Putnam Investments named Social Media Leader of the year at Mutual Fund Industry Awards

BOSTON, April 27, 2016Putnam Investments was named the first-ever recipient of the Social Media Leader of the Year Award at the 23rd Annual Mutual Fund Industry Awards ceremony held last night in New York City. The new award category honors a firm that demonstrates leadership in social media through observations, insights and engagement with clients and the general public.

“Social media has become a critically important communication tool for asset management firms to interact with all stakeholders in the marketplace,” said Robert L. Reynolds, Putnam Investments President and Chief Executive Officer. “We take great pride both in being the first recipient of this award and in the acknowledgement of our leadership in developing an innovative, ever-evolving social media program that has become an integral part of the firm’s culture. Our social media efforts span the entire advisor and investor experience as we work each day to help clients and investors succeed.”

Putnam was recognized for the social media program that began in 2009 with the company’s launch of its presence on Facebook and Twitter. Reynolds embraced the emerging communications platforms and began tweeting @RobertLReynolds, becoming one of the very first financial services CEOs with an active Twitter presence. Putnam immediately began expanding its outreach, building out a robust social media program unique in the industry in terms of its depth and innovation, focused on branding, marketing and communications outreach, as well as industry leadership.

With a corporate presence on Twitter, LinkedIn, Facebook, YouTube ,Instagram, Google+ and three standalone blogs, Putnam presents a balanced and humanized portrait of its brand to advisors and investors.

Putnam identified a need among financial advisors to understand the emerging importance of social media as a business-building tool and, in response, developed key practice management offerings, including best practice seminars on the use of LinkedIn and other social platforms; a series of online resources and tools; one-on-one training and continuing discussions; and video vignettes on Putnam’s Advisor Tech Tips blog.

In 2014, Reynolds was named a LinkedIn Influencer, joining a select group of CEOs, political figures, entrepreneurs and other influential leaders who provide compelling commentary and professional insights on a variety of subjects. Reynolds currently has more than 130,000 followers on LinkedIn.

In addition to offering informative content marketing, robust practice management tools, customer service and advisor support, Putnam’s social media outreach communicates the firm’s commitment to thought leadership in the social sphere. The 2015 Putnam Social Advisor Study, an in-depth survey of more than 800 financial advisors, represented the third edition of the firm’s groundbreaking benchmarking of advisors’ use of social media in their practices.

Putnam has been widely recognized for developing and adopting best practices in social media, including being ranked #1 in 2014 by kasina, a leading industry observer, for the firms’ leadership and outreach in this area.

About the Awards
The annual Mutual Fund Industry Awards recognize the funds, fund leaders, marketers, trustees and independent counsel who stood out for their successes, achievements and contributions in 2015. Winners are selected by the editorial staff of Fund Action and Fund Directions based on their extensive industry-wide due diligence. The editorial staff draws on market intelligence as well as input from the industry garnered through an annual call for nominations when making their selections.

Putnam Investments Wins Lipper Awards for Five Funds

BOSTON, March 23, 2016Putnam Investments announced today that five of its mutual funds received 2016 Lipper Fund Awards in recognition of consistently strong risk-adjusted performance relative to their peers over periods of three or more years.

The Putnam funds honored at the Thomson Reuters Lipper Alpha Forum and Fund Awards ceremony held in New York City last night, and the performance periods for which they were recognized include:

  • Putnam Capital Spectrum Fund Y (PVSYX) — 5 years
  • Putnam Absolute Return 700 Fund Y (PDMYX) — 5 years
  • Putnam RetirementReady 2045 Fund Y (PRVYX) — 3 years
  • Putnam RetirementReady 2050 Fund Y (PRRUX) — 3 and 5 years
  • Putnam RetirementReady 2055 Fund Y (PRTLX) — 3 and 5 years

“Our talented investment teams have made winning for our clients a tradition at Putnam and we are honored to receive these 2016 Lipper Awards which recognize superior long-term investment performance,” said Robert L. Reynolds, Putnam Investments President and Chief Executive Officer.

