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China’s economy showed signs of slowing in July as factory output and retail sales slowed and housing prices dropped further, according to data released Friday.Uncertainty over tariffs on exports to the United States is still looming over the world’s second-largest economy after President Donald Trump extended a pause in sharp hikes in import duties for 90 days, beginning Monday, following a 90-day pause that began in May.As officials worked toward a broader trade agreement, China reported earlier that its exports surged 7.2% in July year-on-year, while its imports grew at the fastest pace in a year, as businesses rushed to take advantage of the truce in Trump’s trade war with Beijing.But that also reflected a lower base for comparison, and manufacturers have slowed investments, hiring and production as they watch to see what comes. Chinese manufacturers also have ramped up shipments to Southeast Asia, Africa and other regions to help offset lost business in the U.S.“Exports remained a bright spot although the boost from front-loading appears to be tapering off and has started to show up in weak industrial production, as we anticipated,” Oxford Economics’ Sheana Yue wrote in a report.China also has been enduring flooding from torrential seasonal rains that have disrupted business activity in many parts of the country.The statistics bureau’s report said the economy had shown “notable resilience and vitality against the complex and volatile external environment and adverse impacts from extreme domestic weather.”Annual growth in industrial output slowed to 5.7% in July from 6.8% in June, the National Bureau of Statistics said. That was an 8-month low.Investments in factory equipment and other fixed assets rose a meager 1.6% in January-July, compared with 2.8% growth in the first half of the year.“Chinese economic activity slowed across the board in July, with retail sales, fixed asset investment, and value added of industry growth all reaching the lowest levels of the year,” Lynne Song of ING Economics said in a report.Property investments plunged 12% in the first seven months of the year, with residential housing investment dropping nearly 11%.Prices for newly built housing in major cities fell 1.1%, as a prolonged downturn in the property industry lingered.Yue of Oxford Economics said prices could continue to fall before stabilizing in 2028.The meltdown in the housing market hit just as the COVID -19 pandemic began, sapping one of the economy’s main drivers of growth and causing dozens of developers to default on their debts.The crisis rippled throughout the economy, destroying jobs for millions of people.The government has sought to ensure that most housing that was paid for gets built, but sales remain weak despite a series of moves meant to entice families into back into the market.Since most Chinese families have their wealth tied up in property, the anemic housing market has been a major factor crimping consumer spending. In July, retail sales rose 3.7%, the slowest rate in seven months and down from a 4.8% increase in June.The unemployment rate rose to 5.2% from 5% as university graduates began looking for work.While consumer prices rose 0.4% in July from the month before, prices at the wholesale level slipped 3.6% from a year earlier in another indicator of relatively weak demand. Shihuan Chen in Beijing contributed to this report. Elaine Kurtenbach, AP Business Writer
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A senior lawyer in Australia has apologized to a judge for filing submissions in a murder case that included fake quotes and nonexistent case judgments generated by artificial intelligence.The blunder in the Supreme Court of Victoria state is another in a litany of mishaps AI has caused in justice systems around the world.Defense lawyer Rishi Nathwani, who holds the prestigious legal title of King’s Counsel, took “full responsibility” for filing incorrect information in submissions in the case of a teenager charged with murder, according to court documents seen by The Associated Press on Friday.“We are deeply sorry and embarrassed for what occurred,” Nathwani told Justice James Elliott on Wednesday, on behalf of the defense team.The AI-generated errors caused a 24-hour delay in resolving a case that Elliott had hoped to conclude on Wednesday. Elliott ruled on Thursday that Nathwani’s client, who cannot be identified because he is a minor, was not guilty of murder because of mental impairment.“At the risk of understatement, the manner in which these events have unfolded is unsatisfactory,” Elliott told lawyers on Thursday.“The ability of the court to rely upon the accuracy of submissions made by counsel is fundamental to the due administration of justice,” Elliott added.The fake submissions included fabricated quotes from a speech to the state legislature and nonexistent case citations purportedly from the Supreme Court.The errors were discovered by Elliott’s associates, who couldn’t find the cases and requested that defense lawyers provide copies.The lawyers admitted the citations “do not exist” and that the submission contained “fictitious quotes,” court documents say.The lawyers explained they checked that the initial citations were accurate and wrongly assumed the others would also be correct.The submissions were also sent to prosecutor Daniel Porceddu, who didn’t check their accuracy.The judge noted that the Supreme Court released guidelines last year for how lawyers use AI.