Category World News

Consumer prices in the United States held steady in July, as elevated inflation sweeps through the economy.

The consumer price index report (CPI) rose 2.7 percent over this time last year and follows a 2.7 percent increase in June, according to the Department of Labor report released on Tuesday. On a monthly basis, prices increased by 0.2 percent in July compared to 0.3 percent in June.

The data beat analyst expectations. Economists surveyed by Dow Jones expected a 2.8 percent increase on an annual basis.

The cost of energy dropped by 1.1 percent over the last 12 months. Petrol, in particular, led the decline with a 2.3 percent decrease for the year. Grocery prices fell by 0.1 percent, but the cost of eating out of the house increased by 0.3 percent. Shelter costs increased by 0.2 percent.

The cost of medical care services rose by 4.3 percent. Airline prices increased by 4 percent compared with this time last year.

Increases and decreases

“Today’s CPI report revealed that inflation beat market expectations once again and remains stable, underscoring President [Donald] Trump’s commitment to lower costs for American families and businesses,”  White House press secretary Karoline Leavitt said in a statement to reporters.

But a deeper look at the data tells a different story. Prices increased in areas heavily affected by tariffs, while they decreased in areas that are not affected by tariffs.

“We really are seeing a divergence in the inflation data right now between import-sensitive sectors and those that do not rely on imports,” Daniel Hornung, senior fellow at MIT and former deputy director of the National Economic Council, told Al Jazeera.

Compared with this time last year, hotel prices fell by 1.3 percent and car rental prices tumbled by 2.9 percent as Americans have pulled back on discretionary travel spending. But products like tools and hardware prices ticked up 1.6 percent, car parts rose by 0.9 percent, and footwear surged 1.4 percent, all items that are imported and have to bear the levies.

The latest data comes after Trump fired Erika McEntarfer, the head of the Bureau of Labor Statistics, amid recently revised jobs data showing far fewer jobs were created than originally reported.

The president intends to replace her with EJ Antoni, an economist with the Heritage Foundation. He was a contributor to Project 2025, a far-right wishlist the conservative think tank put together.

While on the campaign trail, Trump distanced himself from Project 2025, but he has since appointed authors of many of its chapters to several key roles in the federal government, including Brenden Carr, who now leads the Federal Communications Commission and Russell Vought to lead the Office of Management and Budget.

A look ahead

Hornung believes that the latest data shows the effect of tariffs and is expected to rise as rates increase on trading partners.

“The way that probably shows up in the data is not literally over one month, but a relatively steady increase over the course of several months,” Hornung said.

“It might last even longer because of the way that the tariffs are being put in place, where we’re seeing in April one set of tariff announcements that take a few months to work their way through into consumer prices. Then again, in August, another set of increased incremental tariff rates that will work their way through the system over the course of the fall.”

In the private sector, some of the US’s largest businesses have announced a need to raise prices because of tariffs, including big box retailer Walmart, and Procter and Gamble, the world’s largest consumer goods maker.

Increased inflation and slowing job growth could lead to lower interest rates in September when the Federal Reserve is next set to meet, according to Hornung.

Foreign ministers from Syria and Jordan, as well as a United States envoy have met in Amman to discuss ways to support the rebuilding of Syria under its new government, as Damascus seeks investment deals with international companies to revive an economy battered by 14 years of civil war.

Syria’s Foreign Ministry said on Tuesday that its top diplomat Asaad al-Shaibani met with Jordan’s Foreign Minister Ayman Safadi and US envoy for Syria Tom Barrack to discuss “ways of strengthening cooperation and coordination between the three sides” to serve Syria’s stability, “sovereignty and regional security”.

Damascus said the sides had agreed to form a working group “to support the Syrian government’s efforts to consolidate the ceasefire in [Suwayda] province, and work to find a comprehensive solution to the crisis”.

