Global (Page 54)

WASHINGTON, June 11 — Wholesale prices in the United States rose far faster than expected in May, the Bureau of Labor Statistics reported on Thursday, June 11, adding to evidence that inflation is heating up as higher energy costs ripple through the economy.

The Producer Price Index (PPI), which measures prices received by producers before those costs reach consumers, climbed 1.1% in May, pushing the annual rate to 6.5%, the highest reading since November 2022.

The increase came in well above economists’ forecasts. Analysts surveyed by Dow Jones had expected a 0.7% monthly increase, while FactSet economists projected 0.6% and a 6.4% annual rate. Instead, wholesale inflation matched April’s elevated pace, signaling that price pressures remain stubbornly strong.

Energy Drives the Increase

Most of the increase came from goods prices.

Final-demand goods prices jumped 2.8% during the month, the largest increase since the current data series began in December 2009. According to the Bureau of Labor Statistics, goods accounted for nearly four-fifths of the overall monthly increase.

Energy prices were the primary driver.

Wholesale energy prices surged 10.7%, while wholesale gasoline prices jumped 23.4% in May.

The increase followed ongoing disruptions in global energy markets tied to the conflict with Iran and reduced shipping flows through the Strait of Hormuz, a key artery for global oil transportation.

Inflation Remains Broad-Based

Even after removing volatile food and energy prices, inflation remained elevated.

Core producer prices rose 0.4% during the month.

A broader measure excluding food, energy, and trade services climbed 0.8%, marking the largest monthly increase since March 2022. On a year-over-year basis, that measure increased 5.1%, the highest level since October 2022.

Among services, portfolio management fees increased 4.8%.

Food prices rose 0.6%, more than double April’s pace, although some categories declined, including pork prices, which fell 10.1%.

Pressure Building Earlier in the Supply Chain

Further upstream, inflation pressures were even stronger.

Prices for unprocessed goods used in early-stage production increased 4.9% during May and were up 22.2% from a year earlier — the largest annual increase since September 2022.

Much of that increase was driven by an 11.8% jump in crude petroleum prices.

One notable exception was natural gas, where prices fell 18.2% during the month.

Why It Matters to Consumers

The report arrives one day after the Bureau of Labor Statistics reported that consumer inflation reached 4.2% annually in May, the highest level in three years.

Producer prices often serve as an early warning sign because businesses frequently pass higher costs through to consumers.

When fuel, transportation, manufacturing inputs, and raw materials become more expensive, those increases often show up weeks or months later in grocery stores, retail shelves, utility bills, and household budgets.

Small businesses may face particularly difficult choices as margins tighten, forcing owners to absorb higher costs or pass them on to customers.

Federal Reserve Faces Growing Pressure

The report also complicates the outlook for the Federal Reserve.

At the start of the year, financial markets expected multiple interest-rate cuts. Persistent inflation has dramatically altered those expectations.

The Federal Reserve’s next meeting is scheduled for June 16–17 and will be the first chaired by Kevin Warsh. Policymakers are expected to release updated economic projections and interest-rate forecasts.

While markets see little chance of an immediate rate move, futures traders increasingly expect the possibility of another rate increase before year-end.

Higher interest rates would raise borrowing costs for consumers and businesses while inflation remains elevated, creating additional pressure on household budgets and economic growth.

The next Producer Price Index report is scheduled for July 15.

JBizNews Desk — Washington

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The clearest picture of how artificial intelligence is reshaping work in Asia can be found in India’s vast technology industry, where hiring has slowed to its weakest pace in more than two years. According to staffing data firm Xpheno, whose figures were reported during the week of June 8, entry-level job openings across India’s IT sector have fallen 44% from a year earlier, while senior-level postings are down 67%.

The numbers from India’s biggest employers tell the same story. Tata Consultancy Services made 25,000 job offers to new graduates last month, and Infosys is expected to hire about 20,000 in the coming year. Those figures sound large, but they are well below previous levels. Tata Consultancy Services hired more than 40,000 new graduates annually during each of the previous three years. Direct campus hiring across the industry now runs roughly 30% to 35% below historical levels.

What makes this shift striking is that the companies are not shrinking. They are growing output while holding headcount flat or reducing it. Tata Consultancy Services shed a net 13,249 employees in one recent fiscal year even as revenue continued rising, while Infosys recorded the largest annual headcount decline in its history, a 5.9% decrease. Neither company attributes the trend solely to AI, but the pattern is increasingly difficult to ignore: more work, fewer people.

The stakes are enormous because of the industry’s scale. India’s technology and business-process sector generated approximately $254 billion in revenue and employed 5.4 million people, according to NASSCOM. For decades, the sector thrived by providing skilled labor to multinational corporations. Artificial intelligence is now challenging that model.

The jobs facing the greatest pressure are the very positions that launched millions of careers: entry-level coding, software testing, routine customer support, and back-office processing. These roles absorbed vast numbers of graduates each year and helped build India’s middle class. AI tools increasingly perform many of those tasks, reducing the need for large numbers of entry-level workers. Recruiters describe a growing shift toward just-in-time hiring, where employees are added only when projects require them rather than being kept on large reserve benches.

The transformation is not limited to India. Across Asia’s major financial centers, AI is moving rapidly from pilot projects to everyday operations. In Hong Kong, a 2026 KPMG employment survey found that 24% of organizations are now widely deploying AI, triple the level reported a year earlier. KPMG identified AI literacy and practical AI application as the most valuable skills employees can possess. At the same time, more employers expect to reduce headcount than increase it, reflecting one of the most cautious hiring outlooks in recent years.

