Member Briefing July 16, 2025
Empire State Mfg Survey – Slight Uptick in Activity and Employment in July
Business activity picked up slightly in New York State in July, according to firms responding to the Empire State Manufacturing Survey. The headline general business conditions index climbed twenty-two points to 5.5, its first positive reading since February.
- The new orders index rose sixteen points to 2.0 and the shipments index climbed nineteen points to 11.5, its highest reading in several months.
- The inventories index rose fifteen points to 15.6, a sign that business inventories grew.
- Delivery times were somewhat longer, and the supply availability index remained below zero at -11.0, suggesting that supply availability continued to worsen.
- The index for number of employees rose five points to 9.2, and the average workweek index rose to 4.2. This marks the first time that both indexes have been positive since 2022.
- The prices paid index rose nine points to 56.0, pointing to a pickup in input price increases, while the prices received index held steady at 25.7, suggesting that selling price increases remained moderate.
- The index for future general business conditions edged up to 24.1, suggesting that, on the whole, businesses expect activity to increase in the months ahead.
- New orders and shipments are expected to increase.
- Capital spending plans picked up.
CPI = 2.7% - Inflation picks up again in June in Line With Expectations
The consumer price index, a broad-based measure of goods and services costs, increased 0.3% on the month, putting the 12-month inflation rate at 2.7%, the Bureau of Labor Statistics reported Tuesday. The numbers were right in line with the Dow Jones consensus. Excluding volatile food and energy prices, core inflation picked up 0.2% on the month, with the annual rate moving to 2.9%, also matching the respective estimates. Prior to June, inflation had been on a generally downward slope for the year, with headline CPI at a 3% annual rate back in January and progressing gradually slower in the subsequent months despite fears that Trump’s trade war would drive prices higher.
- Vehicle prices fell on the month, with prices on new vehicles down 0.3% and used car and trucks tumbling 0.7%.
- Tariff-sensitive apparel prices increased 0.4%.
- Household furnishings, which also are influenced by tariffs, increased 1% for the month.
- Shelter prices increased just 0.2% for the month, but the BLS said the category was still the largest contributor to the overall CPI gain.
- food prices increased 0.3% for the month, putting the annual gain at 3%,
- Energy prices reversed a loss in May and rose 0.9%, though they are still down marginally from a year ago.
- Medical care services were up 0.6%.
What to Know About the Massive Energy and AI Summit in Pittsburgh
The “world’s top leaders in energy and AI” met at Carnegie Mellon University on Tuesday, where leaders announced a massive investment for Pennsylvania. The inaugural Energy and Innovation Summit, organized by U.S. Sen. Dave McCormick, R-Pa., convened at Carnegie Mellon University and featured President Donald Trump, who is making his second visit to Western Pennsylvania in less than two months. Trump and Mr. McCormick announced a $90 billion investment in energy and artificial intelligence in Pennsylvania.
At least 60 industry CEOs, six Trump administration cabinet members, and Gov. Josh Shapiro also attended the summit, Mr. McCormick said in an interview with KDKA Radio. “We have the skilled workforce to build and operate this critical infrastructure, world-class universities driving innovation, and strategic proximity to over half the country’s population,” Mr. McCormick said. “I am proud to partner with President Trump and the business leaders here today to drive a new era of industrial growth that helps make America energy dominant while creating jobs and opportunities for working families across Pennsylvania.”