Putnam Capital Spectrum Fund Y (PVSYX), managed by David L. Glancy, was honored for its top risk-adjusted performance relative to 256 peers in the Lipper Flexible Portfolio Funds category for the five-year period ended November 30, 2015. The fund invests in the total return opportunities of leveraged companies, targeting the investment potential of companies that use a significant amount of debt in their capital structure to achieve their business goals. This is the fourth consecutive year that Putnam Capital Spectrum Fund has received a prestigious Lipper Award.

Putnam Absolute Return 700 Fund Y (PDMYX) was honored for its top risk-adjusted performance relative to 78 peers in the Lipper Absolute Return Funds category for the five-year period ended November 30, 2015. The fund, which invests dynamically in bonds, stocks and/or alternative asset classes worldwide, seeks an annualized total return of seven percent above inflation as measured by U.S. Treasury bills over a period of three years or more. James A. Fetch; Robert J. Kea, CFA; Robert J. Schoen; and Jason R. Vaillancourt, CFA manage Putnam Absolute Return 700 Fund.

Putnam RetirementReady 2045 Fund Y (PRVYX) was honored for its top risk-adjusted performance relative to 130 peers in the Lipper Mixed-Asset Target 2045 Funds category for the three-year period ended November 30, 2015. Managed by James Fetch, Robert Kea, Robert Schoen and Jason Vaillancourt, the fund seeks to provide capital appreciation and current income consistent with a decreasing emphasis on capital appreciation and an increasing emphasis on current income as it approaches its 2045 target date.

Putnam RetirementReady 2050 Fund Y (PRRUX), managed by James Fetch, Robert Kea, Robert Schoen and Jason Vaillancourt, was honored for its top risk-adjusted performance in the Lipper Mixed-Asset Target 2050 Funds category for both the three- and five-year periods ended November 30, 2015, when measured against 146 peers and 113 peers, respectively. The fund seeks to provide capital appreciation and current income consistent with a decreasing emphasis on capital appreciation and an increasing emphasis on current income as it approaches its 2050 target date.

Putnam RetirementReady 2055 Fund Y (PRTLX), managed by James Fetch, Robert Kea, Robert Schoen and Jason Vaillancourt, was honored for its top risk-adjusted performance in the Lipper Mixed-Asset Target 2055+ Funds category for both the three- and five-year periods ended November 30, 2015, when measured against 95 peers and 36 peers, respectively. The fund seeks to provide capital appreciation and current income consistent with a decreasing emphasis on capital appreciation and an increasing emphasis on current income as it approaches its 2055 target date.

About the Lipper Fund Awards
For more than three decades, the Lipper Fund Awards program honors funds that have excelled in delivering consistently strong risk-adjusted performance, relative to peers. The Lipper Fund Awards take place in more than 20 countries in Asia, Europe, Middle East and North Africa region (MENA) and the Americas. The award winners are formally announced between January and April. Ceremonies take place in select countries.

Lipper Rankings (as of 2/29/16)

  1 year 3 years 5 years 10 years
Putnam Capital Spectrum Fund Y (PVSYX)  90%
(512 / 569)
(7 / 420)
(1 / 287)
Putnam Absolute Return 700 Fund Y (PDMYX)  55%
(154 / 280)
(51 / 165)
(9 / 86)
Putnam RetirementReady 2045 Fund Y (PRVYX)  32%
(55 / 174)
(5 / 131)
(5 / 91)
(7 / 12)
Putnam RetirementReady 2050 Fund Y (PRRUX)  41%
(79 / 192)
(3 / 144)
(5 / 115))
(2 / 14)
Putnam RetirementReady 2055 Fund Y (PRTLX)  52%
(107 / 206)
(3 / 102)
(6 / 43)

Lipper rankings for class Y shares are based on total return without sales charge relative to all share classes of funds with similar objectives as determined by Lipper. Past performance is not indicative of future results.

