Tag Archives: tariffs

Analysis: Prices lurch higher as Home Depot, other importers battle surging cargo, commodity costs

By Lisa Baertlein

(Reuters) – As Home Depot heads into its busy spring project season – when shoppers build backyard decks and buy patio furniture – it is tangling with surging costs for goods and transportation, on top of tariffs that cost it and other U.S. importers billions of dollars.

Across the United States, major retailers and makers of everything from Peloton spin bikes and La-Z-Boy recliners to Kia Sorrento SUVs are battling the same profit-squeezing pressures. They pass those costs along to home-bound consumers, who are snapping up expensive-to-ship items like appliances, furniture and exercise equipment.

“As I think about all that’s going on now, I reflect back to the tariffs and… long for (when) that was our biggest issue,” Home Depot President Edward Decker said on a webcast on Tuesday.

Retailers like Home Depot, Walmart and Amazon.com got a boost when shoppers redirected travel and entertainment spending due to the COVID-19 pandemic. Now they must quickly replenish supplies to sate consumer demand.

Like other U.S. importers, they are rushing in products from China, Vietnam and other Asian countries – swamping U.S. seaports and spawning delays and disruptions that ripple across the globe.

Home Depot struggled to keep enough products on shelves during the fourth quarter, when strong sales required it to bring in more inventory than a year earlier.

Home Depot executives said consumer prices for construction supplies like lumber and copper products are up due to commodity cost spikes. “A stick of lumber that was 2-odd dollars is now over $5,” Decker said.

At the same time, major appliance prices are on a steep climb, with laundry equipment up more than 23% in January versus a year ago, according to the Bureau of Labor Statistics’ Consumer Price Index.

CARGO COSTS MOUNT

U.S. sea-borne imports hit $6.4 billion in January, up 159% from a year earlier, according to S&P Global Market Intelligence’s Panjiva unit and S&P Global Platts. That was on top of a similar increase in the fourth quarter.

In recent weeks, the cost of transporting goods from Asia to the U.S. West Coast rose a whopping 200% year-over-year, while rates to the East Coast have more than doubled, data from S&P Global Platts Containers shows.

Port and container shipping executives say the bottlenecks may not dissipate until the second or early third quarter of this year.

Peloton Interactive plans to spend $100 million to expedite deliveries of spin bikes and other equipment. That will require pricier air shipping and expedited ocean freight services, as well as the cost of routing cargo containers away from the Los Angeles/Long Beach port complex – which is suffering record backups.

Transportation- and commodity-related inflation could send costs $70-80 million higher this fiscal year, said David Maura, chief executive of Spectrum Brands, whose products include Kwikset locks, Hot Shot bug spray and George Foreman grills.

Parts shortages also contribute to the pain.

Kia Motors America is flying in computer chips due to a global shortage, spokesman Rick Douglas said.

La-Z-Boy last week said short supplies of components for its most-lucrative powered seating hit its sales mix.

“It feels like whack-a-mole. You figure out one (supply chain issue), get it fixed – and another piece comes up,” said Lifetime Products CEO Richard Hendrickson, whose Utah-based sporting goods company imports some items from China.

(Reporting by Lisa Baertlein; Additional reporting by Timothy Aeppel and Melissa Fares in New York, Richa Naidu in Chicago, Jonathan Saul in London and Nivedita Balu in Bengaluru; Editing by Dan Grebler)

EU set to impose tariffs on $4 billion U.S. goods next week

By Philip Blenkinsop

BRUSSELS (Reuters) – The European Union is likely to impose tariffs on $4 billion of U.S. imports including planes and plane parts next week in retaliation over U.S. subsidies for aircraft maker Boeing, EU diplomats said on Friday.

A majority of EU governments have already backed the tariffs, which are expected to be put in place after a meeting of EU trade ministers on Monday.

“I would expect the tariffs to be imposed next Tuesday or Wednesday,” an EU diplomat said.

The move will echo U.S. tariffs on European goods over subsidies for Boeing’s rival Airbus. Combined, the two cases represent the world’s largest ever corporate trade dispute.

