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World Updated on: June 14, 2022 / 12:49 PM / CBS News Hope in India as country fights air pollution "Everybody living in India is a smoker" due to pollution, but there's some hope 04:24 New Delhi — Air pollution in major South Asian cities has shortened the life expectancy of people living there by up to 10 years, despite COVID-19 lockdowns slowing economic activities since 2020, a new study by a U.S. research group says. New Delhi, India's capital, has been ranked the world's most polluted city, where people have lost almost 10 years of their lives to air pollution, according to the study commissioned by the Energy Policy Institute (EPIC) at the University of Chicago. Air pollution has shortened life expectancy in New Delhi by up to 10 years, and across the country by five years, the study says. The study ranked Bangladesh as the world's most polluted country overall, followed by India, Nepal, and Pakistan.People living in Bangladesh's capital Dhaka are losing nearly nine years of their lives to air pollution, while the national average stands at 6.9 years, according to the research. The "Air Quality Life Index" study by EPIC translates particulate air pollution into real-world impact on life expectancy by calculating how long people would live in a given population if the World Health Organization (WHO) guideline for annual average particulate pollution of 5 μg/m³ was met. Millions of Americans live in places with unhealthy levels of air pollution 04:21 Levels of the most dangerous air pollution — fine particulate matter known as PM2.5 — in Delhi are more than 10 times the WHO's safe limit. PM2.5 particles can penetrate and settle deep in the lungs, causing severe health issues including respiratory and heart diseases. The study notes that more than 500 million people who live in northern India are "on track" to lose 7.6 years of their lives, on average, if the high pollution levels are not tackled."The report is definitely alarming, although such studies have come out in the past, too," Professor Sachchida Nand Tripathi, an Indian scientist who researches air quality, told CBS News.About 44% of the global pollution since 2013 has come from India, according to the research by EPIC. The country has witnessed a huge spike in air pollution over the last few decades due to rapid industrialization and a heavy reliance on fossil fuels. The number of vehicles on the country's roads has increased about four-fold, the report notes. India is trying hard to switch to cleaner fuels, but experts have told CBS News that it's not going to be easy to quit the national coal habit."It's going to take about 15 years for us to see any tangible reduction in the particulate matter… significant reduction could take two to four decades," Tripathi told CBS News. World Health Organization revises air quality guidance to target hazardous emissions 01:43 He's a member of the Indian government's National Clean Air Programme (NCAP) panel, which is working on a plan to reduce PM2.5 in 122 cities by 20–30% by 2024, compared to 2017 levels. Air pollution in Nepal, the third most polluted country, and in Pakistan, the fourth most polluted country, shortened life expectancy there by 4.1 years and 3.8 years respectively, according to the EPIC study. But some of the districts in the two countries — including Lahore and Peshawar in Pakistan — are as bad as Bangladesh, where peoples' lives are being shortened by almost seven years according to the research.The study indicates that more than a billion people living in South Asia may already have have suffered serious health impacts.Tripathi said "rapid economic growth, high population density, and a unique topography that creates a peculiar weather effect" were all likely factors contributing to the high levels of air pollution across India, Pakistan, Bangladesh, and Nepal. Extreme photos of pollution 27 photos The study says that, globally, air pollution is reducing life expectancy by 2.2 years. That's an impact on par with smoking, and more than three times that of alcohol use and unsafe water."It would be a global emergency if Martians came to Earth and sprayed a substance that caused the average person on the planet to lose more than two years of life expectancy," said Michael Greenstone, an economics professor who co-created the EPIC air pollution life expectancy index. "This is similar to the situation that prevails in many parts of the world, except we are spraying the substance, not some invaders from outer space."The study says air pollution has reduced in both the U.S. and Europe, but the majority of people in both still live in areas that fail to meet the standards set by the WHO. In: india New Delhi Environmental Protection Agency World Health Organization Asia Pollution Thanks for reading CBS NEWS. Create your free account or log in for more features. Please enter email address to continue Please enter valid email address to continue
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Asia Business & Economics
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Israel says it is investigating claims that some investors may have known of Hamas's attack on Israel before it took place on 7 October.
An academic study suggests investors betting against the Israeli economy may have made large sums.
Researchers found significant short-selling in the run-up to the attacks.
Short-selling is when investors try to make money on shares, bonds or other financial instruments that they think will fall in price.
They arrange to sell shares they do not yet own at the current price, hoping to buy them later at a cheaper price before the shares change hands, so they can then bank the difference.
"Days before the attack, traders appeared to anticipate the events to come," say researchers Robert Jackson Jr from New York University and Joshua Mitts of Columbia University.
They said the short-selling "far exceeded the short-selling that occurred during numerous other periods of crisis, including the recession following the financial crisis, the 2014 Israel-Gaza war, and the Covid-19 pandemic".
The researchers said they had identified a dramatic increase in investors seeking to sell shares in Israeli companies on the Tel Aviv Stock Exchange.
They also noted a spike in selling activity in an investment that tracks movements in Israeli shares known as an Exchange Traded Fund (ETF).
ETFs are funds that can be bought and sold which invest in a pool of underlying shares. They typically track the movements in an index such as the FTSE 100 or Dow Jones, allowing investors to buy or sell a whole class of assets - in this case, Israeli companies.
The study said short-selling activity in the MSCI Israel Exchange Traded Fund "suddenly, and significantly, spiked" on 2 October, based on data from the US financial watchdog, the Financial Industry Regulatory Authority.
In a 66-page report, they added that: "Just before the attack, short-selling of Israeli securities on the Tel Aviv Stock Exchange increased dramatically."
In response, the Israel Securities Authority said: "The matter is known to the authority and is under investigation by all the relevant parties."
The study said that 4.43 million new shares in Leumi, Israel's largest bank, were short-sold between 14 September and 5 October period, yielding profits of 3.2bn shekels ($862m; £684m).
"Our findings suggest that traders informed about the coming attacks profited from these tragic events, and consistent with prior literature we show that trading of this kind occurs in gaps in US and international enforcement of legal prohibitions on informed trading," the study said.
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Stocks Trading & Speculation
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By Sameer HashmiBBC News Middle East Business Correspondent, DohaImage source, Paul CleggImage caption, England football fan, Paul Clegg, is hoping to watch his team play in Qatar but is concerned about accomodationIn the past 25 years, Paul Clegg has travelled to several countries to watch the England football team play. He has already ticked three World Cups off his list and is now gearing up for his fourth in Qatar. Like the previous editions, he plans to track England's journey through the tournament and has purchased tickets for their matches all the way until the finals, if they qualify. The only challenge for him is that he is not sure where he is going to sleep for most of the tournament."I've just booked a room for the first four nights and I am paying a lot for it. I haven't found any reasonably priced options, so I am not sure where will I be staying after that," he says. Paul is not alone in his struggle - thousands of others are facing the same problem. The BBC spoke to more than two dozen fans who still have not managed to book any accommodation. With less than two months to go, their concerns are growing. The World Cup is expected to attract more than one million visitors, but by March Qatar only had 30,000 hotel rooms, 80% of which had already been booked by Fifa for football teams, officials, and sponsors. Image source, MUSTAFA ABUMUNESImage caption, Over one million fans are expected to visit Qatar for the World Cup but many have still not found afforable roomsTo boost accommodation options, the organisers are offering shared rooms in empty apartments, villas, fan villages and traditional-style tents in the desert.Two cruise ships are being converted into floating hotels that will be moored at Doha's port. All these measures are expected to add up to 70,000 rooms to the market. In a statement to the BBC, the country's Supreme Committee for Delivery & Legacy said the Gulf state would deliver up to 130,000 rooms in time for the tournament. "This is a comfortable inventory for fans, teams and sponsors travelling to the Fifa World Cup Qatar 2022," it added.Despite this announcement, accommodation options on the ground in Qatar are scant and expensive. Refabricated cabins at so-called fan villages built in the desert on the outskirts of Doha are being sold as a budget option. They are priced at $207 (£184) per night and many fans say they are not worth the money. Image caption, Refabricated cabins at so-called fan villages built in the desert on the outskirts of Doha are being sold as a budget optionAnas Filali, who is flying in from the United States, says there are no affordable options for budget travellers like him. "Two hundred dollars for those cabins at the fan village... is just too expensive. Airbnb rooms are ridiculously priced too. I am hoping to find some cheaper options once I get there," he says. The BBC requested access to visit the fan villages, but permission was declined by the authorities. The sites are reportedly still under construction. Locals have been allowed to host fans at their homes, but at hefty prices. On the room-rental site Airbnb there are hardly any options for less than $200 a night. Leo Caglilio, who is travelling from Australia with his brother-in-law, is paying $265 a night for a private room in a family home. He says he never faced the issue of finding an affordable room when he went to Brazil for the 2014 World Cup. "This time it has been really stressful. We had been looking since April, but the price never really came down," he says.Qatar is the smallest nation by land size ever to stage the World Cup. The country has reportedly spent $200bn (£177bn) since it won the bid to host the tournament in 2010 to build infrastructure and stadiums. The busiest period will be the group stage, when four matches a day will be played in stadiums in and around Doha. Football's governing body, FIFA, says almost 2.5 million tickets out of a possible 3 million are already sold and an unprecedented 1.2 million people, equivalent to almost 40% of Qatar's population, are expected to visit. Boon for neighboursThe accommodation squeeze has forced thousands of fans to look for options outside Qatar, with many deciding to base themselves in neighbouring countries. The United Arab Emirates, Saudi Arabia, Kuwait, and Oman will be operating daily shuttle flights to ferry fans to the host country.Dubai has emerged as a popular destination, with demand for hotel rooms soaring ahead of the World Cup. The city will be operating almost 50 shuttle flights every day to Doha, which is less than an hour away by plane. Image caption, Simon has found cheaper accommodation in Dubai and plans to fly in for matchesSimon Witney, a fan from the UK, is staying in Dubai and plans to travel to Doha only on matchdays. He says he is paying less than $100 a night for a "much better room" in an upmarket locality in the city."Despite the flight cost, I will be saving a substantial amount," he says. The Dubai Sports Council estimates that about 1 million World Cup fans could arrive in the city - though some observers feel this target might be ambitious, considering Qatar is also expecting around the same number of visitors. Despite the accommodation chaos, many fans like Paul hope to be able to stay in Qatar to make the most of their visit. "I want to soak in the World Cup atmosphere," he says. "If I stay in another country, then I will lose out on that experience."
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Middle East Business & Economics
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Rick Rycroft/AP
toggle caption
Indigenous women sit on a bench at a polling place in Sydney as Australians cast their final votes in the referendum to create an Indigenous advocacy committee to Parliament.
Rick Rycroft/AP
Indigenous women sit on a bench at a polling place in Sydney as Australians cast their final votes in the referendum to create an Indigenous advocacy committee to Parliament.
Rick Rycroft/AP
CANBERRA, Australia — Advocates for constitutional change in Australia said they were devastated on Saturday by the defeat of a referendum that would have created an advocacy committee to offer advice to Parliament on policies that affect Indigenous people — the nation's most disadvantaged ethnic minority.
Early counting showed that 57% of voters opposed the Indigenous Voice. Australian Broadcasting Corp. projections found New South Wales, Queensland, Tasmania and South Australia had rejected the amendment.
The Voice needed majorities in each of at least four of the six states as well as a national majority for the referendum to pass.
Voice advocate Tanya Hosch, who spent a decade on developing the model, told ABC: "On a personal level, I feel devastated."
"There's going to be a lot of pain and hurt and dismay and we're going to need to take a moment to absorb that message and what it says," Hosch said.
Another advocate, Tom Mayo, said he was also "devastated" and blamed unfair attacks on the plan.
"We have seen a disgusting 'no' campaign. A campaign that has been dishonest, that has lied to the Australian people," Mayo said.
Opinion polls in recent months indicated a strong majority of Australians opposed the proposal. Earlier in the year, a majority had supported it, before the "no" campaign gathered intensity.
Voice advocates had hoped that listening to Indigenous views would lead to more effective delivery of government services and better outcomes for Indigenous lives.
Accounting for only 3.8% of the population, Indigenous Australians die on average eight years younger than the wider population, have a suicide rate twice that of the national average and suffer from diseases in the remote Outback that have been eradicated from other wealthy countries.
The Voice would have been the first referendum passed since 1977 and the first ever to pass without the bipartisan support of the major political parties.
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Australia Business & Economics
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'Scotland is being held back by Westminster' says SNP "Yesterday, our first minister started a national conversation to choose an independent future," says Ian Blackford.He says neighbours are "outperforming the United Kingdom" adding: "They deliver greater income and equality, lower poverty rates, higher productivity... the evidence is overwhelming."Scotland is being held back by Westminster."Responding, the PM says "there are other subjects in the national conversation right now".He references payroll employment, and investment across the whole of the UK: "And the whole of the UK standing strong together on the international stage and speaking up for Ukrainians".Mr Blackford accuses the PM of "living in his own little world" adding: "Our nation [Scotland] is big enough, rich enough. And smart enough that Scotland simply can't afford to remain trapped in the Westminster system." 'A Conservative Corbyn' Sir Keir throws comments made by Tory MPs back at the prime minister."They are making a lot of noise now but I have a list of what his MPs really think of him," he says."Dragging everyone down - who said that? Come on, hands up?"His authority is destroyed, come on hands up, which of you said that?"Can't win back trust - they're all very quiet now."He then moves on to his "personal favourite" from "a document circulated by his backbench in which they call him the Conservative Corbyn"."Prime minister, I don't think that was intended as a compliment," he says. Starmer accuses PM of 'screwing' the economy Sir Keir Starmer says the prime minister is "not just denying how bad things are. He's actively making things worse." In a fiery exchange the Labour leader said: "Mr Speaker, we know what the prime minister says about British business in private. I think that's pretty parliamentary but when did screwing business turn from a flippant comment into economic policy?"In his response, the prime minister said: "Never forget Mr Speaker that under Labour taxes go up on businesses and on people.""Labour have already made spending commitments in this parliament alone worth £94 billion more than the government - that's £2,100 for every household in the country. No wonder no Labour government has ever left office with unemployment lower than when they came in." Analysis: Starmer seems to have taken on board criticism of last week's PMQs performance By Amanda Akass, political correspondentA short sharp question from Sir Keir Starmer on the economy to begin his grilling of the prime minister this afternoon.He does not go in on the two key issues which have been causing such headaches for the government in the past 24 hours - the cancellation of the Rwanda flight and the European Union taking legal action over the Northern Ireland Protocol. But the prime minister's response, boasting instead about his government's economic achievements, was met with huge cheers by his own backbenchers. The prime minister seems on confident form - throwing Latin insults at Sir Keir and going in on the attack himself about Labour and the forthcoming transport strikes next week. But Sir Keir has his own jokes prepared, with some strong laughs for his claim that the prime minister is playing "Jedi mind tricks on the country" and his impersonation of Obi Wan Kenobi. He seems to have taken on board last week's criticism over what many perceived as a flat performance last week after the prime minister narrowly survived a confidence vote from his own MPs – and has come back on punchier form. Boris Johnson 'Jabba the Hutt' and 'thinks he's on Love Island' Labour leader pulling out a host of Star Wars references to attack the prime minister - and has accused him of "thinking he's on Love Island". "As for his boasting about the economy, he thinks he can perform Jedi mind tricks on the country - these aren't the droids you are looking for, no rules are broken, the economy is broken."The problem is the force just isn't with him anymore."He thinks he is Obi-Wan Kenobi. "The truth is, he is Jabba the Hutt."Sir Keir later adds: "He says the economy is booming when it's shrinking. "He is playing so much, he thinks he's on Love Island. But, Prime Minister, I am reliably informed that contestants that give the public the ick get booted out." PM challenges Starmer to end 'sphinx-like silence' on rail strikes The prime minister has challenged the Labour leader to end his "sphinx-like silence" about the upcoming rail strikes.Boris Johnson asked whether Sir Keir Starmer would "break with his shadow transport secretary" and condemn the strikes.The intervention prompted a rebuke from the Speaker of the House who reminded Mr Johnson PMQs was for him to answer questions.Sir Keir responded by saying: "He's in government, he could do something to stop the strike, but he hasn't lifted a finger. I don't want the strikes to go ahead, but he wants to the country to grind to a halt so he can feed off the division." 'Britain set for lower growth than every major economy' says Keir Starmer Labour leader Sir Keir Starmer begins by paying tribute to those who served in the Falklands war.He then moves on to ask the prime minister why Britain is set for lower growth than every major country, except Russia.Boris Johnson replies by saying it is because the UK "came out of the pandemic faster" which has led to the "highest number of people on payroll employment on record".Sir Keir accuses the PM of blaming global forces: "But global forces mean everybody faces them." Boris Johnson leaves Number 10 to head to the Commons for PMQs Coming up at noon Boris Johnson will face questions from Labour's Sir Keir Starmer, the SNP's Ian Blackford and MPs at PMQs.After that, Home Secretary Priti Patel will make a statement on the government's Rwanda policy after the first deportation flight was grounded late last night. 'The government should have seen it coming' says lead immigration lawyer The government should have seen the legal challenges over its Rwandan immigration policy coming, a lawyer representing the lead case before the European Court of Human Rights has said.Geoffrey Robertson QC said: "It should have seen this coming, but it didn't - it was surprised."The European Court has paused flights until the policy is decided to be lawful by the British courts, he said. Mr Robertson said it could be September or October before flights are up and running again.The government, he told Sky News, has three options now - it can go back to the European Court and "argue that it was wrong", or it can proceed and fight the case properly next month in court and "simply pause any flight, not spend any money hiring planes... until the courts give the all-clear".Yesterday's cancelled flight cost an estimated £500,000.Or, he said, the government can put the case before parliament and put it into law which can't be struck down by the courts."They haven't had the gumption to submit it to parliament and that is perhaps what they should have done in the first place," he said.His clients, he said, are concerned they won't see a fair trial in Rwanda and questioned the impartiality of judges in the country."It's no answer to say these people will be processed by Rwandan judges and then set free," he added. Due to your consent preferences, you’re not able to view this. 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United Kingdom Business & Economics
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Labour will not say how many more migrants it would accept under a returns deal with the EU if it comes to power, as senior party figures insist that they do not want to be bound by quotas.
Keir Starmer said this week that if he became prime minister, he would seek a deal with the EU to return some new arrivals to mainland Europe while allowing others to enter Britain.
His comments triggered claims from senior Conservatives that he planned to oversee 100,000 extra arrivals, which the Labour leader dismissed in an interview broadcast on Sunday as “complete garbage”.
Starmer told Sky News’s Trevor Phillips: “We will not be part of [an EU quota system], we are not an EU member. This is why what the government is saying has been complete garbage.”
Labour officials admit that any migration deal with the EU would require the UK to accept some people coming the other way, but Pat McFadden, the party’s elections coordinator, insisted on Sunday that it did not want to sign up to any hard and fast quotas.
“I don’t think it’s going to be an allocation of numbers,” he told the BBC’s Laura Kuenssberg. “We’re talking about individual cases where a child may have strong family links here. It’s not ‘We will take this many, you take that many.’ That’s not the kind of negotiation that we want to have.”
Pushed by Times Radio to say how many extra people Labour might accept under a new agreement, McFadden said: “I don’t think you can predict what the numbers will be when they’re growing the way they have been in recent years.”
Starmer spent Friday and Saturday in Montreal talking to fellow leaders of centre-left parties from around the world, including Justin Trudeau, the Canadian prime minister, and his Norwegian counterpart, Jonas Gahr Støre.
A Labour spokesperson said Starmer had told the Global Progress Action Summit that he believed the west was facing an “axis of instability” from climate change, cross-border people smuggling, terrorism and assaults on democracy.