His Majesty King Abdullah II, in a meeting with US Special Envoy for Syria and Ambassador to Türkiye Thomas Barrack attended by HRH Crown Prince Al Hussein, noted Washington’s key role in supporting Syria’s reconstruction in a way that preserves the rights of all Syrians #Jordan pic.twitter.com/QrtI0eybiQ

The Jordanian-Syrian-American meeting was a continuation of discussions held between the officials in Amman on July 19 about deadly clashes in the Druze-majority Syrian province of Suwayda, where a week of sectarian violence killed 1,400 people before a ceasefire put an end to the bloodshed. Israel carried out strikes on Syrian troops and also bombed the heart of the capital, Damascus, under the pretext of protecting the Druze.

Syria’s minority communities have expressed concerns for their safety since December, when a lightning rebel offensive toppled longtime ruler Bashar al-Assad, who had projected himself as a protector of minority groups.

While the new Syrian authorities have repeatedly stated their intent to protect all of the country’s ethnic and religious groups, the killing of more than 1,700 mostly Alawite civilians along the coast in March and the violence in Suwayda have brought the issue of sectarian tensions to the fore.

Jordan expresses support for Syria’s reconstruction efforts

Following Tuesday’s meeting, Syria, the US and Jordan released a joint statement regarding Suwayda, saying that it is “an integral part of the Syrian Arab Republic, and that the rights of its people are protected and preserved in the process of rebuilding the new Syria toward a secure and accomplished future for all citizens of the Syrian state, ensuring their representation and participation in building Syria’s future.”

Jordan’s King Abdullah II separately met with al-Shaibani and Barrack, expressing his “support for Syria’s efforts to preserve its security, stability, sovereignty, and territorial integrity”, said a statement from the Jordanian government.

It noted “the importance of Washington’s role in supporting the reconstruction process in Syria in a manner that preserves the rights of all Syrians”.

The king also said Jordan was ready “to share its expertise in all fields to help develop and strengthen the capabilities of Syrian institutions” and “noted the need to step up Jordanian-Syrian cooperation, particularly in combating terrorism and preventing arms and drug smuggling”, the statement added.

According to the Syrian statement, the foreign ministers’ meeting welcomed Damascus’s efforts to “restore basic services, hold perpetrators of violations to account, and prepare the conditions for the return of displaced people to their homes”.

Syria’s new authorities have worked to attract investment for the reconstruction of infrastructure across the country after the United States and European Union lifted sanctions on Syria in the wake of al-Assad’s ouster.

The United Nations has put Syria’s post-war reconstruction costs at more than $400bn.

Damascus signed 12 agreements worth $14bn last week, including a $4bn agreement with Qatar’s UCC Holding to build a new airport and a $2bn deal to establish a subway in Damascus with the national investment corporation of the United Arab Emirates.

Other major developments on the investment front include the $2bn Damascus Towers project for residential high-rises, signed with the Italian-based company UBAKO; a $500m deal for the Baramkeh Towers project, also in Damascus; and another $60m agreement for Baramkeh Mall.

Last month, Saudi Arabia said it would invest about $3bn in real estate and infrastructure projects in Syria.

Ukraine’s military has sent reserves to stem Russian advances near two key cities in the eastern Donetsk region, as Moscow attempts to gain more territory before a meeting between its leader, Vladimir Putin and United States President Donald Trump in Alaska on Friday, where land swap issues to end the war will be focal.

The Ukrainian General Staff said on Tuesday that its forces were involved in “difficult” fighting close to Pokrovsk and Dobropillia, with the extra soldiers needed to block attacks by small groups of Russian troops.

The development suggests intensifying struggles in the eastern Donetsk area, where Moscow-backed separatists have mainly held sway since the conflict there erupted there 2014, instigated by the Kremlin and deepened by Russia’s 2022 invasion of Ukraine.

Some of the advancing clusters of Russian soldiers had been destroyed, while others were still being engaged in combat, it added.

Russia’s advance is one of the most dramatic in the past year, with its soldiers infiltrating 17km (10 miles) past Ukrainian lines over the last three days, according to Pasi Paroinen, a military analyst with the Finland-based Black Bird Group.

