Transcript of Stakes of Trump's China Trip, Inflation Report Shows War Impact, Hantavirus Science

President Trump is leaving for Beijing today for a state visit with China's President Xi Jinping.

One analyst says it'll look polite on the surface, but it'll be a rugby match underneath. Trade is on the agenda, so is the war in Iran.

I'm Michelle Martin. That's A. Martinez. And this is Up First from NPR News. A new inflation report out this morning will show just how much the war in Iran is impacting consumers. The blockage of the Strait of Hormuz has driven gas prices up. Airline tickets are also climbing, have weighed The beaches kept up.

And public health officials say the hantavirus outbreak that started on a cruise ship is not the next COVID, but there's still no vaccine and no specific treatment for it. We'll hear how the virus spreads. Stay with us. We've got the news you need to start your day.

President Trump says he has a great relationship with China's President Xi Jinping. That relationship will be put to the test this week during Trump's visit to Beijing.

Look, I respect him a lot, and hopefully he respects me.

That was Trump Monday in the Oval Office. The White House is keeping expectations for the trip tame. Trade is a major agenda item, but the war with Iran is also likely to get attention.

NPR senior political correspondent Tamara Keith is on the line with us now before traveling to China on Air Force One. Good morning, Tam.

Good morning.

So what is Trump looking to get out of this trip?

Well, China is known for putting on a spectacular show for visiting leaders, which is something Trump clearly wants, and is likely to get. There will be bilateral meetings, a tea, a grand banquet, and a no doubt spectacular welcome ceremony at the Great Hall of the People. This is what Trump said about his expectations earlier this year.

I mean, that's going to be a wild one. I said, but we have to put on the biggest display you've ever had in the history of China. You know, last time I went to China, President Xi, he treated me so well.

Now, in terms of substance, that is less clear. The White House says Trump intends to deliver more good deals on behalf of the country to rebalance trade with China. They are expected to discuss the idea of a U.S.-China Board of Trade, which would represent a further cooling of what had been a very active and escalating trade war during Trump's first year back in office.

So what might be in those deals that the White House is talking about?

Observers expect China to announce purchases of additional soybeans and other farm products, and maybe even Boeing airplanes. Announcing big purchase is a trademark of Trump foreign trips, but these things have often turned out to be less than meets the eye. More than a dozen big-name corporate executives are traveling as part of the U.S. delegation, including Apple's Tim Cook, Tesla's Elon Musk, and Kelly Ortberg, the CEO of Boeing. But Melanie Hart, the senior director of the Global China Hub at the Atlantic Council, says there are still meetings happening this week to lay the groundwork for Trump's trip.

Everything is still in flux at this point. Normally, at least the economic deliverables would be nailed in. That is not the case. So this is going to be evolving up until the last minute.

She says this summit will look polite on the surface, but tactically it's going to be a rugby match with both sides grappling for advantage.

That's— that is quite an image. But what are they grappling over?

What are they not grappling over? The experts I've spoken to say both sides want to stabilize the relationship, otherwise this visit wouldn't have gone ahead in the shadow of the Iran War, but they have very different goals. Dennis Wilder is a professor at Georgetown University who was a top adviser on China to President George W. Bush.

The world's greatest power, the world's greatest emerging power inevitably are in conflict, and particularly because the value systems are so different.

While other presidents scolded Xi about human rights and warned him to leave Taiwan alone, Trump has at least publicly been more focused focused on deals and admiration for the power that President Xi wields within China. It's worth noting this is just the first of what could be 4 meetings between the leaders this year, depending on how this one goes.

That's NPR's Tamara Keith. Tam, thank you, and safe travels.

You're welcome.

A new report on inflation this morning shows just how much the war with Iran is affecting consumer prices.

Inflation surged 3.8% in April from a year ago. That's the highest annual reading in about 3 years.

We'll speak with Chicago Fed President Austan Goolsbee about what that increase means for the broader economy and interest rates. But first, NPR's Scott Horsley is here with all the details. Scott, energy prices are spiking because oil is just not getting out of the Strait of Hormuz. How is that affecting the overall cost of living?

Yeah, we've all seen the impact at the gas pump. AAA says the average price of regular gasoline today is up to $4.50 a gallon. That's about a buck and a half more than it was before the war began.

Again.

And that is a significant driver of inflation in April, just as it was in March. As you all said, the overall cost of living is up 3.8% last month from a year ago, the biggest annual increase since May of 2023.

$6.15 in California, Scott, just saying. All right. So what kind of ripple effects are those high energy prices having?

One of the most obvious side effects is the jump in the cost of airline tickets and bag fees. Ticket prices are up more than 20% from a year ago. Airlines are having to pay a lot more for jet fuel and they are passing that cost on to their customers. Ultimately, the high cost of diesel fuel could affect the price of everything that gets delivered by truck or train. Grocery prices, for example, jumped about 0.7% last month alone. Now, Josh Hirt, who's a senior economist at Vanguard, says a lot's going to depend on how long this wartime price spike lasts.

To really start bleeding through into, you know, more wide-scale use in the economy, we don't anticipate seeing that unless we really had a prolonged period of higher energy prices.

Right now, diesel costs, uh, are up about $2 a gallon since the war began. Businesses can absorb those higher transportation costs for only so long before they start to show up in the price of other goods.

