<figure class="wp-block-image size-full is-resized"><img loading="lazy" decoding="async" width="1920" height="1080" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k.jpeg" alt="" class="wp-image-511374" style="width:840px;height:auto" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k.jpeg 1920w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-1536x864.jpeg 1536w" sizes="(max-width: 1920px) 100vw, 1920px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



Economic activity in the U.S. was considerably stronger than expected during the second quarter, boosted by a strong consumer, government spending and a sizeable inventory build, according to an initial estimate Thursday from the Commerce Department.



Real gross domestic product, a measure of all the goods and services produced during the April-through-June period, increased at a 2.8% annualized pace adjusted for seasonality and inflation. Economists surveyed by Dow Jones had been looking for growth of 2.1% following a 1.4% rise in the first quarter.



Consumer spending helped propel the growth number higher, as did contributions from private inventory investment and nonresidential fixed investment, according to the first of three estimates the department will provide.



Personal consumption expenditures, the main proxy in the Bureau of Economic Analysis report for consumer activity, increased 2.3% for the quarter, up from the 1.5% acceleration in Q1. Both services and goods spending saw solid increases for the quarter.



Inventories also were a significant contributor, adding 0.82 percentage point to the total gain. Government spending added a tailwind as well, rising 3.9% at the federal level, including a 5.2% surge in defense outlays.



On the downside, imports, which subtract from GDP, jumped 6.9%, the biggest quarterly rise since Q1 of 2022. Exports were up just 2%.



Stock market futures drifted higher following the report while Treasury yields moved lower.



“The composition of growth was one of the better mixes that we have observed in some time,” said Joseph Brusuelas, chief economist at RSM. The report “tends to support the idea that the American economy is in the midst of a productivity boom which over the medium term will lift living standards across the country via lower inflation, low employment and rising real wages.”



There was some good news on the inflation front: the personal consumption expenditures price index, a key measure for the Federal Reserve, increased 2.6% for the quarter, down from the 3.4% move in Q1. Excluding food and energy, core PCE prices, which the Fed focuses on even more as a longer-term inflation indicator, were up 2.9%, compared to a 3.7% increase in the prior period.



The so-called chain-weighted price index, which takes into account changes in consumer behavior, increased 2.3% for the quarter, below the 2.6% estimate.



Treasury Secretary Janet Yellen saw the GDP report as “affirming the path we’re on to steady growth and declining inflation,” in remarks she delivered Thursday morning in Rio de Janeiro.



One other key variable, final sales to private domestic purchasers, which the Fed considers a good indicator of underlying demand, accelerated at a 2.6% pace, the same as in the prior quarter.



However, the report also indicated that the personal savings rate continues to decelerate, at 3.5% for the quarter, compared with 3.8% in Q1.



There have been signs of cracks lately in the consumer picture.



A report Wednesday from the Philadelphia Federal Reserve showed credit card delinquencies at an all-time high according to data going back to 2012. Revolving debt balances also reached a new high even as banks reported tightening credit standards and declining new card originations.



However, retail sales numbers have continued to climb indicating that consumers are weathering the headwinds of high interest rates and persistent inflation.



There also is pressure in the housing market: Sales are declining while home prices continue to rise, putting stress on first-time homebuyers.



Federal Reserve officials are expected to hold interest rates steady when they meet next week, though market pricing is pointing to the first cut in four years in September. Policymakers have been circumspect about when they might start reducing rates, though recent comments indicate more of a willingness to start easing policy and most central bankers have said they see further increases as unlikely.



In other economic news Thursday, the Labor Department reported that initial jobless claims totaled 235,000 for the week ended July 20, down 10,000 from the previous week and exactly in line with the Dow Jones forecast. Continuing claims, which run a week behind, edged lower to 1.85 million.



Also, orders for durable goods — generally big-ticket items such as aircraft, appliances and computers — unexpectedly fell 6.6% in June, compared with the forecast for a 0.3% increase. However, excluding transportation, new orders increased 0.5%.

108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k

U.S. economy grew at a 2.8% pace in the second quarter, much more than expected

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-820x547.jpg" alt="" class="wp-image-510532" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2162833993-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">GRAND RAPIDS, MICHIGAN &#8211; JULY 20: Republican presidential nominee, former U.S. President Donald Trump walks offstage after speaking at a campaign rally at the Van Andel Arena on July 20, 2024 in Grand Rapids, Michigan. Trump&#8217;s campaign event is the first joint event with his recent vice presidential pick Sen. J.D. Vance (R-OH) and the first campaign rally since the attempted assassination attempt his rally in Butler, Pennsylvania. (Photo by Anna Moneymaker/Getty Images)</figcaption></figure>



Former President Donald Trump would likely take his trade war and economic decoupling policies to new levels if he were elected to a second term in the White House, experts told CNBC.



While Joe Biden also placed strategic competition with China at the forefront of his economic policy, economists and trade experts largely expect Trump would further cut and destabilize trade relations between the world’s two largest economies.



“A Trump victory is highly likely to increase trade and economic hostilities between the U.S. and China, ramping up the trade and financial decoupling between the two countries,” said Eswar Prasad, an economics professor at Cornell University.



Trump is widely expected to face incumbent Vice President Kamala Harris after Biden bowed out of the race and endorsed her. According to Prasad and other experts, Harris’ approach to China would likely be similar to that of Biden.



While Trump and Biden both took a protectionist stance, their strategies and tactics differed greatly, explained Prasad, who previously served as head of the International Monetary Fund’s China and financial studies divisions.



“Trump relied on tariffs to keep out imports from China. Biden — while keeping those tariffs in place and even increasing tariffs on certain imports — has focused more on restricting China’s access to technology transfers and computer chips,” he said.



<h2 class="wp-block-heading" id="h-tariff-man"><a></a>‘Tariff man’</h2>



Trump’s biggest diversion from Biden-era trade policy would likely be tariffs levied on China.



The self-proclaimed “tariff man” set off a trade war with Beijing during his first term. He placed a series of duties on $250 billion of Chinese imports, disregarding warnings the levies would raise prices and hurt consumers. 



After defeating Trump in 2020, Biden retained his predecessor’s tariffs and even added his own, announcing stiff new duties on about $18 billion worth of Chinese imports, including electric vehicles, solar cells, lithium batteries, steel and aluminum. 



Experts told CNBC they expect Harris to largely continue Biden’s tariff policy. Trump, on the other hand, has already proposed increasing rates on Chinese imports by at least 60%. 



“I certainly don’t know if Trump is willing to pursue such extreme measures, but I do believe that he’s likely to increase tariffs to some degree during a second term,” said Stephen Weymouth, a professor of international political economy at Georgetown University.&nbsp;&nbsp;



Economist Stephen Roach said Trump raising tariffs in a second term would be the “functional equivalent of the nuclear option” in international economic conflict.&nbsp;



William Reinsch, Scholl chair in international business at the Center for Strategic and International Studies, said the tariffs risk another trade war that would end most goods exchange between the two countries at an “enormous economic cost.”



Even if Trump’s aim is not a full decoupling but forcing Beijing into negotiating a more favorable trade deal, Reinsch said there’s little reason to believe that would work.



The Trump administration reached a “phase one trade deal” with China in 2019, but few terms were honored and subsequent phases never materialized.



Some commentators said Trump picking JD Vance as his running mate further signals the Republican is serious about his tariff plans. The senator from Ohio has been a staunch supporter of tariffs on China, identifying the country as the biggest threat facing the U.S. 



“If I was a China policy maker, this selection would have me shaking in my boots,” said Arthur Dong, professor of strategy and economics at Georgetown.&nbsp;



<h2 class="wp-block-heading"><a></a>Tech war</h2>



In contrast, the Biden-Harris administration’s key policies focused on limiting China’s access to technology transfers and directing domestic subsidies to develop high-tech industries and supply chains in the U.S.



The administration dramatically expanded the list of technologies and Chinese companies subject to U.S. export controls in efforts to cut support to critical tech industries in China, such as advanced semiconductors. The Trump administration had enacted some similar controls.



The Biden administration also announced rules limiting U.S. investment in Chinese firms developing sensitive technologies, citing national security concerns.



In perhaps Biden’s biggest move, the administration signed the CHIPS and Science Act in August 2022, putting aside almost $53 billion to invest in domestic semiconductor manufacturing and research to boost U.S. competitiveness with China.



Chris Miller, author of “Chip War,” noted export controls and the CHIPS Act were passed with bipartisan support in Washington, and thus, such policies are likely to remain a priority regardless of what happens in November.&nbsp;



“I expect that the U.S. will ratchet up restrictions a notch or two regardless of who wins the election,” Miller said.



<h2 class="wp-block-heading"><a></a>Diplomacy&nbsp;</h2>



A second term for Trump would also impact U.S. diplomacy and dialogue with Beijing beyond trade matters, said Rorry Daniels,&nbsp;managing director of the Asia Society Policy Institute.



She said channels for the two countries to discuss policy issues decreased significantly during the Trump administration, whereas the Biden administration emphasized its diplomatic engagement efforts.



The current administration has also sought greater coordination with “likeminded partners,” such as lobbying Japan and the Netherlands to cooperate on semiconductor restrictions. 



“That’s both helped minimize the blowback of his trade policy actions, while in many ways also making them more effective,” said Nick Marro, lead analyst for global trade with the Economist Intelligence Unit, adding he expects any future Democratic administration to retain this multilateral approach.&nbsp;



On the other hand, he said Trump opts for a more “go-it-alone” approach, allowing for a more rapid adoption of U.S. measures on China.



