and Lashkar Gar, stretching Afghan special forces thin and killing dozens of civilians.

FIGHTING ‘NOT LIMITED TO PERIPHERIES’

“The operations in Kandahar and Herat are very much important to us and our priority is to capture the two crucial airports or airbases in Kandahar and Herat,” the Taliban commander in Kandahar said.

Officials and experts said they saw signs of a change in strategy last month.

“Taliban are pushing against the provincial capitals … not just to exert pressure but to capture them,” said Asfandyar Mir, a South Asia analyst from Stanford University.

“The main evidence is the extent of their breach of these cities. Fighting is not limited to the peripheries any more. This switch in Taliban strategy has been formalized after Eid, though Taliban forces were putting serious pressure on Kandahar even before Eid.”

The Muslim holiday of Eid al-Adha was celebrated last month.

Kandahar and Herat are the second- and third-largest cities of Afghanistan by population. Experts said their loss would be a major political blow to the government and could potentially trigger major realignments in favor of the Taliban.

“Capture of Kandahar means a lot to the Taliban. It was their capital and occupying the city is great morale boost for the Taliban… This is something they cherish and for Kandahar, Taliban can risk international ire,” said an Asian diplomatic source closely following the Taliban.

A Western security official said: “The fact they are attacking (cities) is a sharp reaction to air support offered by the U.S. … The Taliban have proven that now they will not just stop with controlling trading points.”

It is not clear whether U.S. airstrikes would continue after foreign forces complete their withdrawal.

A spokesperson for U.S. forces in Afghanistan and the U.S. embassy did not immediately respond to requests for comment.

Experts and officials say that for now a military takeover of Kabul would be much more difficult for the Taliban than provincial capitals, but that the group could increase bombings and attacks to undermine security and public morale.

The Taliban claimed responsibility for an attack at the acting defense minister’s residence on Tuesday and warned of further violence.

(Reporting by Kabul/Peshawar newsrooms; Additional reporting by India newsroom; Editing by Nick Macfie)

U.S. services sector growth accelerates despite supply constraints

By Lucia Mutikani

WASHINGTON (Reuters) – A measure of U.S. services industry activity jumped to a record high in July, boosted by the shift in spending to services from goods, but businesses continued to pay higher prices for inputs because of supply constraints.

The Institute for Supply Management survey on Wednesday also showed a rebound in a gauge of services industry employment last month. That eased worries of a sharp slowdown in job growth, which had been stoked by the ADP Employment Report showing the smallest gain in private payrolls in five months in July.

The bounce back in the ISM services employment index followed a similar reading for the manufacturing sector. The economy is pushing ahead after fully recovering in the second quarter the sharp loss in output suffered during the very brief COVID-19 pandemic recession.

“For months, employers have struggled to find labor and employment numbers have been held down from the worker side rather than a lack of demand from companies,” said Chris Low, chief economist at FHN Financial in New York. “These increases bode well for Friday’s employment report. ADP has not been very useful this year.”

The Institute for Supply Management said its non-manufacturing activity index raced to 64.1 last month, the highest reading since the series started in 2008, from 60.1 in June. A reading above 50 indicates growth in the services sector, which accounts for more than two-thirds of U.S. economic activity. Economists polled by Reuters had forecast the index climbing to 60.5.

All services industries reported growth, with anecdotes of pent-up demand as “companies begin to fully reopen and remote workers return to offices.”

Demand is rotating back to services as nearly half of the population has been fully vaccinated against COVID-19, allowing people to travel, frequent restaurants, visit casinos and attend sporting events among services-related activities that were curbed early in the pandemic in favor of goods.

Government data last week showed spending on services accelerated sharply in the second quarter, helping to lift the level of gross domestic product above its peak in the fourth quarter of 2019.

The ISM survey’s measure of new orders received by services businesses increased to a reading of 63.7 from 62.1 in June. Further gains are likely in the months ahead, with inventories lean and inventory sentiment among customers poor. Businesses depleted inventories at a rapid clip in the second quarter. Stocks at retailers are well below normal levels.

U.S. stocks were trading lower after a record close for the S&P 500 index. The dollar rose against a basket of currencies. U.S. Treasury prices were mixed.

PORTS CONGESTION

The strong demand is continuing to strain supply chains. The survey’s measure of supplier deliveries rose to 72.0 from a reading of 68.5 in June. A reading above 50 indicates slower deliveries. Some businesses complained about the scarcity of appliances, laptops as well as rental cars. Others said heating, ventilation and air conditioning repairs also were impacted by longer than normal lead times for replacement units.

Wholesalers said congestion at the ports of Long Beach/Los Angeles and Seattle had increased lead time by 15 days. They were also facing additional delays at the Chicago rail yard.

With bottlenecks in the supply chain persisting, a measure of prices paid by services industries surged to 82.3, the highest reading in nearly 16 years, from 79.5 in June.

Fed Chair Jerome Powell has repeatedly stated that inflation will moderate as supply constraints abate.

Services industries hired more workers in July, though labor shortages lingered, especially in the accommodation and food services sector. A measure of services industry employment rebounded to a reading of 53.8 from 49.3 in June.

That offset the ADP report showing private payrolls rose by 330,000 jobs last month, less than half of the 695,000 that had been anticipated by a Reuters survey of economists.

The slowdown in hiring last month was across all business sizes and industries. Leisure and hospitality payrolls increased by 139,000 jobs, below the 330,000 average in the second quarter. Economists said this suggested the early terminations of benefits in at least 20 states led by Republican governors was not forcing low-wage earners to return to work.

Factories added only 8,000 jobs in July. A global shortage of semiconductors is hampering production in the automobile sector. Hiring at construction sites stalled as expensive lumber and scarce building materials constrain homebuilding.

The ADP report, which is jointly developed with Moody’s Analytics, was published ahead of the government’s more comprehensive, and closely watched employment report for July on Friday. It, however, has a poor record predicting the private payrolls count in the Bureau of Labor Statistics (BLS) employment report because of methodology differences.

According to a Reuters survey of economists, private payrolls likely increased by 750,000 jobs in July after rising 662,000 in June. With government employment expected to have increased by about 130,000, thanks to education-related hiring, that would lead to overall payrolls advancing by 880,000 jobs in July. The economy created 850,000 jobs in June.

July’s nonfarm payrolls estimate is highly uncertain, with labor market indicators mixed. Data from Homebase, a payroll scheduling and tracking company, showed its employees working index rising moderately in July compared to June.

The Conference Board’s labor market differential, derived from data on consumers’ views on whether jobs are plentiful or hard to get, in July hit its highest level since 2000.

Education payrolls typically fall by at least 1 million in July, before adjusting for seasonal fluctuations, as schools and universities close for summer.

This year, however, many students are in summer school catching up after disruptions caused by the pandemic. Economists anticipate a small decline in education employment, which would boost the seasonally adjusted payrolls for the sector.

“We are maintaining our forecast for the BLS report to show 900,000 jobs added in July, with 550,000 coming from the private sector,” said Daniel Silver, an economist at JPMorgan in New York.

(Reporting By Lucia Mutikani; Editing by Andrea Ricci)