Is the war the only factor pushing inflation higher?

No, it's, it's the biggie, but there are other things going on as well. Today's report shows housing costs rose about twice as fast in April as the month before. That's big because housing is such a major component of the government's overall cost of living index. Some of that April increase is real, but some is a statistical quirk that stems from the government shutdown last fall. Remember, there was a gap in the inflation data in October, and so housing inflation has looked artificially low for a while. Hirt says, by contrast, today's report is payback for that.

We would look at that largely as catch-up for the underreporting, you know, that we had in October. We would expect it to start to revert back and normalize next month.

So take that spike in housing prices today with a grain of salt.

Okay, now the Federal Reserve has been trying for years now to bring down inflation. It's moving up again. So I mean, how worrisome is all that?

Yeah, this is not exactly the welcome mat that Kevin Warsh, President Trump's pick to be the new leader of the Fed, was hoping for. Unfortunately for Warsh and his colleagues, there's not a whole lot they can do to address this energy supply shock given their limited toolkit. Ordinarily, the Fed uses higher interest rates to fight inflation. But, you know, higher interest rates don't free up tanker traffic in the Strait of Hormuz or boost the supply of jet fuel. Of course, President Trump has been lobbying being the central bank to lower interest rates. That's looking less likely now. We might see a rate cut if it looked as if the job market were falling apart. But the jobs report we got last week showed no sign of that. Employers added 115,000 jobs in April. So for now, I think the Fed is likely to just keep interest rates steady where they are. By the way, that jobs report last week showed that average wages in April were up 3.6% from a year ago. Today's cost of living report tells us all of those wage gains over the last year have now been gobbled up by higher prices.

That's NPR's Scott Horsley. Scott, thanks a lot.

You're welcome.

The hantavirus outbreak that started on a cruise ship is not the next COVID. Now, that's according to public health experts.

The risk to the public at large is extremely low, but this is a transmissible disease and, of course, a worry to the ship's passengers.

NPR's Gabriella Emanuel joins us. So why are experts saying this is not the next COVID?

The biggest reason is hantavirus does not spread from one person to another that easily. Now, people usually get it when they inhale virus particles from infected rodent feces, urine, or saliva. But when it does spread from one person to the next, you need to be in quite close contact. So think of a household or a nurse caring for a patient. Although I should note from one well-documented outbreak in Argentina a few years back, we do know that it has the potential to spread in settings like a birthday party or a funeral. Scott Weaver of the University of Texas Medical Branch told me that if there are no precautions taken, then one person will spread it to two other people on average. Compare that with COVID where the number has changed over time, but it has risen above 10 people. And for measles about 15 other people get it from one case on average. So Weaver's confident this hantavirus outbreak can be contained.

This is pretty close to the lower end of infectiousness, but it's high enough that we do have to take these kind of measures to prevent further spread.

Measures like monitoring, masking, handwashing. And another distinction from COVID: the time between being exposed to the virus and becoming contagious and sick is long, often multiple weeks. That can be annoying because you have to watch for symptoms, but it gives medical experts time to get a handle on the outbreak.

All right, so not the next COVID, but how serious is it for people who have it?

It's, it's serious. In this outbreak, we have 9 cases so far, 3 deaths according to the World Health Organization. Authorities say in general between 30 and 40% of patients die. Basically what happens is their lungs fill up with fluid. However, that fatality rate is likely significantly lower because many mild cases go detected, but it's still a big percentage and there's no vaccine or specific treatment. And another thing that makes this virus serious is the early symptoms are very generic flu-like symptoms like a fever or muscle aches, meaning it can be hard to know when you need to isolate and get medical attention.

What else do we know about how it spreads?

Yeah, so it starts spreading right around the onset of symptoms and in very close contact, yet scientists can't say definitively if it's droplets in the air or the virus lives on surfaces. What we do know is this hantavirus does not attack the upper respiratory tract or even respiratory cells as much as it attacks the blood vessels, which impact the lungs in the lower respiratory tract. That's likely part of why it does not transmit as easily as, say, the common cold. But scientists still need to learn more. Dr. Weaver actually had a grant from the federal government to study hantavirus. And the grant was terminated last May by the Trump administration. That worries Weaver. He says more investment, not less, is needed.

You mentioned an outbreak in Argentina a few years ago. What was learned then?

It happened in 2018-2019, and one man spread the virus to 33 other people with 11 deaths total. So deadly but not huge. Researchers found that the genetic makeup of that virus Hantavirus was almost exactly the same as in an outbreak two decades earlier, meaning this hantavirus does not seem to mutate quickly. That's good news insofar as it's a known virus and with the right public health precautions, it shouldn't spread too far.

That's NPR's Gabriella Emanuel. Thank you very much.

Thank you.

And that's Up First for Tuesday, May 12th. I'm Emi Martinez.

And I'm Michelle Martin. Today's episode of Up First was Edited by Rebecca Metzler, Raphael Nam, Gisele Grayson, Mohammed El Bardisi, and Olivia Hampton. It was produced by Ziad Butch and Nia Dumas. Our director is Christopher Thomas. We get engineering support from Nisha Hynes. Our technical director is Carly Strange. And our supervising senior producer is Vince Pierson. We hope you'll join us again tomorrow.