Fears of U.S. Recession Recede; Heating Costs Hitched to LNG; China Emissions Seen Nearing Peak

Fears of U.S. Recession Recede; Heating Costs Hitched to LNG; China Emissions Seen Nearing Peak By James Christie

Good day. Economists polled on their outlook for the U.S. economy by the Federal Reserve Bank of Philadelphia are growing more optimistic. They give the economy hitting a recession this quarter a 17.3% chance, down from 40.9% in the bank's previous survey. Meanwhile, Americans' utility bills are getting wrapped up in the fight over President Biden's pause on most new liquefied natural gas exports. In another energy related development, China installed 217 gigawatts worth of solar power last year alone, a 55% increase, according to new government data, or more than 500 million solar panels and well above the total installed solar capacity of the U.S. Climate watchdogs say such additions are leading them to expect China's greenhouse-gas emissions to peak years earlier than anticipated, maybe even as soon as this year.

Now on to today's news and analysis.

Top News Recession Fears Evaporate in New Forecast of Top Economists

Fears of a recession in the first half of 2024 have melted away like the snow in most of the country this winter, according to a new forecast of top economists released Friday, MarketWatch reported . Economists polled by the Federal Reserve Bank of Philadelphia for its Survey of Professional Forecasters now see only a 17.3% chance of negative growth of real gross domestic product in the first quarter. That's down sharply from a 40.9% chance in the previous survey. In normal times, the risk of a recession is around 15%, economists say. In the April-June quarter, economists now see a 23.9% chance of a negative quarter of GDP growth, down from 40.2%. For the last two quarters of the year, the odds are now about 25%, compared with above 24% in the prior survey. (MarketWatch)

U.S. Economy Caught in Biden's Natural-Gas Export Fight: Your Utility Bill

Americans' utility bills are getting wrapped up in the fight over President Biden's pause on most new natural gas exports, a booming industry that has helped turn the U.S. into an energy export powerhouse.

The Cost of Biden's Climate Tax Credits Is Soaring

President Biden's 2022 climate law is driving faster-than-expected growth in electric-vehicle purchases and clean-energy projects, doubling the projected cost to taxpayers while potentially accelerating emissions reductions.

Tech Millionaires Take On Politicians in a Fight to Fix San Francisco

Silicon Valley leaders say they want to make San Francisco a safer and more hospitable place to raise families and run businesses, and to reverse the doom loop narrative that has haunted its downtown since Covid-19.

An Early Bird's Guide to Preparing Tax Returns

While each tax situation has varying degrees of complexity, there are some basics all taxpayers should be aware of as they prepare returns. Here is a look at some of those, as well as a few pointers and updates for the 2023 tax year.

Key Developments Around the World China's Carbon Emissions Set to Decline Years Earlier Than Expected

China's massive rollout of renewable energy is accelerating, its investments in the sector growing so large that climate watchdogs now expect the country's greenhouse-gas emissions to peak possibly as soon as this year .

Can the U.S. Break China's Grip on Solar? How China Miscalculated Its Way to a Baby Bust Ukraine's Military Has a Calculating, Hard-Charging New Chief

Russia doesn't appear to have the immediate capacity to break through Ukraine's defensive lines, but is inching forward in a handful of places with infantry attacks against Ukrainian front-line units low on manpower and gear .

Venezuela Deploys Military to Oil-Rich Guyana's Border

Venezuela is backing up its threats to annex part of Guyana and secure access to some of the world's largest oil finds in more than a decade in what is quickly turning into a new security challenge for the Biden administration.

Financial Regulation Roundup Elon Musk Isn't the Only Billionaire Fighting Delaware

Delaware has long held primacy in the world of U.S. corporate law, but Nevada and Texas are among the states that want a piece of that business by setting up an alternative legal environment .

From a Crisis Winner to Banking's Next Worry

New York Community Bancorp has said it needed to make changes to ensure its balance sheet was befitting its new stature , kicking off events that have rocked its stock and credit ratings, raising questions about its soundness.

IRS Cracked Down on Access to Tax Data After Bezos, Musk Leaks

The IRS clamped down on employees' and contractors' access to confidential taxpayer data after a damaging 2021 leak, but some risks still remained, according to a report that provides new details on the agency's response.

David Solomon Strengthens His Grip on Goldman Sachs

After a bruising stretch in which questions swirled about his ability to hang on to the top job at Goldman Sachs, David Solomon has made it clear to top executives he plans to remain for a while.

How an Unremarkable Deal Now Threatens a Small Investment Bank

History is littered with financial companies that were undone by one bad bet. Investors are worried that B. Riley Financial will be one of them. It is is under fire for funding a buyout linked to a firm that prosecutors call a fraud .

Forward Guidance Monday (all times ET)

9:20 a.m.: Fed's Bowman speaks at American Bankers Association Conference for Community Bankers, San Antonio, Texas

11 a.m.: New York Fed Survey of Consumer Expectations

1 p.m.: Bank of England's Bailey speaks at Loughborough University

Tuesday

2 a.m.: UK unemployment for January

8:30 a.m.: U.S. consumer-price index for January

Research Inflation to Continue Easing in Latin America

A spike in food prices that increased inflation last month in Brazil, Mexico and Chile is likely transitory, Oxford Economics says in a report about Latin American economies. Core disinflation "remains on course, and we expect headline inflation in the region to continue to ease," the economic forecasting firm says. Oxford adds that core inflation "remains worryingly high in Colombia, while Peru enjoys the most benign inflation dynamics in the region." Argentina, which is struggling with triple-digit consumer-price index prints, is expected to see a slight slowdown in January data due this week, Oxford says. "Hyperinflation fears have receded based on the government's determination to establish a credible fiscal anchor."

-Paulo Trevisani

Commentary How Chinese Tariffs Soured Australia's Wine Industry

The sorry state of Australia's once-thriving wine-export business is a warning about what could happen to premium consumer brands if tensions between China and the West spike again, Jacky Wong writes.

Basis Points U.S. retailers are bulking up inventories to start the year, with the National Retail Federation's Global Port Tracker forecasting importers will bring in 1.86 million containers, measured in 20-foot equivalent units, in February, up more than 20% compared with last year. (Dow Jones Newswires) The number of employed working-aged people in Canada climbed 37,300 in January from the month before, more than double the increase economists were expecting and well above the six-month trend following little change the last three months, according to Statistics Canada. (DJN) Mexico's industrial production fell for a second consecutive month in December, led by declines in construction and manufacturing output, the National Statistics Institute said Friday. Industrial output fell 0.7% in seasonally adjusted terms from November. Manufacturing fell 1.2%, led by lower vehicle and auto parts production, and construction activity was down 0.6%. Utilities output fell 1.3% while mining activity rose 1.4% with a jump in mining services offsetting declines in oil and gas and metals extraction. (DJN) Feedback Loop

This newsletter is compiled by James Christie in San Francisco.

Send us your tips, suggestions and feedback. Write to:

James Christie , Perry Cleveland-Peck [mailto:[e-mail]], Nihad Ahmed , Michael Maloney

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

02-12-24 0716ET