U.S. economy set to grow 3.1% in '18
WASHINGTON -- The U.S. economy is projected to grow by 3.1 percent this year, as more government spending and tax cuts help propel an expansion, the Congressional Budget Office said on Monday.
But the robust run of growth may stall as early as next year, with the U.S. economy expected to slow down in 2019 and during the following decade once temporary government policies expire, according to the nonpartisan agency's report.
Economic growth will slow to 2.4 percent in 2019 and to 1.7 percent in 2020, staying at about that level over the next decade, the Congressional Budget Office projected.
If the numbers prove correct, U.S. economic growth will have jumped from 2.6 percent in 2017 to 3.1 percent in 2018. Those numbers mark a significant improvement over the aftermath of the 2008 recession, which saw an annual growth rate of around a tepid 2.2 percent.
"There is an acceleration of growth that is significant," said Allen Sinai, chief economist and strategist at Decision Economics. "A year or so ago, 3.1 percent in annual growth did not look doable. But it has happened."
The federal report suggests the economy is being temporarily juiced, in part due to a large government spending package passed this spring and the Republican tax law passed last fall, which has many provisions set to expire before the end of the decade.
-- The Washington Post
Citigroup's credit-card chief leaving
NEW YORK -- Citigroup is restructuring its consumer-banking operation in a shake-up that includes the departure of its global credit-card chief.
Judson Linville, who ran the world's largest portfolio of credit-card loans, is leaving as the bank merges that business with its wealth and retail units in the U.S., according to an internal memo Monday from Stephen Bird, who leads Citigroup's global consumer bank.
Bird's changes bring to the U.S. a model he oversaw while running the company's Asia operations, before he was appointed to his current role in 2015. The bank often chooses Asia to test new consumer offerings such as branches and digital products. North America consumer revenue growth slowed to 1 percent last quarter from 4 percent in the previous three months, and Citigroup has struggled to meet targets for its U.S. branded-card business.
Citigroup makes almost half its revenue from the consumer bank, and about 60 percent of that comes from the U.S. The lender has renewed its focus on the consumer business in recent months, announcing plans earlier this year to debut a national digital banking product in the U.S.
Year-over-year revenue growth from the consumer operations slowed in the second quarter across the unit's three main regions -- North America, Latin America and Asia, compared with the first three months of the year. Still, about two-thirds of Citigroup's future revenue growth is expected to come from consumer operations in Asia and Mexico as well as its branded-cards business, according to analysts at Portales Partners.
-- Bloomberg News
Florida's orange growers bounce back
ST. PETERSBURG, Fla. -- After enduring pestilence and a deadly hurricane, Florida's orange growers are finally catching a break.
In the season that starts Oct. 1, the state may reap 70 million boxes of the fruit, according to the average estimate of four traders and analysts in a Bloomberg survey. That compares with 44.95 million the prior year, the smallest crop since 1945, government data show. The survey response range was 65 million to 80 million.
Orange production in Florida, the No. 1 U.S. grower, has been dwindling for years due to the scourge of the Asian citrus psyllid, a tiny, winged insect that spreads the bacterial disease known as citrus greening. Greening has decimated groves and increased costs for crop maintenance. Last year, the industry also suffered a blow from Hurricane Irma after the storm smashed into trees in September and damaged fruit.
Orange juice futures have jumped 17 percent over the past 12 months to about $1.59 a pound in New York trading.
The crop is finally getting a bit of a lift after better weather and as more growers develop methods to fight the greening disease. Output of 70 million boxes would be the biggest in three years, data from the U.S. Department of Agriculture show. The agency will issue its first estimate for the upcoming season on Oct. 11. A box weighs 90 pounds.
The battle with greening has increased costs at a time when American demand for orange juice is on the decline. Growers are probably spending about $2,100 per acre today, up from $700 just 10 to 12 years ago, according to Ellis Hunt Jr., the president of Hunt Brothers Cooperative, based in Lake Wales, Fla.
-- Bloomberg News
IBM Building's owner offers it for sale
NEW YORK -- The IBM Building in midtown Manhattan is for sale and could fetch more than $1.3 billion, a person with knowledge of the offering said.
The owner of the 43-story tower at 590 Madison Ave. would also consider selling a partial interest, according to the person, who asked not to be identified because the matter is private. State Teachers Retirement System of Ohio bought a stake in the property in 1994 and the remaining share three years later, the person said.
The 1.1. million-square-foot building is about 80 percent leased, according to the source. International Business Machines Corp., the computer giant, remains its largest tenant, with about 120,000 square feet of offices.
The tower, completed in the early 1980s and designed by architect Edward Larrabee Barnes, stands at the southwest corner of Madison Avenue and East 57th Street in one of Manhattan's priciest business districts. It has a two-story glass atrium that's open to the public, and an Alexander Calder sculpture, Saurian, in its plaza. Tenants at the base include the watch merchant Tourneau and the British auction house Bonhams.
The property is being marketed by a Cushman & Wakefield team led by Doug Harmon and Adam Spies. A spokesman for the brokerage declined to comment. A call to the press office of the State Teachers Retirement System of Ohio wasn't immediately returned.
-- Bloomberg News
Indiana newspaper cuts newsroom jobs
FORT WAYNE, Ind. -- The News-Sentinel has cut seven of its eight newsroom employees but says it will maintain its website and a page within The Journal Gazette of Fort Wayne six days a week.
News-Sentinel Publisher Michael Christman told The Journal Gazette the cuts made Friday were "a business decision, based on the current state of the industry, on how the News-Sentinel was going to move forward."
Columnist Kevin Leininger was the only newsroom employee retained. Laid-off reporter Tom Davis told WANE-TV that those eliminated were given severance packages and continued health care coverage.
The News-Sentinel eliminated its six-day afternoon print edition last October. It has a daily circulation of about 31,000.
The News-Sentinel is owned by Wheeling, W.Va.-based Ogden Newspapers. It has a joint operating agreement with The Journal Gazette for business-side operations such as advertising and circulation.
-- The Associated Press
Business on 08/14/2018