While the Biden-Harris administration’s “more measured and cautious” approach to China trade and diplomacy has done more to stabilize the relationship, Marro said he doubts Beijing is excited about either candidate.



“There’s this feeling that, regardless of&nbsp;which party&nbsp;sits in the White House,&nbsp;US-China relations will remain on a crash-course throughout the remainder of this decade.”



— CNBC’s Zenith Wong contributed to this report

Donald Trump And J.D. Vance Hold First Joint Campaign Rally After The RNC

Trump 2.0 could go ‘nuclear’ on China trade, while economists say Harris would remain tough

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1678" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-scaled.jpg" alt="" class="wp-image-510111" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-300x246.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-820x672.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-110x90.jpg 110w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-768x629.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2161957502-1536x1259.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FAYETTEVILLE, USA &#8211; JULY 18: US Vice President Kamala Harris holds a campaign event that is her seventh visit to North Carolina this year and 15th trip to the state since taking office in Fayetteville NC, United States on July 18, 2024 (Photo by Peter Zay/Anadolu via Getty Images)</figcaption></figure>



Democrats united behind Vice President Kamala Harris as the party’s front-runner for the presidential nomination Monday, and their excitement translated into a juggernaut day of fundraising for the party and for Harris’ campaign.



Late Monday night, NBC News projected that Harris had won endorsements from a majority of the Democratic party’s pledged convention delegates. The threshold is 1,976 delegates, and NBC estimates that Harris has the spoken or written backing of 1,992 delegates.



While not yet formally the party’s presumptive nominee, Harris’ position as frontrunner is rock solid, and no potential challengers have signaled they intend to vie for the nomination.



In the hours since President Joe Biden announced that he would end his teetering reelection campaign, Harris and the Democratic party have pulled in roughly $250 million in online donations and major donor commitments. 



The Democratic fundraising platform ActBlue has processed $106 million in contributions to Democratic candidates since Biden dropped out, according to an automated tracker. 



It is not clear yet how much of this money was given to House and Senate campaigns and how much went to the former Biden campaign, rebranded overnight as the Harris for President campaign.&nbsp;



In addition to the online donations, a super political action committee that supports the Biden-Harris ticket announced that over the past 24 hours, major donors have made contribution commitments totaling $150 million to the Harris election effort.&nbsp;



The pledges to Future Forward were described to NBC News as coming from donors who had been sitting on the sidelines for the past month, amid concerns about Biden as the nominee. 



The pledged donations to Future Forward are just that, however: promises. Until the PAC files mandatory federal campaign finance reports, these numbers cannot be verified.&nbsp;



The historic fundraising numbers are energizing Democrats and breathing new life into their bid to defeat former President Donald Trump and his Republican running mate, Sen. JD Vance of Ohio.



Since Sunday, more than 888,000 small-dollar donors have contributed to the Harris campaign, according to a memo late Monday.



Harris’ momentum could be the reason that West Virginia Sen. Joe Manchin, who recently switched his political affiliation to Independent, dropped his suggestion that he was open to challenging Harris for the Democratic nomination.



Republicans, meanwhile, are scrambling to retool a Trump campaign that was built to defeat Biden into one capable of defeating a very different candidate.



Trump spent much of the morning attacking Biden, but shifted to attacking Harris in the afternoon.

US Vice President Kamala Harris holds campaign in North Carolina

Majority of pledged Democratic delegates endorse Harris after massive fundraising day

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1332" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-scaled.jpg" alt="" class="wp-image-423884" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-300x195.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-820x533.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-138x90.jpg 138w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-768x500.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/CH74466FLFPLDMIKLENAOZO5UY-1536x999.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: U.S. Vice President Kamala Harris speaks in Munich, Germany February 18, 2023. REUTERS/Wolfgang Rattay//File Photo</figcaption></figure>



Washington and the world are still reeling from President Joe Biden’s surprise announcement on Sunday that he is ending his teetering re-election campaign.



But Biden’s swift endorsement of Vice President Kamala Harris to replace him at the top of the Democratic ticket is energizing Democrats and breathing new life into their campaign to defeat former President Donald Trump and his running mate, Ohio Sen. JD Vance.



The “Biden for President” campaign committee has officially been renamed the Harris for President committee, maintaining the Biden team’s infrastructure, staff and — crucially — its $98 million in cash reserves.



Democrats excited about a new ticket have donated tens of millions of dollars online to the Harris for President campaign.



Now, speculation swirls about who the former California senator could choose for a potential running mate, if she becomes the party’s nominee. Several Democratic governors are early favorites, with strategists eyeing Josh Shapiro of Pennsylvania, Roy Cooper of North Carolina and Kentucky Gov. Andy Beshear.



Republicans are meanwhile scrambling to retool a Trump campaign that was built to defeat Joe Biden into one capable of defeating a very different candidate.



Both parties want to know what happened to make it possible for a would-be assassin to shoot at Trump while he was on stage at a rally in Butler Pa. on July 13. Trump survived the attempt, but one of his supporters in the audience was killed.



This is a developing story&#8230;

FILE PHOTO: Vice President Kamala Harris

Democrats rally behind Kamala Harris after Biden drops out; running-mate speculation swirls

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1424" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-scaled.jpg" alt="" class="wp-image-417906" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-820x570.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-768x534.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/06/CQH2GCFS7VKHNNUO4RF6ABAM54-1536x1068.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: U.S. President Joe Biden speaks as he attends the signing into law of the Ocean Shipping Reform Act of 2022, which will level the playing field for American exporters and importers, including farmers, and reduce costs for American consumers by lowering the cost of ocean shipping, at the White House in Washington, U.S., June 16, 2022. REUTERS/Evelyn Hockstein</figcaption></figure>



President&nbsp;Joe Biden&nbsp;on Sunday&nbsp;dropped out&nbsp;of the&nbsp;2024 presidential race&nbsp;and endorsed Vice President&nbsp;Kamala Harris&nbsp;as the Democratic Party’s nominee, bowing to weeks of growing pressure by his own party members to quit his re-election bid against former President&nbsp;Donald Trump.



“It has been the greatest honor of my life to serve as your President,” Biden wrote in a post on the social media site X.



“And while it has been my intention to seek reelection, I believe it is in the best interest of my party and the country for me to stand down and to focus solely on fulfilling my duties as President for the remainder of my term,” Biden wrote.



“I will speak to the Nation later this week in more detail about my decision,” wrote Biden, whose bombshell decision came after a sharp spike in recent days in the number of congressional Democrats publicly calling for him to step aside for another nominee.



Biden in a subsequent tweet wrote that his “very first decision as the party nominee in 2020 was to pick Kamala Harris as my Vice President.”



“And it’s been the best decision I’ve made. Today I want to offer my full support and endorsement for Kamala to be the nominee of our party this year. Democrats — it’s time to come together and beat Trump,” Biden wrote.



“Let’s do this.”



Harris in a statement said, “I am honored to have the President’s endorsement and my intention is to earn and win this nomination.”



Former President Bill Clinton and former Secretary of State Hillary Clinton, in a joint statement from the Democratic power couple, said, “We are honored to join the President in endorsing Vice President Harris and will do whatever we can to support her.”



Biden, who has been isolated at his Rehoboth, Delaware, beach home after being diagnosed with Covid-19, and Harris spoke on Sunday before he announced he would drop out of the election race.



NBC News reported that Biden at 1:45 p.m. ET Sunday told his senior campaign team that he had changed his mind about remaining in the contest.



On Sunday evening, on a campaign staff call, Biden campaign co-chair Jen O’Malley Dillon called for staff to rally behind their new candidate and said that their jobs would safely transfer to the Harris campaign, three sources familiar with the call told NBC News.



She also acknowledged the emotional weight of the moment: “It is ok to grieve, it is ok to be unsure but also be optimistic about our path forward.”



Trump in a phone interview with NBC News said of Biden’s decision, “He should never have been there in the first place.”



“He should have stayed in his basement,” said Trump, who was formally nominated as the Republican Party’s candidate last week, days after narrowly avoiding being killed in an assassination attempt at a Pennsylvania campaign rally on July 13.



Democratic National Committee Jamie Harrison in a statement said, “In the coming days, the Party will undertake a transparent and orderly process to move forward as a united Democratic Party with a candidate who can defeat Donald Trump in November.”



“This process will be governed by established rules and procedures of the Party. Our delegates are prepared to take seriously their responsibility in swiftly delivering a candidate to the American people,” Harrison said.



Biden’s move echoes the decision by another Democratic incumbent, President Lyndon Johnson, to drop out of the 1968 election as he faced turmoil over the Vietnam War, low approval ratings, and a surprisingly strong performance by Sen. Eugene McCarthy in the New Hampshire primary.



Biden’s campaign for weeks had insisted he would remain in the race, despite growing concern since his disastrous debate with Trump in late June that he was too old and frail to compete against the former president and serve a full second term if re-elected.



As of Sunday, nearly 40 Democratic members of Congress had urged Biden to drop out. Sen. Joe Manchin of West Virginia, who recently switched his political affiliation from Democrat to independent, earlier Sunday publicly said Biden should quit the race.



Rep. Nancy Pelosi, the California Democrat who previously served as speaker of the House of Representatives, in a tweet Sunday wrote, “President Joe Biden is a patriotic American who has always put our country first.”



