Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts

Wednesday, August 28, 2019

Real Madrid 'Are Ready To Offer €100m And Three Players To Sign in Neymar'

Real Madrid 'Ready To Offer €100m And Three Players To Sign in Neymar'

Petty perry

Aug 28.2019
Real Madrid are prepared to offer €100million plus three players to sign top target Neymar, according to reports.
Zinedine Zidane's Los Blancos have been busy in this summer's transfer window, but have not given up hope of signing the former Barcelona forward
According to French publication L'Equipe, Paris Saint-Germain have already rejected an offer of €100million plus Gareth Bale, James Rodriguez and Keylor Navas.
Sources from Madrid have poured cooled water on these claims, according to Guillem Balague, stating the offer is inaccurate.
Bale is set to stay put at the Bernabeu despite his grievances as he is keen to prove Zidane wrong once and for all.
Real Madrid are prepared to offer James, Navas and another first team player plus money for Neymar but are so far yet to do so.
Balague claims that this third player is none other than Luka Jovic, who Real Madrid spent £62million on to sign just a few weeks ago
Jovic has struggled to hit the ground running in the Spanish capital after a difficult pre-season.
The former Eintracht Frankfurt man was also named on the bench in Real Madrid's opening day La Liga win over Celta Vigo.
Paris Saint-Germain are keen to keep hold of the Brazilian, and have even reportedly rejected a loan offer for him from Barcelona.

Sunday, August 25, 2019

Economic Calendar - Top 5 Things to Watch This Week

© Reuters.  © Reuters. - The latest escalation in the U.S.-China trade war is likely to dominate investors’ attention this week and a fresh batch of data will give markets more insight into the economic impact of the conflict. Markets will also be watching a gathering of Western leaders at the G7 summit at a time of major divisions over trade, climate change, exchange rates, government spending, Brexit and dealings with China, Iran and Russia.

Here’s what you need to know to start your week.

  1. Trade tit-for-tat

China said on Saturday it strongly opposes Washington's decision to levy additional tariffs on $550 billion worth of Chinese goods and warned the U.S. of consequences if it does not end its "wrong actions".

The comments came after U.S. President Donald Trump announced an additional 5% duty on $550 billion in Chinese imports in the latest tit-for-tat trade war escalation by the world's two largest economies.

The year-long trade war has roiled financial markets with bond markets indicating the chances of a recession are mounting.

Trump linked his spats with China and the Federal Reserve together on Friday, tweeting that the Fed is not helping with easier rate policy and asking “who is the bigger enemy” — China President Xi Jinping or Fed Chairman Jerome Powell.

  1. G7 summit

French President Emmanuel Macron is hosting the Aug. 24-26 G7 summit in Biarritz and has put climate change center-stage for the event. But on that and most other subjects, Trump is an outlier. Locked in a trade war with China, he has floated the idea of tariffs on imports from the EU and elsewhere, and his suggestion to re-admit Russia to the G7 has met with opposition from other members.

Macron's new tax on U.S. tech firms has also irked Trump, who has threatened retaliation on French wine exports.

Another issue investors will watch for is whether any mention is made of fiscal stimulus, above all in Germany, something Chancellor Angela Merkel has hesitated over.

  1. U.S. economic data

The second reading of U.S. gross domestic product on Thursday largely contains tweaks to data already in plain view – consumer spending, business investment and inventories. An initial estimate showed the U.S. economy grew at an annual rate of 2.1% in the second quarter, slowing from 3.1% in the first three months of the year.

Durable goods data is released on Monday and will give insights into U.S. manufacturing activity and capital spending. Thursday’s trade data will show where the deficit with China stood in July. Investors will also be able to parse reports on consumer confidence, pending home sales and the PCE price index, the Fed’s preferred inflation indicator.

  1. Eurozone inflation

Amid concerns that the German economy could slide into recession in the third quarter, Monday’s Ifo survey of the country’s business climate will be closely watched.

An advance reading of euro zone inflation at the end of the week is expected to underscore the need for more measures to kick-start price growth. Data since the European Central Bank last met has been dismal, and accounts of its July 25 meeting have reinforced that the bank is preparing to unleash support.