“If we are to succeed in our generational challenge of taking them on, we need a rewiring of global thinking and new partnerships,” the Labour leader said.
On Tuesday Starmer will travel to Paris for bilateral talks with the French president, Emmanuel Macron, in which migration is likely to feature heavily.
The meeting will help Starmer burnish his credentials as a potential prime minister in waiting, and is the latest stop on his tour as he seeks to build international relationships. Macron regularly meets opposition leaders of countries with close ties to France.
Starmer is expected to be accompanied by his new chief of staff, Sue Gray, the shadow chancellor, Rachel Reeves, and the shadow foreign secretary, David Lammy.
In an interview with Politico from Montreal, he said he believed the UK should “wean itself off” Chinese influence when it comes to trade and technology.
Speaking a week after it emerged that a parliamentary researcher had been arrested on suspicion of spying for Beijing, Starmer said: “How do we wean ourselves off Chinese influence across the world? There are big questions that progressive governments could face together.”
Government ministers, however, have defended their engagement with Beijing, including the meeting between the prime minister, Rishi Sunak, and the Chinese premier, Li Qiang, in Delhi a week ago.
The foreign secretary, James Cleverly, told Kuenssberg on Sunday: “Pretending China doesn’t exist and disengaging is not a credible policy. That is why we have these conversations, so that we can have the difficult conversations.”
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United Kingdom Business & Economics
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BRISBANE, Australia, Sept. 7 (Reuters) - At a beachfront park in Brisbane's north, suspended Australian doctor William Bay told a gathering that an upcoming referendum to recognise the country's first inhabitants and enshrine an Indigenous advisory body in the constitution would "open a gateway to unending tyranny and lawlessness".
The proposal was "equivalent to Germany's Enabling Act of 1933, which turned Hitler into the Fuhrer", Bay said in the speech in August, which he posted on Facebook for his 14,000 followers. The advisory body could "control the parliament and the government, thus replacing our system of representative democracy", added Bay, who lost his medical licence in 2022 after protesting against COVID-19 vaccines.
Dozens of campaigners who built substantial audiences during the COVID era by opposing Australia's pandemic response have turned their focus to undermining the Oct. 14 referendum, analysis of social media posts by independent fact-checkers shows.
Many of their claims bear little resemblance to the proposal Australians will vote on: to establish a body called the Voice to Parliament to provide non-binding advice to lawmakers on matters concerning Indigenous Australians.
These influencers are playing an outsized role in the debate, spreading falsehoods that threaten to put the landmark vote at risk of failing, eight political analysts and anti-misinformation experts told Reuters. The direct link between COVID agitators and misinformation about the Voice has not been previously reported in detail.
Polls show support for the Voice has slumped from about two-thirds in April to less than 40% this month. While factors cited by political commentators include lack of bipartisan support, uncertainty about the Voice's scope and a lackluster "Yes" campaign, the experts who spoke to Reuters said some of the decline can be attributed to misinformation.
Facebook owner Meta (META.O) increased funding for third-party fact-checkers in July, but a month later 40% of posts from accounts flagged for sharing "misinformation or toxic narratives related to the referendum" went viral, according to previously unpublished research by Reset.Tech Australia reported by Reuters for the first time. The internet advocacy group defines "viral" as receiving more than 100 engagements within 24 hours.
Just 4% of posts on Facebook containing independently assessed misinformation about the electoral process were marked or taken down after three weeks, said Reset.Tech, which monitored 99 misleading posts with a combined reach of 486,000 people across Facebook, X (formerly known as Twitter) and TikTok.
Not one X post containing electoral misinformation was marked or taken down in the monitoring period, before or after being reported, Reset.Tech said.
X, which laid off many staff after billionaire Elon Musk bought the platform in 2022, did not respond to a request for comment. The company's civic integrity policy says the use of its services to manipulate or mislead people about elections is a violation of its user agreement.
TikTok labelled or removed one-third of misleading posts, Reset.Tech said, the most proactive in the study.
"Many of the accounts pushing electoral misinformation narratives turned to a style of anti-lockdown politics during the pandemic," said Reset.Tech Australia executive director Alice Dawkins. "Some of these accounts have since attained new levels of virality in the lead up to the referendum, particularly on X."
A Meta spokesperson said the company wanted healthy debate on its platforms but it was "challenging to always strike the right balance" when some users "want to abuse our services during election periods and referendums".
TikTok's Australian public policy director Ella Woods-Joyce said the company was focused on protecting "the integrity of the process and our platform while maintaining a neutral position".
In relation to the referendum, Australia's Electoral Commission has seen "more false commentary about electoral processes spread in the information ecosystem than we've observed for previous electoral events", its media and digital director Evan Ekin-Smyth told Reuters.
Under a giant fig tree, Bay urged his mostly middle-aged audience - and Facebook following - to "scrutineer" polling booths to "make sure it is counted correct", in remarks reminiscent of unsubstantiated vote-rigging claims by former U.S. president Donald Trump over his 2020 loss.
Speaking to Reuters, Bay denied spreading misinformation, saying he considered his claims accurate. He acknowledged his statements "may carry some weight" given his public profile related to the pandemic.
At the same event, local member of parliament Luke Howarth spoke against the Voice, sticking to the conservative opposition's argument that the proposal would be ineffective and divisive because it would extend additional rights to some people based on race.
'POLLUTE YOUR OPINION'
Australia's tough pandemic lockdown and vaccine measures triggered numerous protests, often inspired by social media influencers and anti-vaccine campaigners.
"Covid seemed to awaken in people a complete distrust of authority and lack of confidence in the state," said David Heilpern, dean of the Southern Cross University law school, who studies anti-government movements. "It certainly will have an effect on the vote."
Bay is far from alone in the anti-Voice online ecosystem that has emerged from the pandemic.
A Qantas (QAN.AX) pilot who quit over the airline's COVID vaccine mandate, Graham Hood, now hosts a webcast that he shares with 142,000 Facebook followers.
His guest on July 10, far-right senator Pauline Hanson, told viewers the Voice would turn Australia's Northern Territory into a breakaway "Aboriginal black state" and add extra seats in parliament "which they can make purely for Aboriginal, Indigenous people".
Tristan Van Rye, an electrician with 22,000 Facebook followers after protesting against COVID vaccines, wrote in a July 10 post that the Indigenous body would "take control of certain beaches, nature reserves, national forests and either totally restrict access to all Australians, or charge them fees to access the land". Hood, Hanson and Van Rye did not respond to Reuters' questions about the spread of misinformation.
The Voice was proposed by Aboriginal leaders in 2017 as a step toward healing a national wound dating back to colonisation. Unlike Canada, the U.S. and New Zealand, Australia has no treaty with its Indigenous people, who make up about 3.2% of its population and lag national averages on socioeconomic measures.
Ed Coper, director of communications agency Populares, said that for voters facing a new issue like the Voice, "it is a lot easier to see misinformation on social media and have that pollute your opinion while you're (still) forming that opinion".
One X account labelled by misinformation researchers as possibly fake due to its high volume of anti-Voice content was ultimately linked to a real person, a retired cleaning-business owner from Melbourne.
"I've only got political within the last two years," the account operator, Rosita Diaz, 75, told Reuters by phone. "99.9% of what I post is 100% correct. I would say 100% but some people would turn around and call me a liar. Sometimes I might get something wrong."
Diaz said she had been suspended by Facebook "seven or eight" times over posts deemed false. She now mostly posts on X, where she has 20,600 followers and pays for a subscription, meaning her posts appear more frequently on users' feeds.
MISINFORMATION BILL
Australia's left-leaning Labor government, which supports the Voice, introduced draft legislation this year that would allow the media regulator to determine what constitutes misinformation and fine social media companies that fail to curb it.
The bill, which is still in public consultation, has been criticised by Voice opponents as government censorship. But it may not become law until after the referendum.
A spokesperson for Communications Minister Michelle Rowland said the government wants the bill passed this year but social media platforms are expected to comply with a voluntary code of conduct when it comes to the Voice.
The Yes campaign, meanwhile, has accused the No camp of deliberately spreading misinformation as part of its strategy. A spokesperson for Advance Australia, which is coordinating the No campaign, told Reuters there were "tens of thousands of (No campaign) hats and t-shirts out there and we're not responsible for what people say while they're wearing them".
Elise Thomas, an analyst with the Institute for Strategic Dialogue, said a lack of evidence-based research meant Australians may never gain a full picture of how disinformation and misinformation influence the referendum outcome.
"That's a shame, both for us here in the present and for future generations of Australians trying to understand this moment in history," she said.
Reporting by Byron Kaye; Editing by Praveen Menon, Daniel Flynn and David Crawshaw
Our Standards: The Thomson Reuters Trust Principles.
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Australia Business & Economics
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Colonisation was "the luckiest thing that happened" to Australia, the nation's second-longest serving Prime Minister John Howard has said.
His remarks were made in relation to a historic referendum due to take place this year on Indigenous recognition.
If successful, the vote will change Australia's constitution to give First Nations peoples a greater say over the laws and policies that affect them.
But the debate has seen a surge of divisive commentary.
Speaking to the Australian Newspaper about the upcoming vote, Mr Howard described colonisation as "inevitable".
"I do hold the view that the luckiest thing that happened to this country was being colonised by the British," he said. "Not that they were perfect by any means, but they were infinitely more successful and beneficent colonisers than other European countries."
He also predicted that the Voice to Parliament initiative would fail to pass, leaving a "new cockpit of conflict" over "how to help Indigenous people" in its wake, while accusing its proponents of failing to sell it to the Australian public.
The Voice vote, Australia's first referendum since 1999, was announced by Prime Minister Anthony Albanese at the start of 2023.
If passed, its supporters say it will lead to better outcomes for Australia's First Nations people, who face lower life expectancy, and disproportionately poorer health and education outcomes than White Australians.
But those against it argue - among other things - that the Voice is a largely symbolic gesture which will fail to enact reform, while also undermining Australia's existing government structures.
Recent polling has also shown a steady - yet dramatic - decline in public support for the Voice, as the debate grows more protracted.
Mr Howard is one of the most influential conservative figures to throw his weight behind the No campaign, but his own legacy on Indigenous affairs remains controversial.
His government weakened First Nations land rights, suspended Australia's racial discrimination act, and refused to apologise to the Stolen Generations - tens of thousands of Aboriginal and Torres Strait Islander children who were taken from their families by the government until the mid-1960s.
And in 2007 he was the architect of "the Intervention", a set of policies which saw Australia's military deployed to seize control of daily life in 73 remote Indigenous communities across the Northern Territory.
The now disbanded scheme - which was enacted following a government report on the sexual abuse of children in Aboriginal communities - has been criticised as "coercive" and culturally insensitive.
Mr Howard defended the policy in his interview on Wednesday as "a good old-fashioned dose of proper governance".
He also claimed that if the Voice succeeds, it could prevent the government from intervening in Indigenous communities when it is deemed necessary.
Mr Howard's remarks come amid a wave of controversy that has gripped the referendum's official No campaign.
This week, one of its leaders faced calls to resign after doubling down on comments that Indigenous Australians should undergo blood tests to prove their lineage, to receive welfare payments.
And earlier this month, the campaign was accused of using a "racist trope" in a newspaper ad, after it paid for a full-page cartoon depicting a prominent Indigenous Voice campaigner dancing for money.
Senior figures within the No camp's ranks have also been accused of intentionally spreading falsehoods about the vote.
Among them is federal opposition leader Peter Dutton, who warned that the vote would have an "Orwellian effect" on Australian society, by giving First Nations people greater rights and privileges.
It's a claim that has been further distorted online - and debunked - with social media users suggesting the vote would divide Australians into "settlers" and "original custodians" resulting in a "two-tier government".
If the Voice referendum passes, it will change the nation's constitution for the first time in more than 56 years.
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Australia Business & Economics
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Qantas has warned it could have gone bust if hadn’t been able to offer new staff of its subsidiaries lower pay than the “legacy” conditions of the main airline.
Nathan Safe, the acting executive manager of industrial relations at Qantas, gave that evidence to a Senate inquiry on Tuesday, defending the airline’s “complex” structure as one that had “evolved legally”.
At the Senate employment committee’s hearings into Labor’s closing loopholes industrial relations bill, Qantas has been under scrutiny for hiring new staff through labour companies on lower pay.
The workplace relations minister, Tony Burke, has cited Qantas as “one of the companies that’s used labour hire loopholes” the bill aims to close. The bill’s “same job, same pay” provisions would require that companies with a workplace pay deal pay labour hire workers at the same rate.
On Tuesday Safe said Qantas was a “legacy business” that had shifted from government ownership to private ownership, and thanks to deregulation now operated in a “highly competitive global market with low barriers to entry for new competitors”.
“For most legacy carriers, failing to adapt to this reality has not ended well. That’s why we have evolved our labour model over several decades,” he told the inquiry.
“Our legacy terms and conditions are by far the highest in Australia, and they remain high when compared to virtually every other international carrier flying here.
“But if we kept hiring on those same terms and conditions especially when our domestic competitors are paying at or slightly above award, Qantas would likely not be here.”
Qantas was criticised in the hearing by the chair, Labor senator Tony Sheldon, and outside it by the Australian Council of Trade Unions secretary Sally McManus for using 17 internal or external labour hire entities.
Safe argued that Qantas’s evolution had delivered “huge benefits” including growth in jobs, lower airfares and opening up new routes.
“Yes, our structure is complex,” he said. “But it evolved legally, and it is based on the enterprise bargaining system.”
Safe characterised Qantas’s structure as “grandfathering” and “protecting” legacy conditions while new entities directly employ their workers on “more modern and market relevant conditions”.
The more competitive rates of pay had been negotiated with unions, voted up by employees approved by the Fair Work Commission, Safe said.
“In the last two and a half years we have negotiated 43 enterprise agreements. We don’t always agree [with unions], negotiations are not always easy but we do negotiate … in good faith to arrive at mutually beneficial outcomes for our people and Qantas.”
Turning to the implications if the bill were passed, Safe said it would “significantly increase costs” which, absent improvements in productivity, could “compromise the viability of services, particularly regional ones”.
At an inquiry hearing on 11 October, the Flight Attendants Association of Australia’s federal secretary Teri O’Toole and vice president Angela McManus criticised Qantas’s labour practices, revealing that “no cabin crew” had been hired by the main company since 2008.
They said when Qantas split international crew into a new subsidiary in 2008, flight attendants of Qantas Airways were paid $44.84 an hour, while those of the new Qantas Cabin Crew subsidiary got $21.46 an hour, about 52% less.
Crew of a new Qantas Domestic subsidiary were paid about 28%, they said, with a “significant reduction” in other conditions.
Jetstar International “have Thai and Indonesian workers that are paid $2.16 and $2.93 per hour, flying on Australian aircraft”, they said.
The Flight Attendants Association officials described the bill as “important to stop the continued erosion of conditions in agreements”.
Safe defended the practices as “necessary” for the airline to grow and survive.
Safe said Qantas is still paying “more than our competitors”, none of who “are coming in and paying legacy rates”.
Safe said Qantas – unlike Virgin and Rex – operated in different markets such as freight, premium, and had a low cost carrier (Jetstar), all of which “need to have an appropriate, calibrated cost base”.
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Workforce / Labor
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EURACTIV.com with Reuters Est. 2min 31-08-2023 (updated: 31-08-2023 ) Content-Type: News Service News Service Produced externally by an organization we trust to adhere to journalistic standards. Australian Trade Minister Don Farrell (R) broke off what many had hoped would be the final round of negotiations for an FTA between Australia and the EU when both sides met on 11 July. [European Union, 2023] EURACTIV is part of the Trust Project >>> Print Email Facebook Twitter LinkedIn WhatsApp Telegram Australia and the European Union will resume free trade talks on Thursday (31 August) with a teleconference between Australia’s Trade Minister Don Farrell and EU Commissioner for Trade Valdis Dombrovskis, a month after the two sides failed to reach a deal. Differences over access for Australian agricultural products, particularly beef, to EU markets saw Australia walk away from signing an agreement in Europe in July. Australia is keen to have wider access for its beef, lamb, dairy products and wines, much of which are subject to tariffs and quotas. Both sides are looking to diversify trade, with EU flows affected by the Russia and Ukraine war and Australian exports hurt after major trading partner China imposed blocks on a raft of farm products in a 2020 political dispute. Farrell said in an interview with Reuters last week that he hoped for an improved EU offer when he next speaks with Dombrovskis, whom he has invited to visit Australia. A source familiar with the matter said the teleconference would take place on Thursday. Farrell also said a free trade agreement would simplify European investment in Australia’s burgeoning critical minerals sector, in part by smoothing access through mandatory Foreign Investment Review Board (FIRB) screening. Australia supplies around half of the world’s lithium, as well as other minerals such as rare earths used in batteries for electric cars and defence, amid a global push to diversify supply chains away from dominant producer China. “We want European investment … but they’ve got to understand that as part of that process they’ve got to make a realistic offer,” he said. The EU and Australia opened negotiations in 2018. Australia wants more from the EU in exchange for its minerals Negotiations for a free trade agreement (FTA) between the EU and Australia are stalling as Australia wants to leverage its wealth in critical raw materials to get more access for its meat and sugar industry. Read more with EURACTIV German coalition seeks economic reset, but no agreement on energy subsidiesConcluding a two-day government retreat, Germany’s coalition passed a stimulus package and bureaucracy relief measures to boost businesses and tackle low growth, but questions on Germany’s long-term economic perspective remain unanswered. Print Email Facebook Twitter LinkedIn WhatsApp Telegram Topics Australia Economy EU-Australia FTA Trade
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Australia Business & Economics
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Australians will no longer have to remember their username and password to access government services online as part of an overhaul to stop billions of dollars being lost to scammers.
Earlier this week, the federal government revealed thousands of myGov accounts were being suspended each month out of concern they’d been breached by “scam-in-a-box” kits being sold by criminals on the dark web.
Australians have already lost $3.1bn to scams this year and myGov – which hosts Centrelink, Australian Tax Office and Medicare data – is an attractive target for criminals looking to steal sensitive information.
Next year, the government will introduce passkeys such as face or fingerprint recognition instead of usernames and passwords, making it much harder for scammers to gain access.
“Passkeys will be introduced to bring myGov further into the 21st century, allowing Australians the ability to use biometric options such as facial recognition to access the site,” the government services minister, Bill Shorten, said in a statement.
“These important sign-in alternatives are familiar to many Australians, and are a key safeguard against scammers who use phishing tactics to harvest personal information like people’s date of birth to fraudulently access accounts.”
Government sources believe people reuse their passwords at least 50% of the time, which makes it possible for scammers and hackers to use the stolen password to access other online accounts.
The scam-in-a-box products are used to create fake websites and provide the specialist knowledge required to launch phishing attacks on Centrelink, Australian Tax Office and Medicare accounts.
In some cases, the kits come with security controls and allow criminals to run multiple scams at once, before quickly closing them to avoid detection.
Some can identify when they’re dealing with more IT-savvy users, and direct them to the official myGov website. Many fake websites are almost identical to the real version.
One ad tells buyers that most Australians have a myGov account and that all you have to do is ask for login details and make sure the Australian Tax Office is linked to their account.
Shorten also announced a new advisory group would be formed to ensure myGov puts customers first. The group, which was recommended by a user audit of the service, will be led by the former NSW minister for customer service and digital government Victor Dominello.
Other panel members include the former human rights commissioner Ed Santow; the executive director at The Ethics Centre, Simon Longstaff, and the Victorian secretary of the Community and Public Sector Union, Karen Batt.
“The other committee members bring strong, balanced and wide ranging insights across fields such as governance, service delivery ethics, use of technology in digital service delivery and advocacy for both customers and service delivery staff.”