For workers with the right skills, however, the technology is creating opportunities. Research published in January by UNICEF Innocenti found that AI-related job postings across South Asia continue to rise and offer salaries roughly 30% higher than comparable white-collar positions. Workers who understand how to leverage AI are seeing measurable gains in earnings and productivity. The concern is that those gains may not be shared equally.

Researchers increasingly warn of a more divided labor market, where highly skilled workers benefit from higher pay and greater demand while workers performing routine tasks face fewer opportunities. The challenge is not merely job displacement but widening inequality between those who can effectively use AI and those who cannot.

The World Bank, in its recent report on East Asia and the Pacific, offered a more optimistic long-term perspective. Historically, new technologies have expanded employment overall by increasing productivity and creating new industries. However, the benefits have tended to flow disproportionately to skilled workers, while some less-skilled workers have been pushed into more informal and less secure forms of employment.

There is also an augmentation story unfolding alongside the displacement narrative. Microsoft’s 2026 Work Trend Index, which surveyed 20,000 AI users across ten countries, found that most respondents reported higher productivity, and a majority said AI enabled them to produce work they could not have completed just a year earlier. In many cases, AI is changing how work is performed rather than simply eliminating jobs.

For businesses, the implications are substantial. Investors are increasingly distinguishing between companies that are building AI-driven products and services and those that continue to rely primarily on selling human labor. The valuation gap between those models is expected to widen.

Governments are responding as well. India’s Karnataka state, home to Bangalore, is offering incentives aimed at doubling the number of multinational global capability centers operating there to 1,000 by 2029. These centers are expected to create higher-value jobs, though they are unlikely to absorb the vast numbers of graduates that the traditional outsourcing model once employed.

The broader trend across Asia is becoming clear. Artificial intelligence is increasing productivity, boosting wages for workers who master it, and raising the skill requirements for new entrants. For a region that built much of its modern economic success on abundant, affordable, educated labor, that represents one of the most significant workplace shifts in decades.

JBizNews Desk — Asia

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President Donald Trump said Wednesday, June 10, that the U.S. military has been quietly helping oil tankers move through the Strait of Hormuz, claiming that more than 100 million barrels of oil and over 200 commercial ships have passed safely through the contested waterway. He disclosed the operation in remarks to reporters in the Oval Office and in a post on his Truth Social platform.

Trump said he directed the military last month to carry out what he described as a secret mission to support oil tankers and other commercial vessels navigating the strait, the narrow channel between Iran and Oman that has been largely disrupted since the war began.

“This wildly successful effort is because the UNITED STATES OF AMERICA CONTROLS the Strait of Hormuz — NOT Iran,” Trump wrote, adding that Iran’s military has been weakened and its economy is under severe strain.

The president tied the operation directly to energy prices. He argued that the continued movement of oil through the region helped keep crude prices near $90 per barrel rather than surging above $200, a level some analysts have warned could occur if the strait were completely shut.

That economic angle is the heart of why this matters to ordinary Americans.

The Strait of Hormuz is one of the most important oil routes in the world. Before the conflict escalated, roughly 20 million barrels of oil per day flowed through the waterway, representing about one-fifth of global petroleum supply. Any disruption quickly affects fuel markets, shipping costs, airline expenses, manufacturing, and ultimately consumer prices.

When traffic through the strait became constrained, oil prices climbed and gasoline costs followed. Those higher energy expenses have filtered into transportation, food distribution, and retail supply chains across the economy.

Anything that restores even part of that flow can help reduce pressure.

Still, the picture is more complicated than the president’s description suggests.

Commercial traffic through Hormuz remains significantly below pre-war levels. Independent energy analysts note that global markets are still missing substantial volumes of oil that would normally transit the route. Industry estimates indicate that billions of barrels of expected shipments have been delayed or rerouted since the conflict began.

There is, however, some evidence that more oil may be moving through the region than publicly reported.

A recent JPMorgan analysis suggested that a meaningful volume of crude may still be exiting the Gulf through vessels operating with limited public tracking visibility. Analysts noted that oil exports appear higher than official shipping traffic alone would suggest.

At those estimated rates, Trump’s claimed totals fall within a range that analysts consider plausible, though still far below normal peacetime volumes.

Administration officials have also hinted at improving conditions.

Energy Secretary Chris Wright said earlier this week that oil exports moving through Hormuz are “rising very meaningfully,” though he did not provide specific figures.

Meanwhile, ships that had been stranded inside the Persian Gulf have gradually resumed movement through the corridor amid ongoing coordination with U.S. military forces.

Exactly what role the military is playing remains somewhat unclear.

Earlier this year, Trump announced a mission known as Project Freedom, intended to assist commercial vessels affected by the conflict. Administration officials later indicated that U.S. forces were not formally escorting ships but were providing communications support, intelligence, monitoring, and defensive protection against attacks.

U.S. Central Command has stated that American forces are working to protect commercial shipping from drone, missile, and maritime threats in the region.

Secretary of State Marco Rubio recently told lawmakers that the United States has responded to Iranian attacks targeting commercial vessels. He warned that drone strikes against civilian ships pose significant environmental and economic risks and said U.S. forces respond when commercial traffic comes under attack.

For businesses and consumers, the implications are significant.

If more oil is successfully reaching global markets, it helps explain why crude prices have remained elevated but have not exploded to the levels many feared earlier this year. That stability benefits airlines, trucking companies, manufacturers, retailers, and families facing higher fuel bills.

Gasoline prices remain well above pre-conflict levels, and inflation pressures tied to energy costs continue to affect household budgets. Any improvement in oil flows therefore has direct consequences for the broader economy.