The World Trade Organization gave the European Union the right to impose counter-measures, but the United States said that there was no legal basis this and that, if the bloc chose to impose measures, it “will force a U.S. response”.

The move puts the long-running transatlantic trade dispute on the radar of the next U.S. administration, whoever wins the closely fought election.

The European Union could have acted at the end of October, just days before the U.S. election, but chose to delay in order to avoid potentially impacting the outcome. EU governments formally cleared the move on Tuesday, election day.

Tariffs are due to be placed on U.S. planes and parts, fruits, nuts and other farm produce, processed products such as orange juice, certain spirits and a range of other goods, from construction equipment to casino tables, diplomats said.

The European Commission said it was finalizing the process to exercise its retaliation rights in case no agreed solution could be found with Washington, including the immediate suspension of U.S. measures.

The United States Trade Representative had no immediate comment.

The United States already has tariffs on $7.5 billion of EU and British goods in relation to a parallel case over subsidies for European plane maker Airbus.

Chris Swonger, president and CEO of the Distilled Spirits Council of the U.S., said any tariffs on spirits would further devastate an industry that has already seen a 41% drop in U.S. whisky exports to Europe due to previous EU tariffs.

The tariffs also hand Britain, which left the EU this year, a delicate decision about whether to join its neighbors in imposing tariffs at a time when it is in the midst of trade negotiations with both the United States and European Union.

Britain’s trade minister said last week it would “keep all options open” to ensure it can respond to U.S. tariffs on Scotch whisky and other industries. Britain is one of four Airbus partner nations alongside France, Germany and Spain.

(Reporting by Philip Blenkinsop, additional reporting by Andrea Shalal in Washington, Editing by Tim Hepher)

Canada to impose retaliatory tariffs on C$3.6 billion worth of U.S. goods

By David Ljunggren

OTTAWA (Reuters) – Canada will slap retaliatory tariffs on C$3.6 billion ($2.7 billion) worth of U.S. aluminum products after the United States said it would impose punitive measures on Canadian aluminum imports, a senior official said on Friday.

Deputy Prime Minister Chrystia Freeland told a news conference the countermeasures would be put in place by Sept. 16 to allow consultations with industry.

U.S. President Donald Trump on Thursday moved to reimpose 10% tariffs on some Canadian aluminum products to protect U.S. industry from a “surge” in imports. Canada denies any impropriety.

“A trade dispute is the last thing anyone needs – it will only hurt an economic recovery on both sides of the border. However, this is what the U.S. administration has chosen to do,” said Freeland.

“We do not escalate and we do not back down,” she said later, describing the U.S. decision as unjust and absurd.

The Canadian list of goods that might be subject to tariffs include aluminum bars, plates, household articles, refrigerators, bicycles and washing machines.

It is the second time in two years that Canada has struck back at Trump over trade. In 2018, Ottawa slapped tariffs on C$16.6 billion ($12.5 billion) worth of American goods ranging from bourbon to ketchup after Washington imposed sanctions on Canadian aluminum and steel.

Canadian officials may be calculating that the measures will be short-lived. An Ottawa source briefed by Prime Minister Justin Trudeau’s office said Canadian officials are increasingly sure that Trump will lose the Nov. 3 presidential election to Democratic presidential candidate Joe Biden.

Trump acted just weeks after a new continental trade pact between the United States, Canada and Mexico took effect. The North American economy is highly integrated and Canada sends 75% of all its goods exports to the United States.

The premier of Ontario, Canada’s most populous province, said earlier on Friday that he had encouraged Freeland to impose tariffs on as many U.S. goods as possible.

“For the President to come and attack us during these times, during a pandemic when we need everyone’s support, is totally unacceptable,” Doug Ford told a news conference.

(Reporting by David Ljunggren; Editing by Chris Reese and Dan Grebler)

U.S., China set to sign massive purchases deal, easing trade war

By David Lawder

WASHINGTON (Reuters) – U.S. President Donald Trump and Chinese Vice Premier Liu He will sign an initial trade deal on Wednesday that will roll back some tariffs and see China boost purchases of U.S. goods and services, defusing an 18-month conflict between the world’s two largest economies.