In August, the Australian Tax Office warned people against clicking on emails and text message scams that directing people to fake myGov websites.
These emails and texts often told people they were owed a tax refund, or that they needed to confirm their bank account, and directed them to a fake website.
“We’re receiving an increased number of reports about several ATO impersonation SMS and email scams,” an ATO spokesperson said.
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Australia Business & Economics
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Israel, Threatened By Hezbollah, Seeks Solution For Empty North
A winding road in northern Israel lined with vineyards leads to Kibbutz Menara atop the Ramim Ridge in the Naftali mountains where pomegranate and avocado trees grow.
(Bloomberg) -- A winding road in northern Israel lined with vineyards leads to Kibbutz Menara atop the Ramim Ridge in the Naftali mountains where pomegranate and avocado trees grow.
It should be an idyllic scene.
Instead, gaping holes have been blown through the blackened walls of the community’s double-story houses. A roof has collapsed and a twisted lump of melted metal denotes what was once a car. For the last few weeks, Islamist militant group Hezbollah has been firing anti-tank missiles into the kibbutz from the Lebanese village of Meiss El Jabal in the valley a few hundred yards below. Other villages in the region have also come under attack and the Israeli military has responded with strikes of its own.
While the world’s attention focuses on a resumption in fighting between Israel and Hamas militants in the Gaza Strip in the south, this largely abandoned cooperative highlights an upcoming problem for the embattled Middle Eastern state: How to get the tens of thousands of people who have fled the region to return when an existential threat is in eyesight just across the border.
“Anyone who moves here will get injured. They have no actual security and no sense of security to come back,” Yoshiau, a bearded 27-year-old mechanical engineering student who’s also a tank captain in the Israeli military and limited his identification to his first name in line with its rules, said in an interview at the kibbutz. “In order to allow the citizens to come back, we have to have a clear indication from our enemies in Lebanon, Hezbollah, that they have no intention of attacking people.”
The issue has bedeviled Israel since it fought Hezbollah in a 34-day war in 2006. Yet the sense of precarity that farmers and other inhabitants of Israeli villages that line the Lebanese border live with has reached unprecedented levels since Hamas militants poured out of Gaza into Israel on Oct. 7, killing about 1,200 people and abducting another 240.
The Israeli military hit back with air raids that reduced much of northern Gaza to rubble and a ground invasion that Hamas authorities in the Mediterranean strip say have killed more than 15,000 people. Fighting resumed Friday after a seven-day pause that allowed for the exchange of some Israeli hostages and Palestinian prisoners.
The US considers Hamas and Hezbollah terrorist organizations. Hezbollah is bigger and better-armed than Hamas, and they are both backed by Iran and share the aim of eradicating the Jewish state.
United Nations Security Council Resolution 1701, adopted after the 2006 war ended, required the establishment of a demilitarized zone between the Israeli border and the Litani River, about 29 kilometers (18 miles) to the north. It has been widely flouted and so far the international community has done little to enforce it, Eyal Hulata, a former national security adviser in the Israeli government, said in a press briefing on Thursday.
“Hezbollah has planned to do something very similar in the north for years” to the incursion carried out by Hamas, said Yoshiau, the tank captain, who left his wife and 18-month-old son at his home near the border with Gaza a few weeks ago to help guard the northern frontier. There was “an informal cease-fire” with Hezbollah during the temporary truce in the south, he said.
Hezbollah began firing volleys of mortars, rockets and anti-tank missiles at Israel on Oct. 7, the heaviest attacks it has staged since 2006. The military was placed on high alert and fully deployed along the 48-mile-long border.
The ongoing tension was evident on Thursday morning, the day that Bloomberg spoke to Yoshiau, with the military shooting down what it said was “a suspicious aerial target” that crossed from Lebanon into Israel. Cross-border hostilities resumed after the fighting in Gaza restarted.
For now, many of the 250 people who usually live in Kibbutz Menara have decamped to the town of Tiberias, an hour’s drive south on the western shores of the Sea of Galilee, where the government is paying for their accommodation.
While the stronger military presence may deter Hezbollah from crossing the border or stepping up its attacks, it’s unlikely to convince Israelis who live in the region to come home. Nor will it diminish the threat of Hezbollah’s more advanced weaponry, which includes missiles that could strike as far afield as Eilat on Israel’s southeastern tip.
The conundrum in the north has been put on the back burner while the military and the government mainly focusing on the war in the south, but the problem isn’t going away and is of major concern to some of Israel’s most prominent business leaders.
“People will not continue to be on the border with Hezbollah breathing over them and shooting at the fence or the houses with anti-tank missiles,” said Erel Margalit, founder and chief executive officer of Jerusalem Capital Partners, one of Israel’s biggest venture capital firms. “Something is going to need to be done about that either diplomatically or militarily.”
The government has begun paying incentives to workers to return to their jobs in the north, topping up their salaries, according to Ron Tomer, president of the Manufacturers’ Association of Israel, who says 70 of the group’s member companies operate there.
That doesn’t address the security question, or provide long-term clarity to those who live along the northern border as to whether they should return.
While Israel, concerned about the reaction of the international community, held back from preemptive ground invasions of both Gaza and Lebanon for years, the Hamas attack “changes that calculus” and once it achieves its aims in Gaza of eliminating Hamas and freeing the remaining hostages that may change, Hulata said.
“Doing what we need in Gaza is difficult enough. We don’t need to find ourselves entangled on two fronts,” he said. “I would not propose to any Israeli government to wait again. I think we need to act before it happens to us and prevent another massacre of civilians in any part of Israel.”
Yoshiau, who passed corpses and cars riddled with bullet holes close to his home when driving north to join his unit on Oct. 7, sees no immediate alternative to Israel maintaining an enhanced military presence along the Lebanon border.
“There’s no other option,” he said, even as he bemoaned missing key moments in his son’s childhood. “We need to be here until we can bring back the sense of security.”
--With assistance from Ethan Bronner, Julius Domoney and Roy Katz.
©2023 Bloomberg L.P.
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Middle East Business & Economics
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Market likes Powell's 'resolve' against inflationOn why stocks are reacting positively to Powell's comments about a possible second 0.75 percentage point hike next month:"After Friday's CPI report, the Fed needed to prove once again it was serious about fighting inflation," said Barry Gilbert, asset allocation strategist for LPL Financial. "The more aggressive stance can still be consistent with a softish landing for the economy, but the path is getting narrower. We still think the Fed may be able to back off from its new forecast of a 3.4% benchmark rate at the end of the year, but for now the priority is showing resolve."—Samantha SubinPowell says Fed can achieve 'successful outcome' even if unemployment rises The Federal Reserve's updated economic projections show an expected rise in unemployment in the years ahead as the central bank hikes rates to fight inflation. Fed Chair Jerome Powell said that may be a worthwhile trade off for a healthy economy."If you were to get inflation on its way down to 2%, and unemployment up to 4.1%, that's still a historically low level. … 3.6% is historically low in the last century," Powell said. "So a 4.1% unemployment rate, with inflation well on its way to 2%, I think that would be a successful outcome."Powell added that lower inflation is necessary to have a healthy labor market in terms of real wage gains and strength among all demographic groups.— Jesse PoundAggressive Fed will 'appease the market' for now, Allianz's Ripley saysAllianz Investment Management's Charlie Ripley said the Fed's more aggressive monetary policy stance should bolster the market, at least in the near term."Today's announcement confirms the Fed's commitment to fight the inflation battle more aggressively despite the potential aftermath from raising rates at such a rapid pace," the firm's senior investment strategist said. "Overall, Fed policy rates have been out of sync with the inflation story for some time and the aggressive hikes from the Fed should appease markets for the time being."Stocks and bonds rallied as Chairman Jerome Powell answered questions from the media. The Dow Jones Industrial Average and S&P 500 were both up at least 1%, while the Nasdaq Composite popped more than 2%.—Fred ImbertWe'd like to do more front-end loading to get to normal levels, Powell saysThe Federal Reserve will continue to hike rates to bring them to more "normal" levels, said Chair Jerome Powell. The central bank delivered a 75 basis point rate hike at the conclusion of Wednesday's policy meeting because it believed "strong action" was necessary."The federal funds rate, even after this move, is at 1.6%," Powell said. "The committee is moving rates up expeditiously to more normal levels, and we came to the view that we'd like to do a little more front-end loading on that."— Sarah MinStocks climbed higher after Powell leaves the door open for another 75 basis point rate hikeThe major indexes jumped higher after Federal Reserve Chair Jerome Powell indicated that another 0.75 percentage point rate hike could be possible. Investors cheered central bank officials taking a tougher stance on inflation.At 3:10 p.m. ET, the S&P 500 was up nearly 1.6%, while the tech-heavy Nasdaq Composite gained 2.6%. The 30-stock Dow jumped more than 350 points.—Darla MercadoPowell: 'We're not trying to induce a recession now. Let's be clear about that'Federal Reserve Chair Jerome Powell made it clear during Wednesday's press conference that the central bank's actions are not intended to tip the economy into a recession."We're not trying to induce a recession now. Let's be clear about that," he said."We're trying to achieve 2% inflation with a strong labor market — that's what we're trying to do," he added.— Pippa StevensPowell says Fed is 'absolutely determined' to hold down inflation expectationsJerome Powell said Wednesday's 75-basis-point hike was due in part to the Federal Reserve being worried about inflation expectations increasing.Most measures still show that Americans expect inflation to return to normal in the coming years, but there were some signs of stress, Powell said."If we even see a couple of indicators that bring that into question, we take that very seriously. We do not take this for granted," he said.The Fed chair said the preliminary University of Michigan consumer sentiment report for June, which includes inflation expectations, was "quite eye-catching." Powell also pointed to the Fed's common inflation expectations index as a reading showing a possible increase in inflation expectations."We're absolutely determined to keep them anchored at 2%," Powell added.— Jesse PoundPowell looking for demand to moderate, balanced labor marketA 50 basis point or 75 basis point increase seems 'most likely' at the next Fed meeting, Powell says Fed Chair Jerome Powell expects a 50 or 75 basis point rate hike will be "most likely" at the next central bank policy meeting. He said the policymakers will make rate increases as appropriate based on incoming economic data."Clearly today's 75 basis point increase is an unusually large one and I do not expect moves of this size to be common," Powell said. "From the perspective of today, either a 50 basis point or a 75 basis point increase seems most likely at our next meeting.""We will however make our decisions meeting by meeting and we'll continue to communicate our thinking as clearly as we can."— Sarah MinAggressive Fed welcomed by some on Wall StreetSome on Wall Street greeted the Federal Reserve's larger rate hike as a positive sign of the central bank's focus on inflation."The Fed nailed it. Recognizing that hiking more now means less later, the Fed demonstrated its resolve to tame inflation without undermining its employment mandate," said Ronald Temple, head of U.S. equity at Lazard Asset management. "While some spectators argued for an even steeper hike, the Fed understood that the combination of rate hikes and QT already takes the US into uncharted territory with significant risks to growth. The hike today sent exactly the right message to markets."Chair Jerome Powell indicated in May that the Fed was unlikely to do a hike of 75 basis points in June, but inflation has continued to rage since that meeting.— Jesse PoundFed members predict benchmark rate will end 2022 above 3%The Fed expects the fed funds rate to increase by another roughly 1.75 percentage points over the next four policy meetings to end the year above 3%.To be exact, the midpoint of the target range for the fed funds rate would go to 3.4%, according to the so-called dot plot forecast released by the Fed.Just five of the 18 Federal Open Market Committee members see the rate ending at a higher level than the midpoint 3.4% rate, while eight members see it about that level. The remaining five members expect the the fed funds rate the end the year at roughly 3.2%.Read more here.—Fred ImbertThe big rate hike is priced in, but expect volatility as tightening continues, says strategistThe Fed just pulled off its most aggressive interest rate hike since 1994, and yet the market has so far had little reaction to the move."Even two weeks ago we may have thought that a .75% increase was off the table, at least in the short term. But with inflation not letting up, it's become pretty clear that the Fed needs to take a more aggressive approach," said Mike Loewengart, managing director of investment strategy at E-Trade. "And as we entered bear territory this week, the market may have already priced in a higher-than-expected jump."Still, Loewengart expects wild price swings going forward as the Fed continues to fight inflation."That's not to say the larger hike may spook some investors. Keep in mind that as we go through a changing monetary policy landscape, we'll likely continue to see volatility as the market digests the new norm," he added.— Yun LiInflation is a focal point in the Fed's policy statementThe FOMC's policy statement today runs 368 words, and only mentions "Ukraine," "supply chain" and "Covid" one time each. "Inflation" was cited seven times.-Scott SchnipperThe Fed says it's 'strongly committed' to tamping down inflationThe Fed stressed its dedication to bringing down soaring inflation in its post-meeting statement."The Committee is strongly committed to returning inflation to its 2 percent objective," the Federal Open Market Committee said in the statement.The rate-setting committee removed a long-used phrase indicating that the FOMC "expects inflation to return to its 2 percent objective and the labor market to remain strong."— Yun LiWhat's changed in the new Fed statementClick here for a comparison of Wednesday's Federal Open Market Committee statement with the one issued after the central bank's previous policymaking meeting on May 4.— Yun Li, Jesse PoundFed raises rates by 0.75 percentage pointThe Federal Reserve announced that it raised interest rates by 75 basis points or 0.75 percentage point. This marks the greatest rate increase in 28 years.The Federal Reserve announced that it raised interest rates by 75 basis points or 0.75 percentage point. This marks the greatest rate increase in 28 years, and it brings the benchmark funds rate to a range of 1.5% to 1.75%.Individual members of the Fed expect the benchmark rate will end 2022 at 3.4%, 1.5 percentage points higher than the March estimate.Fed officials also cut their outlook for 2022's economic growth. They now predict a 1.7% gain in GDP, down from 2.8% in March.Read more here.-Darla Mercado, Jeff CoxS&P 500 can gain 23.8 basis points after Fed meeting The S&P 500 historically gains an average 23.8 basis points following the conclusion of a Federal Reserve policy meeting when the broad-market index is already up by 100 basis points by noon, according to data from Bespoke. One basis point is equal to 0.01%.This is compared to an average 5.1 basis point gain for all Fed meeting days.— Sarah MinHere's where the markets stand ahead of the Fed's decisionThe Federal Reserve's interest rate announcement is a few minutes away. Here's a snapshot of where the markets stand.U.S. stocks: The S&P 500 is up 1.1%, and the Nasdaq Composite has gained 1.8%. The Dow Jones Industrial Average has added more than 200 points.Bonds: The 10-year Treasury yield is at 3.398%, down about 8 basis points. One basis point is equal to 0.01%.Gold: Gold futures are trading at $1,822.0 an ounce, up about 0.4%.Currencies: The dollar index is at 105.34, down about 0.1%. The euro is down about 0.1%, at 1.0403 per dollar.-Darla MercadoBill Ackman predicts a 75 basis point rate hike as Fed pledges aggressive actionPershing Square's Bill Ackman is calling on the Federal Reserve to act aggressively so the central bank can regain credibility in its fight against soaring inflation.On Wednesday before the Fed decision at 2 p.m. ET, Ackman gave his prediction in a tweet, anticipating that the Fed "raises 75 bps, expresses a high level of concern about inflation and inflationary expectations, and makes clear that nothing is off the table for July including 100 bps or more if necessary."The hedge fund manager also said a series of one percentage point increment hikes would be more efficient to ease inflation and the markets can recover sooner.— Yun LiAtlanta Fed's GDPNow estimates no growth in second quarterA real-time reading of economic growth from the Atlanta Federal Reserve has declined again on Wednesday, reflecting the slowing U.S. economy and fanning fears of a potential recession.After a weaker-than-expected retail sales report for May, the GDPNow tracker now shows 0% growth for the second quarter.If that comes to pass, this will mark the second straight quarter with flat or negative GDP growth. In the first quarter, GDP growth was negative, though largely due to a higher-than-usual difference between imports and exports.With inflation running at its highest level since the early 1980s, the Federal Reserve is raising rates despite slowing economic growth. That dynamic has led many on Wall Street to predict a recession either later this year or in 2023.Consecutive quarterly declines in GDP often coincide with official recessions, though that standard is not part of the official definition used by the National Bureau of Economic Research.— Jesse PoundThe Federal Reserve is expected to announce a 0.75 percentage point rate hike – the biggest since 1994The Federal Reserve is expected to raise interest rates by three-quarters of a percentage point – a move the central bank hasn't made since 1994. The move would raise the federal funds rate to a range of 1.5% to 1.75%.Central bank officials are also expected to reveal their outlook for interest rates through its "dot plot" of individual members' expectations. The Fed will also update its expectations for gross domestic product, inflation and unemployment.The Fed's rate announcement comes at a time when inflation is running at its highest pace since December 1981.Read more here.-Darla Mercado, Jeff Cox
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Inflation
