Inflation in America rose faster than expected in January, up by 3% year on year, compared with 2.9% in December. Core inflation, stripping out volatile food and energy prices increased from an annualised rate of 3.2% in December to 3.3%. The figures come as a blow to those, like President Donald Trump, who argue that interest rates should come down quickly
America’s defence secretary, Pete Hegseth, said it was “unrealistic” that Ukraine would regain the territory annexed by Russia since 2014. Meanwhile Ukraine’s president, Volodymyr Zelensky, told The Economist in an interview that Mr Trump’s administration had not yet shared any peace proposals with Ukraine. Mr Zelensky will meet J.D. Vance, America’s vice-president, this week.
Binyamin Netanyahu, Israel’s prime minister, threatened a “return to intense fighting” in Gaza unless Hamas releases hostages by midday on Saturday. On Monday the militant group said it would delay the release of three Israeli captives, whom it had agreed to free under its ceasefire deal with Israel. Hamas accused Israel of stopping displaced Palestinians from returning to Gaza.
Austria’s hard-right Freedom Party is returning its mandate to form a government after failing to form a coalition. The FPÖ came first in federal elections in September but has failed to divvy up ministries with the centre-right People’s Party since. Austria’s president, Alexander Van der Bellen, may appoint a technocratic government or give other parties the chance to form a coalition.
Donald Trump signed an executive order requiring federal agencies to significantly reduce staff, and hire no more than one person for every four removed. Speaking alongside Elon Musk in the Oval Office, the president said new hiring would have to be approved by DOGE, Mr Musk’s bureaucracy-slashing department. Mr Musk denied that DOGE lacks transparency and claimed that the civil service is rife with fraud.
A Chinese rocket launched for its first mission, transporting low-Earth-orbit satellites into space. The Long March 8A rocket is part of China’s strategy to compete against Starlink, a satellite-internet service provided by Mr Musk’s SpaceX that already has around 7,000 satellites in orbit. China has many fewer.
Disney and Goldman Sachs became the latest companies to roll back corporate diversity measures. Disney’s changes include replacing its “diversity and inclusion” criterion in executive-salary reviews with “talent strategy”. Goldman Sachs dropped its pledge to work on IPOs only with companies that have at least two “diverse” board members. Meta and McDonald’s are among the firms that have recently scrapped DEI policies.
Figure of the day: 140%, the increase in the average price of a dozen eggs in America from one year ago. Read the full story.
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