Member Briefing April 1, 2025
CNBC Survey: First-Quarter GDP Growth Will Be Just 0.3% As Tariffs Stoke Stagflation Conditions
Policy uncertainty and new sweeping tariffs from the Trump administration are combining to create a stagflationary outlook for the U.S. economy in the latest CNBC Rapid Update. The Rapid Update, averaging forecasts from 14 economists for GDP and inflation, sees first quarter growth registering an anemic 0.3% compared with the 2.3% reported in the fourth quarter of 2024. It would be the weakest growth since 2022 as the economy emerged from the pandemic. The good news is the import effect should abate and only two of the 12 economists surveyed see negative growth in Q1. None forecast consecutive quarters of economic contraction.
Behind the dour GDP forecasts is new evidence that the decline in consumer and business sentiment is showing up in real economic activity. The Commerce Department on Friday reported that real, or inflation-adjusted consumer spending in February rose just 0.1%, after a decline of -0.6% in January. Action Economics dropped its outlook for spending growth to just 0.2% in this quarter from 4% in the fourth quarter. Another factor: a surge of imports (which subtract from GDP) that appear to have poured into the U.S. ahead of tariffs.
Goods Trade Deficit Declined in February
The U.S. ran a smaller trade deficit in goods in February, as exports increased and imports fell. The goods trade deficit fell by 4.9% to $147.9 billion last month, down from $155.6 billion a month earlier, according to the Commerce Department. Economists are scouring data to examine how the Trump administration's fast-moving tariff policies will reshape trade, but it will likely take more months of data to build a clear picture.
One of the Trump administration's goals is to use tariffs to reduce the trade deficit. The goods trade deficit hit a record in January, likely fueled in part by a surge in gold imports driven by financial trading of the precious metal. Despite the monthly decline, February's goods trade deficit is still one of the largest on record. Some of the elevated deficit, which occurs when imports exceed exports, could show American companies' efforts to bring in supplies and products before harsher tariffs hit.
Trump Team Weighs Broader, Higher Tariffs
The Trump administration is scrambling to determine the specifics of its new tariff agenda ahead of its self-imposed deadline of Wednesday, weighing options as the president has promised to remake the American economy with a swath of new levies. One key point of debate is whether to impose individualized tariff rates for U.S. trading partners, as President Trump has previewed in recent weeks, or revert to his campaign pledge for an across-the-board tariff that would affect virtually every country doing business with the U.S., say people familiar with the conversations.
In recent days, advisers have considered imposing global tariffs of up to 20% that would hit virtually all U.S. trading partners. Trump and his team for months promoted such a plan on the campaign trail, before the president publicly ditched it in favor of a so-called reciprocal tariff plan that would mean “what they [other nations] charge us, we charge them,” as the president put it. That reciprocal plan is also still on the table, an administration official said, adding that the president is inclined to tariff every country that the U.S. runs a trade deficit with, and that he wants a “clean number” for each country, though no final decisions have been made.
Global Headlines
Middle East
- Israeli Military Orders The Evacuation Of Gaza’s Southern City Of Rafah – The Hill
- Inside Israel’s Military Operation in a West Bank Refugee Camp - WSJ
- US Airstrikes Hit Yemen: Houthi Rebels – The Hill
- ‘Highly Unlikely’: Iran’s Supreme Leader Downplays Trump’s Bombing Threat But Warns Of Retaliation - Forbes
- Iran's Currency Crashes as Trump's Sanctions Bite - Newsweek
- Netanyahu Defies Court Freeze To Name Ex-Navy Commander As New Security Chief – France 24
- Iran Will Deliver 'Strong Blow' Against US If It Attacks, Khamenei Says - Reuters
- Amid Endless War, Israelis and Palestinians Question Their Leaders - Newsweek
- Hamas Calls For Global Resistance Against Trump's Plan To Expel Palestinians From Gaza – France 24
- Interactive Map- Israel’s Operation In Gaza – Institute For The Study Of War
- Map – Tracking Hamas’ Attack On Israel – Live Universal Awareness Map
Ukraine
- ‘Russians Are Sending Way More Drones Than They Used To’, Ukraine Defence Unit Says – France 24