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SummaryJapan intervened on Sept 22 to stem excessive yen weakeningInvestors seek clues for more interventionDollar broke above level seen before Japan's last interventionTOKYO, Oct 12 (Reuters) - Japanese policymakers kept up their warnings against investors selling off the Japanese currency as the dollar rose to a fresh 24-year high against the yen on Wednesday, raising speculation about a second round of intervention.The U.S. currency rose to 146.35 yen , a level not seen since August 1998 during the Asian financial crisis, moving above levels that triggered intervention by Japanese authorities last month to stem excessive yen weakening.The yen was trading around 146.30 to the dollar around midday on Wednesday as traders braced for U.S. inflation data and its implications on future U.S. rate hikes.Register now for FREE unlimited access to Reuters.com"We are closely watching foreign exchange moves with a high sense of urgency, and ready to take appropriate steps on excess moves," Chief Cabinet Secretary Hirokazu Matsuno told reporters.The comment came after Finance Minister Shunichi Suzuki was quoted by Jiji Press as saying there was no change in the country's stance at all and that it would take necessary steps in the foreign exchange market if necessary."What was important was the speed of forex moves," not any levels, Jiji quoted Suzuki as saying as he was travelling to Washington to attend a gathering of the financial leaders from the Group of 20 major economies.Neither Matsuno nor Suzuki used stronger expressions in describing yen moves on Wednesday such as "excessive," "one-sided" or "speculative," suggesting that currency intervention may not be imminent.Last month, Japanese authorities sold dollars and bought yen in a market intervention for the first time in 24 years, spending 2.8 trillion yen ($19.2 billion) to slow a rapid slide in the yen that was considered a threat to the economy.Market players were closely watching how Suzuki might explain Japan's stance on intervention and whether the country would gain backing from the United States and other countries at the Group of 20 meeting in Washington this week.While Japanese officials have said they do not necessarily need U.S. consent for action in the currency markets, they repeatedly stress the importance of seeking U.S. understanding, which is seen as lending them legitimacy.Investors see solo action by Japan being far less effective than concerted intervention.($1 = 146.2100 yen)Register now for FREE unlimited access to Reuters.comReporting by Tetsushi Kajimoto, Kaori Kaneko and Mariko Katsumura; Editing by David Dolan and Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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'Soft landing' still on the table, Powell saysFederal Reserve Chair Jerome Powell said it is still possible for the central bank to achieve a "soft landing," in which the Fed brings down inflation without causing a recession."I think what's in the SEP would certainly meet that test," Powell said, referencing the Fed projections that show inflation nearing 2% with inflation just over 4% in 2024.The Fed chair did say that the central bank cannot control all the factors driving inflation, such as oil prices that have been pushed higher by Russia's invasion of Ukraine."I think events of the last few months have raised the degree of difficulty, created great challenges," Powell said. "And there's a much bigger chance now that it will depend on factors that we don't control."— Jesse PoundMarket likes Powell's 'resolve' against inflationOn why stocks are reacting positively to Federal Reserve Chair Jerome Powell's comments about a possible second 0.75 percentage point hike next month:"After Friday's CPI report, the Fed needed to prove once again it was serious about fighting inflation," said Barry Gilbert, asset allocation strategist for LPL Financial. "The more aggressive stance can still be consistent with a softish landing for the economy, but the path is getting narrower. We still think the Fed may be able to back off from its new forecast of a 3.4% benchmark rate at the end of the year, but for now the priority is showing resolve."—Samantha SubinPowell says Fed can achieve 'successful outcome' even if unemployment rises The Federal Reserve's updated economic projections show an expected rise in unemployment in the years ahead as the central bank hikes rates to fight inflation. Fed Chair Jerome Powell said that may be a worthwhile trade off for a healthy economy."If you were to get inflation on its way down to 2%, and unemployment up to 4.1%, that's still a historically low level. … 3.6% is historically low in the last century," Powell said. "So a 4.1% unemployment rate, with inflation well on its way to 2%, I think that would be a successful outcome."Powell added that lower inflation is necessary to have a healthy labor market in terms of real wage gains and strength among all demographic groups.— Jesse PoundAggressive Fed will 'appease the market' for now, Allianz's Ripley saysAllianz Investment Management's Charlie Ripley said the Fed's more aggressive monetary policy stance should bolster the market, at least in the near term."Today's announcement confirms the Fed's commitment to fight the inflation battle more aggressively despite the potential aftermath from raising rates at such a rapid pace," the firm's senior investment strategist said. "Overall, Fed policy rates have been out of sync with the inflation story for some time and the aggressive hikes from the Fed should appease markets for the time being."Stocks and bonds rallied as Chairman Jerome Powell answered questions from the media. The Dow Jones Industrial Average and S&P 500 were both up at least 1%, while the Nasdaq Composite popped more than 2%.—Fred ImbertWe'd like to do more front-end loading to get to normal levels, Powell saysThe Federal Reserve will continue to hike rates to bring them to more "normal" levels, said Chair Jerome Powell. The central bank delivered a 75 basis point rate hike at the conclusion of Wednesday's policy meeting because it believed "strong action" was necessary."The federal funds rate, even after this move, is at 1.6%," Powell said. "The committee is moving rates up expeditiously to more normal levels, and we came to the view that we'd like to do a little more front-end loading on that."— Sarah MinStocks climbed higher after Powell leaves the door open for another 75 basis point rate hikeThe major indexes jumped higher after Federal Reserve Chair Jerome Powell indicated that another 0.75 percentage point rate hike could be possible. Investors cheered central bank officials taking a tougher stance on inflation.At 3:10 p.m. ET, the S&P 500 was up nearly 1.6%, while the tech-heavy Nasdaq Composite gained 2.6%. The 30-stock Dow jumped more than 350 points.—Darla MercadoPowell: 'We're not trying to induce a recession now. Let's be clear about that'Federal Reserve Chair Jerome Powell made it clear during Wednesday's press conference that the central bank's actions are not intended to tip the economy into a recession."We're not trying to induce a recession now. Let's be clear about that," he said."We're trying to achieve 2% inflation with a strong labor market — that's what we're trying to do," he added.— Pippa StevensPowell says Fed is 'absolutely determined' to hold down inflation expectationsJerome Powell said Wednesday's 75-basis-point hike was due in part to the Federal Reserve being worried about inflation expectations increasing.Most measures still show that Americans expect inflation to return to normal in the coming years, but there were some signs of stress, Powell said."If we even see a couple of indicators that bring that into question, we take that very seriously. We do not take this for granted," he said.The Fed chair said the preliminary University of Michigan consumer sentiment report for June, which includes inflation expectations, was "quite eye-catching." Powell also pointed to the Fed's common inflation expectations index as a reading showing a possible increase in inflation expectations."We're absolutely determined to keep them anchored at 2%," Powell added.— Jesse PoundPowell looking for demand to moderate, balanced labor marketA 50 basis point or 75 basis point increase seems 'most likely' at the next Fed meeting, Powell says Fed Chair Jerome Powell expects a 50 or 75 basis point rate hike will be "most likely" at the next central bank policy meeting. He said the policymakers will make rate increases as appropriate based on incoming economic data."Clearly today's 75 basis point increase is an unusually large one and I do not expect moves of this size to be common," Powell said. "From the perspective of today, either a 50 basis point or a 75 basis point increase seems most likely at our next meeting.""We will however make our decisions meeting by meeting and we'll continue to communicate our thinking as clearly as we can."— Sarah MinAggressive Fed welcomed by some on Wall StreetSome on Wall Street greeted the Federal Reserve's larger rate hike as a positive sign of the central bank's focus on inflation."The Fed nailed it. Recognizing that hiking more now means less later, the Fed demonstrated its resolve to tame inflation without undermining its employment mandate," said Ronald Temple, head of U.S. equity at Lazard Asset management. "While some spectators argued for an even steeper hike, the Fed understood that the combination of rate hikes and QT already takes the US into uncharted territory with significant risks to growth. The hike today sent exactly the right message to markets."Chair Jerome Powell indicated in May that the Fed was unlikely to do a hike of 75 basis points in June, but inflation has continued to rage since that meeting.— Jesse PoundFed members predict benchmark rate will end 2022 above 3%The Fed expects the fed funds rate to increase by another roughly 1.75 percentage points over the next four policy meetings to end the year above 3%.To be exact, the midpoint of the target range for the fed funds rate would go to 3.4%, according to the so-called dot plot forecast released by the Fed.Just five of the 18 Federal Open Market Committee members see the rate ending at a higher level than the midpoint 3.4% rate, while eight members see it about that level. The remaining five members expect the the fed funds rate the end the year at roughly 3.2%.Read more here.—Fred ImbertThe big rate hike is priced in, but expect volatility as tightening continues, says strategistThe Fed just pulled off its most aggressive interest rate hike since 1994, and yet the market has so far had little reaction to the move."Even two weeks ago we may have thought that a .75% increase was off the table, at least in the short term. But with inflation not letting up, it's become pretty clear that the Fed needs to take a more aggressive approach," said Mike Loewengart, managing director of investment strategy at E-Trade. "And as we entered bear territory this week, the market may have already priced in a higher-than-expected jump."Still, Loewengart expects wild price swings going forward as the Fed continues to fight inflation."That's not to say the larger hike may spook some investors. Keep in mind that as we go through a changing monetary policy landscape, we'll likely continue to see volatility as the market digests the new norm," he added.— Yun LiInflation is a focal point in the Fed's policy statementThe FOMC's policy statement today runs 368 words, and only mentions "Ukraine," "supply chain" and "Covid" one time each. "Inflation" was cited seven times.-Scott SchnipperThe Fed says it's 'strongly committed' to tamping down inflationThe Fed stressed its dedication to bringing down soaring inflation in its post-meeting statement."The Committee is strongly committed to returning inflation to its 2 percent objective," the Federal Open Market Committee said in the statement.The rate-setting committee removed a long-used phrase indicating that the FOMC "expects inflation to return to its 2 percent objective and the labor market to remain strong."— Yun LiWhat's changed in the new Fed statementClick here for a comparison of Wednesday's Federal Open Market Committee statement with the one issued after the central bank's previous policymaking meeting on May 4.— Yun Li, Jesse PoundFed raises rates by 0.75 percentage pointThe Federal Reserve announced that it raised interest rates by 75 basis points or 0.75 percentage point. This marks the greatest rate increase in 28 years.The Federal Reserve announced that it raised interest rates by 75 basis points or 0.75 percentage point. This marks the greatest rate increase in 28 years, and it brings the benchmark funds rate to a range of 1.5% to 1.75%.Individual members of the Fed expect the benchmark rate will end 2022 at 3.4%, 1.5 percentage points higher than the March estimate.Fed officials also cut their outlook for 2022's economic growth. They now predict a 1.7% gain in GDP, down from 2.8% in March.Read more here.-Darla Mercado, Jeff CoxS&P 500 can gain 23.8 basis points after Fed meeting The S&P 500 historically gains an average 23.8 basis points following the conclusion of a Federal Reserve policy meeting when the broad-market index is already up by 100 basis points by noon, according to data from Bespoke. One basis point is equal to 0.01%.This is compared to an average 5.1 basis point gain for all Fed meeting days.— Sarah MinHere's where the markets stand ahead of the Fed's decisionThe Federal Reserve's interest rate announcement is a few minutes away. Here's a snapshot of where the markets stand.U.S. stocks: The S&P 500 is up 1.1%, and the Nasdaq Composite has gained 1.8%. The Dow Jones Industrial Average has added more than 200 points.Bonds: The 10-year Treasury yield is at 3.398%, down about 8 basis points. One basis point is equal to 0.01%.Gold: Gold futures are trading at $1,822.0 an ounce, up about 0.4%.Currencies: The dollar index is at 105.34, down about 0.1%. The euro is down about 0.1%, at 1.0403 per dollar.-Darla MercadoBill Ackman predicts a 75 basis point rate hike as Fed pledges aggressive actionPershing Square's Bill Ackman is calling on the Federal Reserve to act aggressively so the central bank can regain credibility in its fight against soaring inflation.On Wednesday before the Fed decision at 2 p.m. ET, Ackman gave his prediction in a tweet, anticipating that the Fed "raises 75 bps, expresses a high level of concern about inflation and inflationary expectations, and makes clear that nothing is off the table for July including 100 bps or more if necessary."The hedge fund manager also said a series of one percentage point increment hikes would be more efficient to ease inflation and the markets can recover sooner.— Yun LiAtlanta Fed's GDPNow estimates no growth in second quarterA real-time reading of economic growth from the Atlanta Federal Reserve has declined again on Wednesday, reflecting the slowing U.S. economy and fanning fears of a potential recession.After a weaker-than-expected retail sales report for May, the GDPNow tracker now shows 0% growth for the second quarter.If that comes to pass, this will mark the second straight quarter with flat or negative GDP growth. In the first quarter, GDP growth was negative, though largely due to a higher-than-usual difference between imports and exports.With inflation running at its highest level since the early 1980s, the Federal Reserve is raising rates despite slowing economic growth. That dynamic has led many on Wall Street to predict a recession either later this year or in 2023.Consecutive quarterly declines in GDP often coincide with official recessions, though that standard is not part of the official definition used by the National Bureau of Economic Research.— Jesse PoundThe Federal Reserve is expected to announce a 0.75 percentage point rate hike – the biggest since 1994The Federal Reserve is expected to raise interest rates by three-quarters of a percentage point – a move the central bank hasn't made since 1994. The move would raise the federal funds rate to a range of 1.5% to 1.75%.Central bank officials are also expected to reveal their outlook for interest rates through its "dot plot" of individual members' expectations. The Fed will also update its expectations for gross domestic product, inflation and unemployment.The Fed's rate announcement comes at a time when inflation is running at its highest pace since December 1981.Read more here.-Darla Mercado, Jeff Cox
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Inflation
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Story at a glance Researchers from Yale University studied mortality rates and insurance enrollment data from before and during the COVID-19 pandemic. They found that lack of consistent health insurance exacerbated the pandemic and caused more Americans to lose their lives to COVID-19. In 2020 alone, researchers calculated 131,438 deaths could have been saved if the U.S. had a universal health care system. More than 1 million people have died from COVID-19 in the U.S., but over 200,000 lives could have been saved if the country had a single-payer universal healthcare system in 2020, according to a new study. Researchers from the Yale School of Public Health analyzed national mortality data from before and after the COVID-19 pandemic and their results indicated a fragmented healthcare system led to preventable deaths and unnecessary costs. As of Thursday, the U.S. has experienced 1,007,374 deaths to COVID-19 and over 85 million positive cases. At the same time, the U.S. has spent more on healthcare than any other country, both overall and on a per capita basis, according to researchers. Because the U.S. lacks universal healthcare, millions of Americans lean on private marketplace plans and employer-sponosored coverage. However, the pandemic caused over 9 million Americans to fall into unemployment—with many losing critical health insurance during a global pandemic. “Inadequate health insurance coverage has exacerbated the COVID-19 pandemic on both individual and population levels,” wrote researchers. America is changing faster than ever! Add Changing America to your Facebook or Twitter feed to stay on top of the news. Researchers linked mortality statistics to national insurance enrollment to quantify how lack of consistent health insurance caused elevated fatality rates. They found that insurance enrollment from December 2019 to April 2020 experienced a 14.5 million drop in employer-sponsored insurance plans. Around the same time Medicaid enrollments rose from 71.6 million in March 2020 to 80.2 million in December 2020, as unemployed Americans can become eligible for Medicaid based on income and household size. Researchers noted that the increase in Medicaid enrollment could have multiple explanations, including as a response to unemployment, the result of ongoing Medicaid expansion efforts or due to the perceived risk of COVID-19. Tying those statistics to mortality data, researchers calculated that 26.4 percent of the lives that were reported to be lost due to COVID-19 would likely have been saved if the U.S. had universal healthcare throughout the pandemic. That means in 2020 alone, 131,438 American lives could have been saved from COVID-19 and more than 200,000 additional deaths from the virus could have been avoided since then. “Universal healthcare coverage decoupled from unemployment and disconnected from profit motivations would have stood the country in better stead against a pandemic,” wrote researchers. Moving to universal healthcare could also have saved the federal government some serious cash, with researchers calculating that $459 billion could have been saved in 2020 alone. That’s conceivable, as researchers found government-sponsored Medicare charges are 22 percent lower than those charged by private insurance for the same services. When it came to COVID-19, private insurers paid more than double the Medicaid rate for a COVID-19 hospitalization case. Universal healthcare is an idea that Sen. Bernie Sanders (I-Vt.) campaigned on when running for president, introducing a Medicare for All plan that would have established a single-payer national health insurance program. The senator tried to introduce that same plan in May, joined by a handful of Democratic colleagues, that would be implemented over a four-year period. It would establish a federally administered national health insurance program and include dental care, vision coverage and hearing aids with no out of pocket expenses, insurance premiums, deductibles or co-payments. The House has yet to take up the legislation. Published on Jun. 16, 2022
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Unemployment
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For this macroeconomic analysis, I have selected two countries. They are Malaysia and New Zealand. I wish to conduct a macroeconomic analysis by comparing the economic growth, unemployment, inflation, exchange rate, and net exports of two countries Brief explanation to the economies of Malaysia and New Zealand Malaysia Malaysia can be considered as the 4th largest economy in the Southeast Asian region and 36th largest economy in the world. It is a newly industrialized economy and in the year 2019, this was the 27th competitive economy in the world (Schwab & World Economic Forum, 2019). But COVID 19 pandemic very badly affected the every sector of the economy of Malaysia. New Zealand New Zealand can be considered as a highly developed nation and free market economy in the world (Hall & Soskice, 2001). According to Nominal Gross Domestic Product (GDP) statistics, country has been ranked as the 52nd economy of the world. This country owns well established service sector which accounts for 63 percent from the GDP (Stats NZ archive website | Stats NZ, 2014). Aim of this macroeconomic analysis In this study, I will compare the economy of Malaysia and economy of New Zealand using the data of past five years by understanding macroeconomic issues of each countries. For that, I will use macroeconomic fundamentals including economic growth, unemployment, inflation, exchange rate, and net exports of two countries. I wish to discuss about trends of the above-mentioned macroeconomic fundamentals and factors affected to them. Also, I will discuss what countries can learn from each other. Macroeconomic Analysis Economic Growth of Malaysia and New Zealand Year/Country20162017201820192020Avg.New Zealand3.733.613.211.630.982.63Malaysia4.455.814.774.30-5.592.75Source: World Bank national accounts data & OECD National Accounts data, 2021 Figure 1: Graphical presentation of GDP Growth Rate (%) of Malaysia and New Zealand To see what is the GDP, kindly click here Malaysia When we see data from year 2016 to 2019, GDP growth of the Malaysia was more than 4%. In the year 2017, Malaysia recorded the highest GDP growth rate (5.81%) during the period of 2016 to 2019. Most relevant reason for this economic growth was rebound of the agricultural sector and improvement of the manufacturing and service sectors (Department of Statistics Malaysia Official Portal, 2021). But in the year 2020 economy of Malaysia contracted from 5.59 as a result of the COVID 19 pandemic. New Zealand From year 2016 to year 2020, GDP growth of New Zealand has showed a growth but at a decreasing rate. In the year 2016, GDP growth of New Zealand was 3.73% and it has decreased to 0.98% in the year 2020. As major reasons for this slowing economic growth, we can say, trade tension and global economic contraction as a result of the COVID 19 pandemic (Shane, 2019). Comparison Average economic growth of Malaysia is higher than New Zealand. Although Malaysia has recorded 5.59 economic contraction in the year 2020, average GDP growth of Malaysia is higher than New Zealand for the period of 2016 to 2020. So, New Zealand should take more policies to strengthen the agricultural, manufacturing and service sectors of the county to achieve a higher GDP growth rate. Unemployment of Malaysia and New Zealand Year/Country20162017201820192020Avg.New Zealand5.084.74.34.074.554.54Malaysia3.443.413.33.314.553.602Source: O’Neill, 2021 Figure 2: Graphical presentation of Unemployment Rate (%) of Malaysia and New Zealand Malaysia Malaysia has shown lower and consistent unemployment approximately 3% until the year 2020, which indicates the population of Malaysia is near to full employment. In 2014, the country’s rate of unemployment was at its lowest level, at 2.85% (O’Neill, 2021). And during the last five years in 2018 also we can see that there is a lower unemployment rate than in other years (O’Neill, 2021). Malaysia’s economy is recognized as a growing economy which is one of the most powerful in Southeast Asia. The reasons are the low unemployment rate, excellent growth rates annually and political stability. The highest unemployment rate for Malaysia from 2016 to 2020 is in the year 2020 with an unemployment rate of 4.55%. The reason for this is that the world was experiencing Covid-19 Pandemic from the last quarter of 2019. New Zealand For New Zealand, the highest rate from 2016 to 2020 is in the year 2016, with an unemployment rate of 5.08%. The figures show unemployment fell gradually from 5.08% to 4.07% from 2016 to 2019. For New Zealand, the lowest unemployment rate was in 2019, with an unemployment rate of 4.07% (O’Neill, 2021d). And in 2020 again unemployment rate increased to 4.55% because of the Covid-19 Pandemic. Comparison Malaysia has an average unemployment rate of 3.602% whereas New Zealand has an average unemployment rate of 4.54%. New Zealand’s average unemployment rate trumps that of Malaysia’s. But in 2020 both countries’ unemployment rate is equal. However, government of New Zealand should learn that how Malaysia has taken actions to reduce the unemployment. They should strengthen the labour market of the country, improve the labour skills, knowledge, laws and regulations and so on. Inflation of Malaysia and New Zealand Inflation can be defined as an increase in the general level of prices during a specified period in an economy (Amadeo, 2020). Most economists believe that an inflation rate of 2% to 3% is optimal for a country’s economy. If there is high inflation in a country, that leads to increased unemployment level because businesses would rather wait and hire more people at the same price using future funds and making labor