“His legacy of vision, values and leadership make him one of the most consequential Presidents in American history,” Pelosi wrote. “With love and gratitude to President Biden for always believing in the promise of America and giving people the opportunity to reach their fulfillment. God blessed America with Joe Biden’s greatness and goodness.



Biden’s decision to drop out blows open the presidential race less than four months before Election Day.



It also poses extraordinary questions and challenges for the Democratic party, which now must scramble to assemble a new presidential ticket.



The next candidate will need to compete against the Republican ticket of Trump and Sen. JD Vance, win over donors, delegates and other allies who were loyal to the incumbent — all while convincing voters of their own worthiness for the nation’s highest office.



Biden’s campaign did not immediately respond to a request for comment.



Biden started to hemorrhage support from his own party and allies after his June 27 debate against Trump.



While he is only three years older than Trump, Biden looked and sounded significantly worse on the debate stage. He displayed a stiff posture and sometimes vacant-looking gaze, and he frequently gave answers that were raspy, unclear and ineffective.



In both substance and appearance, Biden contrasted sharply with Trump, who looked and sounded the same as he has in recent years.



The debate instantly set off a crisis among Democrats. Even before it ended, party operatives were raising doubts about whether Biden could effectively campaign against Trump.



High-profile Democratic donors and backers openly urged Biden to drop out, with some vowing to&nbsp;withhold campaign contributions&nbsp;in the meantime.



Biden and his aides spent weeks trying to stanch the bleeding.



In his first post-debate interview, Biden said he was convinced that he is the best person to take on Trump, adding that he could only be persuaded to step down “if the Lord Almighty comes out and tells me that.”



But as his resolute posture failed to quell the&nbsp;unrest in his party, Biden suggested he could be moved to withdraw in other ways.



In a BET interview that aired Wednesday during the Republican National Convention, Biden said he might reconsider his decision to stay in the race “if I had some&nbsp;medical condition that emerged.”



On the same day that interview was set for broadcast, Biden&nbsp;tested positive for Covid. He canceled a scheduled appearance in Las Vegas and returned his beach house in Delaware.



Biden is already the oldest person ever to serve in the White House.



He would have been 86 at the end of a second term. He had&nbsp;weathered questions&nbsp;about his physical and mental fitness even during his 2020 run.



Those concerns grew in the 2024 cycle, but they were aggressively batted down by Biden’s campaign and White House aides, and the president’s relative lack of press conferences and interviews may have shielded scrutiny about his acuity.

U.S. President Joe Biden signs into law the Ocean Shipping Reform Act of 2022

Biden drops out of 2024 presidential election, endorses Kamala Harris as Democratic nominee

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1366" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-scaled.jpg" alt="" class="wp-image-408693" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-120x80.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-154793099-1536x1024.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A sign stands at the entrance to the offices of Anglo American Plc in the Marshalltown district of Johannesburg, South Africa, on Friday, Oct. 26, 2012. Anglo American Plc Chief Executive Officer Cynthia Carroll , the first woman, external hire and non-South African to hold the job, will quit after Anglo lost $14 billion in value in the more than five years she was in charge. Photographer: Chris Ratcliffe/Bloomberg via Getty Images</figcaption></figure>



LONDON July 18 (Reuters) &#8211; Anglo American said its copper output was almost flat in the first half, while it curbed this year&#8217;s output forecast for coking coal, which is likely to weigh on earnings just months after it rebuffed a takeover bid from rival BHP Group.



Copper production rose 2% to 393,800 metric tons in the six months through June and is on track to meet full-year guidance, Anglo said in a statement.



Copper demand is expected to rise sharply in coming years for use in applications ranging from solar panels and electric cars to data centres for artificial intelligence.



Anglo&#8217;s share price was up 1.4% by 0709 GMT.



Anglo cut its output guidance for steelmaking coal to between 14 million tons to 15.5 million tons from 15 to 17 million tons previously, as it battles an underground fire at its Grosvenor coal mine in Australia that started on June 29.



Anglo has put its five operating coal mines, development projects and joint ventures in Australia up for sale, as part of a wider plan to divest less profitable assets and focus on expanding copper output after BHP&#8217;s failed attempt to take over the company. But analysts say the timing and value of a planned sale of coal assets are now uncertain.



&#8220;The mine has been stabilised and we are re-establishing comprehensive underground gas monitoring, prior to being able to assess the steps towards a safe re-entry into the mine,&#8221; Anglo said in a statement on Thursday.



Assessment of the damage and re-opening is likely to take several months, the company said.



Iron ore production was also flat at around 31 million tons in the first half, while platinum group metals (PGM) output fell 5% and rough diamond production dropped 19%.



&#8220;An expected recovery in PGM and diamond prices could help sentiment while a renewed approach from BHP cannot be ruled out,&#8221; analyst Marina Calero at RBC Capital Markets said.



&#8220;However, we view the outlook for Anglo as more balanced in the near term as the sale of the steelmaking coal assets gets more complicated at a time when we expect iron ore prices to roll in H2 24,&#8221; she added.



(Reporting by Clara Denina and Felix Njini; editing by Jason Neely and Sharon Singleton)

Anglo American Plc’s South African Headquarters As CEO Cynthia Carroll Quits

Anglo cuts coal output forecast after fire at Australian mine

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1600" height="900" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648.jpeg" alt="" class="wp-image-508834" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648.jpeg 1600w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/106463174-1585290052493gettyimages-871925648-1536x864.jpeg 1536w" sizes="(max-width: 1600px) 100vw, 1600px" /><figcaption class="wp-element-caption">Chinese President Xi Jinping and former U.S. President Donald Trump in Beijing, China, in 2017. Artyom Ivanov | TASS | Getty Images</figcaption></figure>



BEIJING — If Donald Trump wins the U.S. presidential election, his plans for 60% tariffs on Chinese goods could be a “major downside growth risk” to China, according to Goldman Sachs.



Chances of Trump becoming the next president ticked higher after he survived an assassination attempt on Saturday and selected former critic JD Vance as his running mate two days later.



“Right now exports are a major bright spot in the Chinese economy, and I think the policymakers might want to be prepared,” Hui Shan, chief China economist at Goldman Sachs told CNBC’s “Squawk Box Asia” on Tuesday.



“We are seeing tariff narratives, not only in the U.S., but across other major trading partners of China’s,” she said. “So this is not going to be a sustainable driver of growth for China.”&nbsp;



The U.S. is China’s largest trading partner on a single-country basis, while the European Union has fallen behind Southeast Asia as China’s largest regional trading partner. Trump had raised duties on Chinese goods when president in 2018 and has threatened to increase them to 60% if reelected this fall.\



The contribution of goods exports to real GDP growth in China for the second quarter of this year was the highest since the first quarter of 2022, when Covid restrictions limited domestic economic activity, according to Citi.



Meanwhile,&nbsp;Beijing’s push to develop high-end manufacturing has not yet been able to fully offset a real estate slump and lackluster consumption.



U.S. officials such as Treasury Secretary Janet Yellen have said that China’s policies to boost its industrial capability and technological self-reliance have led to U.S. job losses.



<h2 class="wp-block-heading" id="h-china-the-biggest-threat"><a></a>China the ‘biggest threat’?</h2>



In his first interview since he was selected as Trump’s running mate, Vance told Fox News that instead of the war in Ukraine, China was the “real issue” for the U.S. and posed the “biggest threat.”



The Biden campaign has criticized Trump’s pick, saying the choice was deliberately made “because Vance will do what Mike Pence wouldn’t on January 6: bend over backwards to enable Trump and his extreme MAGA agenda, even if it means breaking the law and no matter the harm to the American people.”



Supporters of Trump, who was president at that time, had stormed the U.S. Capitol in an attempt to overturn the 2020 presidential election results on January 6, 2021.



Asked about Vance’s comment, China’s Ministry of Foreign Affairs spokesperson Lin Jian said Tuesday at a daily press briefing, “We are always opposed to making China an issue in U.S. elections.”



<h2 class="wp-block-heading" id="h-calls-for-stimulus"><a></a>Calls for stimulus</h2>



China’s economy grew by 4.7% in the second quarter compared to a year ago, missing economists’ expectations and bringing growth for the first half of the year to 5%. It prompted some calls for more stimulus if the world’s second-largest economy is to reach 5% growth for the full year.



The downside risk from potentially higher U.S. tariffs under Trump would primarily come from the greater uncertainty and tighter financial conditions, as well as pressure on the Chinese yuan, Goldman’s Shan said. She pointed out that tariffs in 2018 did not significantly dent China’s exports to the U.S.



More recent data, however, showed a slowdown in that trade. China’s exports to the U.S. rose by a modest 1.5% in the first half of the year.



“Policymakers need to think about domestic demand and focusing on something that is more persistent and sustainable for the growth outlook,” Shan told CNBC on Tuesday.



If 60% tariffs are imposed, “that’s pretty high and we think the implication for the macro economy is pretty significant,” she added.



So far, China has held back on stimulus measures. The country’s top leaders are meeting in Beijing this week for a highly anticipated Third Plenum, which is expected to determine long-term economic policy goals.



Citi analysts said Monday that weak retail sales and disappointing second-quarter growth won’t be enough to convince Beijing to increase support for the economy.



“Policymakers may tolerate short-term weakness amid the structural shift of the property sector,” the analysts said. “More concerns on trade and external relationships could also lead China to save the policy space for future.”



Citi forecasts 5.0% growth in real GDP growth for China this year.