- Trump Says He’s ‘Very Angry’ And ‘Pissed Off’ At Putin During An NBC News Interview - CNBC
- Russia Says 'Work Ongoing' With US After Trump Says He Is 'Angry' With Putin - BBC
- A NATO Plane’s Busy Duty: Tracking (and Dodging) Russia in the Baltic Sea - NYT
- Trump Promises ‘Big, Big Problems’ If Zelenskyy Backs Out Of Minerals Deal - Politico
- Russia Denies Reports of Mystery Virus Causing Victims to Cough Up Blood - Newsweek
- Russia’s Latest Combat Vehicle Is A Truck From 1952 - Forbes
- Interactive Map: Assessed Control Of Terrain In Ukraine – Institute For The Study Of War
- Map – Tracking Russia’s Invasion Of Ukraine – Live Universal Awareness Map
Other Headlines
- French Far-Right Leader Marine Le Pen Found Guilty Of Embezzlement, Banned From Next Elections – Reuters
- ‘Je suis Marine’: Europe’s Far Right Slams Le Pen’s Conviction, Election Ban – France 24
- EU Exploring Weaker 2040 Climate Goal - Politico
- Search For Quake Survivors Intensifies In Myanmar, Thailand; Death Toll Expected To Rise - Yahoo
- As ‘Buy Canadian’ Grows, More US Companies Say Retailers Turning Away Their Products – Reuters
- How Trump Is Forcing Europe To Get Real On Steel - Politico
- Suspected Missile Cargo Ship Arrives in Iran from China - Newsweek
- Bodies of Three Missing U.S. Soldiers Recovered in Lithuania – WSJ
Policy and Politics
Senate GOP Races Toward Vote On Trump Agenda Blueprint
Senate Republicans are racing to consider a compromise budget resolution as they look to advance President Trump’s legislative agenda, with a vote potentially taking place this week. House and Senate Republicans each adopted their own budget blueprints last month, with the lower chamber moving forward with “one big, beautiful bill,” as Trump refers to it, and the upper chamber utilizing a two-track strategy. Top Republicans have been working to reconcile the two visions ever since.
Senate Majority Leader John Thune (R-S.D.) signaled that his ranks could consider the compromise measure this week, which would require a vote-a-rama. One large wild card, however, is when — and how — the Senate parliamentarian rules on whether Republicans can use the current policy baseline, the budgetary gimmick that leaders are hoping to utilize to make the 2017 Trump tax cuts permanent. The Senate could vote on an emerging compromise budget resolution as soon as this week — a timeline Thune has indicated is possible — though a number of key questions remain as the chamber looks to move forward on an agreed-upon framework.
Hudson Valley State Senators Skoufis And Mayer Call For Overhaul Of ‘Failed’ Public Service Commission
In the wake of the State Public Service Commission’s approval of electric and gas rates for the next three years for Orange and Rockland Utilities customers, Senators James Skoufis (D, Cornwall) and Shelley Mayer (D, White Plains) are calling for an “immediate overhaul” of the commission. The lawmakers said their push comes after the March 20 announcement by the PSC that it “patted itself on the back” for approving O&R delivery rates that are “much less than initially requested.” O&R said revenue increases will be put toward the ongoing development of clean and resilient energy projects, additional storm hardening programs and continuation of energy affordability programs for low-income customers.
Utilities across the state are seeking rate increases in large part to offset their costs to comply with State’s Climate Leadership and Community Protection Act (CLCPA) requirements. “The Public Service Commission is failing to meet its responsibility to set delivery rates for gas, electric and other regulated utilities that are ‘fair, just, and reasonable,’” said Mayer. “If the PSC cannot fulfill its primary responsibility, it must be held accountable and work towards a solution that prioritizes New Yorkers’ rights to stable utility rates that are as low as possible.”
Hochul, NY Lawmakers To Blow Past Budget Deadline In ‘Standstill’ Over Discovery Law Reforms
Gov. Kathy Hochul and state lawmakers will blow by a budget deadline Tuesday as negotiations hit an impasse over New York’s divisive discovery laws – despite growing calls for reforms. Hochul has proposed changes to the laws that set strict rules and deadlines about evidence sharing during criminal trials but her fellow Democrats in the state Assembly have pushed back against changes to the law. Assembly Leader Carl Heastie said Thursday that his conference is opposed to Hochul’s changes to the discovery laws, as written, and that he’s asking Hochul to tweak the language.