Years of declining budget deficits coming to a close

Today, the national debt exceeds $18 trillion and is expected to grow as six years of declining federal budget deficits come to an end this year, according to a recent analysis from the Congressional Budget Office (CBO).

Even with a growing economy, revenues coming into the government’s coffers will not keep pace with spending, especially given significant mandatory expenditures. At the same time, today’s tax rates are significantly lower than 50 years ago. In fact, the highest marginal tax rate has hovered around 35% most of the time since the mid-1980s.

The nation’s debt

The total national debt — money owed by the United States and measured by the value of outstanding Treasury securities — was $18.9 trillion as of January 20, 2016, the Treasury Department reported. The nation’s debt has more than doubled since 2007.

Budget deficit to increase in 2016

The federal budget deficit, which represents the shortfall between government revenue and spending for one year, totaled $439 billion — or 2.5% of GDP — in 2015. This represented the lowest level since 2007 and, in percentage of GDP, was below the average deficit over the past 50 years. Fiscal year 2015 was the sixth straight year that the deficit had declined as a percentage of GDP since it peaked in 2009.

In its January 19, 2016 update, the CBO stated that the deficit will increase for the first time since 2009. The projection is for a $544 billion deficit, representing 2.9% of GDP.

Calendar issue

A portion of the increase — about $43 billion — is due to the timing of the fiscal year on the calendar. In 2016, October 1, which is the first day of fiscal year 2017, falls on a weekend. Certain government payments that would ordinarily be made in fiscal year 2017 will be made on the last day of fiscal year 2016. If it were not for the calendar issue, the 2016 deficit would still increase but would total $500 billion or 2.7% of GDP, the CBO noted.

New legislation

The CBO’s January outlook is $130 billion higher than its August projection of $426 billion. The increase is largely due to bills that became law after August, including the retroactive extension of a number of tax provisions.

The deficit would also cause an increase in the national debt to about 76% of GDP by the end of 2016, reflecting an increase of two percentage points compared with last year, the report noted.

Entitlement programs pose challenges for federal budget

Federal spending is projected to rise by 6% this year, largely due to a nearly 7% increase in mandatory spending, a 3% increase in discretionary spending, and a 14% increase in net interest spending.

A significant portion of mandatory spending is Social Security, which is expected to increase by 3% this year. Other major sources of mandatory program spending include Medicare, Medicaid, the Children’s Health Insurance Program, as well as the cost of health-insurance subsidies, which are expected to be 11% higher in 2016 than in 2015, according to the CBO.

Other pressures on the budget include discretionary spending, where discretionary spending for national defense will increase slightly and non-defense spending will rise 4%. The biggest jump is in net interest spending resulting from the rising-interest-rate environment and the fact that the federal debt is growing.

Revenues to rise

Federal revenues are expected to rise by only 4% in 2016. And CBO projections indicate expenditures will outpace revenue for the next decade.

If current laws remain unchanged, the deficit is expected to grow over the next 10 years, and by 2026 it would be larger than its average over the past 50 years, the CBO stated. The budget deficit is expected to increase modestly through 2018 but then rise more sharply, reaching $1.4 trillion in 2026. As a percentage of GDP, the deficit would climb to about 4.9% by the end of the 10-year period.

Entitlement programs remain challenged

Social Security is the largest single program in the federal budget, the CBO points out. As U.S. life expectancy increases, more and more Americans qualify for benefits. In fiscal year 2015, Social Security benefits totaled nearly one quarter of all federal spending. According to CBO projections, Social Security’s trust funds will be exhausted in 2029. At that point, the result would be a 29% reduction in benefits.


Putnam Investments Launches Major Effort To Help Financial Advisors “Maneuver In Markets”

BOSTON, January 20, 2016Putnam Investments today announced it is launching a multi-faceted program to help advisors — and their clients — navigate some of the most vexing challenges of today’s financial markets, as investors confront low interest rates, highly volatile markets and geopolitical instability.