China’s U.S. dollar-denominated exports grew by 3.6% in the first six months of the year after better-than-expected global demand for Chinese goods in recent months.



“Manufacturing and infrastructure investment may stay robust and exports should stay in decent [year-on-year] growth in [the third quarter], with possible front-loading of shipment orders in [the second half of the year] due to fears of higher tariffs,” Tao Wang, head of Asia economics and chief China economist at UBS Investment Bank said in a note Tuesday.



She said Chinese authorities would likely be reluctant to roll out major stimulus in the next few months in order to save resources in the case of greater economic weakness and increased tariffs.



UBS forecasts 4.9% growth for China’s economy this year.



<h2 class="wp-block-heading"><a></a>Trump the dealmaker</h2>



Not all analysts believe a possible Trump presidency will prove detrimental to China, though.



Ben Harburg of Corevalues Alpha told CNBC on July 4 that he believes China is more likely to have “positive” trade outcomes under a Trump presidency, given the ex-president’s “transactional nature.” “He’s a dealmaker, and like any negotiator, he likes to kind of set the bar low, and kind of set his price low, and then work up from there,” the portfolio manager said on “Street Signs Asia.”



Speaking on foreign policy, Harburg pointed out that another Biden term would also mean continued tariffs, as well as “encroachment on Chinese domestic issues” — which would not significantly improve China’s economy, nor U.S.-China relations.



He said a Trump-China partnership would signify “a more binary potential for a positive outcome for China.”



CNBC’s Sonia Heng contributed reporting from Singapore.

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What would a second Trump presidency mean for China? Goldman Sachs weighs in

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1365" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-scaled.jpeg" alt="" class="wp-image-508539" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-scaled.jpeg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107405347-1713901590053-gettyimages-1467862508-r15207-fr-01-ge-01-1536x1024.jpeg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Golden Horn and Bosphorus at sunset, Istanbul, Turkey Matteo Colombo | Digitalvision | Getty Images</figcaption></figure>



Turkey came out miles ahead of the rest of the world in an annual global wealth ranking — in a result that may come as surprising, given the country’s high levels of inflation.



“Türkiye stands out with a staggering growth of over 157% in wealth per adult between 2022 and 2023, leaving all other nations far behind,” Swiss bank UBS wrote in its Global Wealth Report 2024, using the local spelling for the country’s name.



The next-highest countries in terms of average wealth growth per adult were Russia and Qatar with nearly 20% and South Africa with just over 16%. In the U.S., average wealth per adult grew by nearly 2.5%.



Inflation in Turkey sits at nearly 72%, an eye-watering figure for the country’s 85 million people, many of whom have seen a dramatic drop in their purchasing power over the last several years. In the last five years, the Turkish lira has lost nearly 83% of its value against the dollar, and the currency trades at 33 lira to the greenback as of 09:07 a.m. London time on Wednesday.



But for Turks who own assets like homes, wealth has grown, as inflation pushes up the costs of those holdings.



The UBS report defines net worth or “wealth” as “the value of financial assets plus real assets (principally housing) owned by households, minus their debts.” In a call with journalists, some of the report’s authors broke down the relationship between inflation and wealth rises in Turkey.



“In certain ways, the high pace of inflation also helps explain why wealth has risen much much more in local currency terms, at least [more] than in other countries because it’s worth keeping in mind that wealth is measured in nominal terms,” Samuel Adams economist at UBS Global Wealth Management, told CNBC.



“If inflation is very high, what tends to happen is that if you have a real asset like housing, the house prices tend to rise in line with inflation, if not even faster,” he said. “So those people with have homeownership, or who have equities, which also tend to perform fairly well in those environments, they tend to see their wealth accumulate a bit faster.



“Of course, it doesn’t mean that everybody benefits to the same extent,” Adams added. “If you’re not in those assets, if your wage rises don’t keep pace with inflation, then, of course, it will be fairly negatively affected.”



The report also noted the “currency effect”, which is what changes wealth growth the most — local currency growth figures for wealth are often significantly different from those in dollar terms.



“Türkiye’s already exceptional growth of over 63% in USD &#8230; more than doubles to nearly 158% in Turkish lira,” it said. Other examples in the report included Japan, which in dollar terms has seen less than 2% average growth in wealth per adult in U.S. dollar terms between 2022-23, but in local currency that growth was 9%.



Evaluating countries’ average wealth growth between the years of 2008 and 2023, “the most dramatic evolution has taken place in Türkiye,” UBS wrote, “where average wealth per adult in this period has shot up by 1708% in local currency.”



UBS Global Wealth Management’s Chief Economist Paul Donovan pointed out that being asset-rich does not necessarily mean being cash-rich — in Turkey, this could actually be the opposite.



“In terms of living standards rather than wealth, it’s also important to remember that if you own a house, the value of your house has gone up, but your real wage may be negative at the same time. So you can be &#8230; asset rich and cash poor,” Donovan said last week.



“That’s certainly a possibility, where a lot of the stresses that have arisen in the Turkish economy over the last few years have come about because of negative real income,” he added, “not necessarily what’s happening on the asset side.”

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Wealth growth in Turkey, South Africa shows surprising expansion

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-820x547.jpg" alt="" class="wp-image-493882" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, U.S., as IMF Managing Director Christine Lagarde meets with Argentine Treasury Minister Nicolas Dujovne September 4, 2018. REUTERS/Yuri Gripas</figcaption></figure>



WASHINGTON, July 16 (Reuters) &#8211; The global economy is set for modest growth over the next two years amid cooling activity in the U.S., a bottoming-out in Europe and stronger consumption and exports for China, but risks to the path abound, the International Monetary Fund said on Tuesday.



The IMF warned in an update to its World Economic Outlook(WEO) that momentum in the fight against inflation is slowing, which could further delay an easing of interest rates and keep up strong dollar pressure on developing economies.



The IMF kept its 2024 global real gross domestic product growth forecast unchanged from April at 3.2% and raised its 2025 forecast by 0.1 percentage point to 3.3%. The forecasts fail to shift growth from the lackluster levels that IMF managing director Kristalina Georgieva has warned would lead to &#8220;the tepid twenties.&#8221;



But the revised outlook reflected some shifting sands among major economies, with the 2024 U.S. growth forecast reduced by 0.1 percentage point to 2.6%, reflecting slower-than-expected first-quarter consumption. The Fund&#8217;s 2025 U.S growth forecast was unchanged at 1.9%, a slowdown driven by a cooling labor market and moderating spending in response to tight monetary policy.



&#8220;Growth in major advanced economies is becoming more aligned as output gaps are closing,&#8221; IMF chief economist Pierre-Olivier Gourinchas said in a blog post accompanying the report, adding that the U.S. was showing increasing signs of cooling, while Europe was poised to pick up.



The IMF significantly hiked its China growth forecast to 5.0% &#8211; matching the Chinese government&#8217;s target for the year &#8211; from 4.6% in April due to a first-quarter rebound in private consumption and strong exports. The IMF also boosted its 2025 China growth forecast to 4.5% from 4.1% in April.



<h2 class="wp-block-heading" id="h-china-risks">CHINA RISKS</h2>



But China&#8217;s momentum may be sputtering, as Beijing on Monday reported second-quarter GDP growth of just 4.7%, significantly below forecasts amid weak consumer spending amid a protracted property downturn.



Gourinchas told Reuters in an interview that the new data poses a downside risk to the IMF forecast, as it signals weakness in consumer confidence and continuing problems in the property sector. To boost domestic consumption, China needs to fully resolve its property crisis, as real estate is the main asset for most Chinese households.



&#8220;When you&#8217;re looking at China, the weaker the domestic demand, the more growth is going to rely potentially on the external sector,&#8221; he said, inviting more trade tensions.



On a more positive note, the IMF slightly upgraded its 2024 eurozone growth forecast by 0.1 percentage point to 0.9%, leaving the bloc&#8217;s 2025 forecast unchanged at 1.5%.



The eurozone has &#8220;bottomed out&#8221; and saw stronger first-half services growth, while rising real wages will help power consumption next year and easing monetary policy will aid investment, the IMF said.



It cut Japan&#8217;s 2024 growth forecast to 0.7% from 0.9% in April due in part to supply disruptions from a major auto plant shutdown and weak private investment in the first quarter.



<h2 class="wp-block-heading" id="h-inflation-risks-remain">INFLATION RISKS REMAIN</h2>



The IMF warned of near-term upside risks to inflation as services prices remain elevated amid wage growth in the labor-intensive sector and said renewed trade and geopolitical tensions could stoke price pressures by increasing the cost of imported goods along the supply chain.



&#8220;The risk of elevated inflation has raised the prospects of higher-for-even-longer interest rates, which in turn increases external, fiscal and financial risks,&#8221; the IMF said in the report.



Gourinchas said that despite a fall in U.S. consumer prices last month, the Federal Reserve



can afford to wait



a bit longer to begin cutting rates to avoid any inflationary surprises.



<h2 class="wp-block-heading" id="h-protectionism-risks">PROTECTIONISM RISKS</h2>



The IMF also warned of potential swings in economic policy as a result of many elections this year that could have negative spillovers to the rest of the world.



&#8220;These potential shifts entail fiscal profligacy risks that will worsen debt dynamics, adversely affecting long-term yields and ratcheting up protectionism,&#8221; the Fund said.



The Fund did not name U.S. Republican Party candidate Donald Trump, who has proposed to impose a 10% tariff on all U.S. imports, nor Democratic President Joe Biden, who has sharply hiked tariffs on Chinese electric vehicles, batteries, solar panels and semiconductors.