The conflict, however, remains unresolved, and the Strait of Hormuz is still operating far below normal capacity.

Energy forecasters continue to expect elevated oil prices through much of the year unless shipping conditions improve substantially.

Trump’s announcement signals that the administration believes its efforts are helping keep energy supplies moving despite the conflict. Whether that translates into sustained relief at the gas pump will depend on how much oil is truly flowing and how long the disruption lasts.

JBizNews Desk — Energy

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The federal government’s energy forecasters expect fuel prices to climb sharply this year as the war with Iran keeps oil from flowing freely through the world’s most important shipping lane. The U.S. Energy Information Administration laid out the outlook in its monthly Short-Term Energy Outlook, released June 9.

The agency expects the global oil benchmark, Brent crude, to average around $105 a barrel through June and July, assuming the Strait of Hormuz stays largely closed to shipping in the near term. It projects the wholesale price of gasoline will rise by about 50% in 2026 compared with the agency’s pre-conflict forecast from February, with diesel and jet fuel up more than 60%.

Those are wholesale figures, the prices charged before fuel reaches the corner station, but they flow straight to the pump. Drivers have already felt it. The national average for a gallon of regular gasoline jumped well above $3 this spring as the conflict disrupted oil supplies, and the government’s forecast suggests relief is not coming soon.

The cause traces back to the Strait of Hormuz, a narrow waterway between Iran and Oman that carries roughly a fifth of the world’s oil. The agency assumes shipping through the strait stays effectively closed in the near term, with traffic only beginning to resume in the third quarter of 2026 and not returning to normal until early 2027. Until those flows recover, the world is short of oil, and shortages push prices up.

There is a path back down. Once oil moves through the strait again and producers restore output, the agency expects Brent to fall to an average of $79 a barrel in 2027. But that depends entirely on the war winding down, which remains uncertain after fresh U.S. strikes on Iran this week.

The strain is showing up in America’s emergency reserves. The Strategic Petroleum Reserve, the nation’s backup supply of crude, has been drawn down sharply since the conflict began and is heading toward its lowest level since the early 1980s. That cushion helps soften price spikes, but it cannot be drained indefinitely.

For households, the effect goes far beyond the gas tank. Energy is woven into the price of nearly everything. When fuel costs rise, it costs more to grow food, manufacture goods, and truck them to stores. That is why energy did most of the damage in this week’s inflation report. The Bureau of Labor Statistics said consumer prices rose 4.2% over the past year, the fastest in three years, and that energy alone accounted for more than 60% of the monthly increase.

Small businesses feel it acutely. Delivery companies, contractors, landscapers, and anyone who runs a fleet of vehicles watches fuel costs eat into already thin margins. Many face a hard choice between absorbing the expense or raising prices on customers who are themselves stretched. Farmers face higher costs for diesel and fertilizer, much of which is tied to energy prices, which can ripple forward into grocery bills.

The travel industry is caught too. Airlines just cut their global profit forecast in half, blaming the same jump in fuel costs. Higher pump prices also weigh on summer road trips, a staple of the warm-weather economy, as families recalculate whether the drive is worth it.

The forecast itself carries a clear caveat: it assumes the strait stays disrupted. Energy prices have been less explosive than some feared, in part because traders have found workarounds and quiet routes to keep some oil moving. But the government’s central expectation is for elevated prices to persist through the year, easing only when the conflict does.

For now, the message to consumers and business owners alike is to plan for higher fuel costs through the summer and beyond. The next monthly energy outlook is due July 7, and it will show whether the war, and the prices it is driving, are getting better or worse.

JBizNews Desk — Energy

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Stocks opened higher on Thursday, June 11, shaking off a brutal week even as the U.S.-Iran conflict deepened and a fresh inflation report came in hot. The S&P 500 rose 0.21%, the Dow Jones Industrial Average gained 0.45%, and the Nasdaq Composite added 0.26% in the opening minutes. The small-cap Russell 2000 fell 1.10%, a sign investors remained cautious about higher interest rates sticking around.

Oil prices climbed after President Donald Trump said the United States would hit Iran “very hard” and seize “total control” of the country’s oil and gas industry, while U.S. Central Command confirmed fresh strikes overnight. Explosions were reported across Iran, including near the Strait of Hormuz, the strategic shipping lane through which a significant portion of the world’s oil supply passes.

The market’s gains came despite an alarming inflation report.

The U.S. Bureau of Labor Statistics reported that the Producer Price Index (PPI) jumped 1.1% in May from April, exceeding economists’ expectations of 0.7%. On a year-over-year basis, wholesale prices climbed 6.5%, marking the steepest increase since November 2022.

Energy prices drove much of the increase. Wholesale gasoline prices surged 23.4% during the month as escalating tensions with Iran pushed crude oil prices sharply higher. Excluding food and energy, so-called core wholesale prices rose a more moderate 0.4%, suggesting the inflation shock was concentrated largely in energy markets.

The report arrived just one day after separate government data showed consumer inflation reaching 4.2% annually, the highest reading in three years, and only days before the Federal Reserve’s June 17 policy meeting.

The biggest corporate story of the morning belonged to Oracle Corporation.

The software and cloud-computing giant reported fiscal fourth-quarter results after Wednesday’s closing bell. Revenue totaled approximately $19.2 billion, while adjusted earnings came in at $2.03 per share, both above Wall Street expectations.

Despite the strong results, Oracle shares fell roughly 8% at the open after management revealed plans to raise approximately $40 billion through a combination of debt and equity offerings, including a reported $20 billion stock sale, to fund an aggressive expansion of artificial-intelligence infrastructure.