Moscow, which has further isolated the destroyed town of Kostiantynivka, one of the last remaining urban areas Ukraine holds in the Donetsk, hopes to encircle the nearby city of Pokrovsk.

“A lot will depend on availability, quantity and quality of Ukrainian reserves,” Paroinen wrote on X Monday.

Ukraine’s DeepState blog, which has close connections to the Ukrainian military, described the situation as “quite chaotic”, as Russian troops are “infiltrating deeper, trying to quickly consolidate and accumulate forces for further advancement”.

The Institute for the Study of War, a US-based research group, said Moscow’s advances in the Dobropillia area did not yet amount to “an operational-level breakthrough”.

The Russian advance in eastern Ukraine comes as Europe hopes to rally Trump to Ukraine’s cause at an emergency virtual summit on Wednesday.

Organised by the German Chancellor Friedrich Merz, the meetings are due to be attended by EU leaders, Trump and Ukrainian President Volodymyr Zelenskyy.

In the run-up to the talks, the EU said on Tuesday that it welcomed the US president’s efforts “towards ending Russia’s war of aggression against Ukraine”, but emphasised that “the path to peace in Ukraine cannot be decided without Ukraine” and “international borders must not be changed by force.”

Trump had earlier disappointed his European allies by saying that Ukraine and Russia would have to accept land swaps if peace is to be achieved.

Meanwhile, Zelenskyy has warned that Russia is “not preparing to end the war”, despite Friday’s scheduled meeting between Putin and Trump in Alaska.

“On the contrary, they are making movements that indicate preparations for new offensive operations,” he wrote on X.

In other developments, Ukraine’s SBU intelligence agency said it had successfully targeted a building in Russia’s Tatarstan region, 1,300km (800 miles) from Ukraine, which contained long-range Shahed drones.

United States President Donald Trump has suggested that Federal Reserve Chief Jerome Powell could face a lawsuit over renovation costs for the central bank’s nearly century-old headquarters.

The threat, issued on Tuesday in a post on Truth Social, is the latest salvo in Trump’s ongoing pressure campaign against the central bank leader.

The two have clashed over interest rates: Trump has pushed for aggressive cuts, while Powell has maintained the bank will make a decision based on financial indicators, not political pressure.

“Jerome ‘Too Late’ Powell must NOW lower the rate,” Trump wrote in Tuesday’s message. “I am, though, considering allowing a major lawsuit against Powell to proceed because of the horrible, and grossly incompetent, job he has done in managing the construction of the Fed Buildings.”

The president’s attacks on Powell have become a source of concern for economic observers, who worry that Trump is attempting to undermine the independence of the central bank and bring it into closer alignment with his political priorities.

Trump has latched onto cost overruns stemming from construction work at the bank’s headquarters in Washington, DC, which he said points to Powell’s “incompetence”.

The Federal Reserve is currently undergoing renovations on two of its historic buildings, both built in the 1930s, including asbestos removal, major structural work to meet modern safety standards, and the replacement of antiquated systems for ventilation, plumbing, electricity and fire detection.

“While periodic work has been done to keep these buildings occupiable, neither building has seen a comprehensive renovation since they were first constructed,” Powell wrote in a letter to the Trump administration on July 17.

“Both buildings were in need of significant structural repairs and other updates to make the buildings safe, healthy, and effective places to work.”

But while the renovation project was initially estimated to cost $1.9bn, that number has increased to around $2.5bn as construction proceeds. Some Republican lawmakers have said they may open an investigation into the increased projected cost, and Trump has used the renovation to push for Powell to step down.

Trump has also pushed strongly for a decrease in rates, dubbing Powell by the nickname “Too Late” for his supposed delays in cutting rates.

Powell’s term as Federal Reserve chair ends in May 2026. Trump, who nominated Powell to the role during his first term, has already suggested he is considering replacing the outgoing chair with a more compliant figure.