Read more at The Pittsburgh Post Gazette
Global Headlines
Middle East
- Netanyahu Under Mounting Political Pressure After Ultra-Orthodox Party Quits – Reuters
- Israel Bombs Syrian Forces Entering Druze City After Sectarian Clashes - BBC
- Amid Heated Debate, No Real Plan For Israel's 'Humanitarian City' In Gaza – Reuters
- Iran Seeks Backing from China and Russia After U.S. Airstrikes - Newsweek
- Iran President Was Reportedly Injured In Israeli Strikes - BBC
- Iran's President Says Iran Is Pursing A Peaceful Path And Using All Resources To Prevent War - Newsweek
- Interactive Map- Israel’s Operation In Gaza – Institute For The Study Of War
- Map – Conflicts in the Middle East – Live Universal Awareness Map
Ukraine
- Putin, Unfazed By Trump, Will Fight On And Could Take More Of Ukraine – Reuters
- I'm 'Disappointed But Not Done' With Putin, Trump Tells BBC - BBC
- After Trump Deal, Ukraine’s Fortunes Hinge On How Fast NATO Can Deliver Arms - WSJ
- Russia Shrugs Off Trump’s Threat Of ‘Very Severe Tariffs’ - CNBC
- Reports: Trump Raised Striking Moscow, St Petersburg in Zelensky Call - Newsweek
- 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
- Trump says NATO becoming ‘opposite’ of obsolete and collective defense is ‘fine’ – Politico
- Taiwan President To Visit Paraguay Next Month, Likely To Make US Transits - Reuters
- France’s ‘Moment Of Truth’: PM Bayrou Unveils €43.8 Billion In Spending Cuts – France 24
- Japan Calls China’s Military Activity Its Biggest Strategic Challenge – The Hill
- Von der Leyen Dumps Farm Subsidy Chaos Onto EU Capitals - Politico
- Roman-Era Mosaic Panel With Erotic Theme That Was Stolen During World War II Returns To Pompeii - AP
- Nissan Says Oppama Plant Will Stop Production By March 2028 - Reuters
- Aerial Photos Show Progress On Neom, The World's Biggest Construction Site In Saudi Arabia – Newsweek
Policy and Politics
Senate Republicans Scramble To Lock Down Support For Trump’s Spending Clawbacks
Senate Republicans are scrambling to iron out changes to President Donald Trump’s $9.4 billion request for spending clawbacks ahead of a key vote on Tuesday. Majority Leader John Thune needs 51 votes to start debate on the “rescissions” package, and as of Monday evening, it was not clear he had them. He’s also staring down a looming deadline: Congress has until Friday night to clear the request Trump sent last month, or the president will be forced to spend the money as Congress intended. An added wrinkle is that if the Senate makes changes it will have to be passed again by the House.
Even if Thune can gather the necessary support to start debate on the package of cuts to public broadcasting and foreign aid, it’s not clear he’ll get the votes to pass it later this week. Appropriations Chair Susan Collins huddled with several GOP senators in her committee office on Monday as some Republicans seek changes to the White House request or clarifications on what exact spending the administration is seeking to rescind. Collins said the questions went beyond her previously stated concerns about PEPFAR, the global AIDS program, to include broader concerns about cutbacks in overseas public health.
OSHA Lowers Penalties on Small Businesses
On July 14, OSHA announced it had updated guidance on penalty and debt collection procedures in the Occupational Safety and Health Administration's Field Operations Manual. The agency said the guidance is an "effort to minimize the burden on small businesses and increase prompt hazard abatement." The new policy, increases penalty reductions for small employers making it easier for small businesses to invest resources in compliance and hazard abatement.
For example, a penalty reduction level of 70%, which was previously only applicable for businesses with 10 or fewer employees, will now be expanded to include businesses who employ up to 25 employees. The revisions also include new guidelines for a 15% penalty reduction for employers who immediately take steps to address or correct a hazard. Additionally, the updated policy expands the penalty reduction for employers without a history of serious, willful, repeat, or failure-to-abate OSHA violations. Under OSHA’s revised policy, employers who have never been inspected by federal OSHA or an OSHA State Plan, as well as employers who have been inspected in the previous five years and had no serious, willful, or failure-to-abate violations, are eligible for a 20% penalty reduction. The new policies are effective immediately.
Student Loan Borrowers Need To Pay Up, Since Biden-Era SAVE Plan Is Blocked By Courts, Say Feds
After 5-year hiatus – and an end to pandemic-era relief on student loans during the Biden administration, the Department of Education resumed collections in May on defaulted federal student loans. Last week, the Department announced it will also restart interest accrual for borrowers with loans in the legally-challenged Saving on a Valuable Education (SAVE) Plan on August 1, 2025. This action is necessary to comply with a federal court injunction that has blocked implementation of the SAVE Plan, including the Department’s action to put SAVE borrowers in a 0% interest rate status, according to a statement.