Chief Executive Clay Magouyrk told analysts the company expects to bring nearly one gigawatt of computing capacity online this quarter alone, while Chief Financial Officer Hilary Maxson said Oracle anticipates roughly $70 billion in capital expenditures during the coming fiscal year.

Investors appeared concerned about the scale of the spending.

Analysts at Bank of America noted that more than half of Oracle’s contracted future revenue is tied to a single customer, OpenAI, increasing perceived concentration risk.

The spending plans also rattled parts of the broader software sector. Shares of German software giant SAP fell more than 4% as investors questioned whether competitors would face similar pressure to dramatically increase AI infrastructure spending.

Not all analysts turned negative.

UBS analyst Karl Keirstead raised his price target on Oracle to $285 from $250, while Oppenheimer and Wedbush increased their targets to $275. Evercore ISI lifted its target to $245, and Barclays maintained an overweight rating with a $240 price target.

Another major market focus is SpaceX.

Elon Musk’s rocket company is expected to price its long-awaited initial public offering after Thursday’s close at approximately $135 per share, with trading expected to begin Friday on the Nasdaq under the ticker symbol SPCX.

At a reported valuation exceeding $1.75 trillion, the offering would rank as the largest IPO in history.

The proposed listing has already generated controversy.

Senator Elizabeth Warren has urged the Securities and Exchange Commission to delay approval of the offering, citing concerns about valuation and Musk’s concentrated control over the company.

Adding further uncertainty, Iranian state media reportedly warned that Musk’s businesses operating in the Middle East, including the Starlink satellite network, could be viewed as military targets amid escalating regional tensions.

Elsewhere, semiconductor stocks rebounded after a difficult stretch that erased nearly $1 trillion in market value earlier this month.

Shares of SoftBank Group Corp. fell more than 9% after reports suggested financing tied to its investment in OpenAI encountered complications. Meanwhile, investors were awaiting earnings from Adobe Inc., scheduled for release after Thursday’s closing bell, with analysts closely watching whether the company’s AI initiatives are translating into meaningful revenue growth.

For now, Wall Street’s gains rest on a fragile assumption: that the latest inflation surge is primarily an energy story and that the conflict with Iran remains contained.

Investors now turn their attention to Adobe’s earnings, SpaceX’s IPO pricing, and next week’s highly anticipated Federal Reserve interest-rate decision, which may ultimately determine whether the market’s recent volatility intensifies or begins to ease.

JBizNews Desk — New York

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Meta announced Tuesday that it has signed an agreement with Reliance Industries to lease its first artificial intelligence data center in India, according to a statement released through the company’s newsroom and comments from Mark Zuckerberg, Founder and Chief Executive Officer of Meta, and Mukesh D. Ambani, Chairman and Managing Director of Reliance Industries Limited.

The plant will be built in Jamnagar, a city in the western Indian state of Gujarat. Under the agreement, Reliance will construct the facility while Meta leases the computing capacity inside it. The first phase is expected to operate at 168 megawatts of power, with room for future expansion.

Here is the simplest way to understand the arrangement. Meta operates platforms used by billions of people worldwide, including Facebook, Instagram, and WhatsApp, and requires vast computing power to run its growing artificial intelligence systems. Rather than building its own facility from the ground up in India, Meta will pay Reliance to build and operate the infrastructure while leasing the computing resources it needs.

India is central to the strategy. It is one of Meta’s largest and fastest-growing markets, and the company said locating computing power within the country will allow AI products and services to run faster for local users. Zuckerberg said the Jamnagar facility will strengthen Meta’s global AI infrastructure while deepening its long-term investment in India.

The partnership builds on an existing relationship. In 2020, Meta invested $5.7 billion in Jio Platforms, Reliance’s telecommunications and digital subsidiary, in a move aimed at expanding internet access and helping small businesses across India. The companies later worked together to make Meta’s open-source AI models available to Indian businesses and developers. The new data center extends that partnership into the physical infrastructure powering artificial intelligence.

The facility has been designed around two of the largest operating costs in data centers: energy and water. Reliance is developing what it describes as one of the world’s largest data center campuses in Jamnagar, with access to the significant power resources required for AI computing. The site will run on renewable energy and use desalinated seawater for cooling rather than freshwater supplies. Meta said it will cover the full cost of the energy and water needed to operate the center.

Ambani described the agreement as a milestone for India’s digital infrastructure, saying that building the country’s first custom-designed data center for a technology company of Meta’s scale demonstrates India’s readiness to play a leading role in the global AI economy.

Meta also announced a major clean-energy expansion in India. The company said it has contracted nearly 1 gigawatt of new solar and wind generation through two energy providers.

CleanMax will supply 837 megawatts from new projects in Rajasthan and Karnataka, bringing Meta’s total announced capacity with the company to more than 900 megawatts. Fourth Partner Energy will provide an additional 88 megawatts from projects across Tamil Nadu, Karnataka, Maharashtra, and Uttar Pradesh.

The business implications are significant. AI data centers have become one of the largest areas of spending across the global technology sector, influencing employment, construction activity, power demand, and local infrastructure investment. By having Reliance build and operate the facility, India retains ownership of the underlying infrastructure while keeping related energy and water spending within the country.

For Reliance, the agreement helps transform Jamnagar—long known as a major refining and energy hub—into a destination for AI and cloud-computing customers. The company has signaled its intention to host AI infrastructure for outside firms, and securing a customer the size of Meta represents a major validation of that strategy.

The deal also highlights a broader trend across the technology industry as major American companies race to secure computing capacity around the world rather than relying solely on domestic infrastructure.