A weak inflation reading will likely stir debate about the need to amend the ECB's inflation target, in favor of a more flexible goal that would open the door to even bigger stimulus. The data might also re-ignite calls for Germany to start spending more.

  1. Retail earnings

Investors will get another look at retail earnings this week when electronics retailer Best Buy (NYSE:BBY) and discount retailer Dollar Tree (NASDAQ:DLTR) report quarterly results.

Robust retail sales and strong retail earnings have been a bright spot for the U.S. economy this month, helping to ease fears over the risk of a recession against a background of heightened trade tensions and signs of slowing global growth.

Target's (NYSE:TGT) shares hit record highs last week after its second-quarter earnings beat estimates, but Home Depot (NYSE:HD) warned of slowing sales growth partly due to the potential impact from the upcoming batch of tariffs from the U.S.-China trade war.

--Reuters contributed to this report

Original Article

At G7 summit, Trump offers Brexit Britain a 'very big' trade deal

By Jeff Mason and William James

BIARRITZ, France (Reuters) - U.S. President Donald Trump promised a big trade deal for post-Brexit Britain to Boris Johnson on Sunday and praised the new prime minister as the right man to take Britain out of the European Union.

Johnson, who faces a delicate task of assuaging European allies while not angering Trump at a G7 summit in France, said trade talks with the United States would be tough but there were huge opportunities for British businesses in the U.S. market.

Speaking to reporters with Johnson ahead of a trade-focused bilateral meeting, Trump said Britain's membership of the EU had been a drag on efforts to forge closer trade ties.

"We're going to do a very big trade deal - bigger than we've ever had with the UK," Trump said. "At some point, they won't have the obstacle of - they won't have the anchor around their ankle, because that's what they had. So, we're going to have some very good trade talks and big numbers."

With less than three months until an Oct. 31 deadline, it is still totally unclear, how, when or even whether Britain will leave the EU. The uncertainty around Brexit, the United Kingdom's most significant political and economic post-war move, has left allies and investors aghast and roiled markets.

Opponents fear Brexit will make Britain poorer and divide the West as it grapples with both Trump's unconventional presidency and growing assertiveness from Russia and China.

Supporters acknowledge the divorce might bring short-term instability, but say in the longer term it will allow the United Kingdom to thrive if cut free from what they cast as a doomed attempt to forge European unity.


Trump and Johnson were in the French seaside resort of Biarritz for a summit of G7 industrialized nations that exposed sharp difference over trade protectionism and an array of other issues including climate change and digital taxes before it had even begun.

Johnson will on Sunday meet European Council head Donald Tusk, who on Saturday said Johnson would go down as "Mr No-Deal" if he took Britain out of the EU without a withdrawal agreement.

Johnson is expected to tell Tusk that Britian will only pay 9 billion pounds ($11 billion) instead of the 39 billion pound liability agreed by former prime minister Theresa May under a no-deal Brexit, Sky News reported on Sunday.

On his arrival on Saturday, Johnson said in reference to the escalating U.S.-China trade war he was "very worried" about the growth of protectionism. He said those who "supported tariffs were at risk of incurring the blame for the downturn in the global economy".

Sitting opposite Trump on Sunday, Johnson praised the performance of the U.S. economy before adding: "But just to register a faint, sheeplike note of our view on the trade war - we are in favor of trade peace on the whole."

Johnson used a pre-summit phone call to Trump to demand he lower trade barriers and open up parts of the U.S. economy to British firms, citing a wide range of markets from cars to cauliflowers.

Britain was looking forward to some comprehensive talks about taking the future UK-U.S. relationship forward, Johnson said, adding he had made clear to Trump that the National Health Service would not be a part of trade talks.

London's preference is for a comprehensive free trade deal with the United States post Brexit, UK government officials say, while some U.S. officials including Trump's national security adviser John Bolton have talked of a sector-by-sector approach.

Hints of those divisions emerged on Sunday.

As Johnson said London and Washington would do a "fantastic deal", Trump interrupted to say: "lots of fantastic mini-deals, we're talking about many different deals but we're having a good time."