Liu said the two sides will work more closely together to obtain tangible results and achieve a win-win relationship despite differences in their political and economic models, China’s official Xinhua news agency reported on Wednesday.

U.S. officials called the deal a huge win that marked a significant shift in Washington’s relations with China, but said it included a tough enforcement measure that could trigger renewed tariffs if Beijing does not live up to its promises.

The Phase 1 agreement caps a trade war marked by tit-for-tat tariffs that has hit hundreds of billions of dollars in goods, roiling financial markets, uprooting supply chains and slowing global growth.

Some analysts and economists have questioned whether the outcome of the drawn-out talks justified that economic pain.

Trump and Liu, who led the Chinese side in the trade talks with Washington, are scheduled to sign the 86-page Phase 1 deal at a White House event at 11:30 a.m. EST (1630 GMT) before over 200 invited guests from business, government and diplomatic circles.

It is not clear at this time whether the entire document will be released on Wednesday.

Trump, who entered the White House in 2017 vowing to rebalance global trade in favor of the United States, has already begun touting the deal as a pillar in his 2020 re-election campaign, calling it “a big beautiful monster” at a rally in Toledo, Ohio last week.

“Our farmers will take it in. I keep saying, ‘Go buy larger tractors, go buy larger tractors,'” Trump said.

The centerpiece of the deal is a pledge by China to purchase an additional $200 billion worth of U.S. farm products and other goods and services over two years. That will help reduce the bilateral U.S. trade deficit in goods, which peaked at $420 billion in 2018. The United States had a small services trade surplus with China of $40.5 billion in 2018.

Top White House economic adviser Larry Kudlow told Fox News the agreement would add 0.5 percentage point to U.S. gross domestic product growth in both 2020 and 2021.

Kudlow said the deal called for China to buy an additional $75 billion worth of U.S. manufactured goods over the two-year period. A source told Reuters this week that would include aircraft, autos and car parts, agricultural machinery and medical devices.

Beijing will boost energy purchases by some $50 billion and services by $40 billion, mostly in the financial sector, Kudlow said.

The Reuters source said agricultural purchases will get a $32 billion lift over the two years, compared to a 2017 baseline of U.S. exports to China.

When combined with the $24 billion in 2017 farm exports, the $16 billion annual increase approaches Trump’s goal of $40 billion to $50 billion in annual agricultural sales to China.

China will significantly increase imports of U.S. soybeans after the Phase 1 deal is signed, the Global Times reported on Wednesday, citing comments from a senior Chinese economist at a state think tank.

Wang Liaowei, senior economist at the China National Grain and Oils Information Center, which is under the National Food and Strategic Reserves Administration, also told the paper that imports of U.S. products such as pork and cotton could also see a jump.

Although the deal could be a big boost to farmers, planemaker Boeing <BA.N>, U.S. automakers and heavy equipment manufacturers, some analysts question https://af.reuters.com/article/commoditiesNews/idAFL4N29J26S China’s ability to divert imports from other trading partners to the United States.

“I find a radical shift in Chinese spending unlikely. I have low expectations for meeting stated goals,” said Jim Paulsen, chief investment strategist at Leuthold Group in Minneapolis. “But I do think the whole negotiation has moved the football forward for both the U.S. and China.”

TARIFFS TO STAY

The Phase 1 deal, reached in December, canceled planned U.S. tariffs on Chinese-made cellphones, toys and laptop computers and halved the tariff rate to 7.5% on about $120 billion worth of other Chinese goods, including flat panel televisions, Bluetooth headphones and footwear.

But it will leave in place 25% tariffs on a vast, $250 billion array of Chinese industrial goods and components used by U.S. manufacturers.

U.S. Treasury Secretary Steven Mnuchin told CNBC on Wednesday the deal would boost the U.S. economy, and that Washington could lower tariffs as part of a Phase 2 agreement that would address complex issues such as cybersecurity.

Mnuchin said the U.S. relationship with China was complicated and Washington would continue to raise humanitarian and national security concerns with Beijing in separate discussions. “You have to negotiate different pieces at different times,” he said.

