US ECONOMY & POLITICS

U.S. Inflation Forecasts Keep Rising as Supply Constraints Loom – Bloomberg, 8/13/2021

• Forecasters lowered economic growth projections for this year and lifted inflation expectations into 2022 across a variety of metrics, according to Bloomberg’s latest monthly survey of economists.
• Compared to a year earlier, the personal consumption expenditures price index is now expected to rise 4% in the third quarter and 4.1% in the fourth, double the Federal Reserve’s 2% goal.
• Expectations for the core measure, which strips out the volatile food and energy components, were also revised higher.
• Consumer outlays are now forecast to grow at an annualized 4.5% pace in the current period, down nearly two percentage points from last month’s survey and a sharp deceleration from the sizzling 11.8% rate seen in the second quarter.
• A softening pace of household demand paired with ongoing supply constraints weighed on expectations for economic growth.
• Gross domestic product is now seen rising 6.3% in the fourth quarter versus the same three months last year.
• That’s a downgrade from the 7.1% projection in the July survey.

FDA Authorizes Covid-19 Boosters for Certain Immunocompromised – Wall Street Journal, 8/13/2021

• The agency on Thursday cleared giving a third dose of a messenger RNA Covid-19 vaccine from Pfizer and its partner BioNTech or from Moderna to immunocompromised people.
• Immunocompromised people who didn’t have an antibody response after two doses of the mRNA vaccines had responses after a third dose, studies indicated, supporting the decision to recommend a third dose.
• About 2.7% of American adults are immunocompromised, which also includes people who live with HIV or take cancer treatments and other drugs that suppress their immune systems.
• Pfizer, which developed a Covid-19 vaccine with BioNTech, has said it plans to ask U.S. regulators to authorize booster shots of its two-dose vaccine this month. Moderna has said it plans to do so next month.
• Johnson & Johnson is expected to release data about the efficacy of two doses of its single-shot vaccine later this month.

Pelosi Faces Revolt From Moderates on Budget Vote Timing – Bloomberg, 8/13/2021

• Nine moderate House Democrats are threatening to withhold support from a $3.5 trillion budget blueprint until a bipartisan infrastructure package is signed into law, threatening to unravel plans for moving President Joe Biden’s agenda through Congress.
• The moderates’ stance risks undermining Pelosi’s strategy, which would bring the budget resolution to a vote in the House the week of Aug. 23.
• Pelosi’s slim margin of control means she can only afford to lose three members of her caucus in a vote on the budget measure, which passed the Senate on a party-line vote this week and isn’t expected to garner any Republican support in the House.
• Representatives Josh Gottheimer of New Jersey, Carolyn Bourdeaux of Georgia, Filemon Vela of Texas, Jared Golden of Maine, Henry Cuellar of Texas, Vicente Gonzalez of Texas, Ed Case of Hawaii, Jim Costa of California and Kurt Schrader of Oregon signed the letter, first reported by Punchbowl News.

Job Postings Requiring Covid-19 Vaccination Jump in Past Month – Wall Street Journal, 8/13/2021

• The share of job postings stating that a new hire must be vaccinated have nearly doubled in the past month, according to the job search site Indeed.
• The total number remains low, roughly 1,200 postings requiring a vaccination per million in the first week of August.
• But that is well up from about 600 in early July, and about 50 per million job postings in early February.
• The share of job postings, per million, in the education sector that required a vaccination rose to 2,166 in July from 33 in February, according to Indeed.
• In food service, the rate per million rose to 814 in July from 43 in February. The rate per million for accounting rose to 1,184 from 39, and in software development the rate increased to 438 from four.
• Nearly 30% of adults in the U.S. haven’t received at least one dose of a Covid-19 vaccine, according to the Centers for Disease Control and Prevention.