Original Article

China central bank sets rules on mortgage rates after reform

BEIJING (Reuters) - China's central bank issued detailed rules on Sunday on interest rates on mortgage loans, following its reform to switch to a market-based reference rate for pricing new loans.

Effective from Oct. 8, banks will set individual housing loans based on the new loan prime rate (LPR), the People's Bank of China said in a statement published on its website.

The interest rate on individual mortgage loans for first-time home buyers cannot be lower than the LPR, and the rate on loans for second-time home buyers cannot be lower than the LPR plus 60 basis points, the central bank said.

Original Article

Italy's 2020 deficit on track to be well below target: minister

MILAN (Reuters) - Italy's deficit for next year is on track to be well below target with public finances going much better than expected, outgoing Economy Minister Giovanni Tria said on Sunday.

"Even under current laws, without other measures, the 2020 deficit would be substantially below the 2.1% of GDP (forecast back in April)," Tria said in an interview in daily Corriere della Sera.

He said the 2020 deficit, under current conditions, would be more than 0.3% lower than forecast. But he added that was subject to possible corrections depending on economic growth trends and expectations.

Tria said there was room to avoid implementing an unpopular rise in value-added tax next year.

But he said Italy's budget, scheduled to be drawn up in the autumn, would possibly need to find more than 15 billion euros to fund tax cut reforms.

Italy's government, riven by months of infighting, imploded last week, forcing Prime Minister Giuseppe Conte to resign just as he was to begin preparing the 2020 budget.

Talks are under way between political parties to try and form a new coalition government to avoid snap elections and prepare the budget.

Original Article

Explainer: What tools could Trump use to get U.S. firms to quit China?

WASHINGTON (Reuters) - Hours after China announced retaliatory tariffs on U.S. goods on Friday, President Donald Trump ordered U.S. companies to "start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.".

The stakes are high: U.S. companies invested a total of $256 billion in China between 1990 and 2017, compared with $140 billion Chinese companies have invested in the United States, according to estimates by the Rhodium Group research institute.

Some U.S. companies had been shifting operations out of China even before the tit-for-tat tariff trade war began more than a year ago. But winding down operations and shifting production out of China completely would take time. Further, many U.S. companies such as those in the aerospace, services and retail sectors would be sure to resist pressure to leave a market that is not only huge but growing.

Unlike China, the United States does not have a centrally planned economy. So what legal action can the president take to compel American companies to do his bidding?

Trump does have some powerful tools that would not require approval from U.S. Congress:


Trump could do more of what he's already doing, that is hiking tariffs to squeeze company profits enough for them to make it no longer worth their while to operate out of China.

Trump on Friday boosted by 5 percentage points the 25% tariffs already in place on nearly $250 billion of Chinese imports, including raw materials, machinery, and finished goods, with the new higher 30% rate to take effect on Oct. 1.

He said planned 10% tariffs on about $300 billion worth of additional Chinese-made consumer goods would be raised to 15%, with those measures set to take effect on Sept. 1 and Dec. 15.

In addition to making it more expensive to buy components from Chinese suppliers, tariff hikes punish U.S. firms that manufacture goods through joint ventures in China.


Trump could treat China more like Iran and order sanctions, which would involve declaring a national emergency under a 1977 law called the International Emergency Economic Powers Act, or IEEPA.

Once an emergency is declared, the law gives Trump broad authority to block the activities of individual companies or even entire economic sectors, former federal officials and legal experts said.

For example, by stating that Chinese theft of U.S. companies' intellectual property constitutes a national emergency, Trump could order U.S. companies to avoid certain transactions, such as buying Chinese technology products, said Tim Meyer, director of the International Legal Studies Program at Vanderbilt Law School in Nashville.

Trump used a similar strategy earlier this year when he said illegal immigration was an emergency and threatened to put tariffs on all Mexican imports.

Past presidents have invoked IEEPA to freeze the assets of foreign governments, such as when former President Jimmy Carter in 1979 blocked assets owned by the Iranian government from passing through the U.S. financial system.

