China to Allow Couples to Have Three Children

The Chinese government will now allow married couples to have up to three children as the country aims to stem off demographic imbalance and population decline.

In the announcement, the government also vowed to provide educational and child rearing assistance, both commonly seen as barriers for couples who desire more children. 

Since 2015, China has allowed all couples to have up to two children as the population has continued to age. In addition, there are concerns over the gender imbalance, as the traditional bias for male offspring has led to more males being born than females.

 

Belarus Diverts Flight to Arrest Dissident on Board

 A Ryanair flight from Athens, Greece to Vilnius, Lithuania was diverted on May 23 after a Belarussian fighter jet intercepted the plane. Using the pretense of a bomb threat, the plane landed in Minsk, the capital of Belarus, and journalist Roman Protasevich and his girlfriend were arrested. Protasevich is a known critic of Alexander Lukashenko, the authoritarian leader of Belarus who has led the country since independence from the Soviet Union.

The other passengers of the flight were eventually allowed to depart on the plane, which reached Vilnius  over eight hours behind schedule.

The European Union has banned flights from flying through Belarussian airspace in response to the incident, which has been widely called a violation of international law.

Belarus, sometimes called the last dictatorship in Europe, is known for its restrictive laws and its strongman rule by Lukashenko. Lukashenko faced massive protests calling for his resignation after the presidential election in 2020, which was clouded by allegations of widespread fraud.

 

Rising Prices Raise Inflation Concerns

The Federal Reserve reported that the personal consumption expenditure index (PCE), which measures the prices of consumer goods minus food and energy, rose at a 3.1% annualized rate in April, an increase from 1.9% in March. This was higher than the expected 2.9% increase.

If one were to include food and energy prices, inflation rose to 3.6% in April, up from 2.4% in Match.

The Federal Reserve has tried to allay fears of rising inflation, blaming it on supply-chain bottlenecks and the large fiscal stimulus, which they believe are temporary factors. In addition, the inflation is starting from a relatively low base line, as price increases were low during the coronavirus lockdown and related economic downturn.

The Biden administration, which has proposed trillions in additional spending, has signaled they believe that they can continue the large amounts of fiscal stimulus without drastically raising inflation. Republicans have countered that the additional money pumped into the economy could lead to even higher prices.

The US is not alone in facing inflation risk. Germany reported a 2.4% inflation rate for May. Spain also experienced the same inflation rate for May.

Markets overall have responded negatively to the news of increased inflation. While US markets have stabilized in the past few days, increased volatility in equity markets worldwide have continued. Cryptocurrency markets have also seen sharp declines from their previous highs, though other factors besides inflation worries are likely at play.