Lawmakers were off Monday for the Muslim holiday Eid and will most likely pass legislation to extend current spending for a few days, which would cover upcoming state payroll. Last week, the legislature passed a non-controversial portion of the budget to finance state debt. Lawmakers are scheduled to recess beginning April 10 for about two weeks for Passover and Easter. Legislators stop getting paid after April 1.
Trump’s First 100 Days
- Trump Approval Rating Tracker: 60% Unhappy About Tariffs – Forbes
- Navarro Says Trump’s Tariffs Will Raise $6 Trillion Over A Decade – The Hill
- The Democrats Who Are Fighting—and Winning—Against Trump in Court - WSJ
- Trump’s Pick To Lead Social Security Pledges To 'Preserve And Protect' SSA, At Senate Hearing – Benefits Pro
- Donald Trump Agrees to Bill Maher Meeting As 'Favor' for Kid Rock - Newsweek
- Florida’s Special House Elections Tuesday: What To Watch In These Tests Of Trump’s Second Term - Forbes
- Senate Republicans Urge Trump, Allies To Stop Threatening Courts – The Hill
- Starmer And Trump Discuss 'Productive Negotiations' On US-UK Trade Deal – France 24
- Vaccine Stocks Fall After Key FDA Official Resigns In Protest Of RFK Jr. - CNBC
- Wisconsin Supreme Court Race: Why Elon Musk And Fellow Billionaires Are Spending Millions On Tuesday’s Election - Forbes
- The Trump Tracker, Stay Up To Date on the First 100 Days – WSJ
Health and Wellness
What’s Next for mRNA Vaccines and American Biotech Dominance
Less than a year after COVID-19 upended life as we know it and killed the first of what would become more than 7 million people, the FDA and other regulators around the world authorized the first mRNA vaccine. Co-developed by Pfizer and BioNTech, the vaccine was based on new biotechnology that uses the body’s own machinery to produce disease-fighting antibodies. The speed with which they were developed and distributed was unprecedented; The mumps vaccine had taken four years. The speed was only possible thanks to the more than $330 million in federal NIH grants that had supported three decades of underlying research into mRNA.
Today underlying mRNA technology, which helped save millions of lives, prevent hospitalizations and mitigate instances of long Covid, is now also being used to tackle a wide range of diseases — bird flu, cancer, heart failure. But despite those COVID successes — and President Trump’s ongoing attempts for take credit for them — the president’s administration and base are now attacking mRNA. And they’re doing it in a way that might threaten not only next-generation vaccines for the pandemics to come, but U.S. biotechnology leadership in a market estimated to be worth almost $20 billion
Industry News
China's Manufacturing Hits 12-Month High, Driven By Strong Orders
China's manufacturing activity expanded at the fastest pace in a year in March, a factory survey showed on Monday, with new orders boosting production, giving the world's No. 2 economy some reprieve as it deals with an intensifying U.S. trade war. The reading should reassure officials that recent fiscal support is bolstering the $18 trillion economy, which is also benefiting from foreign buyers frontloading purchases in anticipation of further U.S. trade curbs. The official purchasing managers' index (PMI) rose to 50.5 in March from 50.2 a month prior, according to the National Bureau of Statistics (NBS), the highest reading since March 2024. The non-manufacturing PMI, which includes services and construction, accelerated to 50.8 from 50.4.
Pointing to improved domestic demand, the new orders sub-index rose to 51.8 in March, its highest reading in 12 months, while the decline in new export orders slowed, narrowly missing the 50-mark separating growth from contraction.
GlobalFoundries And Taiwanese Chipmaker UMC Mull Potential Merger
Taiwan's major chipmaker United Microelectronics and U.S.-based GlobalFoundries are exploring the possibility of a merger, the Nikkei reported on Monday, citing an assessment plan seen by the newspaper. A combined entity would establish a larger U.S.-based firm with a global manufacturing footprint spanning Asia, the United States and Europe, according to the report. The news of a potential deal comes as the U.S. seeks to strengthen its semiconductor supply chain amid rising geopolitical tensions in the Taiwan Strait and increasing competition from China in the mature chip market.