After a five-year hiatus, the Department resumed collections on May 5 and has emailed more than 23 million borrowers reminding them of their legal obligation to repay their loans. The 30-day notices contained information that their federal benefits will be subjected to the Treasury Offset Program, which withholds government payments – including tax refunds, federal salaries and other benefits—from people with past-due debts to the government. The Department of Education is allowed to garnish up to 15% of an employee’s paycheck without a court order if they go into default on federal student loans and can issue garnishment orders to employers to enforce collection
Political Headlines
- Jamie Dimon Touts Fed Independence As Trump Ponders Replacing Jerome Powell – The Hill
- Trump Administration Fires 17 Immigration Court Judges Across Ten States, Union Says - AP
- Bessent Says Formal Process to Pick Fed Chair Is Starting - WSJ
- Trump-Backed Crypto Regulation Bills Fail To Clear Key Hurdle In Congress - CNBC
- EU To Hit US Aircraft, Cars And Food In Latest Retaliatory Strike - Politico
- Republicans Look To Tweak Trump’s Request For $9.4 Billion In Spending Cuts - AP
- The Presidential Autopen Is Back in the Spotlight. Here’s What to Know. - WSJ
- Education Department Announces Foreign Funding Investigation Against University Of Michigan – The Hill
- Watch: Flash Flooding Sweeps Through New York City Subways - BBC
- Trump Tracker: Keep Tabs On The Latest Announcements And Executive Orders - WSJ
Health and Wellness
WHO Recommends Gilead's Twice-Yearly Injection For HIV Prevention
The World Health Organization on Monday recommended Gilead's (GILD.O), opens new tab lenacapavir, a twice-yearly injection, as a tool to prevent HIV infection. The recommendation, issued at the International AIDS Conference in Kigali, Rwanda, comes nearly a month after the U.S. health regulator approved the drug, giving patients new hope of interrupting virus transmission.
The twice-yearly injectable offers a long-acting alternative to daily oral pills and other shorter-acting options, reshaping the response to the disease especially among those who face challenges with daily adherence, stigma, or access to health care. Lenacapavir, part of a class of drugs known as capsid inhibitors, proved nearly 100% effective at preventing HIV in large trials last year.
Industry News
Trade Wars
- Canada PM Carney Signals U.S. Tariffs May Be Here to Stay – WSJ
- Europe Draws Up Retaliatory Tariffs for U.S. Goods in Case No Trade Deal Is Reached - WSJ
- U.S. Tariffs Take Center Stage But China And The EU Are Quietly Clashing – CNBC
- To Whom It May Concern: Trump’s Tariff Letters, Annotated - AP
- Trump Says Indonesia Trade Deal Features 19% Tariff; Jakarta Yet To Confirm - CNBC
- US Imposes 17% Tariff On Mexican Tomatoes After Withdrawing From Agreement - Reuters
- America’s Biggest Rare-Earth Producer Makes a Play to End China’s Dominance - WSJ
- Tariffs Drive Volvo To Plan U.S. Production Of 2 Bestselling Crossovers – Automotive News
- Trump’s 50% Copper Tariffs Jolt US Market as Buyers Slash Imports and Delay Orders - Bloomberg
- As Tariffs Surge Higher, So, Too, Do The Incentives Not To Pay Them – WSJ
China’s GDP Beat Masks Fragile Demand, Sparking Outlook Concerns
China’s gross domestic product expanded by 5.2% in the second quarter, according to China’s National Bureau of Statistics on Tuesday. While the growth rate beat Reuters-polled economists’ estimates of a 5.1% growth, it represented a slowdown from the 5.4% in the first quarter. In June, retail sales growth slowed to 4.8% from a year earlier, compared with the 6.4% year-on-year increase in May. That figure also disappointed Reuters-polled economists’ forecast of 5.4%. Industrial output expanded by 6.8% from a year earlier, versus median estimates of 5.7%.
