2025-02-12 18:14

NEW YORK, Feb 12 (Reuters) - Federal Reserve Chairman Jerome Powell said Wednesday the central bank has not been cut off from any data it needs to do its work. Speaking before a House panel as the Trump administration has been stripping government websites from various data sets, Powell he wasn't aware of losing anything the Fed needs, while saying he'd speak up if issues emerged. Powell was also asked about outside access to critical systems the Fed and the Treasury Department use to process government payments and Powell noted access to these tools is done "very carefully." Many observers have grown concerned about access by Elon Musk's associates, as part of the Department of Government Efficiency, to government payment systems that are critically important and historically are operated far from any political considerations. (This story has been refiled to add Elon Musk's first name in paragraph 4) Sign up here. https://www.reuters.com/markets/us/feds-powell-says-central-bank-still-has-access-data-it-needs-2025-02-12/

2025-02-12 17:37

SAO PAULO, Feb 12 (Reuters) - Services activity in Brazil ended 2024 on a negative note despite notching its fourth consecutive year of gains, with the sector unexpectedly slipping in December as the local economy provides cooling signs, data showed on Wednesday. According to statistics agency IBGE, services activity in Latin America's largest economy was down 0.5% in December from November, undershooting market forecasts of a 0.1% expansion in a Reuters poll of economists. Service sector activity is the main engine of Brazil's economy and helped the country grow more than expected throughout last year, but has been slowing in recent months amid tight financial conditions. December was the second negative month in a row for the sector, with the fresh figures adding to data showing a drop in Brazil's industrial output in the month. "The consequence of this recent weakness in an all-important sector of the economy is that our nowcasters are falling further, suggesting downside risks to our GDP estimates," JPMorgan economists said in a note to clients. Three of the five main groups surveyed by IBGE were down in December on a sequential basis, according to the agency. The recent service sector weakness comes as Brazil's central bank tightens its monetary policy in order to return inflation to its 3% target. Policymakers at the bank last month delivered a 100-basis-point interest rate hike for the second straight meeting to 13.25%, and signaled another hike of the same size in March while taking time to analyze activity data. "The latest data are confirming a deceleration trend," Inter's chief economist Rafaela Vitoria said after the service figures were released. On a yearly basis, Brazil's services activity grew 2.4% in December, while economists expected a 3.5% rise. In the full year the sector was up 3.1%, its fourth consecutive year of gains, IBGE said. Sign up here. https://www.reuters.com/world/americas/brazils-services-activity-posts-surprise-drop-december-economy-cools-2025-02-12/

