Business Briefs - June 28, 2025
U.S., China announce a trade agreement — again
WASHINGTON (AP) — The U.S. and China have reached an agreement — again — to deescalate trade tensions. China is making it easier for U.S. companies crucial magnets and rare earths materials. But details are scarce, and the latest pact leaves major issues between the world's two biggest economies unresolved. President Donald Trump said late Thursday that a deal with China had been signed "the other day." China's Commerce Ministry confirmed Friday that some type of arrangement had been reached but offered little clarity about it. Sudden shifts and a lack of definition have been hallmarks of Trump's trade policy since he returned to the White House determined to overturn a global trading system that he says is unfair to the United States and its workers.
Gloomy Americans cut back on spending as inflation ticks higher
WASHINGTON (AP) — A key inflation gauge moved higher in May in the latest sign that prices remain stubbornly elevated while Americans cut back on their spending. Prices rose 2.3% in May compared with a year ago, up from just 2.1% in April, the Commerce Department said Friday. Excluding the volatile food and energy categories, core prices rose 2.7% from a year earlier, an increase from 2.5% the previous month. Both figures are modestly above the Federal Reserve's 2% target. The inflation figures suggest that President Donald Trump's broad-based tariffs are still only having a modest effect on prices.
Deal with Beijing will speed China's export of minerals to the U.S., treasury secretary says
BANGKOK (AP) — Washington and Beijing have signed a trade agreement that will make it easier for American firms to obtain magnets and rare earth minerals from China that are critical to manufacturing and microchip production. That's according to U.S. Treasury Secretary Scott Bessent on Friday. The agreement comes after China had retaliated against steep import tariffs imposed by President Donald Trump's administration on Chinese goods by slowing export of rare earth minerals and magnets much-needed by U.S. industrial interests. Bessent tells Fox Business Network "rare earth magnets" are "starting to flow back to the U.S." and calls it a "de-escalation" of trade tensions between both countries.
Big banks all pass the Federal Reserve's stress tests, but the tests were less vigorous this year
NEW YORK (AP) — The Federal Reserve said all major banks passed this year's stress tests, showing they can withstand a hypothetical severe economic downturn. The tests, announced Friday, were less rigorous than in previous years, with milder assumptions about unemployment, real estate, and stock market declines. The Fed says the changes aim to reduce unintended volatility in results. However, the tests excluded risks like exposure to private credit, a growing $2 trillion market that has been repeatedly flagged by economists and financial market observers as potentially destabilizing. Passing the tests allows banks to issue dividends and buy back stock.