The merged company, according to the Nikkei report, would prioritize research and development investments in the U.S. and could potentially emerge as a viable alternative to Taiwan Semiconductor Manufacturing Co, the world's leading chipmaker. GlobalFoundries has a market capitalisation of $20.40 billion, while UMC is currently valued at $16.90 billion, according to data compiled by LSEG.
Aircraft Leasing Company BOC Aviation To Buy 120 Airbus, Boeing Jets To Grow Fleet
One of the world's largest aircraft leasing companies, BOC Aviation will purchase 120 single-aisle planes from and Boeing it said on Monday, as it seeks to grow its fleet to 1,000 by the end of the decade. Singapore-based BOC Aviation, majority-owned by Bank of China, ordered 70 A320neo family aircraft from Airbus and 50 737 MAX 8 jets from Boeing. The value of the deal was not disclosed, but the Airbus order would be worth about $3.78 billion and the Boeing order about $2.72 billion based on estimated delivery prices from aviation data provider Cirium Ascend.
The Boeing deliveries are expected through to 2031 and the Airbus deliveries through to 2032, BOC said. Despite the strong demand for planes, airlines have been hit by new aircraft delivery delays due to labor strikes, regulatory scrutiny and supply chain bottlenecks. This has benefited lessors like BOC by driving up demand for leased aircraft.
Global Steel Output Falls In February
Global raw steel production fell to 144.7 million metric tons during February, a -3.8% drop from the January total, and a decrease that was evident in nearly all of the world’s top producer nations. While February typically results in slower output, the new monthly total shows nine of the past 12 months resulted in falling output – and compared to the year-ago period result the new figure is -3.4% lower. Steel production worldwide continues to face weak demand, and steelmakers in most industrialized regions continue to restrain any surplus tonnage that may weaken prices.
- The February raw steel output in China was 78.9 million metric tons, or about 54.5% of the volume produced worldwide last month. It was -3.8% less than the amount produced in China during January, and -3.3% less than the February 2024 result.
- Indian steelmakers produced 12.7 million metric tons of raw steel during February, -7.1% less than their January total but 6.3% more than the February 2024 output.
- In Japan, 6.4 million metric tons were produced during February, -6.2% less than the previous month and -8.5% less than a year ago.
- U.S. steelmakers produced 6.0 million metric tons (6.6 million short tons) during February, a -15.0% decrease from January and -7.0% less than last February.
- For the Russian steel industry, World Steel estimated 5.8 million metric tons produced during February, -3.4% less than last February’s result, indicating a -2.5% decrease for the year to-date.
- South Korea was the only nation among the top 10 steelmaking nations that did not produce a negative month/month total – it posted no change from its January result of 5.2 million metric tons – and it’s year/year improvement is just 0.7%.
- In the European Union (27 nations), the total output for February was 10.1 million metric tons, or -7.1% below the year-ago figure. Within that total is the German steel industry’s 2.7 million metric tons produced during February, -3.7% less than January and -1.6% less than February 2024.
Hyundai Opens HMGMA Vehicle Assembly And Battery Plant In Georgia
Hyundai Motor Group Metaplant America (HMGMA) has officially opened its electric and hybrid vehicle manufacturing facility in Ellabell, Georgia. The plant, located 20 miles from Savannah, will have an annual production capacity of 300,000 vehicles, initially producing models for Hyundai, Genesis, and Kia, with expansion plans set to increase capacity to 500,000 units. The project is expected to create 8,500 jobs at HMGMA by 2031 and contribute to nearly 40,000 jobs across Georgia, with more than $2.5 billion in supplier investments already committed.
The facility incorporates innovative manufacturing technologies, including AI-driven systems, robotics, and automated guided vehicles for optimized production and logistics. It features an advanced design with a human-centered work environment, open layouts, and natural light, promoting team collaboration. HMGMA is part of Hyundai's broader $21 billion investment plan for the U.S., which will drive growth in electric vehicle production, autonomous driving, robotics, AI, and advanced manufacturing technologies. This initiative is expected to create 14,000 new jobs by 2028 and have a total economic impact generating over 100,000 direct and indirect job opportunities across the U.S.