For users in India, the immediate goal is straightforward: faster AI services and digital applications powered by servers located closer to where they live and work.

Neither company disclosed the financial terms of the lease agreement or provided a firm timeline for when the Jamnagar facility will begin operations.

JBizNews Desk — Asia

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Governor Tiff Macklem’s warning that Canada’s economy remains weak sent government bond prices higher as investors increased bets on future rate cuts.

The Bank of Canada left its key interest rate unchanged on Wednesday, June 10, 2026, and Governor Tiff Macklem described the country’s economy as “weak,” a message that sparked a rally in Canadian government bonds and reinforced expectations that future interest-rate cuts remain possible.

The central bank held its benchmark overnight rate at 2.25%, marking the fifth consecutive meeting without a policy change. The decision was widely expected by economists and financial markets.

Speaking in Ottawa alongside Senior Deputy Governor Carolyn Rogers, Macklem acknowledged that economic conditions remain sluggish.

“The economy is weak, but it is not clearly in recession,” Macklem said, adding that policymakers expect growth to improve during the second quarter.

Bond markets reacted immediately.

Canada’s benchmark two-year government bond yield fell to approximately 2.84% shortly after the announcement after trading near 2.88% earlier in the day. Bond yields move inversely to prices, meaning investors were buying government debt following the central bank’s comments.

The move reflected growing market expectations that the Bank of Canada’s next policy adjustment is more likely to be a rate cut than a rate increase.

In its policy statement, the central bank highlighted the difficult balancing act facing policymakers.

“Economic activity in Canada has been weak and uncertainty about U.S. trade policy persists,” the bank said.

Officials also pointed to continuing tensions in the Middle East and elevated oil prices. However, the bank emphasized that it intends to look through temporary energy-driven inflation pressures and “will not let higher energy prices become persistent inflation.”

The statement underscores the competing forces currently shaping Canada’s economy.

Higher oil prices can push inflation upward, which would normally support higher interest rates. At the same time, weak economic growth and soft business activity argue for lower borrowing costs to stimulate demand.

Caught between those competing risks, policymakers chose to remain on hold.

The decision comes as Canada continues to flirt with recession.

The economy recorded a second consecutive quarterly contraction during the first quarter of 2026, meeting the traditional definition of a technical recession. Despite that, Macklem stopped short of formally describing the economy as being in recession, arguing that conditions could improve as growth rebounds during the spring and summer months.

For consumers and businesses, the decision has direct implications.

The Bank of Canada’s overnight rate influences borrowing costs throughout the financial system, including variable-rate mortgages, lines of credit, business loans, and consumer lending products.

By leaving rates unchanged, the central bank maintained existing borrowing costs for millions of Canadians.

Fixed mortgage rates operate differently because they are heavily influenced by government bond yields. As a result, Wednesday’s rally in Canadian bonds could eventually help reduce pressure on fixed-rate borrowing costs if lower yields persist.

The current pause follows one of the most aggressive easing cycles among major central banks.

Between June 2024 and October 2025, the Bank of Canada reduced its benchmark rate by 2.75 percentage points, lowering it from 5.0% to 2.25%. Since then, policymakers have adopted a wait-and-see approach, weighing slowing economic activity against lingering inflation risks.

Economists generally interpreted Macklem’s comments as supportive of future easing rather than tightening.

Ali Jaffery, Chief Economist at KPMG Canada, described the central bank’s tone as dovish, arguing that inflation risks remain manageable given the economy’s weakness.

Andrew Grantham, Senior Economist at CIBC, characterized the Bank of Canada as “very patient” and said policymakers appear comfortable waiting to see whether current rates can support a modest recovery.

Several major financial institutions, including CIBC, BMO, and Royal Bank of Canada, currently expect the benchmark rate to remain unchanged through the remainder of 2026.

A major variable remains trade policy.

The upcoming review of the United States-Mexico-Canada Agreement (USMCA) in July could significantly affect Canada’s economic outlook. Any changes to trade arrangements would have direct implications for manufacturing, exports, investment, and cross-border supply chains.

Until there is greater clarity on trade negotiations and the trajectory of economic growth, the Bank of Canada appears content to keep rates at 2.25%, monitor incoming data, and wait for stronger evidence that either inflation or economic weakness is gaining the upper hand.

JBizNews Desk — Canada

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China sold far more goods abroad than expected last month — including a sharp jump in shipments to the United States — even with American tariffs still in place.

According to data released Tuesday, June 9, by China’s General Administration of Customs, exports rose 19.4% in May from a year earlier in dollar terms, accelerating from April’s 14.1% gain and easily beating economists’ expectations of roughly 15% growth.

The number attracting the most attention was the one tied to the United States.

China’s exports to the U.S. surged 35.4% in May compared with a year earlier, the strongest increase in five years. The jump marks a dramatic reversal from much of last year, when shipments to America were falling sharply under the weight of tariffs and slowing demand.

For many readers, the obvious question is simple: if tariffs are supposed to discourage imports, why are Chinese exports to the United States rising so quickly?

Why Tariffs Aren’t Stopping Trade

A tariff raises the price of imported goods, but it does not automatically eliminate demand.

Many American businesses still depend on Chinese-made products because there are few alternatives available at comparable prices or scale. As a result, imports can continue growing even when tariffs remain in place.

Part of the recent surge also appears to be about timing.

Companies around the world rushed to place orders ahead of rising energy and shipping costs linked to the conflict in the Persian Gulf. When businesses expect transportation costs to increase, they often stock up early, temporarily boosting trade figures.

That front-loading effect appears to have contributed to May’s export surge.