Named “Maneuver in Markets,” the broad-based Putnam informational campaign is designed to provide the advisor community with an ongoing stream of timely observations and perspectives to create deeper understanding of the rapidly changing market environment and potential investment strategies to help clients achieve their key financial goals, despite prevailing headwinds.

“In recognizing that meticulous investment research and flexible management strategies are crucial to helping investors “maneuver in markets,” we will be bringing a new dimension to our dialogue with the marketplace this year,” said Robert L. Reynolds, President and CEO, Putnam Investments. “As a firm that has spent years piloting investors through virtually every type of investment climate, we are committing the full force of our resources and best thinking to help advisors steer their clients through these times.”

In discussing the “Maneuver in Markets” campaign, William T. Connolly, Co-Head of Global Distribution, Putnam Investments, said, “The high-quality, thoughtful advice dispensed by financial advisors has never been more important than it is today. Putnam recognizes that there is a critical need for new levels of insight on the drivers of current market conditions and how to solve for optimal outcomes. Advisors will be able to count on a steady flow of new, high-impact research, analysis and tools that they can apply to their work in guiding clients.”

The “Maneuver in Markets” program will largely center around four key challenges facing investors today:

  • Navigating interest rates: addressing client challenges with active rate strategies
  • Expanding short-term choices: preserving client options and capital
  • Diversifying to reduce risk: seeking to manage volatility and diversification
  • Pursuing greater returns: evaluating the performance potential of equities

Mark McKenna, Head of Global Marketing, Putnam Investments, indicated that there will be a frequent delivery of robust content to the marketplace — through a host of different vehicles — to support advisors and their clients on the most topical investment issues of the day. Primary components of the “Maneuver in Markets” program will include regular updates on www.putnam.com, thematic video commentary from portfolio managers, investment webinars, expert white papers on a range of topics, social media, and digital and print advertising.

The firm expects to have a series of updates on the program throughout the year.

Putnam Investments’ receives DALBAR Total Client Experience Award for fifth consecutive year

BOSTON, January 12, 2016Putnam Investments today was announced the recipient of the DALBAR Total Client Experience award for the fifth consecutive year, reflecting the firm’s dedication to delivering superior customer service to its retail mutual fund clients. As the sole recipient of the award, Putnam is being honored for providing quality, accuracy, and client security.

The award is based on DALBAR’s measurement of the complete experience of the customer, evaluating the level of professionalism that is demonstrated by the financial services firm’s personnel and the follow through — the accurate execution of transactions and requests while ensuring thorough security protocols.

“Putnam is pleased to receive this special recognition from DALBAR,” said Robert L. Reynolds, President and Chief Executive Officer, Putnam Investments. “Our firm’s longstanding commitment to creating an excellent client service experience is a chief priority of our work — each and every day — and reflective of our philosophy that the client always comes first.”

2015 marks the 26th consecutive year in which Putnam has received a DALBAR service quality award.

DALBAR, Inc., the nation’s leading financial services market research and consulting firm, is committed to raising the standards of excellence in the financial services industry. With offices in both the US and Canada, DALBAR develops standards for, and provides research, ratings, and rankings of intangible factors to the mutual fund, broker/dealer, life insurance, property and casualty, and managed account industries. Measurements include investor behavior, customer satisfaction, service quality, communications, Internet services, and financial professional ratings.

Putnam Investments to establish new headquarters in 2018 at 100 Federal Street

BOSTON, January 11, 2016Putnam Investments today announced that the firm’s Boston-based headquarters will be located at 100 Federal Street in the city’s financial district, with the move of personnel slated for 2018.