Amazon’s Nova AI Agent Launch Puts It Up Against Rivals OpenAI, Anthropic
Amazon on Monday released a new AI model that can take actions in a web browser on a user’s behalf, a move that puts it in more direct competition with OpenAI, Anthropic and other companies that have developed the so-called “agents.” The new model, called Nova Act, is designed to help developers build agents, or AI software that can complete multi-step tasks for users without supervision. Amazon showed Nova Act searching for “apartments by biking distance to the train station” as one example of a task it can complete.
A growing number of companies are building AI agents as they look beyond text and image generators. The release is part of a broader strategy within Amazon to invest heavily in generative AI software. Amazon has introduced a flurry of AI products, including its own set of Nova models, Trainium chips, shopping and health assistants, as well as a marketplace for third-party models called Bedrock. It’s also overhauling Alexa, the digital assistant it launched more than a decade ago, with AI capabilities.
AMD CEO Says Demand For AI Infrastructure Is 'Immense'
If AI infrastructure demand is slowing, as some market watchers claim, AMD (AMD) CEO Lisa Su isn't seeing it. "The need for compute continues to be immense," Su told me in a Yahoo Finance exclusive interview on Monday. "We see that throughout all of our customers globally, and we're going to continue to invest strongly in this area because I think this is the single most important technology. I like to say it's the single most important technology of the last 50 years."
Su is backing up her views with cold, hard cash. AMD announced today it closed on its $4.9 billion acquisition of ZT Systems. Announced in August 2024, the deal is expected to bolster AMD's presence in compute infrastructure for hyperscalers. ZT Systems counts Microsoft (MSFT) as a key customer, as does AMD. The company anticipates the transaction to be accretive to non-GAAP results by the end of 2025. The company is "actively engaged" with strategic partners to purchase ZT Systems' US-based data center infrastructure manufacturing business in 2025.
These Nuclear Companies Are Leading The Race To Build Advanced Small Reactors In The U.S
The nuclear industry is racing to launch advanced small reactors by the early 2030s, aiming to meet the deep-pocketed technology sector’s growing need for electricity to fuel artificial intelligence. The advanced reactors under development promise to have smaller, lighter footprints that could make them cheaper and quicker to build when they are fully commercialized. But the industry is crowded with more than 90 different technologies in various stages of development around the world, according to the Nuclear Energy Agency. The following are some of the leading players in the U.S. market to revive nuclear power, all three of them private but with significant financial backing — often from tech companies — and customers already lined up.
TerraPower is the first advanced reactor company in the U.S. to move from design to construction, breaking ground on its first plant near a former coal site in Kemmerer, Wyoming in the summer of 2024. The company aims to start dispatching power by the end of 2030 to Warren Buffett’s PacifiCorp.
X-Energy. Of all the advanced reactor companies, X-Energy is the first to win a direct investment from a tech company, securing hundreds of millions of dollars from Amazon to build its Xe-100 reactor.
Kairos Power signed a contract with Alphabet’s Google unit last year to deploy multiple, advanced reactors, aiming to supply the YouTube company with 500 megawatts of power. The first reactor is expected to come online in 2030, with additional deployments through 2035.
Chipmaker Wolfspeed's Shares Hit 27-Year Low Over Uncertain Federal Funding
Wolfspeed's shares lost half their value last Friday, hitting their lowest level since 1998, as funding through a Joe Biden-era legislation that promised subsidies for chip making in the United States remains uncertain. Wolfspeed is waiting on about $750 million in federal funding under the U.S. CHIPS Act, the 2022 bipartisan law which promised $52.7 billion in subsidies for domestic semiconductor chips manufacturing and production. Wolfspeed is constructing a Silicon Carbide fabrication facility in Marcy, New York.
"Wolfspeed's CHIPS Act grant ended up being the highest-dollar CHIPS grant to not be officially awarded before Biden's exit, leaving it particularly vulnerable to being pulled under the new administration," said Brooks Idlet, senior analyst at CFRA Research. Without the grant, Wolfspeed would face devastating consequences requiring major restructuring to preserve cash, Idlet said. Wolfspeed hopes to accelerate the manufacturing of silicon carbide chips used in electric vehicles and renewable energy industries with the federal funding. The company said on Friday it is maintaining "constructive" communication with the White House and the U.S. Commerce Department to secure the funding.