EUROPE & WORLD

Adidas Agrees to Sell Reebok to Authentic Brands – Wall Street Journal, 8/12/2021

• Adidas said it has agreed to sell Reebok to Authentic Brands Group for up to about $2.5 billion, roughly 15 years after acquiring the U.S. fitness brand and trying to revamp it.
• The German sporting-goods company managed to improve the Reebok business, but its sales lagged behind those of Adidas itself and dragged down the group’s profits.
• The company put the value of the deal with Authentic Brands at as high as €2.1 billion.
• Adidas on Thursday said the majority of the transaction will be paid in cash at the deal’s closing, with the remainder made up of deferred and contingent fees.
• The sale doesn’t affect Adidas’s existing guidance for the full year, it said.
• Adidas earlier this month said it sees sales growing by up to 20% for the full year, while at the same time it continues to absorb the effects of Covid-19.

Tesla Battery Supplier CATL Plans $9 Billion Share Sale to Boost Capacity – Wall Street Journal, 8/13/2021

• Contemporary Amperex Technology one of the world’s largest makers of lithium-ion batteries, said Friday it expects to raise up to 58.2 billion yuan, equivalent to $9 billion, via a share placement to large investors.
• The nearly decade-old company, also known as CATL, is a major supplier of batteries to Tesla’s Shanghai factory.
• Its market capitalization was about $180 billion as of Friday, according to FactSet, making it one of the most valuable companies listed in mainland China.
• CATL said it plans to use most of the proceeds to increase the production of lithium-ion batteries at its facilities in China’s Fujian, Guangdong and Jiangsu provinces.
• Besides Tesla, CATL supplies batteries to Chinese EV makers NIO, XPeng, and Li Auto, as well as traditional brands such as Daimler AG’s Mercedes-Benz.
• The company’s revenue in the first quarter of this year doubled to nearly $3 billion, while profit for the three months to March 2021 jumped to $301 million.
• Beijing, meanwhile, has said it wants electric vehicles to make up 20% of China’s new car sales by 2025, and 50% by 2035.

Taliban Seize Kandahar, Prepare to March on Afghan Capital Kabul – Wall Street Journal, 8/13/2021

• The Taliban completed the seizure of Kandahar, Afghanistan’s second-largest city and the Islamist movement’s birthplace, and took into custody a warlord who organized the failed defenses of the western city of Herat.
• The U.S. has already launched the drawdown of its large embassy in Kabul, sending troops to evacuate most of the staff as it cuts the diplomatic presence to an essential core.
• The Taliban’s new governor for Kandahar, Haji Yousaf Wafa, issued a message announcing a general amnesty for government employees and members of security forces, and urged everyone to return to work as normal, including in schools and universities.
• On Friday, the Taliban also entered Pul-e-Alam, the capital of Mr. Ghani’s home province of Logar just south of Kabul, and captured its governor and several other senior officials.
• The Taliban launched their offensive soon after President Biden said in April that all U.S. forces would leave Afghanistan by Sept. 11, implementing the agreements that the Trump administration struck with the Taliban in Doha in February 2020.

Iran Hit by Worst Covid-19 Wave Yet as Vaccine Rollout Flounders – Wall Street Journal, 8/13/2021

• Iran was the first coronavirus hot spot in the Middle East, and remains the hardest-hit country in the region, largely due to a botched response from authorities, experts and analysts say.
• The government has been reluctant to impose fresh lockdowns to contain the latest wave as the country’s economy reels from damaging U.S. sanctions.
• President Ebrahim Raisi, who draws his support from a conservative base, has refused to ban religious gatherings, despite recommendations from health authorities.
• Only about 4.4% of Iran’s roughly 80 million people have been fully inoculated, mostly with a Chinese vaccine, according to Iranian authorities. About 18% have received one dose, according to Iran’s health ministry.
• The number of new cases in Iran has now reached about 40,000 every day this week, with more than 500 dead on Thursday, both higher than the previous record set during the last major coronavirus wave in late 2020.
• The official death toll is nearing 100,000, though critics say the number is far higher, while the total number of cases has reached 4.3 million, according to the country’s health ministry.

Factmonster – TODAY in HISTORY

• A series of earthquakes killed 25,000 in Peru and Ecuador. (1868)
• Disney’s Bambi opened at Radio City Music Hall in New York City. (1942)
• The border between East and West Berlin was closed and marked with a barbed wire fence. (1961)
• U.S. swimmer Michael Phelps won his 11th career gold medal, becoming the first athlete in Olympic history to do so. (2008)