The firm has secured a 15-year lease agreement with Boston Properties for nearly 250,000 square feet of space — equating to 11 floors, along with a highly visible presence in the lobby and on the building’s facade. Putnam expects to have approximately 1,000 employees in the new facility after relocation, with flexibility to accommodate expected growth of the firm’s employee base in years to come.

“As a firm that takes great pride in its Boston heritage, Putnam Investments is extremely pleased to establish our global headquarters in a building that is a powerful presence on the city’s landscape, symbolizing the strength of the region’s financial services industry,” said Robert L. Reynolds, President and Chief Executive Officer, Putnam Investments.

Reynolds explained that it was a top priority to maintain and strengthen the firm’s nearly 80-year roots in Boston, which has long been considered a premier international city and a world-renowned center of education — with an extraordinarily deep talent pool, a thriving financial hub and a well-recognized quality of life.

“Our corporate headquarters has always been a reflection of our identity, sense of purpose and commitment to excellence, as we do our best each day to serve clients and deliver strong investment performance,” indicated Reynolds. “The 100 Federal Street location offers the ideal mix of modern, high-quality facilities in the heart of Boston’s financial district, with flexibility of space that will allow our firm to grow its onsite presence — as our business grows — over time.”

Putnam will be making the move to 100 Federal Street from its current headquarters, located at One Post Office Square, where the firm has been based since 1978. Presently, the firm leases over 240,000 square feet at the facility.

In addition to its downtown Boston location, Putnam maintains a sizable office north of the city in Andover, Massachusetts, which houses a number of key operations and functions for the firm. Putnam expects to continue to expand its Andover presence in future years.

Lower energy prices give consumers more to spend

With a slump in demand and a glut in supply, energy prices are hitting the lowest levels in more than a decade. Consumers are paying less to fill up their car as well as to heat their homes this winter.

This trend is likely to continue, according to weather and energy experts.

EIA: Expect a warmer winter

Particularly in the Northeast, residents are already experiencing higher-than-normal temperatures for December. The highlights from the latest “winter fuels outlook” from the U.S. Energy Information Administration (EIA) calls for a warmer winter and potential savings of up to 33% over last year on heating oil.

Just recently, the price of crude oil hit a record low below $35 a barrel and natural gas prices fell to a 14-year low on the cheaper crude and mild weather.

Oil prices have fallen by 50% since June 2014. U.S. oil production rose significantly over the past six years, and the growth in global demand has fallen. At the same time, OPEC has refused to cut production.

Consumers recently began paying close to $2.00 per gallon on average for gasoline. That price may go below $2.00 in the coming weeks. The EIA expects consumers to spend $750 less on gas this year because of the price drop.

Weather — not bills — heating up

Based on the latest forecasts from the National Oceanic and Atmospheric Administration (NOAA) temperatures east of the Rocky Mountains are likely to be warmer than last winter— with the Northeast 13% warmer, the Midwest 11% warmer, and the South 8% warmer.

About half of American homeowners use natural gas for heat and could see a 10% decrease in their gas bill this winter over last year,the EIA reported. That estimate could rise to 17% if the weather is 10% warmer than forecast. For propane, declining demand will probably result in an 18% savings for consumers, and 30% less expenditure if the weather warms up further.

Households using electricity for home heating are expected to save about 3% over last year on their bills, and 7% if it gets warmer.

The El Niño effect

Climate experts point to El Niño as the cause for the lower-than-normal warm weather. El Niño is created when the waters in the equatorial region of the Pacific Ocean get significantly warm. This year’s El Niño is among the strongest on record, and is expected to be the strongest in nearly two decades. The El Niño effect is altering the position of the Pacific jet stream, according to NOAA. The weather pattern is expected to produce cooler and wetter weather in the
Southern Plains and southeast, and above-average temperatures in the west and northern half of the United States, NOAA reported.

The winter will not be completely void of cold air snaps and snowstorms. But the frequency and number of storms cannot be predicted. On a positive note, California is likely to see some drought improvement, the report added.

Will first-quarter growth be affected?