China’s economy has remained on a generally firm footing this year, buoyed by robust exports and support measures, but economists are largely cautious of more economic headwinds ahead, calling for the leadership to launch fresh fiscal stimulus. “The above-target growth in Q1 and Q2 gives the government room to tolerate some slowdown in the second half of the year,” Laiyun Sheng, deputy commissioner at the NBS. Beijing’s stimulus measures have so far lifted parts of the economy, with both official and private surveys showing an improvement in the manufacturing activity.
Nvidia Wins OK to Sell AI Chip to China Again After CEO Meets Trump
Nvidia said it has received assurances from the Trump administration that it can sell its H20 artificial-intelligence chip in China, days after Chief Executive Jensen Huang met President Trump. The administration’s move marks a turnabout after the Commerce Department restricted sales of the chip in April, costing Nvidia billions of dollars. The news came during a visit by Huang to Beijing, where he was meeting senior officials. “I’m very happy,” he told reporters. The U.S. decision to allow more Nvidia chips to flow to China again was viewed in Beijing as a gesture of good faith in trade talks, said people close to official thinking. Access to chips and advanced technology has been a main priority for Chinese negotiators.
The administration said Nvidia would be allowed to sell the H20 chip after licenses are granted by the Commerce Department, according to the company. Nvidia said it would resume deliveries soon of the chip, which was designed for Chinese customers and has been a top seller in the country since 2024. In addition, Huang said Nvidia has developed a new AI chip for China that he said would be useful for factory automation and logistics. The chip is built on the Blackwell architecture—Nvidia’s most advanced on the market—but is downgraded in some features to address U.S. officials’ concerns about exports to China, people familiar with the chip said.
National Semiconductor Technology Center Opens At Albany NanoTech
The country’s first National Semiconductor Technology Center opened Monday at Albany Nanotech as part of a broader federal effort to boost the United States' competitiveness in the industry. The Albany NanoTech complex was selected last year by federal officials as the national headquarters for research into a cutting-edge semiconductor technology known as extreme ultraviolet, or EUV, lithography. The lab will have the most advanced chip-making machinery in the world and allow researchers from the semiconductor industry to collaborate with their university counterparts.
The Albany hub opened three years after the signing of the federal CHIPS and Science Act, which aims to build the U.S. manufacturing of microchips that power cell phones, automobiles and other devices. "The AI revolution is just starting," Natcast CEO Deidre Hanford said. "And all of the semiconductors that live in the data centers today, all the advanced processing semiconductors are leveraging this type of capability now and into the future." The new technology will spur hundreds of jobs in the Capital Region. Anderson said Albany's new lab will have the most advanced chip-making machinery in the world.
RFK Jr. Says Ice Cream Makers Must Ditch Synthetic Dyes By 2028—What It Means For Major Brands
The U.S. Health Secretary Robert F. Kennedy Jr.‘s announcement that ice cream makers will eliminate synthetic dyes in their formulations could impact the listed ice cream makers who would be required to execute the change. According to federal health officials cited by Fortune, ice cream makers representing about 90% of the U.S. supply will be required to eliminate synthetic dyes by 2028. The initiative sees 40 ice cream and frozen dairy dessert makers, including major players, pledging to phase out seven dyes—Red 3, Red 40, Green 3, Blue 1, Blue 2, Yellow 5, and Yellow 6, according to Michael Dykes, the president and CEO of the International Dairy Foods Association.
This move, part of a broader Donald Trump administration push to remove petroleum-based dyes linked to ADHD and cancer, marks a significant shift in the food industry, Dykes said that it is "a great day for ‘Make America Healthy Again.” Already, 40% of the food industry has committed to removing these dyes by 2026, with 35% having done so.
Google To Invest $25 Billion In Data Centers And AI Infrastructure Across PJM, Largest U.S. Electric Grid
Alphabet’s Google will invest $25 billion in data center and artificial intelligence infrastructure over the next two years in states across the biggest electric grid in the U.S., the technology company said Tuesday. Google will also spend $3 billion to modernize two hydropower plants in Pennsylvania to help meet the growing power demand from data centers and AI in the region, according to the company.