2025-02-12 17:17

House Republicans unveil plan to extend Trump tax cuts Proposal would raise federal debt ceiling by $4 trillion Some argue that growth from tax initiatives could offset costs Congress faces looming deadlines for funding and debt ceiling WASHINGTON, Feb 12 (Reuters) - Barely a month after predicting a new "golden age" under President Donald Trump, congressional Republicans are struggling to move forward on the president's tax-cut agenda, despite their control of both the Senate and House of Representatives. House Republicans on Wednesday unveiled a plan that would cut taxes by about $4.5 trillion over a decade, raise the federal government's debt ceiling by $4 trillion - clearing the way for the nation's liabilities to exceed $40 trillion - and find $2 trillion in cost cuts over a decade in mandatory spending programs. While the plan did not specify which programs would be targeted, they could include the Medicaid health program for low-income Americans and Social Security and Medicare for the elderly. House Republicans hold a narrow 218-215 majority split between lawmakers from Democratic states who want a bigger federal tax deduction for state and local tax payments, hardliners pushing offsetting spending cuts and centrists worried about the potential ill-effects of those cuts back home. Those divisions could make it challenging for the caucus to find the near-unanimity it would need to pass a measure that would extend the 2017 tax cuts that were the signature legislative accomplishment of Trump's first presidential term. House Speaker Mike Johnson, who over the past year has repeatedly needed Democratic support to pass legislation, expressed confidence he would be able to muster the votes. "I've been talking to members non-stop, and I believe everybody is there," Johnson told reporters on Wednesday. "We have a commitment to the president's entire agenda, not just part of it." In recent weeks, some Republicans have backed down from calls for spending cuts to offset the cost of Trump's full tax-cut menu including eliminating taxes on tips, Social Security benefits and overtime pay, which the nonpartisan Committee for a Responsible Federal Budget estimates could add $5 trillion to $11 trillion to the nation's $36-trillion debt pile. Republicans are instead emphasizing that growth from the tax initiatives, energy deregulation and reciprocal trade will generate additional government revenues, while the extension of cuts under the 2017 Tax Cuts and Jobs Act will not change the deficit outlook. They made similar arguments in 2017, though the CRFB estimates that round of cuts added about $2.5 trillion to the nation's debt. "Current policy baseline is current law," said Republican Representative Jason Smith, chairman of the tax-writing House Ways & Means Committee. "These aren't new tax cuts. This is existing tax policy." RAISING STAKES Congress will face escalating deadline pressures in the coming weeks, as current federal funding runs out after March 14. Lawmakers will also need to act by summer to raise their self-imposed debt ceiling or risk a disastrous default. Democrats have warned they could withhold support from a stopgap funding measure due to their opposition to the Trump administration's controversial actions to freeze funding and fire federal employees at government agencies. No. 3 House Democrat Pete Aguilar told reporters that his caucus would not want the federal government to enter a partial shutdown -- as it did twice during Trump's first term -- but said the onus was on Republicans to come up with a path forward. "Republicans control the House, the Senate and the White House," Aguilar said. "If they want to keep government open, they should keep government open." Several House Republicans said their conference is considering a partisan continuing resolution, or CR, that would keep funding flat for the remainder of fiscal 2025, which ends September 30, while they look to other legislation including fiscal 2026 appropriations to cut spending and eliminate Biden-era policies. Given that a number of hardline conservatives routinely oppose CRs, some House Republicans said the task of passing one with only Republican votes could trigger a shutdown next month and pose an early test of Trump's ability to force the fractious conference into agreement. Ahead of the mid-March funding deadline, Republicans in both the House and Senate hope to advance rival budget blueprints. Both chambers need to pass the same budget resolution to unlock the reconciliation tool they intend to use to enact Trump's agenda with only Republican votes while circumventing Democratic opposition in the Senate. Johnson - who last month proclaimed that Trump's inauguration would usher in a "new golden age for America" - and other House Republican leaders are proceeding toward a resolution that calls for including the entire Trump agenda, including tax cuts, in a single piece of legislation. Senate Republicans are also moving ahead this week with a two-bill strategy that would quickly enact Trump's border security, military and energy priorities while leaving the thornier tax issues for later this year. "We're moving because we have to," Senate Budget Committee Chairman Lindsey Graham of South Carolina told reporters after hearing White House officials say the Trump border and immigration initiative was running out of money. "I cannot and I will not go back to South Carolina and justify not supporting the president's immigration plan." Sign up here. https://www.reuters.com/world/us/us-republicans-find-unity-taxes-heavy-lift-trump-golden-age-2025-02-12/

2025-02-12 13:01

Feb 12 (Reuters) - Interpublic Group (IPG.N) , opens new tab missed estimates for fourth-quarter results on Wednesday, as clients in major markets like the U.S. cut back on ad spending. Companies are tightening their marketing and advertising budgets, resulting in slower project progress and delays in launching new business initiatives. The company saw a more than 3% fall in revenue from the U.S. and the UK in the fourth quarter. In Europe, revenue dropped 3% and Asia Pacific reported a decline of around 8%. Interpublic said during its third-quarter earnings call in October that economic and political uncertainty in the U.S. and in many of the largest international markets remain "a significant consideration" for the rest of last year. The results contrast that of rival Omnicom Group (OMC.N) , opens new tab, which beat Wall Street expectations for fourth-quarter revenue last week helped by strong growth in its advertising and media segment. IPG-owned media research firm Magna Global said that the global advertising market's size is expected to grow at a slower rate in 2025 versus prior years due to the lack of major cyclical events. The advertising industry, often seen as a mirror of corporate strength, will consolidate, as Omnicom (OMC.N) , opens new tab and Interpublic join forces in a $13 billion all-stock deal. This deal is expected to create the world's largest advertising agency and could attract regulatory scrutiny. Based in New York, Interpublic has clients in sectors ranging from healthcare to retail and owns brands such as McCann, Weber Shandwick, Mediabrands and MullenLowe. On an adjusted basis, the company earned $1.11 per share in the fourth quarter, compared with expectations of $1.17, according to data compiled by LSEG. The company reported revenue of $2.43 billion, below estimates of $2.52 billion. Interpublic also announced a new share repurchase program of up to $155 million. Sign up here. https://www.reuters.com/business/interpublic-misses-estimates-quarterly-results-weak-ad-spending-2025-02-12/