"The IEEPA framework is broad enough to do something blunt," said Meyer.

Using it could risk unintended harm to the U.S. economy, said Peter Harrell, a former senior State Department official responsible for sanctions, now at the Center for a New American Security. U.S. officials would need to weigh the impact of China's likely retaliation and how U.S. companies would be affected.

Invoking IEEPA could also trigger legal challenges in U.S. courts, said Mark Wu, a professor of international trade at Harvard Law School.


Another option that would not require congressional action would be to ban U.S. companies from competing for federal contracts if they also have operations in China, said Bill Reinsch, a senior adviser at the Center for Strategic and International Studies think tank.

Such a measure might be targeted specifically at certain sectors since a blanket order would hit companies such as Boeing (N:BA), which is both a key weapons maker for the Pentagon and the top U.S. exporter.

Boeing opened its first completion plant for 737 airliners in China in December, a strategic investment aimed at building a sales lead over its European arch-rival Airbus (PA:AIR).

Boeing and Airbus have been expanding their footprint in China as they vie for orders in the country's fast-growing aviation market, which is expected to overtake the United States as the world's largest in the next decade.


A far more dramatic measure, albeit highly unlikely, would be to invoke the Trading with the Enemy Act, which was passed by Congress during World War One.

The law allows the U.S. president to regulate and punish trade with a country with whom the United States is at war. Trump is unlikely to invoke this law because it would sharply escalate tensions with China, said Wu.

"It would be a much more dramatic step to declare China to be an enemy power with which the U.S. is at war, given the president has at times touted his friendship with and respect for President Xi (Jinping)," said Wu.

"That would amount to an overt declaration, while IEEPA would allow the Trump administration to take similar actions without as large of a diplomatic cost."

Original Article

UK's Johnson tells Trump: Lower your trade barriers to seal UK deal

By William James

BIARRITZ, France (Reuters) - Prime Minister Boris Johnson used a pre-G7 summit phone call to U.S. President Donald Trump to demand he lower trade barriers and open up parts of the U.S. economy to British firms, citing a wide range of markets from cars to cauliflowers.

The two spoke on Friday ahead of the meeting of world leaders in the French resort of Biarritz, where they are expected to talk up the prospect of a bilateral trade deal once Britain leaves the European Union.

"There is a massive opportunity for Britain but we must understand that it is not all going to be plain sailing," he said during his flight to France, relaying details of the call to traveling reporters.

"There remain very considerable barriers in the U.S. to British businesses which are not widely understood."

Johnson listed what he said were restrictions or tariffs on shower base units, wallpaper, fabric, cars, railway carriages, pork pies, cauliflowers, micro-brewery beer, insurance, public procurement contracts, bell peppers, wine and rulers.

Brexit advocates, including Johnson, have hailed the ability to strike free trade deals with countries such as the United States as one of the main benefits of leaving the EU. Critics say the terms that Trump will demand are likely to damage the British economy in the long run.

The two leaders are due to meet in person on Sunday morning, which is expected to result in more positive talk about a trade deal, building on a previous promise made by Trump to agree a "fantastic" deal.

Nevertheless, Johnson has used the trip to indirectly criticize Trump, saying a global trade war needed to de-escalate, and that those responsible for rising tariffs could be held responsible for damaging the world economy.

Wary of Britain being seen as what French President Emmanuel Macron called a "junior partner of the United States", the government has also in recent days sought to dampen down the idea of a swift bilateral agreement, stressing that they would not rush into a one-sided deal.

"There are massive opportunities for UK companies to open up, to prise open the American market," Johnson told reporters.

"We intend to seize those opportunities but they are going to require our American friends to compromise and to open up their approach because currently there are too many restrictions."

Original Article

China to fight back against U.S. tariff move: People's Daily

BEIJING (Reuters) - China will fight back against the latest U.S. step to increase tariffs on Chinese goods, the ruling Communist Party's People's Daily said on Sunday amid an escalating trade war between the world's two largest economies.

"China is confident that it will follow its own path and do its own things well, and will never waver in its stand on countering any provocations by the U.S. side," the newspaper said in a commentary.

