LONDON – Bill Gates is personally lobbying Trump administration officials to keep funding health programs worldwide, from childhood vaccination to HIV treatment, and warning that his foundation cannot step in to fill gaps, two sources familiar with the matter told Reuters.

Gates, the billionaire Microsoft MSFT.O co-founder turned global health philanthropist, met with the National Security Council as well as Republican and Democratic lawmakers in recent weeks to press that case, the sources said.

Soon after his January 20 inauguration, President Donald Trump moved to dismantle the US Agency for International Development, cutting more than 80% of contracts and freezing billions of dollars for everything from emergency food assistance to malaria prevention.

The Trump administration, led by the State Department, is reviewing what kinds of foreign aid will remain under its “America First” policy, with a list of around 30 global health projects for consideration, one of the sources said.

“Bill was recently in Washington D.C. meeting with decision makers to discuss the life-saving impact of US international assistance and the need for a strategic plan to protect the world’s most vulnerable while safeguarding America’s health and security,” said a spokesperson for the Gates Foundation, his charitable organization.

Gates told the officials he met with that his foundation cannot replace the role of the US government, the sources said. Gates Foundation directors have also said publicly that no foundation has that capability.

At the same time, many Gates Foundation top priorities like eradicating polio and fighting malaria will be hit by the US pullback. In such cases, the Foundation would need to decide if and how it can keep those programs on track, one source close to the organization said.

Gates’ discussions focused on organizations such as Gavi, the Vaccine Alliance, as well as the Global Fund to Fight AIDS, Tuberculosis and Malaria, among others. They are on the shortlist for review by Secretary of State Marco Rubio and Trump. The US gives around $300 million annually to Gavi, and more than $1 billion to the Global Fund.

Several projects under the President’s Emergency Plan for AIDS Relief (PEPFAR) are also on the review shortlist, the source said.

The Global Fund declined to comment for this story, and Gavi said only that it had not had a termination notice for its main US funding contract. The White House did not respond to requests for comment.

USAID terminated more than 5,200 grants and contracts, a State Department spokesperson said, adding that critical program awards remain active.

“USAID continues to support the US coordinated, interagency response to the Ebola outbreak in Uganda; to provide lifesaving HIV care and treatment services; to provide emergency assistance in conflict zones; and to support key American strategic partners,” the spokesperson said.

At the National Security Council, Gates also pushed for the US to continue to support the World Health Organization, which Trump moved to exit on day one of his administration, as well as efforts to eradicate polio.

Established in 2000, the Gates Foundation has an annual budget of more than $8 billion. Gates has met regularly with security officials in previous administrations on key areas like malaria or COVID-19. He met with Trump at a dinner in December, before the inauguration, and the White House in early February after the USAID cuts were first announced, according to an NBC report. — Reuters

WASHINGTON – US President Donald Trump still intends for new reciprocal tariff rates to take effect on April 2, the White House said on Tuesday, despite earlier comments from Treasury Secretary Scott Bessent that indicated a possible delay in their activation.

“The intent is to enact tariffs on April 2,” the official said when asked to clarify Bessent’s comments that countries would get an opportunity to avoid higher tariffs by reducing their own trade barriers.

“Unless the tariff and non-tariff barriers are equalized, or the US has higher tariffs, the tariffs will go into effect,” the White House official said.

Bessent told Fox Business Network’s “Mornings with Maria” program that Trump on April 2 would give trading partner countries a reciprocal tariff number that reflects their own rates, non-tariff trade barriers, currency practice and other factors, but could negotiate to avoid a “tariff wall.”

“On April 2, each country will receive a number that we believe represents their tariffs,” Bessent said. “For some countries, it could be quite low, for some countries, it could be quite high.”

“We are going to go to them and say, ‘Look, here’s where we think the tariff levels are, non-tariff barriers, currency manipulation, unfair funding, labor suppression, and if you will stop this, we will not put up the tariff wall,'” Bessent said of trading partners.

“I’m optimistic that (on) April 2, some of the tariffs may not have to go on because a deal is pre-negotiated, or that once countries receive their reciprocal tariff number, that right after that they will come to us and want to negotiate it down,” Bessent said.

Countries that fail to reduce their trade barriers will face steeper tariffs aimed at protecting the US economy, its workers and industries, Bessent added.

His remarks were taken to mean that while the proposed duties would be announced on April 2, their implementation could be delayed to allow time for negotiations. But the White House official said any such deals would need to be negotiated in advance to avoid the new tariffs.

DETAILED WORK
The dueling comments illustrate the developing nature of Trump’s new reciprocal tariffs just two weeks out from the April 2 activation deadline.

Details of the plan are still being worked out, one White House official said, with much of the technical work on the expected tariffs being led by the US Trade Representative’s office, headed by Jamieson Greer, and his staff of some 200 people at USTR.

Vice President JD Vance has also played a more active role in the discussions in recent weeks, the official said.

A spokesperson for USTR did not immediately respond to a request for comment on the reciprocal tariff plan.

