The first major railroad merger in more than two decades, one that would link the United States, Canada and Mexico, was approved by federal regulators Wednesday.

Canadian Pacific’s $31 billion acquisition of Kansas City Southern will combine the two smallest of the nations seven major railroads after an arduous two-year review from the U.S. Surface Transportation Board.

As part of the deal, Alberta, Canada-based CP is moving its U.S. headquarters from Minneapolis to Kansas City, Mo.

The Transportation Board said that the new railroad “will facilitate the flow of grain from the Midwest to the Gulf Coast and Mexico, the movement of intermodal goods between Dallas and Chicago and the trade in automotive parts, finished vehicles, and other containerized mixed goods between the United States and Mexico.”

The combined company will have little to no track redundancies or overlapping routes, and is also expected to add more than 800 new union jobs in the U.S., according to the board.

“The Board is well cognizant of the recent elevated level of public concern stemming from the derailment in East Palestine, Ohio, and as always, the Board has carefully analyzed the proposed merger from a safety perspective.”

It said that Canada Pacific has the best safety record of any Class I railroad over the past 15 years and that the combined record for both railroads of preventing hazardous material releases on average exceeds any record affiliated with using trucks or any other railroad.

“Any rail traffic diverted to (Canadian Pacific-Kansas City Southern) from other railroads will mean traffic likely moving to a railroad with a better safety record,” the board said.

Regulators said in a report earlier this year that the only major impact of the deal would be an increase in noise in places where train traffic is expected to increase significantly. The Surface Transportation Board essentially rejected concerns that the deal would create problems in towns along the tracks as longer and more frequent freight trains block car crossings for extended periods of time or clog the already busy rail network around Chicago and create problems for commuter trains.

The biggest traffic increases are expected between Chicago and Laredo, Texas, with some of the rail lines across Iowa predicted to see more than 14 additional trains a day and the tracks between Kansas City, Missouri, and Beaumont, Texas, likely to see about 12 more trains a day.

— Associated Press

Wholesale inflation continues to abate

Wholesale price increases in the United States slowed sharply last month as food and energy costs declined, a sign that inflationary pressures may be easing as the Federal Reserve considers whether to keep raising interest rates to fight higher prices.

From January to February, the government’s producer price index fell 0.1%, after a 0.3% rise from December to January. Compared with a year ago, wholesale prices rose 4.6%, a big drop from the 5.7% annual increase in January.

A significant driver of last month’s wholesale inflation slowdown was a huge drop in the prices of eggs, which plummeted 36.1% just in February. Egg prices had previously surged after a widespread outbreak of avian flu.

Excluding volatile food and energy costs, so-called core wholesale prices were unchanged from January to February.

Consumers pare back spending in February

America’s consumers trimmed their spending in February after a buying burst in January, underscoring the volatility of the economic environment.

The government said Wednesday that retail sales slipped 0.4% after jumping a revised 3.2% in January, helped by an increase in auto sales. Retail sales were down in November and December, the critical holiday period.

The February retail sales figure was weighed down by a 1.8% drop in auto sales as well as declines at restaurants and stores selling furniture and clothing. Excluding autos, sales slipped 0.1% from January, according to the Commerce Department.

Seat belt issue forces 500K Honda recalls

Honda is recalling a half-million vehicles in the U.S. and Canada because the front seat belts may not latch properly.

The recall covers some of the the automaker’s top-selling models including the 2017 through 2020 CR-V, the 2018 and 2019 Accord, the 2018 through 2020 Odyssey and the 2019 Insight. Also included is the Acura RDX from the 2019 and 2020 model years.

Honda says it has no reports of injuries caused by the problem.

Chinese tycoon accused in $1B fraud

A business tycoon long sought by the government of China and known for cultivating ties to Trump administration figures including Steve Bannon was arrested Wednesday in New York on charges that he oversaw a $1 billion fraud conspiracy.

Guo Wengui, 54, and his financier, Kin Ming Je, faced an indictment in federal court in Manhattan charging them with various crimes, including wire, securities and bank fraud. Guo was charged in court papers under the name Ho Wan Kwok.

U.S. prosecutors said the indictment stemmed from a complex scheme in which Guo lied to hundreds of thousands of online followers in the United States and around the world before misappropriating hundreds of millions of dollars.

Kin Ming Je, 55, has not been arrested. Guo’s attorney did not comment.

— From news services