U.S. politicians, seeking to hamper China's economic development, still want to use the tactics of exerting maximum pressure on China that has achieved few results, the paper said.

The United States will not win the trade war because of the plight faced by its farmers and businesses, it said.

China said on Saturday it strongly opposes Washington's decision to levy additional tariffs on $550 billion worth of Chinese goods and warned the United States of consequences if it does not end its "wrong actions".

U.S. President Donald Trump announced on Friday that Washington will impose an additional 5% duty on the Chinese goods, hours after Beijing announced its latest retaliatory tariffs on about $75 billion worth of U.S. goods in the latest tit-for-tat moves in their bilateral trade dispute.

The intensifying U.S.-China trade war stoked worries about a global economic recession.

Original Article

China warns U.S. to stop 'wrong' trade actions or face consequences

BEIJING (Reuters) - China said on Saturday it strongly opposes Washington's decision to levy additional tariffs on $550 billion worth of Chinese goods and warned the United States of consequences if it does not end its "wrong actions".

The comments made by China's Ministry of Commerce came after the U.S. President Donald Trump announced on Friday that Washington will impose an additional 5% duty the Chinese goods, hours after Beijing announced its latest retaliatory tariffs on about $75 billion worth of U.S. goods, in the latest tit-for-tat moves in their bilateral trade dispute.

"Such unilateral and bullying trade protectionism and maximum pressure violates the consensus reached by head of China and United States, violates the principle of mutual respect and mutual benefit, and seriously damages the multilateral trade system and the normal international trade order," China's commerce ministry said in a statement on Saturday.

"China strongly urges the United States not to misjudge the situation or underestimate determination of the Chinese people," it added.

Trump's latest tariff move, announced on Twitter, said the United States would raise its existing tariffs on $250 billion worth of Chinese imports to 30% from the current 25% beginning on Oct. 1, the 70th anniversary of the founding of the communist People's Republic of China.

At the same time, Trump announced an increase in planned tariffs on the remaining $300 billion worth of Chinese goods to 15% from 10%. The United States will begin imposing those tariffs on some products starting Sept. 1, but tariffs on about half of those goods have been delayed until Dec. 15.

Trump was responding to Beijing's decision on Friday night that it was planning to impose retaliatory tariff on $75 billion worth of U.S. imports ranging from soybean to ethanol. China will also reinstitute tariffs of 25% on cars and 5% on auto parts suspended last December.

The White House economic adviser said earlier in the week the Trump administration was planning in-person talks between U.S. and Chinese officials in September. It is unclear if the bilateral meeting would still take place.

The year-long trade war between the world's two largest economies has roiled financial markets and shaken the global economy.

Original Article

IMF meets with Argentina's Treasury minister and central bank president

BUENOS AIRES (Reuters) - Top Argentine finance officials met with a team from the International Monetary Fund on Saturday, the Treasury Ministry said, while tens of thousands of supporters of President Mauricio Macri gathered just outside the presidential palace, waving national flags and cheering.

The IMF officials met with Treasury Minister Hernan Lacunza, who was just installed in that position on Tuesday, and central bank President Guido Sandleris, according to the Treasury Ministry statement.

No details were released on the talks. The IMF team on Friday said it planned to "exchange views" over the weekend with the economic advisers to Argentina's top presidential contenders in the October election, the incumbent Macri and opposition candidate Alberto Fernandez.

Macri was trounced in the primary election on Aug. 11 by Fernandez, who is now the front runner for the October presidential election. Center-left Peronist Fernandez has criticized the $57 billion standby agreement Macri struck with the IMF in 2018, pledging to "rework" the deal if elected.

Fernandez's landslide support in the primary vote prompted the peso currency to fall by nearly 18% last week amid fears of a return to the interventionist economic policies of former President Cristina Fernandez de Kirchner, who is Fernandez's vice presidential candidate.

Macri appeared only briefly on Saturday afternoon, saluting fans in Buenos Aires´ historic Plaza de Mayo, and joining in chants of "Yes, we can," his now-familiar campaign slogan. Supporters launched similar gatherings in large cities throughout Argentina.