cheaper. Year/Country20162017201820192020Avg.New Zealand0.651.851.61.621.721.488Malaysia2.083.80.970.66-1.141.274Source: O’Neill, 2021 Figure 3: Graphical presentation of Inflation Rate (%) of Malaysia and New Zealand Malaysia The highest inflation rate in Malaysia was in the year 2017 with an inflation rate of 3.8%. And there is a significant decrease in inflation in 2018. The lowest inflation rate for Malaysia was in 2020, with an inflation rate of -1.14%. The expected inflation rate for 2021 is 2% (O’Neill, 2021). New Zealand The highest inflation rate in New Zealand was in the year 2017 with an inflation rate of 1.85%. The lowest inflation rate for New Zealand is in the year 2016 during the last five years, with an inflation rate of 0.65%. The expected inflation rate for 2021 is 1.83%. (O’Neill, 2021) Comparison The average inflation rate for Malaysia is 1.274%, whereas the average inflation rate for New Zealand is 1.488%. Overall, New Zealand’s inflation rate is higher (Compare countries | TheGlobalEconomy.com, 2010). Both countries’ inflation rates do not have a consistent tendency; they change continually throughout five years. There is deflation in both countries in some years. When there is deflation, the investors want to save their money and wait for it to grow in value before investing. This is a major issue in deflation. Exchange Rate of Malaysia and New Zealand (Compared to the USD) Year/Country20162017201820192020Avg.New Zealand0.6970.7110.6920.6590.6510.682Malaysia0.2420.2330.2480.2410.2380.240Source: Yearly Average Rates & Forex History Data, 2021 Figure 4: Graphical presentation of Exchange Rate (compared with USD) of New Zealand Figure 5: Graphical presentation of Exchange Rate (compared with USD) of Malaysia Malaysia Average exchange rate of Malaysia was 0.24 US Dollars within the period of year 2016 to 2020. That means averagely a Malaysia Ringgit was valued 0.24 Us Dollars. But this exchange rate has been fluctuated over the period as presented in above graph. Although country recorded higher GDP in the year 2017, exchange rate has been depreciated as a result of the declining of crude oil prices and increasing of debt. But country could increase the exchange rate in the next year (2018) up to 1 Malaysian Ringgit = 0.248 USD. Again exchange rate has been fallen in the year 2020, as a result of the COVID 19 pandemic. New Zealand Average exchange rate of New Zealand was 0.682 US Dollars within the period of year 2016 to 2020. That means averagely a New Zealand Dollar was valued 0.682 Us Dollars. But this exchange rate has been decreased over the period of 2018 2020 as presented in above graph. Although country recorded higher Exchange rate in the year 2017, exchange rate has been depreciated from year 2018 to 2020 as a result of the decreasing the prices of the exports and bad effect of the COVID 19 pandemic. (FocusEconomics, n.d.) Comparison Average exchange rate of the New Zealand is higher than Malaysia. But trends of the exchange rates of both countries cannot be appreciated. Because in Malaysia, there were higher fluctuations in the exchange rate and in New Zealand, exchange rate was continuously declining from year 2018 to 2020. However, if there was no COVID 19 pandemic, we could expect that exchange rate of both countries might better in the year 2020. Net Exports of Malaysia and New Zealand Year/Country20162017201820192020Avg.New Zealand (USD)13786238911816898604(678174333)(591319258)2569309689899067718.5Malaysia (USD)199903353092198827786124054470763271509081252178342890622993484193Source: World Bank et al., 2021 Figure 6: Graphical presentation of net exports (in USD) of Malaysia and New Zealand Malaysia Average net exports (total goods and services exports – total goods and services imports) of Malaysia were USD 22,993,484,193 within the period of year 2016 to 2020. When we consider about year 2016 to 2019, net exports of Malaysia have been continuously increased. In the year 2016, net exports were valued USD 19,990,335,309 and it has been increased up to USD 27,150,908,125 in the year 2019. Because Malaysia is an export oriented economy which exports large amount of goods and services to other countries in the world. But in the year 2020, Net export value of the Malaysia has been sharply decreased as a result of the decreasing exports since COVID 19 pandemic. New Zealand Average net exports of New Zealand were USD 899,067,718.5 within the period of year 2016 to 2020. There was a significant level of fluctuations in the net exports of the New Zealand. Especially in the year 2018 and 2019, there negative values of net exports. This is one of the major reasons for the decreasing BOP value and decreasing exchange rate of the country. But in the year 2020, New Zealand could increase the net export value although there was bad effect of COVID 19 pandemic. Comparison Average net exports of Malaysia were USD 22,993,484,193 and average net exports of New Zealand were USD 899,067,718.5 within the period of year 2016 to 2020. If we neglect the bad effect of COVID 19 pandemic, Net exports of Malaysia have been continuously increased. But net export value of New Zealand has been fluctuated and especially in the year 2018 and 2019, there negative values of net exports. So, New Zealand should take actions to increase its exports and should learn to make an export friendly economy like Malaysia. New Zealand should decrease the export duties and taxes, prices of the goods and services, make more trade relationships with other countries and so on Conclusion and recommendation of the Macroeconomic Analysis According to this macroeconomic analysis, about past five years, overall economic performance of Malaysia is better than New Zealand. Although Malaysia has recorded 5.59 economic contraction in the year 2020, average GDP growth of Malaysia is higher than New Zealand for the period of 2016 to 2020. So, New Zealand should take more policies to strengthen the agricultural, manufacturing and service sectors of the county to achieve a higher GDP growth rate. If we neglect the bad effect of COVID 19 pandemic, Net exports of Malaysia have been continuously increased. But net export value of New Zealand has been fluctuated and especially in the year 2018 and 2019, there were negative values of net exports. So, New Zealand should take actions to increase its exports and should learn to make an export friendly economy like Malaysia. However New Zealand could control COVID 19 pandemic very successfully by minimizing the bad effect of pandemic to the economy. But, economy of Malaysia was very badly beaten by COVID 19 pandemic. So, Malaysia should learn the health practices, social distance practices and economic stimulus policies from New Zealand. Bibliography Amadeo, K. (2020, September 17). Inflation, How It’s Measured and Managed. The Balance; The Balance. https://www.thebalance.com/what-is-inflation-how-it-s-measured-and-managed-3306170 Compare countries | TheGlobalEconomy.com. (2010). TheGlobalEconomy.com. https://www.theglobaleconomy.com/compare-countries/ Department of Statistics Malaysia Official Portal. (2021, October 13). Www.dosm.gov.my. https://www.dosm.gov.my/v1/index.php?r=column/ctwoByCat&parent_id=99&menu_id=TE5CRUZCblh4ZTZMODZIbmk2aWRRQT09#:~:text=Malaysia FocusEconomics. (n.d.). New Zealand Dollar Exchange Rate (USD to NZD) – News & Forecasts. FocusEconomics | Economic Forecasts from the World’s Leading Economists. Retrieved October 14, 2021, from https://www.focus-economics.com/country-indicator/new-zealand/exchange-rate Hall, P. A., & Soskice, D. (2001). Varieties of Capitalism: The Institutional Foundations of Comparative Advantage. In Google Books. OUP Oxford. https://books.google.lk/books?id=EU02HzYJeFsC&q=canada+a+market+economy&redir_esc=y#v=snippet&q=canada%20a%20market%20economy&f=false O’Neill, A. (Ed.). (2021a, May 12). Malaysia inflation rate 2010-2022 | Statista. Statista; Statista. https://www.statista.com/statistics/319033/inflation-rate-in-malaysia/ O’Neill, A. (2021b, May 18). New Zealand – Inflation rate 2022 | Statistic. Statista; Statista. https://www.statista.com/statistics/375265/inflation-rate-in-new-zealand/ O’Neill, A. (Ed.). (2021c, July 7). Malaysia – unemployment rate 1998-2018 | Statista. Statista; Statista. https://www.statista.com/statistics/319019/unemployment-rate-in-malaysia/ O’Neill, A. (2021d, July 14). New Zealand – Unemployment rate 2019. Statista. https://www.statista.com/statistics/375266/unemployment-rate-in-new-zealand/ Schwab, K., & World Economic Forum. (2019). The Global Competitiveness Report. https://www3.weforum.org/docs/WEF_TheGlobalCompetitivenessReport2019.pdf Shane, D. (2019, September 19). Subscribe to read | Financial Times. Www.ft.com. https://www.ft.com/content/e703a348-da6d-11e9-8f9b-77216ebe1f17 Stats NZ archive website | Stats NZ. (2014). Www.stats.govt.nz. https://www.stats.govt.nz/about-us/stats-nz-archive-website/ World Bank national accounts data, & OECD National Accounts data. (2021a). GDP growth (annual %) – Malaysia | Data. Data.worldbank.org. https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2020&locations=MY&start=2016 World Bank national accounts data, & OECD National Accounts data. (2021b). GDP growth (annual %) – New Zealand | Data. Data.worldbank.org. https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2020&locations=NZ&start=2016 World Bank, IMF, & BOP Statistics. (2021a). Net trade in goods and services (BoP, current US$) – Malaysia | Data. Data.worldbank.org. https://data.worldbank.org/indicator/BN.GSR.GNFS.CD?end=2020&locations=MY&start=2016 World Bank, IMF, & BOP Statistics. (2021b). Net trade in goods and services (BoP, current US$) – New Zealand | Data. Data.worldbank.org. https://data.worldbank.org/indicator/BN.GSR.GNFS.CD?end=2020&locations=NZ&start=2016 Yearly Average Rates & Forex History Data. (2021). OFX. https://www.ofx.com/en-nz/forex-news/historical-exchange-rates/yearly-average-rates/
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Asia Business & Economics
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Heather Hoff was working in the control room of the Diablo Canyon nuclear plant near in San Luis Obispo County, Calif., when an earthquake caused a tsunami that shut off the power supply cooling three nuclear reactors at the Fukushima Daiichi nuclear power plant in Japan. Three nuclear reactor cores at Fukushima melted down. "It was super scary," Hoff told CNBC in a video interview. "It's my worst nightmare as an operator — to be there and think about these other operators just across the ocean from us. They don't know what's going on with their plant. They have no power. They don't know if people are hurt."In the first days after the accident, "what I was hearing on TV in the media was pretty scary," Hoff said. Heather Hoff, co-founder of Mothers for Nuclear, has worked at Diablo Canyon nuclear power reactor for 18 years. Here she is seen in approximately 2014 in the control room simulator.Photo courtesy Heather HoffBut as time passed and information about the meltdown became more available, the consequences of the accident became clear. While three employees who worked for the Tokyo Electric Power Company died because of the earthquake and resulting tsunami, nobody died because of the nuclear reactor accident. "Three plants had meltdowns and that's scary and horrible and expensive, but it didn't really hurt anyone," Hoff said. "And that was really surprising to me." In the wake of the Fukushima accident, Hoff went from fearing that she would need to leave her job to being committed to the potential of nuclear to be a safe, clean contribution to the global energy supply."Now I feel even more strongly that nuclear is the right thing to do and that the damaging parts about nuclear are actually not the technology itself, but our fear, our human responses to nuclear."After going through her own evolution in her thinking about nuclear energy, Hoff went on to co-found an advocacy group, Mothers for Nuclear, in 2016 with her colleague and friend Kristin Zaitz."There's so much fear and so much misinformation… it's a convenient villain," Hoff said. "It's okay to be scared, but that's not the same thing as dangerous."Why Hoff started working at Diablo CanyonHoff did not anticipate her career in nuclear energy.Hoff came to San Luis Obispo, Calif., to attend California Polytechnic State University, where she graduated in 2002 with a degree in materials engineering. After graduating, she worked "random jobs around town," she said, including a clothing store, winery, and manufacturing animal thermometers for cows.Hoff applied for and got a job as a plant operator at Diablo Canyonn in 2004. From the outset, Hoff was not sure what her job would entail and how she would feel about it, and her family was nervous about her taking a job working at a nuclear plant. So she decided to deal with the uncertainty by seeking out information herself. "I'd heard a lot of stories of scary things — and just didn't really know how I felt about nuclear," Hoff told CNBC. "I spent the first probably six years of my career there asking tons and tons of questions." For a while, she assumed it was only a matter of time before she would discover some "nefarious thing" happening at the nuclear reactor facility. Her change in sentiment about nuclear energy was a gradual process. "I started feeling proud to work there, proud to help make such a huge quantity of clean electricity on a really small land footprint," she told CNBC. Nuclear power actually is "in really good alignment with my environmental and humanitarian values," she said.Heather Hoff, co-founder of Mothers for NuclearPhoto courtesy Heather HoffAs of now, Hoff has worked at Diablo Canyon for 18 years and she's clear with herself that she's a believer in the importance of nuclear energy.From 2006 through 2008, Hoff took training classes from the Nuclear Regulatory Commission to be able to operate the reactor. Now she writes operations and engineering procedures for Diablo Canyon, a job she's had since 2014. Diablo Canyon provides 8% of California's total electricity and 15% of California's carbon-free electricity, which is enough to power about 3 million homes, she told CNBC.Nuclear is a 'convenient villain'Hoff and Zaitz founded Mothers for Nuclear in 2016 to share what they had learned about nuclear energy."We're not utility executives. We're not guys in suits. We're not mad scientists," Hoff told CNBC. They're mothers. They understand the doubt and the fear that nuclear power arouse, and then educate people about the science of nuclear energy in compassionate language. The Mothers for Nuclear group has a couple thousand followers on Twitter, Instagram and Facebook. The group has evolved since its founding. "When we first started Mothers for Nuclear, I think I was picturing our job as mostly being outreach to the public, but we have also grown into a role of being advisors to our own industry, and we spend a lot of time sharing about how we should all be communicating differently," she told CNBC. Not only does the nuclear industry do a poor job of advertising the benefits of nuclear energy, but it has, in many ways, hurt its own image by focusing on the safety precautions. Those extra layers of backup add cost, are often cases of operational redundancy, and send a subtle message that nuclear power must be terrifying and dangerous."It's completely shot us in the foot," Hoff said. Heather Hoff, co-founder of Mothers for Nuclear, standing by the Unit 2 main transformer during a regularly scheduled maintenance and refueling in approximately 2017. The steam behind Hoff is a normal part of scheduled outage, she said.Photo courtesy Heather HoffGiven that Diablo Canyon is facing a very controversial closure, she knows some might think her nuclear advocacy group is cover for a public effort to protect her own job.But she says it would be "a lot easier for me" to get a job working on a plant decommission or at another nuclear power plant elsewhere. Instead, she says, she believes she has a calling to tell the story of nuclear power as a solution to climate change. "The more I learn about nuclear and our energy options, the more worried I get and the more passionate I get, and the more I feel like it's my duty to to speak out and help change people's minds and help us realize that keeping existing plants open can help us address climate change — can help us reach our energy goals," Hoff told CNBC. Despite all the hurdles, Hoff is optimistic about some of the new advanced nuclear reactor technology being developed. And she says the energy sector really needs to get "a new bad guy." Notably, Hoff does not want to target fossil fuels as that bad guy."I also don't want fossil fuels to be the enemy, because I think energy is so important for people to have a good quality of life and we need more energy," Hoff said. "I don't know, maybe the enemy is extremism — like people that aren't willing to talk about the options and what's the best combination of all the stuff that we have to do to make people's lives better while also protecting the planet."— CNBC's Magdalena Petrova contributed to this report.
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Energy & Natural Resources
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00:46 - Source: CNN New video shows armed guards at Chinese airport, but not due to violence Editor’s Note: A version of this story appeared in CNN’s Meanwhile in China newsletter, a three-times-a-week update exploring what you need to know about the country’s rise and how it impacts the world. Sign up here. Hong Kong CNN Business — Holiday spending during China’s Golden Week has plunged to its lowest level in seven years, as broad Covid curbs discouraged people from traveling or spending, while a darkening economic outlook continues to erode consumer confidence. Tourist spending for the week-long holiday that started on October 1 declined 26% to 287.2 billion yuan ($40.4 billion) year-on-year, according to figures from the Ministry of Culture and Tourism on Friday. That’s the lowest figure since 2014, and less than half of the pre-pandemic level in 2019, according to government statistics from previous years. The National Day break is one of China’s longest public holidays and usually a peak season for travel and spending. But this year, people were deterred from traveling by a resurgence of the virus and stringent Covid restrictions. Lockdowns and other control measures have intensified in recent weeks, including in some popular tourist destinations. Consumer sentiment also took a hit from rising economic woes, which are mainly a result of Beijing’s ongoing zero-Covid policy and a deepening slump in the property market. “The soft pack of holiday data is hardly a surprise with new Covid outbreaks and tighter containment measures ahead of the Party Congress,” said Citi analysts in a research report on Sunday, pointing to this month’s gathering of Communist Party elites in Beijing at which Chinese leader Xi Jinping is widely expected to break with tradition and be appointed to a third term in power. China is the world’s last major economy still enforcing strict zero-Covid measures, which aim to stamp out chains of transmission through border restrictions, mass testing, extensive quarantines, and uncompromising snap lockdowns. The ruling Communist Party has used the zero-Covid strategy to argue that its political model is superior to Western democracies, and Xi has thrown his weight behind the policy. For local officials, doubling down on zero-Covid is a way to toe the Party line, demonstrate their loyalty to Xi, and prevent any large-scale outbreak that could jeopardize their career weeks before the Party Congress. In this month alone, the entire region of Xinjiang, home to 22 million people, banned all residents from leaving its borders, only weeks after it had begun relaxing restrictions from a stringent extended lockdown. While last week, hundreds of tourists were stranded in an airport in the southwestern province of Yunnan after authorities imposed a snap lockdown. As a result of the restrictions, some inside China have taken to calling this year’s holiday “the bleakest Golden Week ever” as people become fatigued with three years of Covid restrictions, choosing instead to stay at home rather than risk getting caught in unexpected lockdowns. Only 422 million trips were taken during this year’s holiday, down 18% from last year, according to the Ministry of Culture and Tourism. The number of trips was the smallest since 2014, and far from recovering from pre-pandemic levels. Air ticket prices were the cheapest in five years, averaging 650 yuan ($91) per domestic travel, figures from Qunar, a Chinese online travel agency, showed. And it wasn’t just travel that was down. Movie ticket revenue plummeted a massive 66% to 1.5 billion yuan ($211 million) year-on-year, the worst box office for the National Day week since 2016, according to the China Film Administration. That’s only a third of the ticket revenue for the same period in 2019. State media outlets have attributed it mainly to a lack of film options, as most of the releases were propaganda or animations. “There is no blockbuster or imported films,” said the state-run Southern Metropolis Daily. New home sales also tumbled 38% during the Golden Week in 21 key cities, compared with the same period a year ago, according to China Real Estate Industry, a private research firm. All the weak data point to the heavy damage of Beijing’s zero-Covid policy on consumer spending and the economy, said analysts. “The Covid resurgence and risk of being lockdowns discouraged consumption and travel notably,” said Ken Cheung, chief Asian forex strategist at Mizuho Bank. “Obviously, the zero-Covid policy has been keeping the economy under pressure and market participants will scrutinize any signals of policy tweaks after the leadership reshuffle at the upcoming 20th Party Congress,” he added. Separately, a key private survey showed Saturday that China’s massive services activity contracted in September for the first time in five months. The Caixin services Purchasing Managers Index, which focuses on small and medium-sized enterprises in China’s service industry, dropped to 49.3 last month from 55 in August, according to a statement by S&P Global Ratings. It was the first drop in the index since May. A reading below 50 indicates contraction. Efforts to curb the spread of Covid across China led to a renewed fall in service sector activity, which disrupted business operations and restricted travel, the statement said. In particular, employment continued to shrink. The gauge for employment stayed in contraction territory for the ninth consecutive month and hit its lowest point since May. China’s service sector is a key source of employment, accounting for 48% of total jobs created, according to government data. It also has the largest numbers of employed youth, mostly in restaurants and other food services. “The market was much less optimistic,” said Wang Zhe, senior economist at Caixin Insight Group, in the statement. The survey also showed that companies’ expectations for future activities recorded the lowest reading in six months and the second lowest since August 2020. “Entrepreneurs’ concerns continued to stem from recurring Covid outbreaks and the impact of related controls on the market,” Wang said. CNN’s Nectar Gan contributed to this report.