Greer and his staff have been wrestling with how to design the reciprocal tariffs given each of the 186 members of the World Customs Organization has different duty rates, sources familiar with the process said.

Calculating the tariff rates is complicated by Trump’s vow to reflect the impact of non-tariff barriers, including taxes and other measures that US officials argue give other countries’ firms an unfair advantage.

At the Commerce and Treasury departments, political appointees have also run into hiring delays linked to vetting, which has created some negotiating bottlenecks, the same sources familiar with the process said.

Financial markets have become increasingly nervous about the impact of Trump’s tariffs and retaliation from trading partners will have on inflation and economic growth. US stocks fell on Tuesday ahead of the Federal Reserve’s rate decision on Wednesday.

TRIGGERING TALKS
The Trump administration expects the tariff announcements to trigger offers by affected countries to reduce their own tariffs or non-tariff measures, the official said, noting that India, for one, was already trying to get ahead of the US moves.

After Indian Prime Minister Narendra Modi and Trump met last month, the two nations agreed to resolve tariff rows and work on the first segment of a deal by the fall of 2025, aiming to reach two-way trade of $500 billion by 2030.

Trump often singles out India as the country with the highest average tariff rates, among top trading partners, while European Union countries are criticized for their high 10% car tariff rate, which is four times the 2.5% US passenger car rate, but less than the 25% US tariff on pickup trucks.

Bessent said that the Trump administration is particularly focused on the 15% of countries that have the highest tariffs and large trading volumes with the US, which he referred to as the “Dirty 15.”

These countries also often have regulations governing domestic content or food safety that conspire to keep US products out of their markets, he said.

British business and trade minister Jonathan Reynolds came to Washington this week to meet in person with Lutnick and Greer, with both sides talking up the prospects of a bilateral trade deal focused on technology.  — Reuters

TOKYO – The Bank of Japan kept interest rates unchanged on Wednesday, as policymakers chose to spend more time gauging how prospects of higher US tariffs would affect the export-reliant economy.

The widely expected decision came as fears of a global slowdown caused by US President Donald Trump’s tariff policy overshadow wage and price data showing Japan making progress in durably achieving the BOJ’s 2% inflation target.

Markets are focusing on Governor Kazuo Ueda’s post-meeting briefing for clues on how soon the bank could next raise rates, a decision complicated by the contrast between benign domestic data and uncertainty caused by Trump’s trade policy.

Having just raised interest rates in January, the board voted unanimously to maintain the bank’s short-term policy rate at 0.5% at a two-day meeting that ended on Wednesday.

The BOJ’s meeting came hours before that of the US Federal Reserve, which is also expected to keep interest rates steady to watch how Trump’s planned April tariff hikes unfold.

“Japan’s economy is recovering moderately, albeit with some weak signs,” the BOJ said in a statement announcing the rate decision, signaling its confidence that rising wages will underpin consumption and the broader economy.

Rising rice prices and the fading effect of subsidies aimed at curbing fuel costs will likely put upward pressure on core consumer inflation through fiscal 2025, the statement said on Japan’s price outlook.

“Japan’s economic and price outlook remains highly uncertain,” due in part to risks surrounding the fallout from trade policies of each country, the statement said.

Big Japanese firms last week offered bumper pay hikes in wage talks with unions for a third straight year, backing the BOJ’s view that sustained wage gains will keep inflation durably around its 2% target.

But Trump’s back-and-forth comments on tariffs have roiled markets and stoked fears of a US recession, which could hit Japan’s export-reliant economy, analysts say.

The United States raised tariffs on imports of steel and aluminum to 25%, effective last week, without exemptions. Washington is expected to announce auto tariffs on April 2, alongside a more sweeping agenda of reciprocal tariffs.

The uncertainty over Trump’s tariff plans is already taking a toll with a Reuters poll showing Japanese manufacturers’ business mood soured in March.

While exports rose 11.4% in February from a year earlier, core machinery orders – a leading indicator of capital expenditure – fell 3.5% in January, data showed on Wednesday.

The Organisation for Economic Cooperation and Development (OECD) on Monday projected global growth to slow slightly from 3.2% in 2024 to 3.1% in 2025 and 3.0% in 2026, due largely to the drag from Trump’s tariff hikes.

The BOJ will take into account such data in a quarterly review of its growth and price forecasts at a subsequent policy meeting on April 30-May 1, which will be crucial to the timing and pace of further rate hikes.

The BOJ raised short-term rates to 0.5% in January after ending a massive stimulus programme last year on the view Japan was on the cusp of meeting its long-term inflation objectives.

It has signaled readiness to raise rates further if economic and price developments move in line with projections. Over two-thirds of economists polled by Reuters expect the BOJ to hike rates to 0.75% in the third quarter, most likely in July. — Reuters

WASHINGTON – US single-family homebuilding rebounded sharply in February amid a thaw in winter weather while production at factories surged, but rising prices for raw materials because of tariffs threaten the nascent housing market and manufacturing recovery.