But it said that higher tariffs and a scaling up of domestic industrial policy could create &#8220;damaging cross-border spillovers, as well as trigger retaliation, resulting in a costly race to the bottom.&#8221;



Instead, the IMF recommended that policymakers persevere with restoring price stability &#8211; easing monetary policy only gradually &#8211; replenish fiscal buffers drained during the pandemic and pursue policies that promote trade and increase productivity. 



(Reporting by David Lawder; Editing by Andrea Ricci and Dan Burns)

IMF logo is seen outside the headquarters building in Washington

IMF sees steady global growth, warns of slowing disinflation momentum

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV-820x461.jpeg" alt="" class="wp-image-505971" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108003607-1720573755368-gettyimages-2157355769-cfoto-dailylif240617_npCKV.jpeg 1920w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Consumers are shopping at a supermarket in Qingzhou, China, on June 12, 2024.  Nurphoto | Nurphoto | Getty Images</figcaption></figure>



BEIJING — China’s consumer price inflation rose by 0.2% in June from a year ago, missing expectations, while producer prices fell in-line with forecasts, data from the National Bureau of Statistics on Wednesday showed.



China’s consumer price index was expected to rise by 0.4% year-on-year in June, according to a poll by Reuters.



The producer price index, which measures factory-gate prices, dropped by 0.8% from a year ago — in line with expectations.



Core CPI, which strips out more volatile food and energy prices, rose by 0.6% year-on-year in June, slightly slower than the 0.7% increase for the first six months of the year.



Pork prices surged by 18.1% in June from a year ago, while beef prices fell by 13.4%. Tourism prices rose by 3.7% year-on-year in June, down by 0.8% from May.



“The risk of deflation has not faded in China. Domestic demand remains weak,” Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said in a note.



He added that China would rely on exports to support growth in the first half of the year.



The country is scheduled to release trade data for June on Friday.



Lackluster domestic demand in China has kept inflation low, in contrast to major economies such as the U.S. where prices have remained elevated.







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China’s inflation numbers miss expectations, rising 0.2% in June

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="929" height="523" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell.jpeg" alt="" class="wp-image-505743" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell.jpeg 929w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell-768x432.jpeg 768w" sizes="(max-width: 929px) 100vw, 929px" /><figcaption class="wp-element-caption">Federal Reserve Chair Jerome Powell speaks during a House Financial Services Committee hearing on the “Federal Reserve’s Semi-Annual Monetary Policy Report” on Capitol Hill in Washington, U.S., March 6, 2024.&nbsp; Bonnie Cash | Reuters</figcaption></figure>



Federal Reserve Chair&nbsp;Jerome Powell&nbsp;on Tuesday expressed concern that holding interest rates too high for too long could jeopardize economic growth.



Setting the stage for a two-day appearance on Capitol Hill this week, the central bank leader said the economy remains strong as does the labor market, despite some recent cooling. Powell cited some easing in inflation, which he said policymakers stay resolute in bringing down to their 2% goal.



“At the same time, in light of the progress made both in lowering inflation and in cooling the labor market over the past two years, elevated inflation is not the only risk we face,” he said in prepared remarks. “Reducing policy restraint too late or too little could unduly weaken economic activity and employment.”



The commentary coincides with the approaching one-year anniversary of the last time the Federal Open Market Committee raised benchmark interest rates.



The Fed’s overnight borrowing rate currently sits in a rage of 5.25%-5.5%, the highest level in some 23 years and the product of 11 consecutive hikes after inflation hit its highest level since the early 1980s.



Markets expect the Fed to begin cutting rates in September and likely following up with another quarter percentage point reduction by the end of the year. FOMC members at their June meeting, however,&nbsp;indicated just one cut.



<h2 class="wp-block-heading" id="h-strengthen-our-confidence"><a></a>‘Strengthen our confidence’</h2>



In recent days, Powell and his colleagues have indicated that&nbsp;recent inflation data has been somewhat encouraging&nbsp;after a surprise jump to start the year. Inflation as judged by the Fed’s preferred&nbsp;personal consumption expenditures price index&nbsp;was at 2.6% in May after peaking above 7% in June 2022.



“After a lack of progress toward our 2 percent inflation objective in the early part of this year, the most recent monthly readings have shown modest further progress,” Powell said. “More good data would strengthen our confidence that inflation is moving sustainably toward 2 percent.”



The statement is part of congressionally mandated semiannual updates on monetary policy. After delivering the remarks, Powell will face questioning from Senate Banking Committee members on Tuesday, then the House Financial Services Committee on Wednesday.



In past appearances, Powell has veered away from making dramatic policy announcements while having to dodge politically loaded questions from committee members. The questioning could get contentious this year as Washington is on edge amid a volatile presidential campaign.



However, Powell has stressed that the Fed is not political and does not get involved in taking policy sides outside of its own roles. In his prepared remarks, he emphasized the importance of “the operational independence that is needed” for the Fed to do its job.



His other remarks focused squarely on the stance of policy in relation to the broader economy. Recent data has shown the&nbsp;unemployment rate creeping higher&nbsp;and broad growth as measured by gross domestic product receding. Both the manufacturing and services sectors reported being in contraction during June.



But Powell said the data is showing that “the U.S. economy continues to expand at a solid pace” despite the deceleration in GDP.



“Private domestic demand remains robust, however, with slower but still-solid increases in consumer spending,” he said.

107383408-17097467082024-03-06t173039z_1867852560_rc2hg6akf319_rtrmadp_0_usa-fed-powell

Fed Chair Powell says holding rates high for too long could jeopardize economic growth

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-820x547.jpg" alt="" class="wp-image-505670" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HIIJDZFCB5P35MGUWBAGP3Y76E-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A person casts a ballot in the second round of the early French parliamentary elections, at a polling station in Paris, France, July 7, 2024. REUTERS/Sarah Meyssonnier</figcaption></figure>



July 9 (Reuters)&nbsp;&#8211;&nbsp;Elections are taking place this year in countries home to almost half of the world&#8217;s population, from Taiwan&#8217;s general election in January to the U.S. presidential race in November.



The votes come amid growing economic and geopolitical strife, with the Ukraine war, conflicts in the Middle East and rising trade tensions between the United States and China, the world&#8217;s two largest economies.



In some countries, there are concerns about the resilience of democracy itself as political discourse has polarized or been warped by disinformation. Many of this year&#8217;s elections will not be free and fair &#8211; or their results will be disputed.



Half-way through the biggest year for elections in history, here are some common themes that have emerged in Reuters&#8217; reporting from around the world:



<h2 class="wp-block-heading" id="h-cost-of-living">COST OF LIVING</h2>



From the price of green onions in Indonesia to higher fuel bills across Europe, rises in the price of food, energy and other basics have hit the living standards of households across the world. Incumbent governments and leaders are paying for it.



Polling showed that cost of living concerns were a powerful factor in a fall in support for Prime Minister Narendra Modi&#8217;s party in India, losses suffered by mainstream parties in June&#8217;s European Parliament elections and the poll rout of Britain&#8217;s ruling Conservatives.



In Africa, discontent over living standards and unemployment contributed to the ANC&#8217;s loss of its majority in South Africa&#8217;s election. Worsening poverty is likely to help shape the outcome of Ghana&#8217;s December vote to succeed President Nana Akufo-Addo.



Polling ahead of the U.S. election suggests voters are similarly unimpressed with President Joe Biden&#8217;s efforts to improve their livelihoods, with many Americans feeling their living standards are falling despite strong headline economic data. One outlier: In Mexico, the ruling MORENA party emerged the winner after offering ample subsidies to low-income voters.



While economic policymakers say there are signs that inflation is returning to normal, they warn it has not yet been fully tamed and many economies remain fragile.



&#8220;A number of pressure points could throw the global economy off track,&#8221; Agustin Carstens, head of the central bank umbrella group the Bank of International Settlements (BIS), warned in June.



<h2 class="wp-block-heading" id="h-green-transition">GREEN TRANSITION</h2>



With the cost of living uppermost in many voters&#8217; minds, climate change action has often been crowded out of election campaigns &#8211; even as global temperatures break new records and death tolls from extreme heat climb.



While surveys show Europeans still support ambitious action on global warming, the debate there has focused on the perceived cost to livelihoods, with farming and other lobbies stepping up calls for an easing of net-zero policies.



In the EU elections, ecologist Greens shed most of the gains made five years earlier. In Britain, Labour dropped a 28-billion-pound green investment pledge ahead of the July 4 general election, saying the country could not afford it, while their Conservative rivals described themselves as &#8220;on the side of drivers&#8221;, attacking low-traffic and low-emission schemes.



The biggest challenge to the green transition may come from the United States, with Donald Trump campaigning on policies supporting continued fossil fuel use. It remains to be seen how much of Biden&#8217;s Inflation Reduction Act (IRA) green subsidies stay in place in the event of a Trump victory.



<h2 class="wp-block-heading" id="h-swing-to-the-far-right">SWING TO THE (FAR)RIGHT?</h2>



The cost of living crisis has led to rising support for far-right movement&nbsp;in Western countries&nbsp;with a mix of anti-immigration and nationalist policies, often unfunded economic spending plans and populist rhetoric attacking global elites.



Back in March, Portugal&#8217;s Chega party quadrupled its seats in parliament to become the country&#8217;s third-largest party. Three months later, its far-right, eurosceptic peers across Europe made gains in elections to the European Parliament.