“The damage he has done by always being Too Late is incalculable,” Trump said on Tuesday. “Fortunately, the economy is sooo good that we’ve blown through Powell and the complacent Board.”

Powell and economic policymakers at the Federal Reserve, meanwhile, have expressed concern over Trump’s aggressive tariff policy, which they maintain could increase inflation in the coming months.

Data released by the US Labor Department on Tuesday said that consumer inflation had risen 2.7 percent for the 12-month period ending in July. That number was an increase of 0.2 percent over June.

China has announced preliminary anti-dumping duties on Canadian canola imports, a new escalation in the yearlong trade dispute that began with Ottawa’s imposition of tariffs on Chinese electric vehicle imports last August.

The provisional rate will be set at 75.8 percent, effective from Thursday, the Ministry of Commerce said in a statement on Tuesday.

Intercontinetal Exchange (ICE) November canola futures RSX5, the global benchmark for canola trading, fell 6.5 percent to a four-month low after the announcement.

“This really came as a surprise and a shock,” said trader Tony Tryhuk of RBC Dominion Securities.

China, the world’s largest importer of canola – also known as rapeseed – sources nearly all of its supplies of the product from Canada. The steep duties would likely all but end imports if they are maintained.

“This is huge. Who will pay a 75 percent deposit to bring Canadian canola to China? It is like telling Canada that we don’t need your canola, thank you very much,” said one Singapore-based oilseed trader.

China’s Ministry of Commerce said on Tuesday that an anti-dumping probe launched in September 2024 had found that Canada’s agricultural sector – particularly the canola industry – had benefitted from “substantial” government subsidies and preferential policies.

China has until September, when the investigation formally ends, to make a final decision on the duties, though it has the option of extending that deadline by six months. A final ruling could result in a different rate, or overturn Tuesday’s decision.

The decision marks a shift from the conciliatory tone struck in June when China Premier Li Qiang said there were no deep-seated conflicts of interest between the countries during a phone call with Canadian Prime Minister Mark Carney.

“This move … will put additional pressure on Canada’s government to sort through trade frictions with China,” said Trivium China agriculture analyst Even Rogers Pay.

Canada’s trade, agriculture and the prime minister’s office did not immediately respond to request for comment. The Canadian embassy in Beijing did not respond to Reuters’ request for comment.

China had already imposed tariffs on canola oil and meal in March. Canada is now in a trade conflict with the world’s two largest economies, as it also faces tariffs on some goods from the United States.

Separately, China also launched an anti-dumping investigation into Canadian pea starch and imposed provisional duties on imports of halogenated butyl rubber, according to ministry statements.

‘Extend the losses’

Replacing millions of tonnes of Canadian canola is likely to be difficult at short notice, say analysts.

China primarily uses imported canola to make animal feed for its aquaculture sector. A separate duty on Canadian canola meal imports in March has already put these supplies at risk.

The move provides an opportunity for Australia, which looks set to regain access to the Chinese market with a few test cargoes this year after a years-long freeze in the trade, Pay said.

Australia, the second-largest canola exporter, has been shut out of the Chinese market since 2020 due mainly to Chinese rules to stop the spread of fungal plant disease called “blackleg”.

However, even if Australian imports increase, “fully replacing Canadian canola will be very difficult unless import demand drops sharply,” said Donatas Jankauskas, an analyst with commodity data firm CM Navigator.

Commodity funds have a substantial long position in ICE canola futures, traders said, which should add fuel to the selloff fire.

“This will help accelerate their exit of that long and could really extend the losses,” said Tryhuk.

Another trader said there was already downward pressure coming into canola prices as Canada’s crop is widely believed to be bigger than many previously forecast due to good weather.

“We’re just realising we’ve got a better crop that’s about to come off,” said the trader. “This is a gut punch no one was expecting.”

Ventum Financial broker David Derwin said some traders do not know how to take the Chinese move yet, since it is not a final rule.