The reports on Tuesday did not change the sense that the economy has slowed in the first quarter as President Donald Trump’s on-again, off-again duties against the nation’s main trade partners and an unprecedented campaign to shrink the federal government through deep spending cuts and mass firings of public workers sour business and consumer sentiment.

“None of the economic reports today are tariff-free,” said Christopher Rupkey, chief economist at FWDBONDS. “The economy is swiftly losing momentum here and if Washington does not change course on many of its business-unfriendly proposals and initiatives, the odds of an economic recession could shift from a risk to a reality in a hurry.”

Single-family housing starts, which account for the bulk of homebuilding, surged 11.4% to a seasonally adjusted annual rate of 1.108 million units last month, the Commerce Department’s Census Bureau said. Homebuilding soared in the Northeast and densely populated South as disruptions caused by frigid temperatures eased. Housing starts also rose in the West, but plunged in the Midwest, likely dragged down by winter storms.

Starts fell 2.3% on a year-over-year basis in February. Trump this month imposed and later suspended a 25% tariff on most goods from Canada and Mexico, which would have pushed US duties on Canadian lumber to nearly 40%. But tariffs on Chinese goods were raised to 20% and levies on steel and aluminum went into effect this month.

The National Association of Home Builders estimated on Monday “a typical cost effect from recent tariff actions at $9,200 per home.” Sentiment among homebuilders plunged to a seven-month low in March.

There have been anecdotes of workers not reporting for duty at construction sites for fear of deportation as the Trump administration cracks down on illegal immigration.

Undocumented immigrants account for 23% of construction labor, the Center for American Progress estimated in 2021.

Though the average rate on the popular 30-year fixed-rate mortgage has declined from 7% at the start of the year, the economic uncertainty is likely to keep prospective buyers on the sidelines. With new housing inventory at levels last seen in December 2007, builders might have no incentive to break new ground on single-family housing projects.

Permits for future construction of single-family housing fell 0.2% to a rate of 992,000 units in February.

Stocks on Wall Street traded lower. The dollar advanced against a basket of currencies. Yields on longer-dated US Treasuries rose.

EYES ON FED
Federal Reserve officials meeting on Tuesday and Wednesday are expected to leave the US central bank’s benchmark overnight interest rate in the 4.25%-4.50% range, having reduced it by 100 basis points since September, and continue to assess the economic impact of the Trump administration’s policies, which are widely deemed as inflationary.

Those inflation concerns were reinforced by a separate report from the Labor Department’s Bureau of Labor Statistics showing import prices increased 0.4% in February, matching January’s gain and confounding economists’ expectations for a 0.1% decline. Import prices, which exclude tariffs, were boosted by higher costs for consumer goods.

Prices of Chinese imports in the US jumped 0.5%, the largest increase since March 2022, after climbing 0.2% in January. They rose 0.5% on a year-over-year basis, the biggest advance since December 2022.

Though consumer and producer price readings were better than expected in February, the details that go into the calculation of the Personal Consumption Expenditures (PCE) price indexes, the inflation measures tracked by the Fed for its 2% target were firmer.

Goldman Sachs now estimates the PCE Price Index excluding food and energy increased 0.34% in February, upgraded from 0.29% before the release of the import prices data. Core PCE inflation rose 0.3% in January. It was forecast to increase 2.75% on a year-over-year basis after advancing 2.6% in January.

“Import prices are measured before the imposition of any tariffs and if import prices do not fall sharply in the coming months, it will be clear evidence that the tariffs are being paid by US households and companies,” said Conrad DeQuadros, senior economic advisor at Brean Capital.

“Import prices from China are picking up even though the series in this report excludes tariffs. Chinese firms do not appear to be lowering their prices to absorb the 10% tariff,” he said.

Financial markets expect the Fed to resume lowering rates in June, after it paused its easing cycle in January. The policy rate was hiked by 5.25 percentage points in 2022 and 2023.

Growth estimates for the first quarter are currently below a 1.5% annualized rate. The economy grew at a 2.3% pace in the October-December quarter.

Starts for housing projects with five units or more increased 12.1% to a rate of 370,000 units.

Overall housing starts jumped 11.2% to a rate of 1.501 million units, more than reversing January’s decline. Economists polled by Reuters had forecast housing starts would rise to a rate of 1.380 million units.

Multi-family building permits fell 4.3% to a rate of 404,000 units. That contributed to lowering overall building permits by 1.2% to a pace of 1.456 million units last month.

A separate report from the Fed showed factory output jumped 0.9% in February amid an acceleration in motor vehicle production. That followed a 0.1% rise in January and beat economists’ expectations for a 0.3% advance. Economists said factory output was likely boosted by businesses rushing through orders ahead of the duties on imports.

“The threat of tariffs and the on-again, off-again implementation style is likely more damaging for manufacturers who are trying to operate in this environment,” said Shannon Grein, an economist at Wells Fargo. “Trying to navigate supply snarls and cost pressures is hard in normal times, adding the uncertainty of tariffs only exacerbates that challenge.” — Reuters