“It is not acceptable for artificial intelligence to be used unless the product of that use is independently and thoroughly verified,” Elliott said.The court documents do not identify the generative artificial intelligence system used by the lawyers.In a comparable case in the United States in 2023, a federal judge imposed $5,000 fines on two lawyers and a law firm after ChatGPT was blamed for their submission of fictitious legal research in an aviation injury claim.Judge P. Kevin Castel said they acted in bad faith. But he credited their apologies and remedial steps taken in explaining why harsher sanctions were not necessary to ensure they or others won’t again let artificial intelligence tools prompt them to produce fake legal history in their arguments.Later that year, more fictitious court rulings invented by AI were cited in legal papers filed by lawyers for Michael Cohen, a former personal lawyer for U.S. President Donald Trump. Cohen took the blame, saying he didn’t realize that the Google tool he was using for legal research was also capable of so-called AI hallucinations.British High Court Justice Victoria Sharp warned in June that providing false material as if it were genuine could be considered contempt of court or, in the “most egregious cases,” perverting the course of justice, which carries a maximum sentence of life in prison. Rod McGuirk, Associated Press
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World shares are generally higher after most stocks on Wall Street fell following a disappointing report that said inflation was worse last month at the U.S. wholesale level than economists had expected.The future for S&P 500 gained 0.2% while that for the Dow Jones Industrial Average went up 0.8%. Meanwhile, oil prices slipped.In early European trading, Germany’s Dax rose 0.4% to 24,479.85. Britain’s FTSE 100 was down less than 0.1%. In Paris, the CAC 40 added 0.7% to 7,924.10.China reported data showing its economy was feeling pressure from higher U.S. tariffs in July, while property investments fell further.Retail sales rose 3.7% year-on-year, down from 4.8% in June, while investments in factory equipment and other fixed assets rose a meager 1.6%, compared with 2.8% growth in January-June.Uncertainty over tariffs on exports to the United States is still looming over manufacturers after President Donald Trump extended a pause in sharp hikes in import duties for 90 days following a 90-day pause that began in May.The Shanghai Composite index added 0.8% to 3,696.77, but Hong Kong’s Hang Seng index fell 1.2% to 25,216.45.“Chinese economic activity slowed across the board in July, with retail sales, fixed asset investment, and value added of industry growth all reaching the lowest levels of the year. After a strong start, several months of cooling momentum suggest that the economy may need further policy support,” ING Economics said in a market commentary.In Japan, the Nikkei 225 gained 1.7% to 43,378.31 after the government reported that the economy grew at a 1% annual pace in the April-June quarter. That was better than analysts had expected.Elsewhere in Asia, Australia’s S&P/ASX 200 rose 0.7% to 8,938.60. Taiwan’s TAIEX gained 0.4% while India’s BSE Sensex edged 0.1% higher.Attention later Friday will likely focus on an update on U.S. retail sales and on a meeting between U.S. President Donald Trump and Russian President Vladimir Putin.On Thursday, seven out of every 10 stocks within the S&P 500 fell, though the index edged up by less than 0.1% to set another all-time high. The Dow Jones Industrial Average dipped 11 points, or less than 0.1%, and the Nasdaq composite fell less than 0.1% from its record set the day before.The inflation report said that prices jumped 3.3% last month at the U.S. wholesale level from a year earlier. That was well above the 2.5% rate that economists had forecast, and it could hint at higher inflation ahead for U.S. shoppers as higher costs make their way through the system.The data led traders to second guess their widespread consensus that the Federal Reserve will cut interest rates at its next meeting in September. Lower rates can boost investment prices and the economy by making it cheaper for U.S. households and businesses to borrow to buy houses, cars or equipment, but they also risk worsening inflation.Higher interest rates drag on all kinds of companies by keeping the cost to borrow high. They can hurt smaller companies in particular because they often need to borrow to grow. The Russell 2000 index of smaller U.S. stocks tumbled a market-leading 1.2%.Thursday’s disappointing data followed an encouraging update earlier in the week on prices at the consumer level. A separate report on Thursday, meanwhile, said fewer U.S. workers applied for unemployment benefits last week. That’s a good sign for workers, indicating that layoffs remain relatively low at a time when job openings have become more difficult to find.But a solid job market could also give the Fed less reason to cut interest rates in the short term.Big Tech stocks helped mask Wall Street’s losses. Amazon rose 2.9% to add to its gains from the prior day when it announced same-day delivery of fresh groceries in more than 1,000 cities and towns.Because Amazon is so huge, with a market value of $2.45 trillion, the movements for its stock carry much more weight on the S&P 500 than the typical company’s.In other dealings early Friday, U.S. benchmark crude lost 8 cents to $63.88 per barrel. Brent crude, the international standard, fell 11 cents to $66.73 per barrel.The dollar edged lower to 146.86 Japanese yen from 147.20 yen. The euro rose to $1.1682 from $1.1654. AP Business Writer Stan Choe contributed. Teresa Cerojano, Associated Press
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