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U.S. will reportedly drop currency manipulator label for China… Multiple news outlets are reporting the U.S. Treasury Department will drop the designation of China as a currency manipulator before the two sides sign a Phase 1 trade deal on Wednesday. The Trump administration tacked the label on China last summer as tensions escalated. China’s currency had been depreciating against the U.S. dollar, limiting the impact of U.S. tariffs on Chinese goods. An easing of tensions between the two superpowers has helped China’s currency to appreciate again.
Wall Street Journal (WSJ) analysis of trade war with China... “Farmers took a big hit. Importers of auto parts, furniture and machinery choked down punishing tariffs. Investment between the world’s two largest economies tumbled. Yet despite the damage to these trade-related sectors, most of the U.S. economy sailed through two turbulent years of trade war with China with barely a scratch, a review of key economic indicators shows.” Key findings:
- U.S. farm exports to China fell to as low as $7 billion from $25 billion in recent years, and farm debt soared to a new record. The agricultural sector relied on $28 billion in federal aid to survive.
- Foreign direct investment in the U.S. contracted sharply in 2018 and 2019.
- Inflation remained largely stable, and most of the U.S. economy now works in sectors largely unaffected directly by the trade fight.
Things could have been worse, but they could have been better, the WSJ writes. The economy grew just 2%, despite President Donald Trump’s goal of 3%. And Gregory Daco, the chief U.S. economist for Oxford Economics, estimates that it could have grown 2.6% if the trade fight hadn’t happened.
Trump will address AFBF’s annual convention… President Donald Trump will speak at American Farm Bureau Federation’s (AFBF) 101st Annual Convention, the organization announced today. Most expected Trump or some other high-level official would take the bureau up on its invitation. This will be the third year the president has spoken at the conference, which will take place Jan. 19 in Austin, Texas.
“We are grateful that he has made agricultural issues a priority and look forward to welcoming him to Austin at a time when there is much to talk about, from trade progress to important regulatory reforms,” said AFBF President Zippy Duvall.
Other officials currently scheduled to attend are Agriculture Secretary Sonny Perdue, EPA Administrator Andrew Wheeler, Senate Agriculture Chairman Pat Roberts (R-Kan.) and Senator Jerry Moran (R-Kan.).
Bird flu continues to spread in Poland… A new case of bird flu was confirmed in Poland on Monday, with 6,000 geese at the impacted farm set to be culled. The strain is a subtype of the highly pathogenic H5N8 bird flu that can also threaten humans. Poland, the EU’s largest poultry producer, has recorded around half a dozen cases of the virus since December.
The U.S. has reportedly reached out to North Korea to restart diplomatic talks that stalled last October… Washington wants to get negotiations with Pyongyang "back on track" and implement leader Kim Jong Un's "commitment" to the denuclearization of the Korean Peninsula, White House national security advisor Robert O'Brien told Axios.
Highway construction is kicking into higher gear across the U.S. even if lawmakers in Washington aren’t taking any new steps to help… State transportation departments are pumping more money into projects to clear up traffic-clogged highways and modernize aging infrastructure, the Wall Street Journal reports, with budgets buoyed by a recovering economy and increases in tax revenues. The 50 states collectively spent $113.2 billion on transportation in fiscal year 2019, a 9% jump from the previous year and the biggest increase since 2015. Transportation industry trackers say they expect spending to continue to grow this year.
The American Road & Transportation Builders Association expects state transportation departments and local governments to spend $77.5 billion on highway and street construction investments alone in 2020, a 6% increase over 2019. States and local governments are now paying larger portions for public infrastructure, accounting for about 80% of all projects.
Europe bans Bayer’s thiacloprid insecticide… The European Commission today decided not to renew approval for Bayer’s thiacloprid insecticide. In effect, this bans use of the insecticide that is sold under brands Calypso and Biscaya after April 30, 2020. The commission said its decision was based on findings of the European Food Safety Agency that highlighted concerns about the active substance being toxic for humans and present in too great a concentration in ground water. The food safety agency also found the insecticide harms bees and bumblebees, weakening their immune systems and impairing their reproduction.