Google’s investments in the region comes as the PJM Interconnection is struggling to keep up with rising electricity demand from data centers and industry. PJM is the biggest electric grid in the nation, covering 13 states across the mid-Atlantic and parts of the Midwest and South. It includes the world’s largest data center market in northern Virginia. The announcement comes as President Donald Trump, White House Cabinet officials, tech and energy executives are meeting at Carnegie Mellon University in Pittsburgh on Tuesday to discuss AI investment in Pennsylvania.
Big Bank Earnings
Large U.S. banks expressed optimism about the investment banking outlook for the rest of the year after dealmaking rebounded in the second quarter, as they reported in earnings on Tuesday. Yet lenders remained cautious about the uncertain economic environment and U.S. tariff policies.
Second-quarter earnings at JPMorgan Chase were better than expected Tuesday, as a boost in dealmaking demonstrated how Wall Street recovered from the spring freeze that accompanied President Trump's "Liberation Day" tariffs. Investment banking revenue at JPMorgan rose 8% from last year's second quarter to $2.5 billion due largely to advising on mergers and equity underwriting. Bond underwriting fell 2% but still exceeded analyst expectations. JPMorgan’s profits rose 9% in the second quarter to $14.2 billion compared with $13.1 billion in the year-ago period. Yahoo finance
Citigroup's quarterly profit beat Wall Street estimates on Tuesday, as its traders brought in a windfall from turbulent markets and investment bankers gained from resilient dealmaking. The third-largest U.S. lender's net income was $4 billion, or $1.96 per share, in the three months ended June 30. Total net income rose 25% from a year earlier. Citi's revenue rose 8% in the quarter from a year earlier to $21.7 billion, notching second-quarter records for its services, wealth and U.S. personal banking business. Reuters
Wells Fargo beat second-quarter profit estimates on Tuesday but cut its 2025 guidance for net interest income. The bank expects its interest income to be roughly in line with the 2024 level of $47.7 billion. In April, it said NII growth would be at the low end of the 1% to 3% range. The fourth-largest U.S. lender’s net income was $5.49 billion, or $1.60 a share, in the three months ended June 30, it said on Tuesday. That compares with $4.91 billion, or $1.33 a share, a year earlier. CNBC
Rolls-Royce invests $75 million to expand South Carolina plant
British aerospace and defense company Rolls-Royce announced it is investing $75 million to expand its engine manufacturing facility in Aiken, South Carolina. The investment will boost output of mtu Series 4000 diesel engines, which are used in backup power systems for data centers and other critical infrastructures. The company said the expansion will create 60 new jobs, increase capabilities and strengthen Rolls-Royce’s U.S. industrial presence.
The move also reflects Rolls-Royce’s shift into energy and power systems, beyond its traditional aerospace focus. Rolls-Royce said it will machine additional mtu Series 4000 components in the U.S. as part of the investment. The company currently produces many the components in Germany and sends them to the U.S. as finished goods. The South Carolina site is now set to become a hub in Rolls-Royce’s North American power systems strategy. The first phase of the expansion will begin in the first quarter of 2026, and production will begin in July 2027.
DOE: Retirements + Load Growth = Outages
The retirement of 104 GW of firm power capacity by 2030 coupled with load growth may lead to significant outages during extreme conditions according to a new report from the Department of Energy. In a 2025 report, Evaluating the Reliability and Security of the United States Electric Grid, the DOE states that without decisive intervention, the power grid will not be able to meet projected demand for manufacturing and data centers, resulting in a 100X increase in outages.
The report highlights a wide range of projections from credible sources regarding projected data center demand by 2030. From a low of 33 GW to a high of 109 GW, a midpoint of 50 GW is reached for projected data center load additions (see chart).Stark contrasts across each ISO are highlighted. To ensure reliability, ERCOT and PJM would both require an additional 10,500 MW of “perfect” capacity. ISO-NE and NYISO require no additional capacity.