He said Chinese telecom equipment maker Huawei Technologies Co Ltd was not a “chess piece” in the economic negotiations.

China’s Global Times said the Phase 2 discussions may not start anytime soon.

Evidence is mounting that tariffs have raised input costs for U.S. manufacturers, eroding their competitiveness.

Diesel engine maker Cummins Inc <CMI.N> said on Tuesday that the deal will leave it paying $150 million in tariffs for engines and castings that it produces in China.

The company issued a tepid statement of approval on Tuesday: “We believe this is a positive step and remain optimistic that all parties will remain at the table in order to create a pathway to eliminate all of the instituted tariffs.”

Lighthizer and Mnuchin insisted there were no side agreements to remove more tariffs after the November U.S. elections. Mnuchin on Wednesday reiterated that Trump could consider easing tariffs if the two countries move quickly to seal a Phase 2 follow-up agreement.

CORE ISSUES UNTOUCHED

The Phase 1 deal includes pledges by China to forbid the forced transfer of American technology to Chinese firms as well as to increase protections for U.S. intellectual property.

But it stops well short of addressing the core U.S. complaints about China’s trade and intellectual property practices that prompted the Trump administration to pressure Beijing for changes in early 2017.

The deal contains no provisions to rein in rampant subsidies for state-owned enterprises, which the administration blames for excess capacity in steel and aluminum and says threaten industries from aircraft to semiconductors.

It also fails to address digital trade restrictions and China’s onerous cybersecurity regulations that have hobbled U.S. technology firms in China.

China has agreed in the Phase 1 deal to open its financial services sector more widely to U.S. firms, and to refrain from deliberately pushing down its currency to gain a trade advantage, the latter prompting Treasury to drop its currency manipulator label on Beijing.

(Additional reporting by Lisa Lambert, Andrea Shalal, Echo Wang, Alexandra Alper, and Herb Lash in New York, and Se Young Lee and Stella Qui in Beijing; Editing by Simon Cameron-Moore and Paul Simao)

Take Five: What’s the deal?

LONDON (Reuters) –

1/AFTER PHASE ONE COMES PHASE TWO

U.S. President Donald Trump and Chinese officials have agreed to a “phase one” trade deal that includes cutting U.S. tariffs on Chinese goods.

Washington has agreed to suspend tariffs on $160 billion in Chinese goods due to go into effect on Dec. 15, Trump said, and cut existing tariffs to 7.5%.

The agreement covers intellectual property, technology transfer, agriculture, financial services, currency, and foreign exchange, according to Washington’s Trade Representative.

Neither side offered specific details on the amount of U.S. agricultural goods Beijing had agreed to buy – a key sticking point of the lengthy deal negotiations. News of the trade deal saw U.S. stocks romp to fresh record levels. But few doubt that the rollercoaster is over yet.

While Trump announced that “phase two” trade talks would start immediately, Beijing made it clear that moving to the next stage of the trade negotiations would depend on implementing phase one first. While markets cheered the December rally, few expect the trade deal rollercoaster ride to be quite over yet.

 

2/MORE NICE SURPRISES, PLEASE!

First clues as to whether euro zone powerhouse Germany can avoid a fourth quarter recession emerge on Monday when advance PMI readings for November are released globally.

The economic activity surveys, a key barometer of economic health, come after Citi’s economic surprise index showed euro zone economic data beating consensus expectations at the fastest pace since February 2018. The latest surprise was a 1.2% rise in German exports in October, defying forecasts of a contraction.

Hopes are high that exports and private consumption, which helped Germany skirt recession, will hold up. Last month’s PMI data showed manufacturing remained in deep contraction across the bloc.

A Reuters poll showed expectations of a modestly higher 46.0 manufacturing reading in the euro zone but that’s still far below the 50-mark which separates growth from contraction. Services, which have held up better so far, are expected to grow modestly from November, at 52.0.

Graphic: Citi surprise index most positive since Feb 2018, https://fingfx.thomsonreuters.com/gfx/mkt/12/9901/9813/Citi%20index.png

3/BEWARE THE BOJ

Japan’s central bank meets on Thursday with the global economic outlook “relatively bright,” according to Governor Haruhiko Kuroda.