Macri took office in 2015 promising to bring an end to the cyclical crises that over the last 100 years turned one of the world’s strongest economies into a serial defaulter. But an economic recovery has failed to materialize.

Voters fed up with Macri's IMF-backed austerity measures and crippling inflation of 55% overwhelming snubbed Macri in the primary election, giving a 15-point lead to Fernandez, who promised on Thursday that Argentina has "no possibility" of default if he is elected.

The International Monetary Fund's next scheduled review of Argentina's lending program is on Sept. 15.

Original Article

Saturday, August 24, 2019

Britain will withhold $37 billion from EU in no-deal Brexit: Mail on Sunday

LONDON (Reuters) - British Prime Minister Boris Johnson plans to tell European Union leaders he will withhold 30 billion pounds ($37 billion) from the Brexit divorce bill unless they agree to changes to the deal, the Mail on Sunday reported.

If Britain leaves the bloc without a trade deal, lawyers have concluded the government's will only have to pay the EU 9 billion pounds, rather than 39 billion pounds, the newspaper reported. This is because there will not be any of the costs associated with any transition period, the newspaper said.

Johnson's office did not immediately respond to a request for comment.

Original Article

German finance minister backs plans for wealth tax: Handelsblatt

FRANKFURT (Reuters) - German Finance Minister Olaf Scholz is backing plans for a wealth tax his Social Democrats (SPD) plan to introduce, the online edition of business daily Handelsblatt reported on Sunday.

Leading members of the SPD, junior partners in the ruling coalition, will meet on Monday to discuss plans to reintroduce the tax, which have developed in a working group led by Thorsten Schaefer-Guembel, who heads the SPD in Hesse state.

The plans forecast revenues nationwide of up to 10 billion euros ($11.14 billion).

"I have closely worked with the SPD working group and I'm supporting the result to follow the Swiss model," Scholz, running for leadership of the SPD, was quoted as saying.

Switzerland is one of a small number of developed economies that still impose a wealth tax, which is charged on cash, securities, real estate, cars and art.

Andreas Jung, vice chair of the conservative benches in parliament, said Chancellor Angela Merkel's conservative Christian Democratic Union (CDU) was opposed to the move, Handelsblatt reported.

Scholz's comments come shortly after the government agreed to exempt most taxpayers from the solidarity tax that was introduced after the county's reunification.

Merkel's government has incurred no new debt since 2014 thanks to an unusually long growth cycle, record-high employment, robust tax revenues and low interest rates.

A senior government official told Reuters earlier this month that Germany is considering ditching its long-cherished balanced budget policy to help finance a costly climate protection program with new debt.

Original Article

Fed's Mester sees downside risk from escalating trade war

By Ann Saphir and Howard Schneider

JACKSON HOLE, Wyo. (Reuters) - Cleveland Federal Reserve President Loretta Mester said on Saturday she sees "big downside risk" from rising trade uncertainty, and will be watching how businesses and consumers react ahead of the U.S. central bank's next policy meeting.

Mester, who opposed the Fed's interest rate cut last month, spoke a day after the U.S.-China trade war escalated sharply, with Beijing and Washington slapping additional tariffs on each other's goods and President Donald Trump calling on U.S. companies to exit China.

Whether trade and other policy moves will knock a U.S. economy chugging along at an expected 2% annual growth rate remains to be seen, Mester told Reuters on the sidelines of the Fed's annual central banking conference in Jackson Hole, Wyoming.

Mester said she and her team of economists at the Cleveland Fed are still formulating their forecasts ahead of the central bank's Sept. 17-18 meeting, at which it is widely expected to reduce borrowing costs for the second time this year.

"You want to be very cognizant of the fact that we are already at neutral, unless the economy takes a turn for the worse," Mester said, referring to the neutral rate of interest that neither brakes nor boosts a healthy economy.

She added that "the more this trade war escalation happens, the more weight you have to put on that other (weak growth) scenario."

If there’s a lot of uncertainty, particularly from trade, "a natural inclination for business or the consumer is, 'I’ve got to like, pause,'” she said. "I think that is a big downside risk here."