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Asia Business & Economics
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Crown Prince Mohammed bin Salman pushed to take Saudi Arabian Oil Co. public. It now has the highest market capitalization of any company in the world. Bandar Aljaloud/ASSOCIATED PRESS With gasoline and diesel hitting record prices amid a post-pandemic surge in driving and flying, it’s no surprise that smart guys like Warren Buffett have been loading up on shares of some of the world’s biggest energy companies including Chevron and Occidental Petroleum. Giant profits are a welcome turnaround for Big Oil, after the 2020 pandemic lockdowns froze demand and drove oil prices temporarily down to zero. Chevron posted first-quarter revenue of $54.4 billion, 75% higher than a year ago, thanks to surging oil and gas prices. Its shares are up 50% in a year. And consider Saudi Arabian Oil Co.: The world’s second-biggest by market value (after Apple) is also the most profitable, scoring $105 billion last year. Energy companies were big movers on this year’s Forbes Global 2000 list, with many jumping more than 300 points in overall rankings. Despite the profit boom, this is a high-stress time for oil giants. President Vladimir Putin’s invasion of Ukraine is turning the energy markets upside down, with a strong likelihood of crippling fuel shortages as sanctions take hold and Russian oil and natural gas find few buyers. To replace Russia, the world will need every molecule of hydrocarbons the energy giants can extract. Already the G-7 richest nations have pledged to embargo Russian oil, while sanctions are expected to keep 3 million barrels per day off the market by the end of May. That’s a lot, even in a 100 million bpd global oil market, and especially when pent-up post-pandemic demand for driving and flying had already tightened up fuel supplies before the invasion. Helping to obscure supply shortfalls, the current round of draconian Covid-19 lockdowns have cut China’s oil demand by an estimated 2 million bpd. When China bounces back, brace for gasoline prices even higher than the $4.25 a gallon now prevalent nationwide. One wild card is how much Russian oil will China continue to buy? Matt Stephani, president of Cavanal Hill Funds in Tulsa sees long-term problems for Russia’s oilpatch. “Even if there’s a near-term truce I think it will be a long time before the West wants to buy those Russian barrels back.” Although Russia’s Rosneft, Lukoil and Gazprom scored high on this year’s Global 2000, that’s highly unlikely to last. But the world doesn’t only need to find replacements for Russian oil, but also for Russian gas. Before the war, state-controlled Gazprom was delivering about 15 billion cubic feet of gas per day into Europe, more than a third of total supply, and vital for fueling power plants, and making plastics and fertilizers. But following Putin’s atrocities in Ukraine, Europe is scouring the globe for alternative supplies, in the form of giant tankers of liquefied natural gas, or LNG. There’s unlikely to be enough. The CEO of Shell, Ben van Beurden, said in early May that he was concerned about fuel shortages in Europe next winter. “It will be a tough winter if we don’t get any Russian molecules coming. That’s the only thing I can say with certainty.”
Shortages bring high prices, which mean big profits for oil companies. Yet after their near-death experience in 2020—when lockdowns dried up demand for transportation fuel and oil prices went to zero—many companies are now being far more careful about how they invest capital. The ongoing ESG (environment, social and governance) trend continues to discourage energy giants from investing in fossil fuels at all. Consultancy WoodMackenzie says annual oil and gas spending has dropped from $750 billion per year a decade ago to just $400 billion a year more recently. Rather than plow profits back into drilling and fracking lots of new wells, companies have slowed the growth and are mostly just drilling to maintain their existing levels of output. Even for the biggest operators, growth is increasingly expensive. Billionaire fracking pioneer Harold Hamm of Continental Resources said recently that the costs of drilling wells has inflated by 15%. Even Saudi Aramco, with the biggest reserves, says it would cost $50 billion of investment over several years to add 1 million barrels per day of new oil production to their current 12 million bpd. After relegating oil companies to purgatory for the past few years, there are even indications that ESG-focused investors are now finding some positive attributes in Big Oil. Jeff Nichols, partner and head of the energy practice at Haynes & Boone, says that ESG is evolving to better appreciate the boon to the civilization of reliable energy. “Since Russia’s invasion of Ukraine, concepts like ‘energy security’ and ‘conflict-free oil’ have entered the ESG lexicon.”
Warren Buffett is comfortable with Big Oil. In the first quarter, Berkshire Hathaway added $20 billion worth of Chevron and bought $6.9 billion worth of stock in Occidental Petroleum. Berkshire also holds $10 billion in Oxy preferred stock and a warrant to buy 83.9 million shares at $59.60. It’s almost in the money. Oxy recently traded as high as $58.75. Even after oil’s run-up, Buffett thinks there’s still juice left to squeeze. Forbes MORE FROM THE GLOBAL 2000
MORE FROM FORBESInside The Global 2000: Sales And Profits For The World's Largest Companies Are Soaring As Economies ReopenBy Isabel Contreras
MORE FROM FORBESThe World's Largest Tech Companies In 2022: Apple Still Dominates As Brutal Market Selloff Wipes Trillions In Market ValueBy Jonathan Ponciano
MORE FROM FORBESGlobal 2000: Berkshire Hathaway Takes Down JPMorgan As America's Largest CompanyBy Isabel Contreras
MORE FROM FORBESForbes Global 2000: The World's Largest Healthcare Companies In 2022By Katie JenningsGlobal 2000 rankings were updated on May 31, 2022.
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Energy & Natural Resources
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SummaryCompaniesRBNZ hikes policy rate 50 bpsNZ move dims hopes of slowdown in rate hikes globallyKiwi jumps briefly, U.S. dollar finds tractionSYDNEY, Oct 5 (Reuters) - The dollar steadied on Wednesday after a sharp rate rise in New Zealand poured cold water over hopes for a pause or slowdown in the U.S. Federal Reserve's intentions for aggressive hikes.The dollar had suffered its heaviest setback in more than two years on Tuesday but was back on the front foot after the Reserve Bank of New Zealand (RBNZ) delivered a fifth consecutive 50 basis point (bp) hike.Even the New Zealand dollar was only boosted briefly. The kiwi leapt as much as 1.3% before falling back to flat at $0.5731. The euro fell 0.2% to $0.9963. Sterling's rally faltered as it fell 0.5% to $1.1425.Register now for FREE unlimited access to Reuters.comThe RBNZ move and tone contrasted with the Reserve Bank of Australia's surprisingly small 25 bp hike a day earlier, which had stoked hopes that the U.S. Federal Reserve may also slow hikes and fuelled dollar selling."Just as RBA's smaller-than-expected hike yesterday added to trimming of hawkish Fed bets, RBNZ's hawkish signalling could remind markets that fighting inflation is still priority for many central banks," said Maybank analyst Saktiandi Supaat."A more synchronous dovish tilt among major central banks on growth fears might be premature."The dollar index , down about 4% since hitting a record high of 114.78 last week, steadied to 110.37.Demand for the safe haven dollar had fallen in recent days as the mood in global markets improved on speculation Britain's new finance minister Kwasi Kwarteng, having rowed back on a proposed tax break for high earners, could make further adjustments to a mini-budget that had sent bond and currency markets into a tailspin last week.Having recovered nearly 11% from week-ago record lows, sterling's rally seems to be running out of steam, dealers said.Analysts have been cautious about how much has really changed about Britain's fiscal outlook and how broad Australia's rates signal really was, leaving the dollar's dip open to reversal.U.S. Federal Reserve Governor Philip Jefferson reiterated overnight that inflation was policymakers top target and that growth would suffer in efforts to bring it down.U.S. labour data due on Friday will be the next major indicator of the likely trajectory of U.S. rates.========================================================Currency bid prices at 0245 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Tom Westbrook. Editing by Lincoln Feast & Simon Cameron-MooreOur Standards: The Thomson Reuters Trust Principles.
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Interest Rates
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Ajanta Pharma Q1 Results Review - Margins Back On Track: Nirmal Bang
Domestic business grew by 14.3% YoY to Rs 3.2 bn on the back of robust growth in both branded business as well as trade generics.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Nirmal Bang Report
Key Points
Ajanta Pharma Ltd.’s Q1 FY24 results beat ours and consensus estimates on margins front, though revenues were in-line.
Revenues grew 7.4% YoY mainly due to robust 14.3% growth in domestic market, which was partially offset by the decline in Africa business due to supply chain issues, which has now normalised.
Ebitda margins were back on track with normalizing raw material and fright costs as well as favorable currency movement.
After a subdued FY23, the beginning of FY24 was strong with better-than expected improvement in margin, along with robust domestic growth. The company has also re-iterated that it would maintain mid to low teen growth for branded markets with 25% margins for FY24.
We remain positive on Ajanta Pharma given its branded play and strong focus on the domestic market.
We maintain 'Buy' on Ajanta Pharma with a revised target price of Rs 1,800, valuing it at 24 times on June-25E earnings.
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India Business & Economics
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Press Release
CEO Of Cryptocurrency And Forex Trading Platform Sentenced To Nine Years In Prison For $240 Million Scheme To Defraud Investors
Damian Williams, the United States Attorney for the Southern District of New York, announced that TIMOTHY SHEA was sentenced today by U.S. District Judge Analisa Torres to 63 months in prison for his role in carrying out a scheme to defraud hundreds of thousands of donors in connection with an online crowdfunding campaign known as “We Build The Wall” by soliciting donations using false statements and then stealing the resulting donations, as well as laundering the proceeds of the fraud scheme and attempting to obstruct the federal criminal investigation of the scheme.
U.S. Attorney Damian Williams said: “Timothy Shea abused the trust of donors to ‘We Build the Wall,’ stole hundreds of thousands of dollars in donations to line his own pockets, and attempted to obstruct the federal investigation of his criminal conduct. The defendant has now been held accountable and faces prison time for his crimes.”
According to court filings and evidence introduced during court proceedings:
Starting in approximately December 2018, TIMOTHY SHEA, his co-defendants BRIAN KOLFAGE and ANDREW BADOLATO, and others orchestrated a scheme to defraud hundreds of thousands of donors, including donors in the Southern District of New York, in connection with an online crowdfunding campaign ultimately known as “We Build The Wall” that raised more than $25,000,000 to build a wall along the southern border of the United States. In particular, to induce donors to donate to the campaign, KOLFAGE repeatedly and falsely assured the public that he would “not take a penny in salary or compensation” and that “100% of the funds raised…will be used in the execution of our mission and purpose.”
Those representations were lies. In truth, KOLFAGE, BADOLATO, SHEA, and others received hundreds of thousands of dollars in donor funds from We Build the Wall, which they each used in a manner inconsistent with the organization’s public representations. For example, KOLFAGE covertly took for his personal use more than $350,000 in funds that donors had given to We Build the Wall. To conceal the payments to KOLFAGE from We Build the Wall, KOLFAGE, BADOLATO, SHEA, and others devised a scheme to route those payments through entities and bank accounts that they controlled. They took various steps to obscure or conceal these payments, including by using fake invoices and sham contracts — conduct for which SHEA was convicted at trial of obstruction of justice.
* * *
SHEA, 52, of Castle Rock, Colorado, was convicted after trial of conspiracy to commit wire fraud, conspiracy to commit money laundering, and obstruction of justice. In addition to the prison term, SHEA was sentenced to three years of supervised release and ordered to forfeit $1,801,707 and pay restitution in the amount of $1,801,707.
KOLFAGE, 41, of Miramar Beach, Florida, and BADOLATO, 58, of Cocoa, Florida, each pled guilty to one count of conspiracy to commit wire fraud. KOLFAGE also pled guilty to tax and wire fraud charges originally filed by the U.S. Attorney’s Office for the Northern District of Florida. KOLFAGE was sentenced to 51 months in prison, and BADOLATO was sentenced to 36 months in prison.
Mr. Williams praised the outstanding investigative work of the U.S. Postal Inspection Service and the Special Agents of the U.S. Attorney’s Office for the Southern District of New York.
The case is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Alison G. Moe, Nicolas Roos, Robert B. Sobelman, and Derek Wikstrom are in charge of the prosecution, with the assistance of Paralegal Specialists Christopher de Grandpre and Andrea Gieseman.
Nicholas Biase
(212) 637-2600
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Crypto Trading & Speculation
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Working a summer job as a student ... [+] [url=file_closeup.php?id=17651603][img]file_thumbview_approve.php?size=1&id=17651603[/img][/url] [url=file_closeup.php?id=17615345][img]file_thumbview_approve.php?size=1&id=17615345[/img][/url] [url=file_closeup.php?id=17577262][img]file_thumbview_approve.php?size=1&id=17577262[/img][/url] [url=file_closeup.php?id=17243360][img]file_thumbview_approve.php?size=1&id=17243360[/img][/url] [url=file_closeup.php?id=17212642][img]file_thumbview_approve.php?size=1&id=17212642[/img][/url] [url=file_closeup.php?id=17201079][img]file_thumbview_approve.php?size=1&id=17201079[/img][/url] [url=file_closeup.php?id=17200241][img]file_thumbview_approve.php?size=1&id=17200241[/img][/url] [url=file_closeup.php?id=17200036][img]file_thumbview_approve.php?size=1&id=17200036[/img][/url] [url=file_closeup.php?id=16521680][img]file_thumbview_approve.php?size=1&id=16521680[/img][/url] [url=file_closeup.php?id=11212542][img]file_thumbview_approve.php?size=1&id=11212542[/img][/url] [url=file_closeup.php?id=11202133][img]file_thumbview_approve.php?size=1&id=11202133[/img][/url] [url=file_closeup.php?id=11174041][img]file_thumbview_approve.php?size=1&id=11174041[/img][/url] [url=file_closeup.php?id=23090621][img]file_thumbview_approve.php?size=1&id=23090621[/img][/url] [url=file_closeup.php?id=17577016][img]file_thumbview_approve.php?size=1&id=17577016[/img][/url] [url=file_closeup.php?id=11204323][img]file_thumbview_approve.php?size=1&id=11204323[/img][/url] [url=file_closeup.php?id=17243159][img]file_thumbview_approve.php?size=1&id=17243159[/img][/url] [url=file_closeup.php?id=23101320][img]file_thumbview_approve.php?size=1&id=23101320[/img][/url] [url=file_closeup.php?id=23090691][img]file_thumbview_approve.php?size=1&id=23090691[/img][/url] [url=file_closeup.php?id=23089592][img]file_thumbview_approve.php?size=1&id=23089592[/img][/url] [url=file_closeup.php?id=22216624][img]file_thumbview_approve.php?size=1&id=22216624[/img][/url] getty Today, more teens are employed than they have been in over a decade. As of May, the Bureau of Labor Statistics shows unemployment rates for ages 16-19 among the lowest in the past 68 years. That’s good news for anyone contemplating the next generation of leaders - and for our economy. Many self-made, by-the-bootstraps professionals attribute their long-term success, in part, to “starting at the bottom” with a low-wage job. Having learned, first-hand, the respectability and value found in every type and every level of work, they credit their acquired leadership characteristics and appreciation for individual contributions to an organization to their journey – from the broom closet to the c-suite. Affluent parents may not be as inclined to recommend, or suggest, summer work for their children. Perhaps this is because they have worked hard to give their kids a life different from their own, or want their children to focus more on their schoolwork. Or, maybe they place a greater emphasis on competitive sports with off-season training, clinics, and travel teams. Whatever the reason, it is important to be careful not to raise adults that have been sheltered in ignorance – highly educated, yet ill-equipped to hold down jobs, support themselves, and communicate with people from varying cultural, ethnic, and socioeconomic backgrounds. The dividends of time management and grit are almost a given when learning how to juggle the demands of work and school. We place a premium on obtaining higher education, and rightfully so. Yet the experiences found in summer jobs are excellent teachers and leadership labs - without the four-year commitment. Here are four reasons why "hire education" should be a prereq for your kids this summer. 1. Summer Jobs: Create Empathetic Leaders
Far too often, the people emptying trash cans, mowing lawns, cleaning toilets, and washing dishes are invisible to the larger organization. Yet they are the team members who facilitate efficiency in the organization, in big and small ways, and deserve to be seen and appreciated for their contributions. Despite the plethora of entry level positions available in today’s red hot job market, many teens are uninterested - or unwilling - to work for minimum wage. Empathetic leaders, however, recognize and understand the importance of every member of an organization. Thasunda Brown Duckett, CEO of TIAA, a Fortune 100 company, often speaks about the importance of forming connections with employees at every level of an organization, illustrated in a story she shared with the New York Times in 2019. After she was named CEO of Chase Auto Finance at JP Morgan, she made a point to meet with workers in the mailroom where she publicly articulated their critical role in the organization. 2. Summer Jobs: Provide Lessons on How to See and Speak with Everyone
In the increasingly divisive world we live in, knowing how to work with people from different backgrounds and lived experiences is invaluable. The young umpire, paid $25 to call a Little League game for 10-year-olds, is potentially getting a master class in diplomacy, de-escalation strategies, and conflict resolution. Taking a verbal beating from an adult coach over something so low-stakes will create a future manager or CEO who understands the value of respect and prioritizing what truly matters within an organization. 3. Summer Jobs: Give Context for Real-World Problems
Leadership qualities are not best acquired through reading or lectures, but through practical experiences. Rudimentary, experiential knowledge and awareness of a subject grounds ideas based on reality versus theory. The day-to-day interaction of an entry-level role serves as a building block for the much-needed confidence teens need to be comfortable functioning in the job market. Time away from their digital and social media worlds gives them a feeling of independence and accomplishment - while beefing up their savings accounts. In the longer term, the teen who bags groceries, or fulfills online orders, has a broader understanding of a multi-step, consumer-driven process. That insight may inspire and influence future product design, workplace culture, diverse procurement initiatives, and supply-chain management. At age 14, Slack CEO Stewart Butterfield had a summer job at the concession stand of a small movie theater. “People lined up outside waiting for the previous show to end, and once they entered we had a crush of hurried customers. The inefficiency was too much for me to take. I started going out with a tray and napkin, French waiter–style, to take people’s orders in advance. Happier customers, less of a rush for us and, as a bonus, I even earned some small tips.”
4. Summer Jobs: Provide Growth Opportunities Missed During the Pandemic
Coronavirus has been hard on kids in myriad ways – especially teens. Over the past two years, adolescents have been isolated at home and not doing the things they need to do to become independent. The pandemic thwarted the most important parts of adolescent development. Part of what helps young people grow is to be exposed to a wide range of experiences. Following the lockdowns, shutdowns, and online schooling brought on by the pandemic, teens are eager for the normalcy of a summer job. Many business owners rebounding from COVID are rediscovering the potential of hiring young people as older workers have been slow to return to customer service jobs. There is endless earning (and experience) potential for teens in the retail, hospitality, restaurants, and tourism sectors.
From answering to a tough boss or dealing with difficult customers, these early work experiences help teens build a new skill set – and self-confidence. Employment allows young people to evolve different parts of themselves that are not tested at home, in school or sports. They will rise to the challenge, and it’s those challenges that enable teens to grow: make them work for it.
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Unemployment
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CANBERRA, AUSTRALIA — Australian Prime Minister Anthony Albanese said Friday he was confident of securing bipartisan political support in the United States for a deal to provide his country with submarines powered by U.S. nuclear technology.
The so-called AUKUS partnership -- an acronym for Australia, the United Kingdom and the United States -- is being discussed by U.S. Defense Secretary Lloyd Austin and U.S. Secretary of State Antony Blinken in meetings with Albanese and other Australian officials in Brisbane on Friday and Saturday.
Under the deal, Australia will buy three Virginia-class submarines from the United States and build five of a new AUKUS-class submarine in cooperation with Britain.
Australian media have focused on a letter signed by more than 20 Republican lawmakers to President Joe Biden that warned the deal would "unacceptably weaken the U.S. fleet" without a plan to boost U.S. submarine production.