Growth green shoots, a possible U.S.-China trade deal and something nearing certainty on Brexit has got almost everyone expecting the BOJ will do very little: Interest rates are at -0.1% and the bank has eased off bond buying – even though the bank’s balance sheet is bursting with negative-yielding paper.

The government has flagged a gigantic $122 billion stimulus package to keep things moving after next year’s Olympics. Yet the business mood is dire with Friday’s “tankan” survey at its lowest reading since 2013. Big manufacturers – especially automakers – are gloomiest, as the trade war takes its toll.

The Bank of Japan has justified standing pat on the view that robust domestic demand will cushion the hit. It blames the weather and a sales tax for recent patchy data. But another week of dollar weakness will not have gone unnoticed in Tokyo, where a cheaper yen is much desired. A surprise on Tuesday export data forecast to show further contraction and Thursday’s inflation reading could jolt yen longs out of their slumber.

4/JOHNSON, AND MORE JOHNSON

A thumping election win for Prime Minister Boris Johnson has raised hopes that 3-1/2 years of Brexit-fuelled chaos will finally end.

Expectations that he may swing slightly nearer the centre of his Conservative Party, sidelining the fiercest eurosceptics, and ease the path towards a free-trade deal with the European Union have sent sterling and British shares surging.

Yet there are signs of caution, with sterling stalling around $1.35. Further gains will hinge on Johnson’s new cabinet, how the global growth and trade war backdrop pans out and what the Bank of England might do.

At the central bank’s Dec. 19 meeting, markets will watch for any shifts in its views on inflation, the UK economy and the interest rate outlook for 2020. While policymakers have skewed dovish of late amid a torrent of dismal data and sub-target inflation, the election result – and a hoped-for growth recovery – have seen money markets halve the probability of an end-2020 cut to 25%.

Without more clarity, investors might just be wary of chasing sterling much higher.

Graphic: UK economic indicators, https://fingfx.thomsonreuters.com/gfx/mkt/12/9958/9869/GB.png

5/SWEDEN RETURNS TO ZERO?

While most central banks are busy pondering whether to hold or cut interest rates, Sweden may swim against the tide and deliver a 25 basis-point rate hike on Dec. 19. That will end half a decade of negative interest rates in the country and make it the first in Europe to pull borrowing costs from sub-zero territory.

Policymakers flagged a rate hike in October and recent data showing inflation rising to 1.7% — just off the 2% target — cemented those expectations. The crown’s rallied to eight-month highs versus the euro, up almost 5% since October.

The proposed interest rate increase has its critics, who cite still-sluggish inflation and factory activity at its weakest since 2012.

Meanwhile, neighbouring Norway’s policy meeting, scheduled for the same day, may be less exciting as no change is expected. Investors remain baffled by the Norwegian crown’s weakness – despite policy makers delivering four rate hikes since Sept 2018, it’s at near record lows to the euro.

Graphic: Swedish crown , https://fingfx.thomsonreuters.com/gfx/mkt/12/9961/9872/crown.png

(Reporting by Alden Bentley in New York, Tom Westbrook in Singapore, Sujata Rao, Elizabeth Howcroft and Yoruk Bahceli in London, compiled by Karin Strohecker; edited by Philippa Fletcher)

Trump says U.S. and China ‘very close’ to trade deal as fresh tit-for-tat tariffs loom

Trump says U.S. and China ‘very close’ to trade deal as fresh tit-for-tat tariffs loom
BEIJING/WASHINGTON (Reuters) – China and the United States are in close communication on trade, officials in Beijing and Washington said, days before tit-for-tat tariffs are due to go into effect.

U.S. President Donald Trump on Thursday said on the United States was “very close” to nailing down a trade deal with China. “Getting VERY close to a BIG DEAL with China,” Trump posted on Twitter. “They want it, and so do we.”

During a regular briefing on Wednesday in Beijing, Gao Feng, spokesman at the Chinese commerce ministry, told reporters “The two sides’ economic and trade teams are maintaining close communication.”