Harsh winter weather did a lot of damage to properties and workers’ commutes in the past two winters. In the first quarter of 2015, a series of blizzards and colder-than-normal temperatures even affected U.S. growth. The Bureau of Economic Analysis (BEA) reported that GDP grew only 0.6% in the first quarter due, in part, to the weather conditions.

In 2014, harsh winter weather also had an impact on much of the country. U.S. GDP contracted 2.9% in the first quarter that year. The BEA reported that 19 out of 22 industry groups experienced a drop in economic activity and some of the leading industries were affected by the harsh winter weather. Agriculture, mining, construction, wholesale trade, and business services were among the declining industries.


Fed weighs key risks in decision

Comprehending the strength of the U.S. economic recovery from the Great Recession is a priority for the Federal Reserve as it continues to weigh whether an interest rate hike is appropriate and how it may affect future growth.

Rate increases have typically come in response to economic strength. This was the case in 1999-2000, when the Fed raised rates several times to temper inflationary pressure.

The U.S. economy posted robust growth numbers in the late 1990s, reaching GDP growth rates of 4.5% in 1997, 4.4% in 1998, and 4.7% in 1999 (Source: worldbank.org). In the same years, inflation remained fairly tame at 2.3%, 1.6%, and 2.2%, respectively. But the pick up in inflation between 1998 and 1999 caught the Fed’s attention, as did a string of record highs for the stock market, signaling possible “irrational exuberance” in stock prices, a concern that Fed Chair Alan Greenspan had raised in prior years.

The Fed considered raising rates in 1998, but chose not to make a move amid concerns about the impact of global events such as the Asian financial crisis and Russian default.

In 1999, however, the Fed decided to act. From June 1999 through July 2000, the Fed raised interest rates six times. During the period, the federal funds rate went from 4.75% to 6.5%.

On June 30, 1999, the Fed raised the federal funds rate by 25 percentage points to 5.0%.

Amid the rate increases, the stock market corrected. Prices began to tumble in July 1999, and the downturn lasted through October 1999, when stocks rebounded and finished the year with a strong rally.

In 2000, Fed rate hikes continued in February and March, bringing the federal funds rate to its highest level in nearly five years. Initially, stocks held up. The S&P 500 Index rose to 1,493.87, setting a record in March.

However, the issue of inflated stock valuations, particularly in the technology sector, remained a concern. Many stocks in the so-called ‘new economy’ or dot.com segment included start-up companies with weak revenues but generous market valuations. Fears about inflation also emerged when the CPI jumped 0.7% and core CPI rose 0.4% in March.

The dot.com bubble burst in March, beginning with a huge selloff in the Nasdaq. The Dow Jones Industrial Average and Nasdaq both experienced record-setting declines.

The final rate hike for the cycle came on May 16, 2000, with an increase of 50 percentage points to 6.5%. GDP growth slowed significantly in the third quarter.

By the beginning of 2001, the slowdown forced the Fed to reverse course and begin cutting rates. In a hasty retreat, the Fed cut rates by a full percentage point in two moves during January 2001. The Fed would follow with nine more cuts during the course of the year, bringing the federal funds rate down to 1.75%.

As the Fed was frantically slashing rates, the economy and stock market continued on their downward paths. In 2001, the United States entered a recession, bringing to an end its longest post-war economic expansion. The recession was relatively brief, lasting from March to November of 2001. For stocks, however, the consequences were more severe. Large-cap stocks continued to slump even after the economy began to recover. In sum, the S&P 500 Index posted negative results for three straight years: in 2000, amid the rate hikes; in 2001, amid the recession; and in 2002, in the early months of the recovery.

Fixed-income markets, on the other hand, fared better, as bullish conditions for high-quality assets continued.