In France, Marine Le Pen&#8217;s National Rally failed in elections on Sunday to achieve the majority they were coveting but became the largest single party in a hung parliament that now risks plunging Europe&#8217;s second-largest economy into policy paralyis.



In Britain, the anti-immigrant, nationalist Reform Party won over four million votes, contributing to the collapse in support for the ruling Conservatives even if Britain&#8217;s first-past-the-post electoral system meant it only won a handful of seats.



Austria&#8217;s Sept. 29 election will be closely watched, with polls showing the far-right Freedom Party (FPO) leading rivals after it ranked first in European Parliament elections.



In the United States, Trump has made immigration one of his top domestic campaign issues, declaring he would carry out mass deportations, end birthright citizenship, and expand a travel ban on people from certain countries.



Mohit Kumar, chief economist for investment house Jefferies, noted that immigration as an election theme was hottest in precisely the large Western economies whose ageing populations were creating labour shortages.



&#8220;Economically we need immigration but the political dynamics are shifting away from immigration,&#8221; he said.



<h2 class="wp-block-heading" id="h-debt-and-election-largesse">DEBT AND ELECTION LARGESSE</h2>



With economic hardship so prevalent, many politicians are offering to spend big and cut taxes in a bid to win power &#8211; at the risk of adding to global debt already at record levels after huge post-pandemic stimulus packages in rich-world economies.



Credit rating firm S&amp;P Global has warned the United States, France and other Group of Seven (G7) governments were unlikely to halt rises in their debt &#8220;at the present stage in their electoral cycles&#8221;.



The BIS annual report in June said an election year like this brought an &#8220;especially high&#8221; risk of fiscal expansion that could complicate efforts to bring inflation down to target.



Budget watchdogs in Britain and France &#8211; two countries struggling to balance their budgets &#8211; noted that many spending pledges were either unfunded or unrealistically costed.



Trump has pledged to keep in place a broad 2017 tax cut that he signed while in office, and his economic team has discussed a further round of cuts beyond those enacted in his first term.



Biden, meanwhile, proposes raising levies on businesses and rich individuals, while vowing not to increase taxes for households earning less than $400,000 a year and to assist low- and middle-income Americans with childcare costs. U.S. federal government currently has more than $34 trillion in debt.



Such levels of debt are seen making the global economy more vulnerable to financial shocks and the International Monetary Fund has urged governments to reduce their borrowing.



&#8220;Unfortunately, fiscal plans so far are insufficient and could be derailed further given the record number of elections this year,&#8221; its chief economist Pierre-Olivier Gourinchas said in a recent blog.



<h2 class="wp-block-heading" id="h-defence-and-security">DEFENCE AND SECURITY</h2>



As geopolitical tensions rise, defence and security matters have been prominent in a number of election campaigns so far this year &#8211; particularly in countries near the hotspots.



In February, Finland elected as president Alexander Stubb, who campaigned on the previously non-aligned country fully participating in NATO and allowing the transit of nuclear arms through it. Incumbents in Lithuania won an election dominated by concerns over Russia and calls for higher defence spending.



Taiwan&#8217;s presidential and parliamentary elections on Jan. 13 focused around arguments on how best to deal with China, which views the island as its own territory. The ruling DPP party secured the presidency for a third term as its candidate vowed to safeguard Taiwan from intimidation while emphasising the need for dialogue with Beijing.



In the United States, Democratic voters&#8217; anger over Israel&#8217;s military action in Gaza &#8211; and over Biden&#8217;s continued support of Israel – has emerged as a major vulnerability for him. American views on the conflict have broken down along party lines with Republicans largely supporting Israel.



While Biden voices unwavering support for NATO, Trump has said that if he is returned to the White House, America would fundamentally rethink NATO&#8217;s purpose. He has also asserted without evidence that if elected he would end the conflict in Ukraine before even taking office. On that, Biden has retorted that Trump has &#8220;no idea what he&#8217;s talking about&#8221;.



<h2 class="wp-block-heading" id="h-democracy-at-stake">DEMOCRACY AT STAKE?</h2>



Pro-democracy watchdogs estimate that nearly three-quarters of the world&#8217;s population live in autocracies. Observers and human rights groups have signalled concerns about the fairness of elections this year in Bangladesh, Azerbaijan, Belarus, Cambodia, Iran and Russia. Votes in Algeria and Uzbekistan face similar questions.



Modi&#8217;s electoral setback has been hailed by some commentators as proof of the resilience of its democracy. There was relief at the peaceful handover of power in Senegal in March after moves by the incumbent to delay the vote triggered protests.



Democracy&#8217;s biggest test this year may, however, be in Washington.



Trump refuses to commit to accepting the election results or to rule out possible violence around the Nov. 5 contest. He is already laying the groundwork to contest a potential defeat.



&#8220;We should be quite worried,&#8221; Steven Levitsky, political scientist and professor of government at Harvard University, told a Brookings think tank event in June.



&#8220;A democracy cannot survive if one party in a two-party system is not committed to playing by the democratic rules of the game.&#8221;



(Graphics by Sumanta Sen and Anand Katakam; Editing by Simon Robinson and Daniel Flynn)

France votes in the second round of the 2024 snap legislative elections

How this year of elections is set to reshape global politics

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="546" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-820x546.jpeg" alt="" class="wp-image-505243" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-820x546.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-1536x1024.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-scaled.jpeg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">British Prime Minister Keir Starmer delivers his speech outside Downing Street 10, following the results of the election, in London, Britain, July 5, 2024.  Claudia Greco | Reuters</figcaption></figure>



Britain’s new Prime Minister Keir Starmer said on Saturday he would scrap a controversial plan to fly thousands of asylum seekers from Britain to Rwanda in his first major policy announcement since winning a landslide election victory.



The previous Conservative government first announced the plan in 2022 to send migrants who arrived in Britain without permission to the East African nation, saying it would put an end to asylum seekers arriving on small boats.



But no one was sent to Rwanda under the plan because of years of legal challenges.



At his first press conference since becoming prime minister, Starmer said that the Rwanda policy would be scrapped because only about 1% of asylum seekers would have been removed and it would have failed to act as a deterrent.



“The Rwanda scheme was dead and buried before it started. It’s never been a deterrent,” Starmer said. “I’m not prepared to continue with gimmicks that don’t act as a deterrent.”



Starmer won one of the largest parliamentary majorities in modern British history on Friday, making him the most powerful British leader since former Prime Minister Tony Blair, but he faces a number of challenges, including improving struggling public services and reviving a weak economy.



At the press conference in Downing Street, Starmer answered about a dozen questions and was repeatedly asked about how and when he would start delivering on his promises to fix the nation’s problems, but he gave few specifics about what he planned.



Asked if he was willing to take tough decisions and raise taxes if necessary, Starmer said his government would identify problems and act in areas such as tackling an overstretched prisons system and reducing the long waiting times to use the state-run health service.



“We’re going to have to take the tough decisions and take them early, and we will. We will do that with a raw honesty,” he said. “But that is not a sort of prelude to saying there’s some tax decision that we didn’t speak about before.”



Starmer said he would set up and chair different “mission delivery boards” to focus on so-called missions or priority areas such as the health service and economic growth.



<h2 class="wp-block-heading" id="h-election-issue"><a></a>Election issue</h2>



The question of how to stop the asylum seekers crossing from France was a major theme of the six-week election campaign.



While supporters say it would smash the model of people traffickers, critics have argued the Rwanda policy was immoral and would never work.



Last November, the UK Supreme Court declared the policy unlawful, saying Rwanda could not be considered a safe third country, prompting ministers to sign a new treaty with the East African country and to pass new legislation to override this.



The legality of that move was being challenged by charities and unions in the courts.



The British government has already given the Rwandan government hundreds of millions of pounds to set up accommodation and hire extra officials to process the asylum seekers, money it cannot recover.



Starmer has said his government would create a Border Security Command that would bring together staff from the police, the domestic intelligence agency and prosecutors to work with international agencies to stop people smuggling.



Sonya Sceats, CEO of Freedom from Torture, one of the many organizations and charities which have campaigned to stop the Rwanda plan, welcomed Starmer’s announcement on Saturday.



“We applaud Keir Starmer for moving immediately to close the door on this shameful scheme that played politics with the lives of people fleeting torture and persecution,” she said.

108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election

New UK leader Starmer declares Rwanda deportation plan ‘dead and buried’

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1365" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-scaled.jpg" alt="" class="wp-image-504199" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2160673037-1536x1024.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">LONDON, ENGLAND &#8211; JULY 05: Labour Leader Keir Starmer celebrates winning the 2024 General Election with a speech at Tate Modern on July 05, 2024 in London, England. Labour is on course to win a landslide victory in the 2024 General Election. Starmer addresses the nation promising Country first, Party second. (Photo by Ricky Vigil/Getty Images)</figcaption></figure>



LONDON — The U.K.’s opposition Labour Party won a huge parliamentary majority in the country’s general election, unseating the incumbent Conservatives after 14 years.



Early on Friday morning, Labour passed the threshold needed to govern alone as outgoing PM Rishi Sunak conceded defeat. Keir Starmer, leader of the center-left Labour, will become the country’s next prime minister and declared victory in the early hours.



“We did it,” he said, addressing his Labour colleagues. “You campaigned for it, you fought for it — and now it has arrived &#8230; change begins now.”