Stock markets jumped on Trump’s tweet, and the S&P 500 <.SPX> shot to a record high, gaining 0.85% on the day.

U.S. negotiators have offered to cut existing tariff rates on $360 billion in Chinese goods by as much as 50%, one person briefed on the negotiations said. They have also offered to suspend tariffs due to go into effect on Dec. 15, the Wall Street Journal reported on Thursday.

The White House had no comment on any offers.

Gao declined to comment on possible retaliatory steps if Washington imposes more tariffs on Chinese goods this weekend.

The United States is due to impose tariffs on almost $160 billion of Chinese imports such as video game consoles, computer monitors and toys on Dec. 15.

Trump is expected to meet top trade advisers on Thursday afternoon to discuss the move, sources told Reuters previously.

Trump’s son-in-law Jared Kushner has recently taken a larger role in U.S.-China trade negotiations, and is among the advisers pushing the 50% tariff rollback, one person briefed on the talks said.

Analysts at Capital Alpha Partners said Thursday they expect Trump to announce a delay in the Dec. 15 tariffs as soon as Thursday for more than 30 days.

A decision to proceed with the Dec. 15 levies could roil financial markets and scuttle U.S.-China talks until after the U.S. presidential election next November. The 17-month-long trade war between the world’s two largest economies has slowed global growth and dampened profits and investment for companies around the world.

The countries agreed in October to conclude a preliminary trade agreement, but Beijing is balking at U.S. demands that it promise to buy a specific amount of agricultural goods. Beijing is also demanding rollbacks of existing tariffs imposed by the United States.

Beijing has said it would retaliate if the United States escalates the trade dispute.

In August, China said it would impose 5% and 10% in additional tariffs on $75 billion of U.S. goods in two batches. Tariffs on the first batch kicked in on Sept. 1, hitting U.S. goods including soybeans, pork, beef, chemicals and crude oil.

The tariffs on the second batch of products are due to be activated on Dec. 15, affecting goods ranging from corn and wheat to small aircraft and rare earth magnets.

China also said that it will reinstitute on Dec. 15 an additional 25% tariff on U.S.-made vehicles and 5% tariffs on auto parts that had been suspended at the beginning of 2019.

(Reporting by Gabriel Crossley and Jeff Mason; Writing by Ryan Woo and Heather Timmons; Editing by Kim Coghill and Jonathan Oatis)

China maintains tariffs must be reduced for phase one trade deal with U.S.

China maintains tariffs must be reduced for phase one trade deal with U.S.
BEIJING (Reuters) – Tariffs must be cut if China and the United States are to reach an interim agreement on trade, the Chinese commerce ministry said on Thursday, sticking to its stance that some U.S. tariffs must be rolled back for a phase one deal.

“The Chinese side believes that if the two sides reach a phase one deal, tariffs should be lowered accordingly,” ministry spokesman Gao Feng told reporters, adding that both sides were maintaining close communication.

Completion of a phase one deal between the world’s two biggest economies had been initially expected in November, ahead of a new round of U.S. tariffs set to kick in on Dec. 15, covering about $156 billion of Chinese imports.

Trade delegations on both sides remained locked in discussions over “core issues of concern,” with rising bilateral tensions over non-trade issues such as the protests in Hong Kong and Beijing’s treatment of its Uighur Muslim minority clouding prospects for a near-term deal to end a trade war.

China warned on Wednesday that U.S. legislation calling for a tougher response to Beijing’s treatment of Uighurs in the western Chinese region of Xinjiang will affect bilateral cooperation.

But “there is no need to panic,” as talks did not stop, a Chinese source who advises Beijing on the trade talks told Reuters on Wednesday.

“Both leaders have talked about reaching a deal, and officials are now finishing the work,” said the source, who thought it unlikely China would retaliate against U.S. legislation by releasing its so-called “unreliable entities list” aimed at punishing firms deemed harmful to Chinese interests.

When asked if China would release the list this year, Gao said he had no further information to reveal at present.