The AI Boom Is Driving Demand

The larger force may be technology.

China’s exports of computer chips, known as integrated circuits, jumped 110% in value from a year earlier, while exports of high-tech products overall rose 50%.

The global race to build artificial intelligence systems is fueling demand for semiconductors, electronics, servers, networking equipment, and other technology products. China remains a major supplier in many of those categories.

As companies worldwide invest billions of dollars into AI infrastructure, demand for Chinese-made technology products has remained strong.

Tariffs Are Lower Than Before

The trade environment has also become less restrictive.

U.S. tariffs on many Chinese goods now stand at roughly 10% after the Supreme Court struck down a series of tariffs that President Donald Trump had imposed using emergency powers.

Trade relations also improved somewhat after Trump met Chinese President Xi Jinping during an APEC summit in South Korea last October.

Lower duties make it easier for Chinese goods to remain competitive in American markets, helping explain why exports have rebounded so strongly.

Economists See More Growth Ahead

Several economists believe the momentum could continue.

Sheana Yue, a senior economist at Oxford Economics, said demand for green-energy products such as electric vehicles, batteries, and solar equipment remains strong, while AI-related technology exports continue to expand.

Tianchen Xu, a senior economist at the Economist Intelligence Unit, noted that China’s tariff disadvantage relative to some Southeast Asian manufacturing hubs has narrowed, improving the competitiveness of Chinese exports.

Those trends are helping offset weakness in other parts of the Chinese economy.

What It Means for Consumers and Businesses

For American consumers, the data suggests that lower-cost Chinese goods continue to arrive in large quantities.

That includes electronics, household appliances, industrial equipment, and components used by manufacturers across the United States.

Continued imports can help limit price increases for some products, even as inflation pressures remain elevated elsewhere in the economy.

For American businesses, the figures reinforce how deeply integrated global supply chains remain despite years of political tensions and tariff disputes.

For Trump, the numbers present a challenge to one of the core goals of his tariff strategy: reducing America’s dependence on Chinese imports.

And for China, the report highlights how important exports have become as a source of growth while the country continues to struggle with a prolonged real-estate downturn and weaker domestic demand.

The Bottom Line

Tariffs may dominate the political conversation, but they are not the only force shaping trade.

A combination of early ordering, booming demand for AI-related technology, and a more favorable tariff environment helped drive Chinese exports sharply higher in May.

The result: China’s exports are growing faster than expected, and American buyers remain a major part of that story.

JBizNews Desk — Asia

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Stocks fell at Wednesday’s opening bell after the Bureau of Labor Statistics reported Wednesday, June 10, that consumer prices rose 4.2 percent over the past year in May — a three-year high — while overnight American airstrikes inside Iran shattered hopes for a quick end to the war. The Nasdaq Composite led the pullback, down 0.7 percent as Tuesday’s tech sell-off deepened, while the S&P 500 and the Dow Jones Industrial Average each fell about 0.5 percent as of just before 10 a.m. Eastern.

The inflation report set the tone. The 4.2 percent annual rise matched economists’ expectations, but the hot reading may boost bets that the Federal Reserve will hike interest rates this year. Energy prices remained the biggest driver of inflation amid the protracted war with Iran. Headline prices rose 0.5 percent from April to May. Before the report landed, markets had priced in a 98.2 percent chance the Federal Reserve leaves rates unchanged at its June meeting, according to the CME Group FedWatch tool. The 10-year Treasury yielded 4.53 percent, and the two-year stood at 4.14 percent.

The war escalated overnight. The U.S. launched a series of airstrikes within Iran on Tuesday, targeting air defense, ground control stations and surveillance radar sites, U.S. Central Command said. Iran acknowledged strikes around the city of Bandar Abbas and Qeshm Island inside the Strait of Hormuz, but gave no details on the damage.

The strikes came after President Donald Trump said in a post on Truth Social that while the two pilots involved in the shootdown of an Apache helicopter near the Strait of Hormuz were safe and uninjured, the United States must respond to the attack. Central Command called the strikes a proportional response to unjustified Iranian aggression.

Trump turned up the pressure again Wednesday morning. He wrote on Truth Social that Iran has taken too long to negotiate a deal that would have been great for them, and now they will have to pay the price. Brent crude rose nearly 2 percent to $93 per barrel after the post, while West Texas Intermediate hovered just below $90.

The supply damage keeps mounting. Rystad Energy said Wednesday that the shutdown of 11.8 million barrels a day of production across six Gulf producers has created the most severe oil supply disruption in modern history, with cumulative losses reaching 1 billion barrels. The consultancy warned each additional month of conflict could erase another 350 million barrels of output.

Global Markets

Asia sold off hard overnight. Japan’s Nikkei 225 fell 1.89 percent, while South Korea’s Kospi slumped 4.52 percent, leading regional losses amid a tech sell-off and Middle East tensions. Hong Kong’s Hang Seng traded 0.77 percent lower, and mainland China’s CSI 300 lost 1.11 percent.

SoftBank Group plunged 10 percent after its effort to secure at least $6 billion through a margin loan backed by its OpenAI stake hit a snag, according to Bloomberg News.

Europe held firmer. The pan-European Stoxx 600 rose 0.3 percent after its open, with London’s FTSE 100 up 0.2 percent, France’s CAC 40 adding 0.4 percent and Germany’s DAX rising 0.2 percent. Autos, insurance and healthcare led gains, while technology and banks lagged.

Movers and Shakers

Super Micro Computer fell 10 percent in premarket trading after the company announced a $7 billion financing package to fund its AI infrastructure order backlog.