Some projections show Labour will gain its second-largest majority after former Prime Minister&nbsp;Tony Blair’s 179-seat majority in 1997.



Millions of people across England, Scotland, Wales and Northern Ireland on Thursday voted for their local representatives in the 650-member House of Commons, the U.K.’s lower house of parliament. Ballots are still being counted, with constituencies announcing their winning candidate as soon as votes are tallied.



Here are the seats that have been declared so far:



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="794" height="746" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/UK-Elections-Graph.png" alt="" class="wp-image-504197" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/UK-Elections-Graph.png 794w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/UK-Elections-Graph-300x282.png 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/UK-Elections-Graph-96x90.png 96w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/UK-Elections-Graph-768x722.png 768w" sizes="(max-width: 794px) 100vw, 794px" /></figure>



<h2 class="wp-block-heading" id="h-what-labour-s-win-means-for-uk-markets">What Labour’s win means for UK markets</h2>



The arrival of a new Labour government hasn’t moved markets all that much yet but analysts expect U.K. assets to become more attractive from here on out.



In a note Friday, analysts at Jefferies said, despite concerns raised by a strong showing for the right-wing Reform UK Party, the Labour Party’s U.K. election win would help make the U.K. appear “relatively stable.”



This, in combination with regulatory reform, “could raise the attractiveness of UK assets,” Jefferies’ analysts wrote in a research note.



Beata Manthey, European equity strategist at Citi, noted that history shows U.K. markets tend to trade flat on average six months after Labour wins, but “meaningfully higher one year later.”



“On a relative basis, the UK market has tended to underperform 1-2 months after Labour wins, while tallying decent relative performance 12m post-election,” Manthey said.



“The domestically oriented FTSE 250 has typically outperformed the FTSE 100 following Labour victories. Sterling and Gilts will be key to watch,” she added.



“FTSE 250 over FTSE 100 is our preferred post-election trade.”



&#8211; Ryan Browne

Labour Leader Keir Starmer Celebrates Winning The 2024 General Election

Labour Party wins UK election in a landslide

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1341" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-scaled.jpg" alt="" class="wp-image-503927" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-300x196.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-820x537.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-137x90.jpg 137w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-768x503.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107357803-1705027006499-AP24012015065200-1536x1005.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Britain’s Prime Minister Rishi Sunak, left, and U.S. President Joe Biden speak at the start of the meeting of the North Atlantic Council (NAC) during the NATO Summit in Vilnius, Lithuania, July 11, 2023. Paul Ellis | AP</figcaption></figure>



The U.K. and U.S. have a lot in common — a shared language, history, democratic ideals and values. But when it comes to politics, us Brits do things very differently from our American friends.



Those differences are plain to see as election campaigns ramp up in the U.K. and U.S., ahead of the British vote on July 4 and the U.S. ballot on Nov. 5.



Of course, our political systems encompass different electoral procedures and processes, but there are other nuances to how the Brits and Americans do political races differently. Here are a handful of them:



<h2 class="wp-block-heading" id="h-1-campaigns"><a></a>1) Campaigns</h2>



By the time a presidential election takes place in the United States, the electorate will have already endured months of seemingly endless electioneering — with the entire election campaign process from candidacies and the campaign trail to the actual presidential election and inauguration taking up to two years.



In the U.K., the time frame between a prime minister calling a general election to the actual vote is just six weeks. American readers might, very reasonably, read that and weep.



With such a tight window in which to win voters’ support, the leaders of Britain’s political parties dash about the U.K. on campaign “battle buses” as they try to visit as many constituencies as possible to persuade voters to elect the local party candidate as a member of Parliament (MP).



The party that wins the most seats in the House of Commons (the British Parliament) usually forms the new government and its leader becomes prime minister. It sounds simple, and usually is, unless there’s a “hung parliament” in which no political party wins a majority of seats. In that case, the largest party can either form&nbsp;a minority government or enter into a&nbsp;coalition government of two or more parties.



Bobby Duffy, director of the Policy Institute at King’s College London, told CNBC that there are many historical and structural differences between the countries when it comes to politics, and reasons why American campaigns are so much longer.



“The hugeness of the election in the U.S. is a function of the massive amounts of money at play to some degree. You do have to have these long periods of fundraising alongside campaigning and we just have completely different rules and structures around that.”



<h2 class="wp-block-heading"><a></a>2) Election spending and ads</h2>



Money is certainly one of biggest differences between U.K. general elections and U.S. presidential elections. Stateside, billions of dollars can be fundraised and spent on campaign activities and political ads, far above that spent in the U.K. (after all, the parties in Britain only have six weeks in which to spend the money!).



For a Brit, the money raised and spent by Republicans and Democrats during election campaigns is eye-watering. In April, the U.S. Federal Election Commission released data that showed that during the first 12 months of the 2024 election cycle (covering 2023), presidential candidates collected $374.9 million and disbursed $270.8 million, while political parties received $684.5 million and spent $595 million, and political action committees raised $3.7 billion and spent $3.1 billion, according to campaign finance reports filed with the commission.



A number of political action committees, or PACs, raise money and make direct contributions to candidates’ campaigns or parties. In the case of “super PACs,” committees raise and spend an unlimited amount of money in support of their preferred candidates, often funding large-scale ad campaigns.



In the U.K., meanwhile, the Electoral Commission sets out strict rules on spending limits for political parties contesting the general election in Great Britain (made up of England, Wales and Scotland). In England, for example, the limit is whichever the greater is of £1,458,440 ($1,845,098) or £54,010 times the number of seats the party is contesting in each part of Britain. Parties can be fined, and often are, for breaching those limits.



In the U.K., political advertising&nbsp;on TV and radio is not allowed, so U.K. voters are subjected to the somewhat quaint “party political broadcasts” during election campaigns. That’s where parties are allocated broadcast slots, free of charge, on radio and TV channels in which they can set out their election pledges. The broadcasts are sporadic, however, and easy to miss, unlike the thousands of ads in the U.S.



<h2 class="wp-block-heading"><a></a>3) ‘We don’t do God’</h2>



You will never hear a British politician — at least not a mainstream one — mentioning God in a political speech or campaign. Ever.



Religion, in general, is kept separate from politics in the U.K., a multifaith country but also one in which religious belief is declining, particularly among younger generations. Just under half (49%) of Britons surveyed in 2022 said they believed in God — down from three-quarters (75%) in 1981, according to a study by King’s College London published last year.



While it’s common to hear U.S. politicians proclaim “God bless America,” jaws would drop in the U.K. if a British politician made such an expression of faith in a political speech. Political aides say the subject is better left alone.



Alastair Campbell, who served as the Labour Party’s director of communications and strategy under former Prime Minister Tony Blair, reportedly interjected with the now famous phrase&nbsp;“we don’t do God,” when Blair, then a member of the Church of England, was asked about his faith while in power.



On another occasion, Blair was reportedly keen on ending a speech with the phrase “God bless Britain” but later said he was advised against it, noting that “one of the civil servants said in a very po-faced way ‘I just remind you prime minister, this is not America’ in this very disapproving tone, so I gave up the idea.” Blair converted to Catholicism on leaving office in 2007.



An aversion to mixing politics and personal belief still runs deep in British public life, Dan Stevens, professor of politics at Exeter University, told CNBC, unlike in the U.S.



“They’re just a much more religious society than we are. The U.K., along with much of Western Europe, is just so secular it’s just not even something worth talking about. Whereas in America, although it is secularizing, particularly among younger people &#8230; there is still this need for political candidates, including people like Donald Trump, to espouse some kind of religion to earn the electorate’s trust.”



<h2 class="wp-block-heading"><a></a>4) Age is just a number</h2>



U.K. voters have been hearing a lot in the press about how U.S. election debates have focused on incumbent President Joe Biden’s age. Indeed, British politicians look like whippersnappers when compared with the 81-year-old president and 78-year-old Republican candidate Trump.



Incumbent British Prime Minister Rishi Sunak is a youngster in comparison, at a mere 44 years old while Keir Starmer, the leader of the Labour Party and, polls suggest, the man likely to become the next prime minister, is “only” 61.



“There are so much older candidates in the U.S.,” the Policy Institute’s Duffy told CNBC, describing it to a “gerontocracy trend” in which society is governed by old people. “It’s very different from around the world where we’re actually seeing a decline in the age of world leaders.”



In the U.S., the age of the candidates reflects the decades it takes to build “political capital and connections,” Duffy said. With support for Biden shaken by his poor performance in a televised debate with Trump, it’s that political capital and connections that appear to be keeping Biden’s election campaign alive.



<h2 class="wp-block-heading"><a></a>5) ‘Culture wars’</h2>



Another point of difference in British elections, and politics in general, is that “morality issues” are not prominent points of debate, dissent or divergence. Unlike the U.S., where the abortion debate, gun control and gay marriage are sources of contention, those debates are not hot topics in the U.K. where abortion is legal, gun ownership is rare and heavily restricted (critics would argue the U.K. has a knife crime problem instead), and gay marriage is (aside from among some members of the clergy) uncontested.



Similarly, “identity politics” and “culture wars” — the umbrella term for conflicts between often opposed political groupings with different cultural values and beliefs — are not so prominent in the U.K. But the U.K. does have our “moments” — the topics of immigration, transgender rights, the U.K.’s relationship with the European Union (yes, Brexit is still “a thing” eight years after a referendum on EU membership) and assisted dying are hot topics where divisions are evident among the British press and public. Still, such issues are seen as “more of a personal rather than a party issue” in the U.K., according to John Curtice, a top U.K. polling expert who has studied British social attitudes extensively.



