The US economy grew faster than expected in the second quarter of this year as economists begin to backtrack on forecasts of a coming recession.
The nation's gross domestic product grew by 2.4 per cent, year on year, between April and June, according to the Labour Department's advanced estimate released on Wednesday. Bloomberg economists had expected GDP to grow by 1.8 per cent.
Consumer spending grew by 1.6 per cent, slowing sharply from 4.2 per cent in the first three months of the year.
Federal Reserve Chairman Jerome Powell on Wednesday said the central bank's staff had dropped recession predictions they set in March, when the US economy faced uncertainty over the banking crisis and the threat of a default.
“The staff now has a noticeable slowdown in growth starting later this year in the forecast. But given the resilience of the economy recently, they are no longer forecasting a recession,” Mr Powell told reporters on Wednesday. He noted that staff forecasts are independent from members of the Federal Open Market Committee.
In fighting inflation, the Fed has raised interest rates 11 times since early last year. Wednesday's rate increase of 25 basis points increased the Fed's benchmark rate to the range of 5.25 and 5.5 per cent.
As a result, the higher borrowing costs on the likes of credit cards and car loans have taken a toll on consumer spending. However, the economy appears to be set to avoid being driven into a recession.
Thursday's data points to growing evidence that Mr Powell and his colleagues can still achieve a soft landing.
“It has been my view consistently that we do have a shot,” the Fed chairman said after Wednesday's interest rates decision.
“That’s been my view. That’s still my view … But it’s a long way from assured. And we have a lot left to go to see that happen.”
The latest GDP data also adds to a series of positive US economic news stories and fuels hopes that the US will avoid a recession.
While headline inflation is still above the Fed's 2 per cent target, it has fallen to 3 per cent after peaking at 9.1 per cent last year.
"The economy’s continued growth builds on what was already the strongest pandemic recovery and lowest inflation of any G7 country," President Joe Biden said in a statement.
Meanwhile, the labour market remains strong despite the Fed's aggressive rate increases. Though hiring cooled last month, jobs are still being added at a strong pace and unemployment remains low at 3.6 per cent.
Americans are also more upbeat about the economy than they were earlier in the year. Consumer confidence jumped to its highest level in two years this month, the Conference Board reported on Tuesday, with consumers now feeling unburdened by inflation that has dogged them for the last year.
The International Monetary Fund updated its outlook for projected 2023 US GDP to 1.8 per cent, up from 1.6 per cent in April.
Economists at Goldman Sachs have also downgraded the probability of a recession to 20 per cent in the next 12 months.
The National photo project
Chris Whiteoak, a photographer at The National, spent months taking some of Jacqui Allan's props around the UAE, positioning them perfectly in front of some of the country's most recognisable landmarks. He placed a pirate on Kite Beach, in front of the Burj Al Arab, the Cheshire Cat from Alice in Wonderland at the Burj Khalifa, and brought one of Allan's snails (Freddie, which represents her grandfather) to the Dubai Frame. In Abu Dhabi, a dinosaur went to Al Ain's Jebel Hafeet. And a flamingo was taken all the way to the Hatta Mountains. This special project suitably brings to life the quirky nature of Allan's prop shop (and Allan herself!).
Gender pay parity on track in the UAE
The UAE has a good record on gender pay parity, according to Mercer's Total Remuneration Study.
"In some of the lower levels of jobs women tend to be paid more than men, primarily because men are employed in blue collar jobs and women tend to be employed in white collar jobs which pay better," said Ted Raffoul, career products leader, Mena at Mercer. "I am yet to see a company in the UAE – particularly when you are looking at a blue chip multinationals or some of the bigger local companies – that actively discriminates when it comes to gender on pay."
Mr Raffoul said most gender issues are actually due to the cultural class, as the population is dominated by Asian and Arab cultures where men are generally expected to work and earn whereas women are meant to start a family.
"For that reason, we see a different gender gap. There are less women in senior roles because women tend to focus less on this but that’s not due to any companies having a policy penalising women for any reasons – it’s a cultural thing," he said.
As a result, Mr Raffoul said many companies in the UAE are coming up with benefit package programmes to help working mothers and the career development of women in general.
Cases of coronavirus in the GCC as of March 15
Saudi Arabia – 103 infected, 0 dead, 1 recovered
UAE – 86 infected, 0 dead, 23 recovered
Bahrain – 210 infected, 0 dead, 44 recovered
Kuwait – 104 infected, 0 dead, 5 recovered
Qatar – 337 infected, 0 dead, 4 recovered
Oman – 19 infected, 0 dead, 9 recovered
Day 3 stumps
New Zealand 153 & 249
Pakistan 227 & 37-0 (target 176)
Pakistan require another 139 runs with 10 wickets remaining
The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
Country-size land deals
US interest in purchasing territory is not as outlandish as it sounds. Here's a look at some big land transactions between nations:
Louisiana Purchase
If Donald Trump is one who aims to broker "a deal of the century", then this was the "deal of the 19th Century". In 1803, the US nearly doubled in size when it bought 2,140,000 square kilometres from France for $15 million.
Florida Purchase Treaty
The US courted Spain for Florida for years. Spain eventually realised its burden in holding on to the territory and in 1819 effectively ceded it to America in a wider border treaty.
Alaska purchase
America's spending spree continued in 1867 when it acquired 1,518,800 km2 of Alaskan land from Russia for $7.2m. Critics panned the government for buying "useless land".
The Philippines
At the end of the Spanish-American War, a provision in the 1898 Treaty of Paris saw Spain surrender the Philippines for a payment of $20 million.
US Virgin Islands
It's not like a US president has never reached a deal with Denmark before. In 1917 the US purchased the Danish West Indies for $25m and renamed them the US Virgin Islands.
Gwadar
The most recent sovereign land purchase was in 1958 when Pakistan bought the southwestern port of Gwadar from Oman for 5.5bn Pakistan rupees.
MOUNTAINHEAD REVIEW
Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
The more serious side of specialty coffee
While the taste of beans and freshness of roast is paramount to the specialty coffee scene, so is sustainability and workers’ rights.
The bulk of genuine specialty coffee companies aim to improve on these elements in every stage of production via direct relationships with farmers. For instance, Mokha 1450 on Al Wasl Road strives to work predominantly with women-owned and -operated coffee organisations, including female farmers in the Sabree mountains of Yemen.
Because, as the boutique’s owner, Garfield Kerr, points out: “women represent over 90 per cent of the coffee value chain, but are woefully underrepresented in less than 10 per cent of ownership and management throughout the global coffee industry.”
One of the UAE’s largest suppliers of green (meaning not-yet-roasted) beans, Raw Coffee, is a founding member of the Partnership of Gender Equity, which aims to empower female coffee farmers and harvesters.
Also, globally, many companies have found the perfect way to recycle old coffee grounds: they create the perfect fertile soil in which to grow mushrooms.