On Friday, Fed Chair Jerome Powell cited the trade uncertainty in a keynote speech to the conference in which he reiterated his promise that the Fed would "act as appropriate" to keep the economy growing, with unemployment low and inflation near the central bank's 2% annual target.

He did not tip his hand on whether he thought rate cuts at the Fed's next policy meetings would be appropriate, as financial markets are currently betting.

Mester said she would be "open-minded" on the rate-cut debate, focusing on "economic and financial market reconnaissance" including a close look at what business contacts are saying and doing.

"We have three weeks: We're going to gather more data, we are going to look at what the economy is," she said, adding that she'll be focused on whether declines in business sentiment are translating into real actions that slow the economy.

"If you were ever data-dependent, you are uber data-dependent now," she said. "It would be a bad thing to keep reacting to things that haven't materially affected the outlook."

On the other hand, she added, "if your outlook has changed from, the modal forecast is 2% to the modal forecast is much lower, you'd want to move, perhaps, your policy rate down."

Original Article

Fed wields strong influence on global financial conditions: research

By Trevor Hunnicutt

JACKSON HOLE, Wyo. (Reuters) - The Federal Reserve's influence on economic conditions beyond U.S. borders may be bigger than it thinks, according to research that will be presented at the central bank's conference on Saturday.

The new paper, "Mind the Gap in Sovereign Debt Markets," argues that Fed policy is a chief factor determining the cost and availability of the U.S. dollar and Treasury bonds.

The research uses data on demand for Treasuries that would seem to refute Fed Chair Jerome Powell's 2018 statement that "the role of U.S. monetary policy" in setting the global market conditions that can help or hurt economic growth "is often exaggerated." The Fed was raising rates back then but last month cut borrowing costs for the first time in more than a decade to prevent a slowdown.

"There has been an active debate among policymakers about the spillovers of U.S. monetary policy to the rest of the world," the paper said, citing Powell's speech. "Our analysis indicates that such spillovers are intrinsic to the mechanics of international credit and currency markets."

Investors respond directly to Fed policy, for instance reacting to higher rates by snapping up more U.S. government bonds and raising the value of the dollar, according to the paper's authors, Arvind Krishnamurthy and Hanno Lustig at Stanford University.

Strong desire to buy U.S. assets to seek shelter from an uncertain world has been a key theme this year. The U.S.-China trade war and a teetering global economy caused investors to gobble so many 30-year Treasury bonds () in recent days that yields sank to a record-low 1.916%.

Demand for safe-haven dollar assets has grown since the 2008 financial crisis and will only gain steam, the paper's authors conclude, despite frequent predictions that the greenback could lose ground to competing currencies.

Bank of England Governor Mark Carney, speaking on Friday at the same annual Fed retreat in Jackson Hole, Wyoming, said the dollar's dominance increases risks to the rest of the world and said central banks might need to join together to create their own replacement reserve currency.

While strong interest in Treasuries helps the U.S. borrow at low rates, this is a double-edged sword. It allows Uncle Sam and American businesses to take on too much debt. That, in turn, could set the stage for future downturns, Krishnamurthy and Lustig wrote. Fed officials have also warned about record-high U.S. corporate debt.

Foreign investors earn "exceptionally low returns" on their Treasury investments partly because their currencies decline during panics and because they tend to buy the bonds at times when they are in high demand, according to Krishnamurthy and Lustig. They said a dependence on U.S. assets exposes those countries to risks that they cannot repay their debts if dollar-based assets are in short supply.

Original Article

UK PM Johnson to tell Trump to de-escalate trade tensions

BIARRITZ, France (Reuters) - British Prime Minister Boris Johnson said he would be telling President Donald Trump at this weekend's G7 summit to pull back from a trade war which is already destabilising economic growth around the world.

Asked if he would be telling Trump he should not escalate the trade war with China, Johnson said "you bet".

Johnson said his priorities for the summit "are clearly the state of global trade. I am very worried about the way it's going, the growth of protectionism, of tariffs that we're seeing."