“Moral issues of life and death are indeed taken out of our party politics, but other aspects of the argument between social liberals and social conservatives are not taken out, and it’s become more important,” he told CNBC.



<h2 class="wp-block-heading"><a></a>6) ‘Absurd’ diversions</h2>



British political experts note that, unlike in the U.S., where broad political debates tend to remain the key focus, U.K. election campaigns can see more minor or fringe issues dominate the short election campaign.



A betting scandal has erupted in Britain in recent weeks, for example, after several candidates for the Conservative Party, and a candidate for the opposing Labour Party, were found to have placed bets on the date of the general election before it was officially announced, and its outcome, leading to accusations of impropriety in public office. It’s uncertain what amounts were staked, and those accused deny wrongdoing, though investigations have been launched by the U.K.’s gambling watchdog and the police.



Before the gambling debacle, Prime Minister Rishi Sunak’s decision to skip the main D-Day commemorations in France also caused a massive stir in the British press, who questioned his judgment. Such “diversions” during British election campaigns are common, and often pertain to issues that start as “matters of principle” that are then “taken to absurd lengths,” according to Stevens.



“There’s a tendency for our campaigns to veer off in these strange directions where we just lose the big picture,” Stevens said. “I don’t think that happens in America where the stakes are just higher,” he said.



“There, the stakes are just massive.”

107357803-1705027006499-AP24012015065200

No God, no big ads and no age debate: The UK election race is very different to America’s

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108001628-1720062067145-gettyimages-814141990-kidsunset-820x462.jpeg" alt="" class="wp-image-503924" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108001628-1720062067145-gettyimages-814141990-kidsunset-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108001628-1720062067145-gettyimages-814141990-kidsunset-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108001628-1720062067145-gettyimages-814141990-kidsunset-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108001628-1720062067145-gettyimages-814141990-kidsunset-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108001628-1720062067145-gettyimages-814141990-kidsunset.jpeg 929w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A little boy with his mother and grandmother, watch the sunset scenery at Beijing international airport.  Zhang Peng | Lightrocket | Getty Images</figcaption></figure>



China’s population is shrinking, and the demographic shift will ultimately hurt its economy, shrink the labor force and put pressure on fiscal policy.



“The working age population [in China] will fall so rapidly over the next decade, that the Chinese economy will need to deal with 1% drag in GDP growth per year for next 10 years,” Darren Tay, head of Asia country risk at BMI Country Risk &amp; Industry Analysis, told “Squawk Box Asia” in June, referring to estimates gathered by evaluating world population data released by the United Nations.



“The fiscal strain as a result of ageing is immediate and concerning,” the Economist Intelligence Unit has warned.



“Economic growth hinges on productivity, capital accumulation and labour inputs. The negative effect of an adverse demographic landscape will manifest primarily through a shrinking workforce,” according to the report published in January.



Raising the retirement age is “one of the few viable options” to maintain long-term fiscal balance, the EIU said.



“Our calculations suggest that&nbsp;if the retirement age is raised to 65 by 2035, the pension budget shortfall could be reduced by&nbsp;20% and received net pension can be increased by 30%, suggesting relief of both government and household burden,” according to the report.



Birth rates are falling around the world as women choose to have children later, or not at all.



Fertility rates have halved across OECD countries — some of the world’s richest nations — falling from about 3.3 children per woman in 1960 to about 1.5 children per woman in 2022, according to the OECD, or Organisation for Economic Co-operation and Development.



“This is significantly below the ‘replacement level’ of 2.1 children per woman needed to keep population constant in the absence of migration,” according to the&nbsp;June&nbsp;report.



<h2 class="wp-block-heading" id="h-china-s-shrinking-population"><a></a>China’s shrinking population</h2>



China’s population fell for a second consecutive year in 2023 to 1.409 billion people — dropping by 2.08 million from the previous year, according to data from the National Bureau of Statistics of China.



That’s more than the population decline of about 850,000 in 2022 — the first year deaths outnumbered births in the country since the early 1960s during the Great Famine.



“This is a consequence of the one-child policy [set] in place [in] the 1980s,” Erica Tay, director of macro research at Maybank, told CNBC.



China’s population is expected to shrink to 1.317 billion by 2050, and drop by nearly half — to 732 million — by 2100.



Fertility rate in the country is dropping more quickly than its regional peers like South Korea and Japan, Tianchen Xu, a senior economist at The Economist Intelligence Unit (EIU), told CNBC.



He said the three countries are disproportionately impacted by&nbsp;a rapidly aging population,&nbsp;largely due to&nbsp;improved standards of living,&nbsp;which&nbsp;have&nbsp;a “very strong inverse relationship with fertility rates.”



China, in particular, has been “growing at a very high rate for nearly three decades.” and its economic expansion has been “rapid and extended,” he added.



The country’s&nbsp;welfare system has also “lagged” and fiscal support for childbearing is “quite low by international comparison,” according to Xu.



Surging home prices are not helping.



“The government has largely been incapable of managing the significant rising housing costs,” according to Xu, who pointed out that as housing becomes increasingly costly, people may find it difficult to purchase homes and delay starting a family.



<h2 class="wp-block-heading"><a></a>Falling birth rates</h2>



The rapid economic expansion seen in recent decades in developed nations has brought about rising income levels and the broadening of educational and career opportunities for women.



These improved conditions have led to a greater opportunity cost for having children, Xu said.



“In more developed societies, the tendency is that parents face a much higher cost of raising children, and that tends to be a deterrent to having [them],” said BMI’s Tay.



“The more developed an economy is, the more skills the actors in the economy have to have, and thus, the required investment in each [child] rises by that amount,” he said.



The work culture in Asia can also&nbsp;play a part.



“Among the Asian countries, there’s the entrenched mindset of working long hours,” said Xu, which is “particularly an issue in China, South Korea&#8230; [and] other parts of East and Southeast Asia.”



“These countries are where the aggregate working hours are the longest in the world,” and as a result, workers have less time to build a family, Xu told CNBC.



<h2 class="wp-block-heading"><a></a>Shrinking workforce</h2>



A decline in fertility rate puts pressure on the economy and&nbsp;the society at large&nbsp;as the working population shrinks.



“A country’s birth rates will translate into its working age population growth, some two decades down the road,” said Tay from Maybank..



Additionally, falling fertility rates can impact the ratio of elderly folks who need support from younger generations, which can put “excessive burdens on a country’s health care and pension systems,” Maybank’s Tay told CNBC.



Ultimately, the&nbsp;burden on younger&nbsp;generations will grow as they need to care not only for their own children, but for their elderly parents as well.



This demographic shift in parts of Asia is a structural issue that will require “determined and holistic government effort,” on both fiscal and monetary policy, she said.



<h2 class="wp-block-heading"><a></a>China’s policy shifts</h2>



In China, policymakers have been putting a big emphasis on “productivity growth,” Xu told CNBC.



“They have [seen] that there’s a very big decline in the labor contribution to GDP, [which] cannot be mitigated via any sort of policy intervention in the short term,” he said. “That’s why they have been focusing on their productivity growth.”



The country has invested heavily into shifting to digital solutions and developing technologies such automation and advanced chips, said Xu, with the goal of making traditional industries more efficient, and overall, improving productivity.



Looking ahead, Chinese policymakers are encouraged to do more about the labor environment. “That probably entails tighter enforcement of the labor law and promoting work-life balance,” said Xu.



Economists also agree that Chinese policymakers should also work to raise the retirement age in the country, create more aggressive tax rebates for costs associated with child-rearing, and step-up its efforts in constructing affordable housing in the country.



Despite the slowdown in growth expected in China due to its demographics issue, the country’s GDP has grown an average of 9% per year since 1978, according to the World Bank.



Ultimately, “the fact remains that growth of even around 3% would not be, by any stretch of the imagination, a disaster for the Chinese economy,” Tay from BMI told CNBC.



“If they would continue to grow at that pace, which probably would be more sustainable, the average Chinese citizen would be in real terms, better off in income by 13% by 2033,” he added. “So living standards would still continue to rise.”

108001628-1720062067145-gettyimages-814141990-kidsunset

China faces economic headwinds as it grapples with an aging — and shrinking — population

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="800" height="525" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LYNXNPEE8A12W-OZABS.jpg" alt="" class="wp-image-503921" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LYNXNPEE8A12W-OZABS.jpg 800w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LYNXNPEE8A12W-OZABS-300x197.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LYNXNPEE8A12W-OZABS-137x90.jpg 137w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LYNXNPEE8A12W-OZABS-768x504.jpg 768w" sizes="(max-width: 800px) 100vw, 800px" /><figcaption class="wp-element-caption">Trafigura logo is pictured in the company entrance in Geneva March 11, 2012. REUTERS/Denis Balibouse</figcaption></figure>



July 4 (Reuters)&nbsp;&#8211;&nbsp;Trafigura and engineering company Promarks have signed a memorandum of understanding (MOU) with the government of Angola to develop a regional power transmission and supply project, the commodities trading company said on Thursday.



The project under consideration is a 2,000 megawatt high-voltage electricity transmission line to take power produced by hydroelectric dams in the north of Angola to the DRC copper belt and Zambia, integrating with the Southern Africa Power Pool, Trafigura said.



(Reporting by Brijesh Patel in Bengaluru; Editing by David Goodman)

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