05/08/2025

BIZ & FINANCE TUESDAY | AUG 5, 2025

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White House defends firing of labour official

WASHINGTON: House economic advisers on Sunday defended President Donald Trump’s firing of the head of the Bureau of Labour Statistics, pushing back against criticism that Trump’s action could undermine confidence in official US economic data. Later on Sunday, Trump again criticised BLS commissioner Erika McEntarfer, without providing evidence of wrongdoing, and said he would name a new BLS commissioner in the next three or four days. US Trade Representative Jamieson Greer told CBS that Trump had “real concerns” about the BLS data, while Kevin Hassett, director of the National Economic Council, said the president “is right to call for new leadership”. Hassett said on Fox News Sunday that the main concern was Friday’s BLS report of net downward revisions showing 258,000 fewer jobs had been created in May and June than previously reported. Trump accused McEntarfer of faking the jobs numbers, without providing any evidence of data manipulation. The BLS compiles the closely watched employment report as well as consumer and producer price data. The BLS gave no reason for the revised data but noted “monthly revisions result from additional reports received from businesses and government agencies since the last White

The BLS surveys 121,000 employers – businesses and government agencies – each month, seeking their total payroll employment during the week in which the 12th day of the month falls. The response rate has fallen sharply since the Covid pandemic, from 80.3% in October 2020 to about 67.1% in July. Knowing that, BLS allows late-arriving employer submissions, and revisions to earlier submissions, to be taken into account over the next two months. That means each month’s initial estimate of employment for the immediately preceding month also contains revisions to the two months before that. The revisions in Friday’s report were large by historic standards. The downward revision of 125,000 jobs for May was the largest between a second estimate and third estimate since a 492,000 reduction for March 2020. That was the largest ever and was reported in June 2020 for the payrolls report for May 2020. – Reuters UBS to pay US$300m to resolve mortgage securities cases ZURICH: UBS yesterday said it will pay US$300 million (RM1.27 billion) to settle outstanding obligations related to the misselling of mortgage-linked investments by Credit Suisse in the United States. On Aug 1, Credit Suisse Securities entered into an agreement with the US Department of Justice to resolve all of Credit Suisse’s outstanding consumer relief obligations under the 2017 settlement for its residential mortgage-backed securities (RMBS) business, the bank said. Under the 2017 agreement, Credit Suisse agreed to pay US$5.7 billion to settle with American authorities over claims it misled investors in residential mortgage-backed securities it sold in the run-up to the 2008 financial crisis. The decline in mortgage payments reduced the value of the assets, leading to huge losses for investors. “With this agreement, UBS has resolved another of Credit Suisse’s legacy issues, in line with its intention to resolve legacy matters at pace in a fair and balanced way, and in the best interest of all its stakeholders,” UBS said. Credit Suisse agreed to pay US$495 million in 2022 to settle one case brought by the New Jersey Office of Attorney General that alleged that the bank had “misled investors and engaged in fraud or deceit in connection with the offer and sale of RMBS”. – Reuters

restatements ... that creates doubt about it.” Critics, including former leaders of the BLS, slammed Trump’s move and called on Congress to investigate McEntarfer’s removal, saying it would shake trust in a respected agency. “It undermines credibility,” said William Beach, a former BLS commissioner and co-chair of the group Friends of the BLS. “There is no way for a commissioner to rig the jobs numbers. “Every year we’ve revised the numbers. When I was commissioner, we had a 500,000 job revision during President Trump’s first term,” he said on CNN’s State of the Union . Former Treasury secretary Larry Summers, who worked in both Bill Clinton and Obama Barack’s administrations, also criticised McEntarfer’s firing. “This is a preposterous charge. These numbers are put together by teams of literally hundreds of people following detailed procedures that are in manuals,” Summers said on ABC’s This Week.