Albanese said he remained "very confident" that the United States would deliver the three submarines.
Albanese said he had been reassured by discussions he had with Republicans and Democrats at a NATO summit in Lithuanian this month.
"What struck me was their unanimous support for AUKUS, their unanimous support for the relationship between the Australia and United States. It has never been stronger," Albanese told reporters in Brisbane.
Austin and Blinken arrived in Brisbane late Thursday ahead of annual bilateral meetings with their Australian counterparts, Defense Minister Richard Marles and Foreign Minister Penny Wong.
Marles said the AUKUS program was "on track."
"Congress can be a complicated place as legislation makes its way through it, but actually we're encouraged by how quickly it is going through it and we are expecting that there will be lots of discussions on the way through," Marles told Australian Broadcasting Corp.
"Fundamentally, we have reached an agreement with the Biden administration about how Australia acquires the nuclear-powered submarine capability and we're proceeding along that path with pace," he added.
Australia understood there was "pressure on the American industrial base" and would contribute to submarine production, Marles said. The AUKUS deal is forecast to cost Australia up to 368 billion Australian dollars ($246 billion) over 30 years.
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Australia Business & Economics
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U.S. Dollar banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSINGAPORE, Aug 9 (Reuters) - The dollar lurked just below recent highs on Tuesday as traders waited for U.S. inflation data due later in the week, wary of a surprise that could heap more upward pressure on interest rates.The data is due on Wednesday and the anticipation is likely to keep things calm until then.The Australian and New Zealand dollars rose overnight and were steady in the pre-CPI calm in Asia. The Aussie held gains at $0.6974. The kiwi did likewise at $0.6281, leaving both just above their 50-day moving averages.Register now for FREE unlimited access to Reuters.comSterling held at $1.2084 and the euro was stuck just above parity at $1.0194, with the continent's energy crisis meaning it may miss out on a boost if the dollar weakened. The yen held at 134.94 per dollar.Previous releases have led to mixed reactions in the currency market and it isn't clear whether a high number would lift rate expectations and the dollar together, or send them in opposite directions by further stoking fears of stagflation."The market understandably is waiting for the numbers to then reprice, rather than moving in anticipation of them," said Ray Attrill, head of foreign exchange strategy at National Australia Bank in Sydney."We've had six CPI numbers this year, four of those six have been upside surprises...but the impact on the dollar is a little bit ambiguous."Economists polled by Reuters see year-on-year headline inflation (USCPNY=ECI) at 8.7% -- incredibly high, but below last month's 9.1% figure.Last week's strong labour data stoked expectations of aggressive near-term hikes and the Treasury market has moved to lift short-term yields, but has hardly shifted long rates.The two-year Treasury yield is now above the 10-year yield , a reliable recession indicator, and the gap has grown to its largest in two decades.Yet on Monday, a New York Fed survey showed consumers' inflation expectations fell sharply in July, perhaps offering a sliver of hope that the CPI release brings relief. read more "Expectations that the Fed may announce another 75 basis point rate hike on September 21 have risen on the back of (Friday's) strong U.S. July payrolls report," said Jane Foley, senior currency strategist at Rabobank."Later this week, the July U.S. CPI inflation release is expected to show some moderation in inflation pressures," she said. "This may now be sufficient for the Fed to relax."The dollar's haven status, though, makes the greenback's reaction a little harder to predict, especially as growth concerns and geopolitical worries swirl.Consumer confidence slid in Australia for a ninth straight month. read more China extended military drills near Taiwan, and the self-ruled island's foreign minister said China was using the drills launched in protest against U.S. House Speaker Nancy Pelosi's visit as an excuse to prepare for an invasion. read more China's yuan inched lower to 6.7513 per dollar."U.S.-China relations are worsening," Singapore's Prime Minister Lee Hsien Loong said in his National Day address, which also included a warning for those hoping for a swift victory over inflation."The world is not likely to return any time soon to the low inflation levels and interest rates that we have enjoyed in recent decades," he said.========================================================Currency bid prices at 0552 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Tom Westbrook. Editing by Sam Holmes & Shri NavaratnamOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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A senior TikTok executive has been rebuked by a parliamentary inquiry for saying she does not know the location of the tech giant's headquarters.
Key points:
- The senate committee is identifying risks posed by foreign interference through social media
- TikTok executives said they don't know how many Australians have had their user data accessed by Chinese employees
- They confirmed 'rogue employees' in China had accessed journalists' data
Today, Senator James Paterson, who is chairing a committee into foreign interference through social media, tried to establish whether TikTok or its parent company ByteDance are based in China.
TikTok's Australian director of public policy Ella Woods-Joyce said she knew there were offices in China but didn't know where the "formal headquarters" were.
"I'm very happy to provide that very specific piece of information and I'll do it as soon as I can, my apologies," she said.
Senator Paterson expressed his frustration with Ms Woods-Joyce and accused her of obfuscating.
"Are you seriously not able to say how your parent company, which ultimately owns and controls you, is operated?" he said.
"Your reluctance to acknowledge basic facts about the parent company with whom you are ultimately employed is not a promising start to your willingness to honestly answer these questions, it appears like obfuscation to me."
Senator Paterson continued his line of questioning by asking if the Chinese government had a strategic stake in Douyin, which is commonly known as the Chinese version of TikTok.
Ms Woods-Joyce said the Chinese government had no stake in TikTok or ByteDance but didn't answer about Douyin.
"That wasn't my question, I asked you a very specific question. This is continued obfuscation ... it does not reflect well on the company that you're not willing to answer direct, simple questions," Mr Paterson replied.
The TikTok executive then explained the Chinese government had a 1 per cent ownership in Douyin.
Data can be accessed by Chinese employees
The select committee is tasked with identifying risks posed to Australia's democracy by foreign interference through social media.
To this end, TikTok executives were asked whether Australian user data could be accessed by employees in China.
Will Farrell from TikTok's US Data Security arm said employees only get the minimum amount of access required to do their job and multiple approvals are required before they get any access.
When asked how often Australians have had their data accessed by employees in China, Mr Farrell said he didn't have "specific numbers in front of me".
"I'd be happy to take that on notice."
Ms Woods-Joyce was also asked about the collection of Australian users' location data and told Senator Paterson the company didn't collect GPS data in Australia.
When the senator pointed out that the company's privacy statement says they collect GPS data, she insisted that applied in other markets but not Australia.
It was only when the senator asked if she was drawing a distinction between "precise GPS location information or all GPS information location" Ms Woods-Joyce conceded they collect "approximate location" data based on IP addresses.
'Rogue employees' access journalists' data
The general manager of TikTok Australia, Lee Hunter, defended the company against allegations it had inappropriately spied on journalists and attempted to identify their sources.
He told Senator Paterson some "rogue employees" had attempted to find the source of leaked confidential company information.
He described this as "serious misconduct" and said those employees were no longer with TikTok.
TikTok categorically denied the company ever "targeted" journalists in an op-ed published in the Daily Telegraph in October last year, but later admitted the incident in December.
Senator Paterson asked why the company "misled" the Australian public in the op-ed.
"Senator, again, I stand by the sentiments that were expressed in that op-ed and I would not categorise the efforts as spying," Mr Hunter said.
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Australia Business & Economics
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Oil-producing countries have agreed to continued cuts in production in a bid to shore up flagging prices.
Saudi Arabia said it would make cuts of a million barrels per day (bpd) in July and Opec+ said targets would drop by a further 1.4 million bpd from 2024.
Opec+ accounts for around 40% of the world's crude oil and its decisions can have a major impact on oil prices.
Average diesel prices fell by a record 12p per litre in the UK last month, according to the RAC.
The seven hour-long meeting of the oil-rich nations, led by Russia, came amid a backdrop of falling prices and an over-supply of the commodity.
Total production cuts, which Opec+ has undertaken since October 2022, reached 3.66 million bpd, according to Russian Deputy Prime Minister Alexander Novak.
Opec+, a formulation which refers to the Organisation of Petroleum Exporting Countries and its allies, had already agreed to cut production by two million bpd, about 2% of global demand.
"The result of the discussions was the extension of the deal until the end of 2024," Mr Novak said.
'A Saudi lollipop'
In April, it also agreed a surprise voluntary cut of 1.6 million bpd which took effect in May, a move that briefly saw an increase in prices but failed to bring about a lasting recovery.
On Sunday, Saudi Energy Minister Prince Abdulaziz bin Salman said the cut of one million bpd could be extended beyond July if needed. "This is a Saudi lollipop," he said, in what is seen as a bid to stabilise the market.
Analysis by Sameer Hashmi, Middle East business correspondent
Before the two-day Opec+ meeting started, it was widely expected the oil cartel would make production cuts to prop up prices. It appears most members were against the idea, as any cuts would impact oil revenues, which are crucial to keep running their economies.
Saudi Arabia's decision to make a voluntary reduction of one-million barrels per day was unexpected but does not come as a huge surprise. As the leader of the pack, and also the largest exporter of oil, it was the only one in a position to be able to lower output.
From Riyadh's point of view, it is crucial the price of crude remains over $80 a barrel for it to break even. Saudi officials want elevated prices to keep spending billions of dollars on ambitious projects spearheaded by Crown Prince Mohammed bin Salman, as he tries to diversify the kingdom's economy away from oil.
The move by the Saudis also underlines the uncertain outlook for demand for fuels in the months to come. Concerns about the global economy, especially recessionary fears in the US and Europe are expected to put further pressure on crude prices.
Oil producers are grappling with falling prices and high market volatility amid the Russian invasion of Ukraine.
The West has accused Opec of manipulating prices and undermining the global economy through high energy costs, according to Reuters. It has also accused the group of siding with Russia despite sanctions over the invasion of Ukraine.
In response, Opec insiders have said the West's monetary policy over the last decade has driven inflation and forced oil-producing nations to act to maintain the value of their main export.
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Energy & Natural Resources
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A logo of BNP Paribas is seen at its exhibition space, at the Viva Technology conference dedicated to innovation and startups at Porte de Versailles exhibition center in Paris, France June 15, 2022. REUTERS/Benoit TessierRegister now for FREE unlimited access to Reuters.comSummaryCompaniesQ2 net income up 9.1% to 3.2 billion eurosQ2 revenues up 8.5%, outpacing expensesShares up about 4%PARIS, July 29 (Reuters) - French bank BNP Paribas (BNPP.PA) reported better than expected profit in the second quarter after bad loan provisions dipped and business remained buoyant in both investment and retail banking, amid torrid global markets and an economic slowdown.France's biggest-listed lender said on Friday its net income rose 9.1% year-on-year to 3.2 billion euros ($3.25 billion). An informal consensus forecast circulating among analysts saw net income at only about 2.7 billion euros.BNP shares jumped over 4% in morning trading, outperforming the European banking sector (.SX7E) which was rising at only about half that pace.Register now for FREE unlimited access to Reuters.comRevenues rose 8.5% to 12.78 billion euros, faster than operating expenses, which were up 7.6% at 7.72 billion euros."There's a positive 'jaws effect'" with revenue growth outpacing expenses, noted Arnaud Journois, a credit analyst for DBRS Morningstar."But while these results are good, it doesn't mean that the outlook has improved," he added, pointing to the provisions taken by the bank to cover potential losses on loans should the euro zone economy deteriorate further."It's possible that the third and fourth quarter won't be as good for European banks," he cautioned.Europe's lenders this week offered some positive surprises on profits, but investors are watching for signs a weaker economy, surging inflation and the war in Ukraine could hit their prospects. read more In the second quarter, however, BNP's cost of risk - money set aside for failing loans - stood at 789 million euros, about 100 million below analysts' average forecast.Activity grew across business lines, with revenues in the unit home to retail banking up 11.1% and investment banking up 10.6%.DERIVATIVES DEMANDWith financial markets experiencing one of the worst first six months in living memory, demand for financial instruments grew strongly, the bank said.Demand was "driven in particular by reallocation and hedging needs in rates, forex, emerging markets and commodity derivatives products", it said, adding it enjoyed a "good level of activity overall on equity markets, particularly in derivatives".BNP's revenue in fixed-income, currency and commodities trading rose by 14.8% in the quarter, while equity trading revenue gained 16.1%.The French bank's push to increase market share in that business came under the spotlight last week after the global head of prime services, Ashley Wilson, resigned, having joined from Deutsche Bank (DBKGn.DE) just a year ago. read more Noting a slight decrease in the key CET 1 capital ratio from 12.4% to 12.2%, Citi analysts said that while a short term boost could be expected for BNP shares, visibility remained low."We expect the market to have a positive initial reaction to these numbers, but to have questions on the 2022/23 outlook, the development of asset quality/provisions, capital trends, sensitivity to macro developments, trend in AM (asset management), growth and capital return", they wrote in a note.($1 = 0.9790 euros)Register now for FREE unlimited access to Reuters.comReporting by Julien Ponthus and Matthieu Protard
Editing by Tomasz Janowski and Mark PotterOur Standards: The Thomson Reuters Trust Principles.
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Banking & Finance
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SINGAPORE, Nov 14 (Reuters) - The U.S. dollar steadied on Monday after Federal Reserve Governor Christopher Waller said the central bank was not softening its fight against inflation, which made some investors think that the steep sell-off last week was probably overdone.A slightly cooler-than-anticipated inflation data on Thursday put the greenback in a tailspin, with the dollar index slipping 4% for the week, its worst week in more than two and half years.The dollar index , which gauges the greenback against a basket of six counterparts that includes the yen, euro and sterling, rose 0.234% to 106.960 during Asian trade on Monday, coming off the nearly three month low of 106.27 it touched on Friday.Global equities, meanwhile, soared as investors poured into risky assets on hopes that peaking inflation means less aggressive rate hikes from the Fed.But Waller said on Sunday that the inflation print last week was "just one data point" that would have to be followed, and h other similar readings would be needed to show convincingly that inflation was slowing.Waller did add, however, that the Fed could now start thinking about hiking at a slower pace."I think the market got a little bit ahead of itself," said Carol Kong, a currency strategist at Commonwealth Bank of Australia, adding the market can expect more reality checks from Fed officials, which would help the dollar to recoup more ground.U.S. inflation will likely remain high and keep the Fed on its monetary tightening path, Kong said.U.S. consumer sentiment fell in November, pulled down by persistent worries about inflation and higher borrowing costs, a survey showed on Friday.Sim Moh Siong, currency strategist at Bank of Singapore said the Fed's job was still not done and the central bank is unlikely to want the equity market to rally too much or bond yields to come off too much."If the financial markets get too buoyant, they will probably growl louder to make themselves heard in terms of their inflation message."The U.S two-year yield , which reflects rate move expectations, edged up to 4.41%, after diving as low as 4.29% on Friday, while the U.S. 10-year yield was up 7 basis points at 3.899%.Elsewhere, cryptocurrencies remained under pressure from ongoing turmoil after the fall of crypto exchange FTX. FTX's native token, FTT , was last down 7.6% at $1.31, taking its month-to-date losses to nearly 95%.Bitcoin fell 2.2% slipping below $16,000.Sterling was swaying at $1.1747, down 0.74% on the day, having risen 4% in the previous two sessions ahead of the Autumn Statement on Thursday when Britain's finance minister Jeremy Hunt is expected to set out tax rises and spending cuts.The Japanese yen weakened 0.60% versus the greenback at 139.63 per dollar, while the euro was down 0.47% to $1.0303.The risk-sensitive Australian and New Zealand dollars slipped, giving up some gains made after China moderated its zero COVID strategy.On Sunday, Reuters reported that Chinese regulators have told financial institutions to extend more support to property developers to shore up the struggling real estate sector.China's yuan rose to a near two-month high against the dollar on Monday, after the central bank lifted its official guidance fixing by the most since 2005 when Beijing abandoned the currency's decade-old peg against the greenback.========================================================Currency bid prices at 0147 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJReporting by Ankur Banerjee in Singapore; Editing by Ana Nicolaci da Costa and Simon Cameron-MooreOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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Nepal's Everest base camp. Image: Frank Bienewald/LightRocket via Getty Images)ABSTRACT breaks down mind-bending scientific research, future tech, new discoveries, and major breakthroughs.Nepal plans to move its base camp at Mount Everest, the most popular gateway to the world’s tallest mountain, after a combination of global climate change and local erosion from climbers—who excrete some 4,000 liters of pee at the camp every day in peak season—is making conditions there unsafe, reports the BBC.Human-driven climate change, which is caused by the consumption of fossil fuels, has accelerated the melting of Khumbu glacier near the location of Nepal’s Everest base camp at 5,364 meters of elevation. The camp is also buckling under the pressures of the roughly 1,500 people that visit during its busiest periods. For decades, a bustling tent city has popped up in that location every year as climbers prepare to summit Everest. In addition to the voluminous urine left at the camp, runoff from kerosene and other waste products are weathering Khumbu glacier, reports Euronews.The glacier is losing roughly 9.5 million cubic meters every year, a rapid decline that is opening up new crevasses on a daily basis at the busy camp, according to reports from tourists. For the protection of both the natural landscape and the human visitors, Nepalese officials plan to relocate the camp to an ice-free area a few hundred meters below the current site. "We are now preparing for the relocation and we will soon begin consultation with all stakeholders," said Taranath Adhikari, director general of Nepal's tourism department, according to the BBC. "It is basically about adapting to the changes we are seeing at the base camp and it has become essential for the sustainability of the mountaineering business itself."Though there is another base camp on the Tibetan side of Everest, China has kept it off limits to most tourists since 2019, after officials said they were struggling with similar damage from an excess of garbage left by visitors.As the most iconic mountain in the Himalayas to outsiders, Everest is a powerful herald of the drastic changes that are occurring across this ancient range. Himalayan glaciers have shrunk about ten times faster in the past four decades than during the 700 years before them, an alarming rate that will have major and unpredictable consequences for its communities and ecosystems, reports a recent study in Scientific Reports.“The ten-fold acceleration in ice loss we have observed across the Himalaya far exceeds any centennial-scale rates of change that have been recorded elsewhere in the world,” according to the study. “By comparison to other world regions the magnitude of the acceleration in glacier mass loss across the Himalayan region is exceptional.” ORIGINAL REPORTING ON EVERYTHING THAT MATTERS IN YOUR INBOX.By signing up, you agree to the Terms of Use and Privacy Policy & to receive electronic communications from Vice Media Group, which may include marketing promotions, advertisements and sponsored content.
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Energy & Natural Resources
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Leaks shows Qatar secretly sent $15 million to Islamist movements in northern Mali
Leaked government letter is 'the first document to directly implicate the Emir of Qatar in the financing of terrorism'
Qatar’s regime funneled $15 million dollars to the Islamist movements in northern Mali and to an entity in the Sahel, according to a reportedly leaked Qatari document.
The Washington D.C.-based Middle East Media Research Institute (MEMRI) translated and published the alleged Qatari government letter with the subject “Secret and Urgent" on November 29.
According to a letter sent from Youssef Hussein Kamal, Qatar’s then-minister of economy and finance, to the director of the office of the Emir of Qatar, it stated “I wish to refer to your Excellency’s letter (da-49-2011) of April 4, 2011, which includes the esteemed directions from His Highness, the Emir of the country, regarding sending urgent monetary support to the Islamic opposition movements in northern Mali and to the organization of the Sahel and to the Sahara in the amount of US $15 million.”
The letter adds, “This sum must be distributed with the knowledge of the state security service, represented by Mr. Abdullah bin Hamad Al-Nue'eimi, under the section of humanitarian support.”
The letter further reads “I wish to inform Your Excellency that in the implementation of the esteemed directives, the sum of the support in cash, in the amount of US $15 million, was delivered to the state security service represented by Mr. Abdullah bin Hamad Al-Nue'eimi.”
