The widespread shortage of microchips that has persisted for months has rattled supply chains and caused prices for electronics items and other semiconductor-heavy goods to soar. During a White House meeting with more than a dozen CEOs, US President Joe Biden spoke of a bipartisan USD 50bn aid package aimed at easing domestic shortages of chips and circuit boards. The cash injection is justified by allegedly aggressive Chinese ambitions to take over the semiconductor market. This anti-Chinese bill, which seems to have majority support, is intended to ensure that more chips are produced in the US again and that more research is carried out on home soil. Also, the major investments in US infrastructure that have been planned for a while are said to include comprehensive plans on how to make the supply chain for electronics items more robust again and how dependence on foreign suppliers would be minimized. The effective allocation of the funding has yet to be determined, and both semiconductor manufacturers and the auto industry have been vocal in communicating their claims. The White House has not yet taken an official position on the fund distribution.
China's exports grew at a steady pace in March, giving a renewed boost to the country's economic recovery. Global demand is picking up due to progress on the global Covid-19 vaccine, while import growth rose to its highest level in four years. Despite risks of setbacks, the data suggests the world's second-largest economy will continue to gain momentum. Following February's record growth of +154.9%, exports rose again in March by +30.6% year-on-year in dollar terms. As the global economy continues to recover, strong foreign demand should remain. Global demand continues to be the backbone of the Chinese economy.
The US government recorded a budget deficit of USD 660bn in March, the US Treasury Department said on Monday. This was due to direct payments to Americans under President Joe Biden's stimulus package, it said. The deficit for the first six months of fiscal 2021 rose to a record USD 1'706bn, compared with a deficit of USD 743bn in the same period last year, which did not yet include any huge pandemic measures. The March 2021 deficit was the third highest monthly US deficit on record, surpassed only by the June 2020 deficit of USD 864trn and the April 2020 deficit of USD 738trn. Thus, according to current projections, US national debt is at historic highs, now around USD 28trn, equivalent to about 130% of GDP. At the beginning of the last debt ceiling crisis in 2013, the bone of contention was a comparatively low debt level of USD 16trn.
|-||China||Trade balance||USD 78 bn|
|14:30||USA||Consumer Price Index (y/y)||1.7%|
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