Federal Reserve governor Adriana Kugler, which opened a spot on the central bank’s powerful board and could shake up what was already a fractious succession process for Fed leadership amid difficult relations with Trump. Trump said on Sunday he would announce a candidate to fill the open Fed position within the next couple days. In an interview with CBS’ Face the Nation , Greer acknowledged there were always revisions of job numbers, “but sometimes you see these revisions go in really extreme ways”. Brian Moynihan, CEO of Bank of America, said large revisions of economic data could undermine public confidence and that government officials should develop ways of improving data quality. “They can get this data, I think, other ways and I think that’s where the focus ought to be: how do we get the data to be more resilient and more predictable and more understandable?” he said on CBS. “Because what bounces around is

o Critics warn of trust erosion, call for Congress to investigate removal published estimates and from the recalculation of seasonal factors.” McEntarfer responded to her abrupt dismissal on Friday in a post on the Bluesky social media platform, saying it was “the honour of her life” to serve as BLS commissioner and praising the civil servants who work there. McEntarfer’s firing added to growing concerns about the quality of US economic data and came on the heels of a raft of new tariffs on dozens of trading partners, sending global stock markets tumbling as Trump presses ahead with plans to reorder the global economy. Investors also are watching the impact of the surprise resignation of

US trade adviser says tariff rates unlikely to change WASHINGTON: New US tariff rates are “pretty much set” with little immediate room for negotiation, Donald Trump’s trade adviser said in remarks aired on Sunday, also defending the president’s politically driven levies against Brazil. depend on the level of the trade deficit or surplus we may have with the country,” Greer said. “These tariff rates are pretty much set.” Undoubtedly some trade tariffs on exports to the United States – albeit with significant exemptions for key products such as aircraft and orange juice. Meanwhile White House economic adviser Kevin Hassett said that while talks are expected to continue over the next week with some US trade partners, he concurred with Greer’s tariffs assessment in that the bulk of the rates “are more or less locked in”. A person throwing water in the face of a Bolsonaro supporter, during a protest in defence of national sovereignty after trade tariffs and sanctions were imposed by the US on Brazil, near the American consulate in Rio de Janeiro. – AFPPIC

Trump has openly admitted he is punishing Brazil for prosecuting his political ally Jair Bolsonaro, the former president accused of plotting a coup in a bid to cling to power. The US president has described the case as a “witch hunt.” Greer said it was not unusual for Trump to use tariff tools for geopolitical purposes. “The president has seen in Brazil, like he’s seen in other countries, a misuse of law, a misuse of democracy,” Greer told CBS. “It is normal to use these tools for geopolitical issues.” Trump was “elected to assess the foreign affairs situation... and take appropriate action”, he added.

ministers “want to talk more and see how they can work in a different way with the United States”, he added. “(But) we’re seeing truly the contours of the president’s tariff plan right now with these rates.” Last Thursday, the former real estate developer announced hiked tariff rates on dozens of US trade partners. They will kick in on Aug 7 instead of Aug 1, which had previously been touted as a hard deadline. Among the countries facing steep new levies is Brazil. South America’s largest economy is being hit with 50%

Trump, who has wielded tariffs as a tool of American economic might, has set tariff rates for dozens of economies including the European Union at between 10% and 41% come Aug 7, his new hard deadline for the duties. In a pre-taped interview broadcast on Sunday on CBS’s Face the Nation , US Trade Representative Jamieson Greer said “the coming days” are not likely to see changes in the tariff rates. “A lot of these are set rates pursuant to deals. “Some of these deals are announced, some are not, others

Asked by the host of NBC’s Sunday talk show Meet the Press with Kristen Welker if Trump could change tariff rates should financial markets react negatively, Hassett said: “I would rule it out, because these are the final deals.” Legal challenges have been filed against some of Trump’s tariffs arguing he overstepped his authority. An appeals court panel last Thursday appeared sceptical of the government’s arguments, though the case may be ultimately decided at the Supreme Court. – AFP