Chip stocks stayed under pressure. Shares of Nvidia, Micron, Intel and Qualcomm pointed lower before the open after finishing Tuesday in the red.

Oracle reports earnings after Wednesday’s closing bell, with investors focused on details of its cloud business, which counts OpenAI as a customer, amid fluctuations in the AI trade.

Starbucks is exploring options for its business in Japan, including a stake sale, according to Bloomberg, which reported preliminary talks between the company and investment banks. Japan is one of the chain’s largest markets, with about 2,100 stores.

In housing, Keefe, Bruyette & Woods upgraded Toll Brothers to outperform from market perform, saying builders exposed to affluent buyers are better positioned to defend margins, while downgrading Lennar to underperform, citing its heavy entry-level exposure. Bank of America upgraded STMicroelectronics to Buy from Neutral.

What Comes Next

The week’s main event arrives Friday. SpaceX holds its initial public offering Friday, June 12, listing on the Nasdaq under the ticker SPCX at $135 per share, giving the company an initial market value of $1.77 trillion — the largest IPO on record.

Roughly $75 billion worth of shares must be allocated to underwriters and asset managers before trading begins Friday.

Until then, the market sits between two forces it cannot control: inflation climbing on war-driven energy costs, and a conflict in the Persian Gulf that shows no sign of ending.

JBizNews Desk

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Iran’s Islamic Revolutionary Guard Corps claimed Wednesday, in a statement carried by Iranian state media, that it had struck 21 U.S. military targets across the region — including what it described as an F-35 fighter-jet base in Jordan and multiple U.S. command facilities — in retaliation for recent American strikes near the Strait of Hormuz. The claims have not been independently verified, and U.S. officials have reported a far more limited impact.

For investors and businesses, however, the immediate issue is not the disputed battlefield accounts. It is that the escalation arrived just as markets had begun betting the conflict was cooling.

That optimism had already been reflected in oil prices. In recent days, traders had pushed crude lower on hopes that a fragile ceasefire would hold and that diplomatic efforts could eventually ease pressure on one of the world’s most important energy corridors. Brent crude, the global benchmark, had retreated from recent highs as investors priced in the possibility of reduced tensions.

Wednesday’s developments threaten to reverse that trend.

The gap between the competing narratives remains significant. Iran claimed it destroyed four of the 21 targets, including an F-35 hangar, and said it shot down an American drone. The U.S. military said it intercepted multiple incoming missiles, while regional governments reported defensive actions against aerial threats. Reports of military activity emerged from several locations, but casualty and damage figures remain unconfirmed.

In short, Iran is presenting the operation as a major success. The U.S. and its partners are describing a largely contained attack. Independent verification may take days.

Markets, however, do not wait for complete information.

The reason energy traders reacted quickly is simple: geography. The Strait of Hormuz carries roughly 20% of global oil and natural-gas shipments, making it one of the most strategically important waterways in the world. Any threat to shipping through the strait raises fears of supply disruptions and higher energy prices.

Both the recent U.S. strikes and Iran’s claimed retaliation occurred near infrastructure tied to the Gulf energy network. That has kept investors focused on the possibility that the conflict could affect the movement of oil, liquefied natural gas, and refined fuels.

The pattern throughout the conflict has been familiar. Periods of diplomatic optimism have pushed energy prices lower, only for renewed military activity to bring risk premiums back into the market. Traders have repeatedly shifted between pricing in de-escalation and preparing for wider regional instability.

The economic consequences extend well beyond energy markets.

The countries cited in Iran’s claims — Bahrain, Kuwait, and Jordan — play important roles in regional aviation, finance, logistics, and military operations. Previous rounds of fighting led to temporary airspace closures, flight disruptions, and higher insurance costs for commercial shipping.

If tensions continue rising, airlines, cargo operators, and importers could face additional expenses. Those costs often move through supply chains and eventually reach consumers through higher prices on goods and services.

A broader conflict could also drive increased spending on missile-defense systems, military equipment, and regional security infrastructure, creating additional fiscal burdens for governments already coping with elevated defense budgets.

For American households, the most visible impact remains energy. Rising crude prices typically lead to more expensive gasoline, diesel, and jet fuel. Transportation companies, airlines, and freight operators feel the effects first, but consumers generally see them later through higher travel and shipping costs.

There are important reasons for caution before drawing conclusions.

Iran’s claims regarding the scale of damage remain unverified. U.S. and allied accounts suggest many incoming threats were intercepted. Markets have also shown a tendency to recover quickly when diplomatic channels reopen or when energy infrastructure remains intact.

At the same time, factors such as increased OPEC+ production and softer demand growth from major economies have helped prevent even larger price spikes during the conflict.

The bottom line is straightforward: regardless of the ultimate damage assessment, military exchanges around the world’s most important oil corridor continue to inject uncertainty into global markets.

Until the security of the Strait of Hormuz becomes clearer and the risk of further escalation recedes, investors, businesses, and consumers are likely to remain focused on one question above all others: what happens next to energy prices?

JBizNews Desk — Middle East

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Iran’s Islamic Revolutionary Guard Corps said Wednesday that it had launched attacks on U.S. military bases in Bahrain, Kuwait, and Jordan, describing the operation as retaliation for recent American strikes on Iranian ports and islands near the Strait of Hormuz. The claims were carried by Iranian state media and had not been independently verified at the time of publication.

For businesses and consumers far from the Gulf, the immediate concern is not only the military escalation but its potential effect on global energy markets.

The reason is geography. The Strait of Hormuz is one of the world’s most important energy chokepoints, carrying roughly one-fifth of global oil and natural-gas shipments. Any disruption around the waterway can quickly affect oil prices, shipping costs, airline operations, and ultimately consumer prices around the world.