Beijing may hold back from publishing the list until the trade situation with the United States is at its most tense, a Chinese government source told Reuters in October.

On Wednesday, Trump said trade talks with China were going “very well,” sounding more positive than his remarks the previous day that a deal might have to wait until after the 2020 U.S. presidential election.

On Nov. 7, Gao said China and the United States must simultaneously cancel some existing tariffs on each other’s goods for both sides to reach a phase one trade deal, but how much tariffs should be canceled could be negotiated.

On a telephone call last week, China’s lead trade negotiator Vice Premier Liu He discussed “core issues of concern” with U.S. Trade representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin.

Washington imposed additional 15% tariffs on about $125 billion worth of Chinese goods on Sept. 1, on top of the additional 25% tariffs levied on an earlier $250 billion list of industrial and consumer goods.

U.S. President Donald Trump and Lighthizer recognize that rolling back tariffs for a pact that fails to tackle core intellectual property and technology transfer issues will not be seen as a good deal for the United States, a person briefed on the matter told Reuters late last month.

(Reporting by Gabriel Crossley and Yawen Chen; Writing by Ryan Woo; Editing by Clarence Fernandez and Jacqueline Wong)

Black Friday sees fewer shoppers in U.S. stores as spending moves online

Black Friday sees fewer shoppers in U.S. stores as spending moves online
By Melissa Fares and Nandita Bose

NEW YORK/WASHINGTON (Reuters) – Fewer people lined up outside stores as Black Friday shopping kicked off, suggesting early discounts offered by retail chains and a surge in online buying may have taken the shine off America’s biggest shopping day.

Spot checks across the country showed there were fewer shoppers this year as retail chains started offering discounts earlier than usual to make up for a shorter holiday season.

Some shoppers also worried that tariffs imposed by President Donald Trump on Chinese imports would make their holiday shopping more expensive, though many large retailers had not raised prices to protect margins.

“There were definitely some concerns about prices due to what we see in the news about the trade war, but I haven’t seen the impact yet, so I am planning to spend about the same this year as I have in the past,” said Jay Smith, 28, who was shopping at a Macy’s in Pentagon City to buy clothes and toys for her family.

While store traffic still remains an important indicator, a lot of shopping during Thanksgiving and Black Friday now happens online. Adobe Analytics, which measures transactions from 80 of the top 100 U.S. online retailers, estimates $7.5 billion in online sales for Black Friday, growth of over 20.5% year-over-year.

Online sales on Thanksgiving Day alone jumped 17% to $4.1 billion in the United States, according to Salesforce. Global online revenue rose 24% to $20 billion.

Companies including Walmart Inc , Target Corp , Costco Wholesale Corp  and Best Buy Co Inc  have bulked up their online presence, deliveries and fast in-store pickups to attract customers.

Though Black Friday remains an important day for holiday shopping, its relevance is fading as the condensed shopping season this year has accelerated early promotions and spending. Retailers have six fewer days to make sales between Thanksgiving and Christmas Day.

That has pulled spending into early November. More than half of consumers polled by the National Retail Federation (NRF) in the first week of this month had already begun making purchases. On average, Americans had already completed almost a quarter of their shopping, the most in the history of NRF’s surveys.

“We’ve seen many merchants start their promotions pretty much right after the trick-or-treaters have gone to bed,” said Lauren Bitar, head of retail consulting at analytics firm RetailNext.

Sales made prior to Thanksgiving and Black Friday could erode “the spike that we have seen in sales dollars historically,” Bitar said.

Several shoppers on Friday said they regularly make sure they are getting the best deal by making price comparisons, oftentimes as they are shopping in-store.

“I will come to the mall, look at prices and go back and check them online,” said Dick Doyle, 76, who was shopping at a Modell’s Sporting Goods while his wife was next door at Nordstrom Rack <JWN.N>. Doyle is an Amazon <AMZN.O> Prime member, which keeps him “locked in” to shopping the online retailer.

“Prices and discounts online are competitive to what’s available in stores,” he added.

Meanwhile, in France, activists staged protests against Amazon on Friday, denouncing the rampant consumerism typified by the annual Black Friday shopping frenzy.