Original Article

France's Macron says Europe looking at 'new tax cuts' to stimulate growth

© Reuters. French President Emmanuel Macron delivers a speech during the G7 summit in Paris© Reuters. French President Emmanuel Macron delivers a speech during the G7 summit in Paris

BIARRITZ, France (Reuters) - French President Emmanuel Macron said on Saturday Europe will "probably" decide to launch new tax cuts to kick-start a flagging economy threatened by a tit-for-tat trade war between the United States and its global partners.

"When I look at Europe especially, we need some new tools to relaunch our economy," Macron told U.S. President Donald Trump before a working lunch in Biarritz where G7 leaders are gathering for the weekend.

"We will probably decide to have new tax cuts, which is one of these ways to relaunch ... (in coordination)," he added, without elaborating.

Macron's office did not immediately return a request for comment.

Original Article

ECB's Weidmann sees no need for economic stimulus: FAS

FRANKFURT (Reuters) - Germany's economy has weakened but it is too early for a major economic stimulus, European Central Bank policymaker Jens Weidmann was quoted as saying on Saturday.

"The current outlook is uncertain," he told German weekly Frankfurter Allgemeine Sonntagszeitung (FAS) in an interview. "But I don't see a reason to panic."

Original Article

Trump says U.S. would tax French wine in response to digital tax

WASHINGTON (Reuters) - U.S. President Donald Trump on Friday reiterated criticism of a French proposal to levy a tax aimed at big U.S. technology companies and threatened again to retaliate by taxing French wine.

Speaking to reporters at the White House before leaving for a Group of Seven summit in France, Trump said he is not a "big fan" of tech companies but "those are great American companies and frankly I don't want France going out and taxing our companies."

"And if they do that ... we'll be taxing their wine like they've never seen before," he said.

Original Article

Sajid Javid prepares ground for no-deal emergency budget: The Times

(Reuters) - British finance minister Sajid Javid is preparing ground for a no-deal emergency budget in the fortnight before Britain leaves the European Union, The Times reported.

Javid, who took office last month, will ask the

Office for Budget Responsibility (OBR) to begin work on forecasts for a no-deal Brexit within days, the newspaper reported.

Javid will postpone the final decision on whether to push ahead with the budget until after the European Council meets on Oct. 17, the report added.

Original Article

New EU import curbs on fruit not Canada specific: Canadian minister

By Kelsey Johnson

OTTAWA (Reuters) - New European Union rules that could block shipments of Canadian cherries and other fruits to the 28-nation grouping apply to all countries and "was not unusual," a senior Canadian official said on Friday.

The clarification from federal Agriculture Minister Marie-Claude Bibeau came a day after the Canadian Food Inspection Agency (CFIA) warned industry in a notice seen by Reuters that EU imports of the Canadian fruits would end on Sept. 1.

Bibeau's office said the EU had agreed to work with the Canadian agency and industry "to establish a systems approach to certify fruit and maintain trade."

"CFIA successfully uses a system approach for trade with other countries, and is well equipped to establish a systems approach for fruit exports with the European Union," she added.

In a statement, the EU office in Ottawa confirmed the new rules would apply to "all EU trading partners, not just Canada," adding EU trading partners were alerted to the pending regulations in December 2018.

"It is important to note that we are in close communication with Canadian authorities and are actively looking at ways to avoid any disruption," the EU delegation said.

Earlier Friday, Canada's Conservative opposition party called on Prime Minister Justin Trudeau to raise the matter with his EU counterparts at this weekend's Group of Seven meeting in France.

In a statement, the party's agriculture critic Luc Berthold said Trudeau should "push for the immediate removal of these trade barriers."

CFIA said on Thursday dried and frozen fruit were not affected by the new rules, which also apply to families of fruits that include apples, pears, cranberries, blueberries, peppers and tomatoes. Sea containers shipped with export documents dated before Sept. 1 should not run into issues, the agency added.

In 2018, Canada shipped about C$3.1 million ($2.34 million) of cherries to the EU, the B.C. Cherry Association said on Thursday.

($1 = 1.3275 Canadian dollars)

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