Here is what is confirmed and what remains disputed.

Iran claimed it struck the U.S. Fifth Fleet headquarters in Bahrain, Ali Al Salem Air Base in Kuwait, and an air base near Azraq, Jordan, saying a total of 21 U.S. targets were involved. Those claims have not been independently verified.

Meanwhile, the U.S. military said it intercepted multiple Iranian missiles over Jordan. Kuwaiti authorities reported intercepting what they described as hostile aerial targets, while warning sirens sounded in parts of the country. Various media outlets also reported apparent military activity near installations in Bahrain. As of publication, no independently verified casualty figures had been released.

The reported U.S. strikes that preceded Iran’s response were concentrated near key locations around the Strait of Hormuz, including areas near Qeshm Island, Bandar Abbas, and Jask. Bandar Abbas serves as one of Iran’s most strategically important naval facilities and sits near the entrance to the strait.

The market implications are significant because both sides are now operating around infrastructure and waterways central to global energy flows.

Before the latest escalation, oil prices had been easing amid hopes that regional tensions might stabilize. Brent crude, the international benchmark, had retreated from earlier highs as investors cautiously anticipated a reduction in military activity.

A renewed exchange of attacks could quickly reverse that trend.

Even during periods of relative calm, energy markets remained sensitive because shipping through the Gulf region had already been disrupted by months of conflict and security concerns. Any additional threat to tanker traffic raises fears about supply interruptions and higher transportation costs.

Several factors have helped prevent even larger price increases. OPEC+ recently approved additional production increases, adding supply to the market despite ongoing geopolitical risks. At the same time, weaker demand growth from major importers, including China, has reduced some of the upward pressure on prices.

Those offsets, however, may not be enough if the conflict expands further.

The economic effects reach well beyond oil traders. Bahrain, Kuwait, and other Gulf states serve as major hubs for aviation, shipping, logistics, and financial services. Previous rounds of fighting led to airspace restrictions, flight cancellations, and increased insurance costs for commercial vessels.

If those disruptions intensify, businesses could face higher transportation expenses and longer delivery times, costs that often work their way through supply chains and eventually reach consumers.

For American households, the most visible impact would likely come through fuel prices. Higher crude-oil prices generally translate into more expensive gasoline, diesel, and jet fuel. Businesses that rely heavily on transportation and freight typically feel those increases first, followed by consumers.

The broader concern for markets is that military activity is occurring directly around one of the world’s most critical energy corridors. Investors, airlines, shipping companies, and commodity traders will be watching closely for signs of either further escalation or renewed diplomatic efforts.

For now, uncertainty remains high. Whether energy prices rise sharply from here will depend on the scale of the military response, the security of shipping routes through the Strait of Hormuz, and whether regional powers can prevent the conflict from expanding further.

JBizNews Desk — Middle East

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LONDON — Copper prices remain near historic highs, a development that may sound like a story for commodity traders but ultimately affects the cost of homes, vehicles, appliances, electronics, and countless other products consumers buy every day.

Copper recently traded near $6.30 per pound, roughly 30% higher than a year ago, reflecting one of the strongest rallies among major industrial commodities.

The metal’s importance is difficult to overstate.

Copper serves as the backbone of modern electrification. It is found in electrical wiring, power grids, automobiles, consumer electronics, air conditioners, refrigerators, industrial equipment, and renewable-energy infrastructure.

When copper becomes more expensive, the cost of producing many everyday products rises as well.

Several factors are driving prices higher.

Supply disruptions at major mining operations have tightened global inventories, while strong demand from emerging technologies continues increasing consumption.

Artificial intelligence is playing a surprisingly important role.

The massive data centers required to support AI systems consume enormous quantities of copper through electrical systems, cooling equipment, networking infrastructure, and power-distribution networks.

Electric vehicles are another major contributor.

A typical electric vehicle uses significantly more copper than a traditional gasoline-powered automobile, creating additional demand as manufacturers expand EV production.

The transition toward cleaner energy is also increasing consumption.

Solar farms, wind turbines, battery-storage systems, and expanded power grids all require substantial amounts of copper.

Trade policy has added another layer of pressure.

Concerns about potential tariffs and supply disruptions have encouraged manufacturers and traders to build inventories, further tightening available supplies and supporting higher prices.

For consumers, the effects are indirect but meaningful.

Homebuilders pay more for electrical wiring. Automakers face higher manufacturing costs. Appliance manufacturers spend more on raw materials. Electronics producers encounter additional expense throughout their supply chains.

Eventually, some portion of those costs reaches consumers.

The timing is particularly important for homeowners.

Summer is traditionally a busy season for home renovations, air-conditioner replacements, and appliance purchases—all categories heavily dependent on copper.

Economists often refer to copper as “Dr. Copper” because its price is viewed as a barometer of global economic activity.

The reasoning is simple.

Copper is used in so many industries that rising demand often signals expanding economic activity, while falling demand can indicate slowing growth.

Today’s elevated prices therefore carry two messages.

They reflect concerns about supply, but they also suggest continued demand from industries investing heavily in infrastructure, technology, artificial intelligence, and electrification.

That demand is unlikely to disappear anytime soon.

Analysts expect AI-related infrastructure spending, electric-vehicle production, and energy-transition investments to remain significant drivers of copper consumption for years to come.

For consumers, the takeaway is straightforward.

Few people buy copper directly, but many of the products they purchase contain it.

As long as copper prices remain elevated, the cost of building, powering, cooling, and connecting the modern world is likely to remain higher as well.

JBizNews Desk

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