Stable Jobs, Rising Costs

What has President Trump said this week?

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What has President Trump said this week? 〰️

1. Xi Receives Trump in Beijing

President Trump arrived in Beijing on May 13 for a highly watched summit with President Xi Jinping, after the summit was postponed earlier this year amid tensions surrounding the Iran war. The U.S. delegation includes senior officials and major business leaders such as Nvidia CEO Jensen Huang, Apple CEO Tim Cook, Elon Musk, and BlackRock CEO Larry Fink, alongside executives from Meta, Visa, JPMorgan, Boeing, Citi, and Mastercard. Expectations for the visit center on trade, market access, and clearer rules for operating in China (CNN, 2026; BBC, 2026). Trade remains the primary issue on the agenda, with Trump stating that his “very first request” would be for China to “open up” so U.S. companies could expand investment and operations in the country (New York Times, 2026).

The summit is taking place against a broader geopolitical backdrop. Ahead of the meeting, Treasury Secretary Scott Bessent urged China to use its influence with Iran to help reduce regional tensions, highlighting Washington’s view that Beijing holds important diplomatic leverage (Reuters, 2026). At the same time, Taiwan remains a major point of friction after the U.S. approved an $11B arms sale to Taiwan, a move that risks increasing tensions with Beijing (Bloomberg, 2026).

The talks are being closely watched because they sit at the intersection of trade policy, energy diplomacy, and rising security tensions across Asia. A constructive outcome could ease uncertainty for companies exposed to China, particularly across technology, manufacturing, agriculture, and financial services. A more confrontational outcome, especially around Taiwan or Iran, could renew pressure on supply chains, tariffs, commodity prices, and global markets. The key question is whether the summit produces concrete trade measures or mainly symbolic political messaging without immediate follow-through (BBC, 2026).

2. April Jobs Report: Stronger Hiring, Persistent Household Strain

The U.S. economy added 115,000 jobs in April, beating expectations of 55,000, while the unemployment rate remained steady at 4.3%, according to the latest report from the federal Bureau of Labor Statistics (BLS) (Reuters, 2026; NBC, 2026). The report showed that employers are still hiring despite higher borrowing costs, elevated energy prices, and weaker consumer confidence. It also eased some recent concerns that the labor market was deteriorating too quickly, although hiring remains noticeably slower than the exceptionally strong pace seen earlier in the economic cycle (Washington Post, 2026; CNN, 2026).

The stronger payroll number reduces near-term recession fears, but it does not eliminate pressure on households. Oil prices remain more than 50% higher since the start of the year, while average gasoline prices are hovering above $4.55 per gallon, continuing to weigh on consumers and inflation expectations (NBC, 2026). At the same time, inflation, food costs, rent, and borrowing expenses continue pressuring lower- and middle-income households that spend a larger share of income on essentials (Bloomberg, 2026). Average hourly wages continued growing at a relatively solid 3.6% annual pace, but many households may still not feel financially stronger because wage gains are increasingly being absorbed by higher living costs (NBC, 2026).

Overall, the April report reinforces the idea that the economy is slowing, but still resilient. Healthcare led hiring with 37,000 new jobs, while transportation and warehousing added 30,000 jobs, and retail added 22,000 (NBC, 2026). However, the labor market also showed signs of softness beneath the headline numbers. The number of workers employed part-time for economic reasons rose by 445,000 to 4.9 million, while the information technology sector lost 13,000 jobs (NBC, 2026). A stable unemployment rate gives the Federal Reserve less urgency to cut interest rates quickly, especially while inflation remains elevated. The main risk is that consumer sentiment continues weakening even as employment stays stable, since prolonged price pressure can reduce discretionary spending and create earnings pressure for consumer-facing businesses (CNN, 2026; Bloomberg, 2026).

3. Strategic Petroleum Reserve Release

The United States moved to release 53.3 million barrels of oil from the Strategic Petroleum Reserve (SPR) under a coordinated International Energy Agency (IEA) agreement aimed at stabilizing global energy markets after the Iran war and disruptions around the Strait of Hormuz tightened oil supply (Reuters, 2026; Al Jazeera, 2026). Because the IEA coordinates emergency energy actions among major economies, the release is part of a broader international effort to increase supply, ease price pressure, and restore confidence in energy markets rather than a purely domestic measure. 

The SPR is the U.S. emergency oil reserve, stored in underground salt caverns and designed to protect the economy during severe supply disruptions (Department of Energy, 2026). The reserve remains one of the world’s most important energy buffers, while China’s large strategic reserves have also become increasingly important given the country’s role as a major oil importer and buyer of Iranian crude (Reuters Graphics, 2026). In the current environment, oil reserves are acting not only as emergency tools, but also as instruments of energy diplomacy amid rising risks around the Strait of Hormuz. 

Despite the release plan, oil prices remained elevated as markets continued pricing in geopolitical risk and uncertainty around global supply flows. Brent crude reached $110.87 per barrel on May 13 (Fortune, 2026). At the same time, U.S. inflation accelerated to 3.8% in April, the highest level since May 2023, driven largely by rising energy, food, and housing costs linked to the Iran conflict and disruptions around Hormuz (BBC, 2026). In the United States, rising fuel costs also pushed airfares up 20.7% year-over-year, while wage growth slowed to 3.6%, meaning wage growth is no longer outpacing inflation (BBC, 2026). 

The additional oil supply may help reduce extreme short-term price spikes, but it does not eliminate the core issue: military conflict near one of the world’s most important shipping routes continues to create supply uncertainty. The likely near-term effect is reduced extreme downside risk in energy markets, but continued volatility across sectors sensitive to fuel costs, including airlines, trucking, chemicals, manufacturing, and consumer goods (EIA, 2026; WCNC, 2026). Rising inflation also reduces the Federal Reserve’s flexibility to cut interest rates, increasing pressure on both policymakers and consumers ahead of the U.S. midterm elections (BBC, 2026).