(Reporting by Melissa Fares in New York, Nandita Bose in Washington, Richa Naidu in Chicago and Lisa Baertlein in Los Angeles; Additional reporting by Uday Sampath in Bengaluru; Editing by Sweta Singh, Saumyadeb Chakrabarty and Nick Zieminski)

U.S. and China ‘getting close’ to trade deal: White House economic adviser

By Andrea Shalal

WASHINGTON (Reuters) – The United States and China are getting close to a trade agreement, White House economic adviser Larry Kudlow said on Thursday, citing what he called very constructive talks with Beijing about ending a 16-month trade war.

Kudlow said negotiators for the world’s two largest economies were in close touch via telephone but he gave no further details on the timing of a possible deal.

“We’re getting close,” he told an event at the Council on Foreign Relations in Washington. “The mood music is pretty good, and that has not always been so in these things.”

The United States and China have been locked in successive waves of tit-for-tat tariffs that have roiled financial markets and threaten to drag growth in the global economy to its lowest rate since the 2007-2008 financial crisis.

Markets are anxiously awaiting an agreement to end uncertainty that has slowed business investment around the globe. An agreement had appeared likely in May, but those prospects were dashed after U.S. negotiators said China backed away from the text of a draft agreement.

Kudlow’s comments could ease market concerns that flared again this week amid reports that the trade talks had hit a snag over how and when to reduce tariffs, and what level of agricultural purchases could be expected from China.

Markets also soured after U.S. President Donald Trump on Tuesday said he could impose substantial new tariffs on China if no deal was reached.

Kudlow told the audience he had just come from a meeting of the top Trump administration trade officials and was more optimistic.

“It’s not done yet, but there has been very good progress and the talks have been very constructive,” he told the event.

He also opened the door to the possibility that Trump and Chinese President Xi Jinping would not need to meet in person to clinch a deal.

Trump had hoped to sign the “phase one” agreement with China on the sidelines of the Asian-Pacific Economic Cooperation summit in Chile this month, but that possibility disappeared after Chile withdrew from hosting the event.

Kudlow said the White House had hoped to stick to that general timetable. He joked that his preference was for the deal to be signed in his office on the second floor of the White House.

“I don’t like to travel,” he quipped.

(Reporting by Andrea Shalal; editing by Sandra Maler and Grant McCool)

Mexico flies 300 Indian migrants to New Delhi in ‘unprecedented’ mass deportation

Mexico flies 300 Indian migrants to New Delhi in ‘unprecedented’ mass deportation
MEXICO CITY/NEW DELHI (Reuters) – Mexico has deported over 300 Indian nationals to New Delhi, the National Migration Institute (INM) said late on Wednesday, calling it an unprecedented transatlantic deportation.

The move follows a deal Mexico struck with the United States in June, vowing to significantly curb U.S.-bound migration in exchange for averting U.S. tariffs on Mexican exports.

“It is unprecedented in INM’s history – in either form or the number of people – for a transatlantic air transport like the one carried out on this day,” INM said in a statement.

The 310 men and one woman that INM said were in Mexico illegally were sent on a chartered flight, accompanied by federal immigration agents and Mexico’s National Guard. They arrived in New Delhi on Friday.

Most of the deportees were from India’s northern Punjab state, an Indian official said. Police will run checks if any of them had criminal history, another official said.

INM said the deportees had been scattered in eight states around Mexico, including in southern Mexico from where many Indian migrants enter the country, hoping to transit to the U.S. border.

The backlog of migrants in southern Mexico has grown as officials have stopped issuing permits for them to cross the country, said Caitlyn Yates, a research coordinator at IBI Consultants who has studied increasing numbers of U.S.-bound Asian and African migrants arriving in Mexico.

“This type of deportation in Mexico is the first of its kind but likely to continue,” Yates said.

(Reporting by Anthony Esposito and Daina Beth Solomon in NEW MEXICO, Rupam Jain in MUMBAI, and Zeba Siddiqui in NEW DELHI; Editing by Sanjeev Miglani and Muralikumar Anantharaman)