2025-02-12 12:49

Heathrow to propose third runway, bids for national support Project to use local steel, support UK industry and jobs Runway privately funded, may be operational by 2035 LONDON, Feb 11 (Reuters) - London's Heathrow Airport will submit its proposal for a third runway this summer, the chief executive of the hub said, weeks after the British government threw its weight behind the project citing its potential to boost trade and economic growth. In a bid to secure national support, the Heathrow boss, Thomas Woldbye, said on Wednesday that a third runway would benefit the wider economy by using domestically produced steel where possible and local manufacturers. The government welcomed the announcement, made at British Steel Scunthorpe in northern England, as a potential boost for an industry that is facing tariffs from the United States. Woldbye called Heathrow "fundamental" to the government's growth mission, saying its expansion would benefit suppliers across the country. "It's a choice between jobs here in the UK or jobs elsewhere in Europe," he said of the decision over whether or not to back the new runway. The government said the pledge on steel would help secure thousands of jobs. Successive British governments have dithered for decades over whether to expand Heathrow, one of the world's busiest hubs, caught between the need to grow, costs and environmental concerns. Woldbye confirmed that the new runway would be entirely privately funded, although he did not give an estimate for the final bill apart from saying it would "significantly" increase from the 14 billion pound cost in 2014. He said the airport would start a separate project to improve infrastructure and add capacity this year, benefitting the economy with billions of pounds of investment over the next 8 to 12 years, before the new runway is built. Heathrow will consult stakeholders including airlines and local communities before finalising the plan, and the airport said the project will only go ahead if it can meet rules on noise, air quality and emissions. British Chancellor Rachel Reeves, who has pushed for growth since her Labour party came to power last July, has said she wants to see permission being granted by the end of this parliament in 2029. Woldbye said a third runway could be operational by 2035. However, even with the government's support, the plan - one of the country's most controversial infrastructure projects - has numerous hurdles to overcome before construction can start, including how it would be financed. Heathrow is operating at 99% capacity and risks being overtaken by European rivals. Its two runways compare with four each in Paris' Charles de Gaulle and Frankfurt Airport, and six at Amsterdam's Schiphol. Financial investors France's Ardian, Qatar Investment Authority and Saudi Arabia's Public Investment Fund are amongst Heathrow's owners. Sign up here. https://www.reuters.com/world/uk/uks-heathrow-airport-submit-plan-third-runway-by-summer-2025-02-11/

2025-02-12 12:46

Feb 12 (Reuters) - U.S. rail locomotive maker Wabtec (WAB.N) , opens new tab forecast 2025 profit largely below analysts' estimates on Wednesday, as the industry tackles weak demand for new locomotives due to a slowdown in freight activity. The company expects its 2025 adjusted profit per share in the range of $8.35 to $8.75, compared with analysts' average expectations of $8.62, according to data compiled by LSEG. Higher prices and borrowing costs have weakened consumer demand for goods, causing a slowdown in freight volume transported by rail. Wabtec's freight segment produces new locomotives, supplies aftermarket parts and services, and manufactures essential components for freight cars. Uncertainty over tariffs and future freight demand has prompted railroads to adopt a cautious approach before making significant investments in new equipment. In the fourth quarter, sales in Wabtec's freight unit, its largest, rose only by 0.3% to $1.79 billion. The Pennsylvania-based company reported an adjusted profit of $1.68 per share for fourth-quarter ended December 31, compared with analysts' expectations of $1.72 per share. Net sales in the quarter rose 2.3% to $2.58 billion, but missed Wall Street expectations of $2.62 billion. Sign up here. https://www.reuters.com/business/autos-transportation/wabtec-forecasts-2025-profit-below-estimates-soft-freight-demand-2025-02-12/