US inflation rises in February due to higher prices for used cars, air travel, and clothing, reinforcing the Fed's cautious stance. Boeing's delivery delays worry US airlines. Intel prevails in chip sales to Huawei. GM's manufacturing chief retires, former Tesla exec steps in. Goldman Sachs aims for aggressive portfolio expansion. All this and more in this edition of World Street.
Inflation Insights
In February, core US inflation surpassed expectations for the second consecutive month, driven by increases in prices of used cars, air travel, and clothing. This strengthens the Federal Reserve's prudent stance on interest rate adjustments.
According to government data released on March 12 , the core consumer price index, excluding food and energy, rose by 0.4 percent from January and 3.8 percent from the previous year.
Boeing Blues
US airlines have cautioned that their expansion initiatives could face setbacks due to further delays in Boeing's jet deliveries, exacerbating the repercussions of the aircraft manufacturer's safety issues in the sector.
The ongoing challenges with Boeing have prompted the airline industry to revise downward its delivery projections for the year, posing challenges to accommodate the surge in travel demand.
Silicon Alliance
Intel has managed to overcome attempts to halt its chip sales, amounting to hundreds of millions of dollars, to China's Huawei. It will allow the global chip manufacturer to maintain its business relationship with the Chinese telecom company despite the substantial sanctions it faces, Reuters has reported.
There have been demands for the Biden administration to revoke a licence, issued by the previous administration, permitting Intel to provide Huawei with cutting-edge laptop processors, it said.
Drive Dynamics
Global sales of fully electric and plug-in hybrid vehicles (PHEVs) saw a tepid rise of 3 percent in February compared to the year-ago period, mainly due to the impact of the Chinese Lunar New Year celebrations, according to market research firm Rho Motio.
"The reason for the lower growth is because China is still the dominant market" for electric cars, Charles Lester, data manager at Rho Motion, told Reuters.
Talent Transfer
General Motors (GM) is bidding farewell to its long-time manufacturing chief as he retires, welcoming a former Tesla and Google executive to fill his shoes. After 44 years with the automaker, Gerald Johnson, the executive vice president of Global Manufacturing and Sustainability, is stepping down.
Jens Peter “JP” Clausen, previously with Tesla, Lego and Google, will assume Johnson’s role. The unexpected departure of Mike Abbott, executive vice president of software and services, was also announced by GM.
Portfolio Pursuit
Goldman Sachs Asset Management aims to expand its private credit portfolio to $300 billion in five years from the current $130 billion, Marc Nachmann, Goldman's global head of asset and wealth management told Reuters, laying out an aggressive expansion plan.
Goldman's private credit aspirations are larger than those of its peers, including Morgan Stanley which aims to double its private credit portfolio to $50 billion in the medium term.
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