Putnam Investments honored for service excellence by DALBAR for 26th consecutive year

BOSTON, December 8, 2015Putnam Investments announced today that for the 26th consecutive year, it has been honored by DALBAR for mutual fund service quality, reflecting industry- leading consistency and reliability. This continuous acknowledgement of Putnam’s work in this area includes being named DALBAR Mutual Fund Service Award winner for 24 years and the sole winner of DALBAR’s Total Client Experience Award for the past four years.

“Each time that our firm receives a DALBAR award, it is more special than the previous one,” said Putnam President and Chief Executive Officer, Robert L. Reynolds. “Putnam takes enormous pride in providing clients with the highest quality of service and is truly pleased to have this dedicated effort recognized.”

Added Reynolds, “Putnam’s culture of proactive, thoughtful and innovative communication and management has been one of the primary drivers in delivering a superior client service experience — surpassing industry standards — and serves as a true differentiator in the marketplace.”

For nearly three decades, DALBAR has conducted rigorous, systematic and yearlong testing of customer service based on industry benchmarks, and point to service that eclipses industry standards in the most important areas. The DALBAR Service Awards are given annually by DALBAR, Inc., a leading financial services market research and consulting firm to elite service providers.

DALBAR, Inc., the nation’s leading financial services market research and consulting firm, is committed to raising the standards of excellence in the financial services industry. With offices in both the US and Canada, DALBAR develops standards for, and provides research, ratings, and rankings of intangible factors to the mutual fund, broker/dealer, life insurance, property and casualty, and managed account industries. Measurements include investor behavior, customer satisfaction, service quality, communications, Internet services, and financial professional ratings.

Pacific trade deal represents 40% of global trade

Trade ministers from 12 countries reached an agreement on October 5, 2015, to establish a historic Pacific trade accord.

The Trans-Pacific Partnership (TPP) would remove most trade tariffs between the United States, Japan, and 10 other countries, and is the largest regional trade agreement in history. The member countries represent about 800 million people and approximately 40% of world trade.

The text of the trade deal were recently released by the administration.

Talked about since 2008, the agreement gained momentum under the current administration, and President Obama has been advocating for its approval. The White House says the deal would eliminate thousands of tariffs and make U.S. export prices more attractive.

The countries included in the TPP are Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam.

Under the pact, most tariffs would be lifted across a range of products including beef, sugar, seafood, dairy, other food products, manufactured goods, and energy. The deal also addresses intellectual property, e-commerce, the environment, and other trade issues.

Still, the trade deal must receive approval from Congress and policymakers in each country.

Division in both parties
Congress is divided on the deal, and there are supporters and opponents within both political parties.

Supporters point to the economic opportunity that would result from the agreement and the potential for other countries, such as China, to sign on in the future. Opponents believe the pact would encourage businesses to outsource manufacturing jobs to other countries and limit competition. Extending patent protections to other countries for products such as pharmaceuticals could drive up drug prices, many opponents contend. Another provision allowing multinational corporations to challenge regulations is also raising concern.

In addition, several national labor unions have voiced concern about the potential loss of American jobs resulting from the trade agreement. And presidential hopeful Hillary Clinton recently announced opposition to the TPP.

The deal will likely go before Congress for a vote early next year.

Strengthening dollar affects exports
U.S. exports have experienced pressure from the strengthening dollar and slowdown in global growth. In August, the trade deficit increased, driven by a decline in exports. The decline in exports, which was largely due to lower oil prices, was the sharpest since October 2012, the Commerce Department reported.

In September, exports rebounded and rose 1.6%, resulting in a decline in the trade deficit.

China is mounting its own trade agreement campaign
China was not part of the trade negotiations for the TPP. But China is working on its own trade agreements and negotiating to conclude the Regional Comprehensive Economic Partnership (RCEP) — a 16-nation free trade agreement across Asia.

Seven countries in the TPP accord are also part of the RCEP negotiations (Australia, Japan, Malaysia, New Zealand, Singapore, Vietnam, and Brunei). If finalized, the agreement would represent about 3.4 billion people.