Marc Eichinger, a former French intelligence agent who has written extensively about Qatar's financing of terrorism, told i24NEWS: "This document is more important than the others in that for the first time we have proof the Emir is directly involved in the financing of terrorism. He personally gave the orders to pay money to people over whom he has no control. This funding destabilized the whole of West Africa to satisfy and provoke an unprecedented wave of migration."
Ghanem Nuseibeh, a leading expert on Qatar's regime and the founder of the London-based Cornerstone Global Associates, told i24NEWS “the allegations aren’t surprising as they fit in with Qatar’s financing and support of Islamist terrorist groups around the world. This fits with Qatar’s foreign policy which for the past two decades has focused on aligning itself with local Islamists in many regions of the world.”
Numerous i24NEWS press queries to Qatar’s embassies in London and in Washington were not immediately returned
In 2012, a number of French-language news outlets reported that Qatar financed Islamists in northern Mali.
French weekly Le Canard Enchainé wrote an article titled “Our friend Qatar is financing Mali’s Islamists.”
A source from French military intelligence told Canard Enchainé, “The MNLA [secular Tuareg separatists], al Qaeda-linked Ansar Dine and MUJAO [Movement for Unity and Jihad in West Africa] have all received cash from Doha.”
In January 2013, France 24 wrote that “two French politicians explicitly accused Qatar of giving material support to separatists and Islamists in north Mali, adding fuel to speculation that the Emirate is playing a behind-the-scenes role in spreading Islamic fundamentalism in Africa.”
According to France 24, the politicians said it added “fuel to speculation that the Emirate is playing a behind-the-scenes role in spreading Islamic fundamentalism in Africa.”
The two politicians who raised Qatar’s alleged funding of radical Islamists in northern Mali were far-right leader Marine Le Pen and Communist party Senator Michelle Demessine.
According to France 24, Sadou Diallo, the mayor of the north Malian city of Gao [which had fallen to the Islamists] told RTL radio: “The French government knows perfectly well who is supporting these terrorists. Qatar, for example, continues to send so-called aid and food every day to the airports of Gao and Timbuktu.”
Former Qatari Prime Minister Sheikh Hamad bin Jassim al-Thani (HBJ) called for dialogue with the Islamists in Mali at the time.
HBJ has long faced accusations of misconduct, ranging from bribing journalists to stoking antisemitism. In a 2017 Congressional hearing, the Qatari regime was accused of financing a wide range of Islamist terrorist organizations. Doha has also faced allegations that the tiny oil-rich Gulf nation seeks to use its enormous wealth to influence human rights organizations, the UN, and think tanks to issue glowing reports about Qatar. In November, i24NEWS reported that an alleged Qatari document revealed that Doha sent 3 million euros to Human Rights Watch. HRW denied that it received money from Qatar.
There is growing criticism in the United States, Germany, and Israel of Qatar’s alleged role as a state-sponsor of terrorism. On Thursday, US congressman Jack Bergman (R-Michigan) said on the House floor, "Qatar poses the gravest and most profound threat to the national security interests of the United States in the Middle East." Bergman also slammed the Qatari-owned Al Jazeera network for enabling Hamas’ terrorism ideology.
Germany’s largest paper, Bild, headlined its October article regarding the visit of Tamim bin Hamad Al Thani, the Emir of Qatar: “Scholz welcomes the top sponsor of terror.” Olaf Scholz is the German Chancellor. The Bild headline would have been largely unimaginable before October 7. MEMRI’s president and founder, Yigal Carmon, said “Qatar is Hamas and Hamas is Qatar.”
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Middle East Business & Economics
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First came the drought. Then the bushfires. Then the floods. And then, on May 21, 2022, came the federal election. After nearly four years as Australian prime minister—a term in office marked by repeated and record-breaking natural disasters—the conservative Scott Morrison was ousted following a contest that hinged on climate change.“It’s a very clear illustration of the concern that Australians have and their desire for climate action,” says Amanda McKenzie, CEO of the Climate Council, a nonprofit organization dedicated to climate change communication. The hope is that the new Labor government will quickly improve Australia’s poor track record on carbon emissions.Australia certainly has a lot of catching up to do. Its efforts to mitigate climate change have been declared “highly insufficient” by the Climate Action Tracker, an independent project that assesses countries’ climate policies. Despite ranking 55th in the world in population, Australia is the 14th-highest emitter of carbon dioxide—and the fifth highest if its large fossil fuel exports are factored in. It is the world’s second-largest exporter of coal. On a per capita basis, the country is one of the highest emitters of CO2 in the world. The election delivered a mixed result—but one that could help change this. New prime minister Anthony Albanese’s center-left Labor Party gained the most seats in Parliament—far more than the incumbent coalition of the center-right Liberal Party and National Party, which took power in 2013. But it wasn’t a landslide, with Labor exceeding the number of seats needed to govern in its own right by just one.The surprise twist was the election of five new “teal” independents—so-called because of their campaign color. These candidates all ran on a platform of substantially stronger action on climate change than Labor, which in turn promised far more action on climate change than the coalition. Many teal independents won in previously secure Liberal Party electorates. The Australian Greens, who have the strongest climate policies of all the parties, also increased their electoral share from one to four seats in the lower house.Prior to the election, the Australian government had maintained a commitment to a 26 to 28 percent decrease in emissions by 2030 under the Paris Agreement, which was compatible with around 3 degrees Celsius of warming. Labor went into the election with a range of climate and energy promises, including a commitment to a 43 percent reduction in emissions, which McKenzie says is “certainly not enough.” Analysis suggests this is still consistent with 2 degrees of warming. The teal candidates’ platforms aim for a 60 percent reduction, and the Greens’ for a 74 percent decrease. “Our analysis from a scientific perspective is it needs to be a 75 percent reduction this decade,” McKenzie says.The hope is that the climate-focused independent and Green presence in Parliament will push Labor towards even greater climate action, says Frank Jotzo, director of the Centre for Climate and Energy Policy at Australian National University in Canberra. “For the government, this should mean a license to do more rather than less on climate change.”One of Labor’s election promises on energy and emissions is to strengthen the existing cap-and-trade system for big carbon emitters, known as the Safeguard Mechanism. Under this, big polluters are required to buy or surrender carbon credits to offset any direct emissions that exceed an agreed-to baseline. Labor’s plan is to reduce the emissions baselines for these emitters over time. “The government will then need to resist industry pressure to keep the ambition low,” Jotzo says, warning that industry will lobby hard for baselines to be eased.This is exactly what happened under the coalition government after it set up this cap-and-trade scheme. Companies continually pushed for adjustments to their baselines, eventually resulting in a 32 percent increase in the emissions they were allowed to produce.Another pillar of Labor’s election platform was its National Electric Vehicle Strategy. In 2020, less than 1.4 percent of all light vehicles sold in Australia were EVs, compared to around three-quarters of all light vehicles sold that year in Norway. Overall just 0.12 percent of all light vehicles in Australia are electric. Manufacturers such as Volkswagen have held off from entering the Australian market because of a lack of incentives for EVs.So going into the election, Labor promised to remove import tariffs and lower taxes on some EVs, and to accelerate the rollout of charging infrastructure. But they haven’t gone far enough, Jotzo says. “They have not committed to do what in many countries is the single biggest driver of electric car uptake, and that is to introduce fleet-wide emission standards,” he says. Requiring all car manufacturers to meet emission targets across their entire range encourages massive investment in electric models to offset the emissions from petrol and diesel models.But the biggest fly in Australia’s climate action ointment is its fossil fuel reserves—particularly coal and gas—and the question of how the country can safely and smoothly transition away from those both for domestic use and export.“Because it’s an extractive resource, the government owns it, it generates royalties for the government, and renewables don’t do that,” says Samantha Hepburn, a professor and expert on mining and energy law at Deakin University in Melbourne. In contrast, renewable projects will generate very little income for the government. “When we talk about energy transition, I don’t think that phrase really captures it—it’s a revolution.”Some progress on renewables was made during the coalition government. A long-running renewable energy target required large-scale energy producers to generate 33 terawatt-hours of renewable energy by 2020, and this was easily met in 2019. But the absence of a new target created a climate of uncertainty in the renewables sector that then saw a drop in investment in new projects.Labor’s “Powering Australia” policy now promises to upgrade the grid to enable better integration of renewables, to invest in solar banks and community batteries across the country, and to deploy low-emission technologies.But the current global gas crisis, precipitated by the Russian invasion of Ukraine, has plunged Australia into a world of energy misery largely of its own making. There are no export controls on its extensive east-coast gas reserves, which are now being sold at incredible prices on the international market, with none set aside for domestic use. Domestic gas prices have therefore skyrocketed, and there is not yet enough renewable energy to pick up the slack. Meanwhile, Australia’s aging network of coal-fired power stations has been steadily winding down over the past decade.“There is no more important time to be talking about energy and climate change in Australia than right now, and what we’re inheriting is a decade-long failure to tackle these issues of climate, energy, and security,” says Madeline Taylor, deputy director of the Centre for Energy and Natural Resources Innovation and Transformation at Macquarie University in Sydney.But Labor has long supported keeping at least some fossil fuels in Australia’s energy mix, even before the current gas crisis, and it has grappled with some in its ranks that opposed taking a stronger stance on climate action. Labor also previously backed the potential fracking of the enormous gas reserves of the Beetaloo Basin in the Northern Territory, and it says it will still allow new gas and even coal projects that meet environmental standards.Taylor, and many others, argue that Australia’s wealth of renewable resources—in particular sun, wind, and waves—should instead see it become a global green-energy superpower. As well as servicing the domestic energy market with renewables, there has been a push for Australia to become an exporter of renewable energy in the form of green hydrogen.Labor has not made specific commitments to this vision, beyond a National Reconstruction Fund that covers investment in renewable and low-emission energy technologies, including the manufacture of wind turbines and hydrogen electrolyzers. However the Greens are shooting for a complete phase-out of fossil fuels in Australia by 2030, and for the country to invest in green hydrogen as an export industry.With Labor's razor-thin majority in Parliament, the hope is that the Greens and climate-focused independents will be a vocal and powerful climate conscience for the ruling party.“There are so many reasons why we need increased ambition on energy and climate change,” Taylor says. “The community wants this. Industry wants it. It’s now time for the government to actually present some certainty.” The recent climate-fueled devastation in Australia has shown how high the stakes are.
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Australia Business & Economics
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PM asked to intervene for retired geologist facing 15 years in Iraqi jail Neale Hanvey raises the case of Jim Fitton, a retired geologist who has been jailed for 15 years in Iraq.Mr Fitton, originally from Bath, was arrested ay Baghdad at the end of March after collecting stones and shards during a visit to an ancient site in Eridu.Mr Hanvey, his local MP, says: "The judge passing sentence does not believe Mr Fitton had any criminal intent."He asks the PM will meet with him and other MPs.Boris Johnson replies he has a "great deal of sympathy" and says he will get a relevant meeting as soon as possible. Analysis: Theatrical Starmer seems to be enjoying himself By Amanda Akass, political correspondentSir Keir Starmer seems to be enjoying himself as he reads out a list of negative quotes about the prime minister made by his own MPs - only last week of course, four in ten of them voted to kick him out. In a much more theatrical style than we normally see from the Labour leader - to resounding cheers from his own side and shaking heads from the Tory benches - he urges the Conservative MPs to own up to quotes like "dragging everyone down", "authority is destroyed" and "can't win back trust". Needless to say none of the Tories respond to his request to put their hands up. In a line which nods to critics in his own party, he says his personal favourite criticism of the prime minister is circulating in a document calling him "the Conservative Corbyn" - adding "I don't think they meant that as a compliment".It's a rather extraordinary to hear a party leader attempting to insult his opposite number by comparing him to his own predecessor, but it's a line which Sir Keir is using to highlight the changes he has sought to make in his own party in drawing a very clear division between himself and Jeremy Corbyn. 'Scotland is being held back by Westminster' says SNP "Yesterday, our first minister started a national conversation to choose an independent future," says Ian Blackford.He says neighbours are "outperforming the United Kingdom" adding: "They deliver greater income and equality, lower poverty rates, higher productivity... the evidence is overwhelming."Scotland is being held back by Westminster."Responding, the PM says "there are other subjects in the national conversation right now".He references payroll employment, and investment across the whole of the UK: "And the whole of the UK standing strong together on the international stage and speaking up for Ukrainians".Mr Blackford accuses the PM of "living in his own little world" adding: "Our nation [Scotland] is big enough, rich enough. And smart enough that Scotland simply can't afford to remain trapped in the Westminster system." 'A Conservative Corbyn' Sir Keir throws comments made by Tory MPs back at the prime minister."They are making a lot of noise now but I have a list of what his MPs really think of him," he says."Dragging everyone down - who said that? Come on, hands up?"His authority is destroyed, come on hands up, which of you said that?"Can't win back trust - they're all very quiet now."He then moves on to his "personal favourite" from "a document circulated by his backbench in which they call him the Conservative Corbyn". Starmer accuses PM of 'screwing' the economy Sir Keir Starmer says the prime minister is "not just denying how bad things are. He's actively making things worse." In a fiery exchange the Labour leader said: "Mr Speaker, we know what the prime minister says about British business in private. I think that's pretty parliamentary but when did screwing business turn from a flippant comment into economic policy?"In his response, the prime minister said: "Never forget Mr Speaker that under Labour taxes go up on businesses and on people.""Labour have already made spending commitments in this parliament alone worth £94 billion more than the government - that's £2,100 for every household in the country. No wonder no Labour government has ever left office with unemployment lower than when they came in." Analysis: Starmer seems to have taken on board criticism of last week's PMQs performance By Amanda Akass, political correspondentA short sharp question from Sir Keir Starmer on the economy to begin his grilling of the prime minister this afternoon.He does not go in on the two key issues which have been causing such headaches for the government in the past 24 hours - the cancellation of the Rwanda flight and the European Union taking legal action over the Northern Ireland Protocol. But the prime minister's response, boasting instead about his government's economic achievements, was met with huge cheers by his own backbenchers. The prime minister seems on confident form - throwing Latin insults at Sir Keir and going in on the attack himself about Labour and the forthcoming transport strikes next week. But Sir Keir has his own jokes prepared, with some strong laughs for his claim that the prime minister is playing "Jedi mind tricks on the country" and his impersonation of Obi Wan Kenobi. He seems to have taken on board last week's criticism over what many perceived as a flat performance last week after the prime minister narrowly survived a confidence vote from his own MPs – and has come back on punchier form. Boris Johnson 'Jabba the Hutt' and 'thinks he's on Love Island' Labour leader pulling out a host of Star Wars references to attack the prime minister - and has accused him of "thinking he's on Love Island". "As for his boasting about the economy, he thinks he can perform Jedi mind tricks on the country - these aren't the droids you are looking for, no rules are broken, the economy is broken."The problem is the force just isn't with him anymore."He thinks he is Obi-Wan Kenobi. "The truth is, he is Jabba the Hutt."Sir Keir later adds: "He says the economy is booming when it's shrinking. "He is playing so much, he thinks he's on Love Island. But, Prime Minister, I am reliably informed that contestants that give the public the ick get booted out." PM challenges Starmer to end 'sphinx-like silence' on rail strikes The prime minister has challenged the Labour leader to end his "sphinx-like silence" about the upcoming rail strikes.Boris Johnson asked whether Sir Keir Starmer would "break with his shadow transport secretary" and condemn the strikes.The intervention prompted a rebuke from the Speaker of the House who reminded Mr Johnson PMQs was for him to answer questions.Sir Keir responded by saying: "He's in government, he could do something to stop the strike, but he hasn't lifted a finger. I don't want the strikes to go ahead, but he wants to the country to grind to a halt so he can feed off the division." 'Britain set for lower growth than every major economy' says Keir Starmer Labour leader Sir Keir Starmer begins by paying tribute to those who served in the Falklands war.He then moves on to ask the prime minister why Britain is set for lower growth than every major country, except Russia.Boris Johnson replies by saying it is because the UK "came out of the pandemic faster" which has led to the "highest number of people on payroll employment on record".Sir Keir accuses the PM of blaming global forces: "But global forces mean everybody faces them." Boris Johnson leaves Number 10 to head to the Commons for PMQs Due to your consent preferences, you’re not able to view this. Open Privacy Options
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United Kingdom Business & Economics
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Australian state suspends human rights law to lock up more children
Australian state suspends human rights law to lock up more children
A Second Suspension: Detention of Minors in Police Watch Houses
The government of Queensland, Australia, has recently come under fire for a controversial move that involves suspending its Human Rights Act for the second time this year. This decision permits the indefinite detention of minors, including children as young as 10, in police watch houses due to a lack of space in youth detention centers. This came in the wake of changes to the state’s youth justice laws, which now include imprisonment for young individuals who breach bail conditions.
Scott McDougall, Queensland’s Human Rights Commissioner, has voiced serious concerns over the potential for irreversible harm to children held in these facilities. The Queensland Human Rights Act, which came into effect in 2019, prohibits the detention of children in adult prisons, necessitating its suspension for the new legislation to be passed.
Queensland: Australia’s Hotspot for Detained Children
Recent reports suggest that Queensland has the highest number of detained children in Australia, with a daily average of 287 individuals in youth detention between 2021-2022. Over half of these children are re-sentenced for new offences within a year of their release. The Justice Reform Initiative also reported a 27% increase in Queensland’s youth detention numbers over seven years.
Police watch houses, typically used as a last resort for adults awaiting court appearances, are now being used to house the growing number of detained minors. Described as “concrete boxes,” these facilities offer no access to fresh air or sunlight. McDougall has reported cases of children’s mental health deteriorating after just a few days in these conditions.
Demographics and the Call for Alternatives
Approximately 90% of the imprisoned children and youth are still awaiting trial. Indigenous children, despite making up only 4.6% of Queensland’s population, constitute nearly 63% of those in detention. Advocates, such as Maggie Munn, National Director of First Nations justice advocacy group Change the Record, have denounced the government’s actions as cruel and wrong, arguing for alternative solutions that address children’s behavior without resorting to incarceration.
Critics also express concern over the Queensland parliament’s single-house system, which allows the ruling party to pass new laws relatively unchallenged. Debbie Kilroy, CEO of Sisters Inside, an organization advocating for the human rights of women and girls in prison, called for a halt to the “funding of cops and cages.” She voiced concern over systemic racism, misogyny, and sexism within the Queensland Police Service.
Conclusion: A Call for Change
This move by the Queensland government has stirred a debate on the treatment of children within the justice system. The suspension of the Human Rights Act raises questions about the balance between public safety and the rights of the most vulnerable. As the controversy unfolds, it underscores the need for a more comprehensive, evidence-based approach to youth justice that is anchored in human rights and focused on rehabilitation rather than punishment.
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Australia Business & Economics
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Kenya's Energy and Petroleum Regulatory Authority (Epra) has hiked electricity charges by 15.7%, reversing the January cuts by former President Uhuru Kenyatta's administration, the Kenyan Wall Street newspaper reported.The increase in pass-through costs, including fuel, forex and inflation adjustments, has pushed the price of a kilowatt hour unit to 25.3 shillings for domestic consumers who use more than 100 units a month.High-consuming households and industries will see their power costs rise even higher since the pass-through expenses now account for more than a third of power bills.The move will directly affect consumer prices for food and manufactured goods, leading to higher living costs, the newspaper reported citing analysts.On the other hand, the National Treasury's Budget Review and Outlook Paper for 2022 expected the country's economy to grow 5.8% in the fiscal year 2022/23 and average 6.2% over the medium term.However, it warned that challenges include subsidising pump prices, reducing electricity tariffs by 15% to lower power costs and granting an import duty waiver on 540,000 metric tons of white maize.(Editing by Seban Scaria seban.scaria@lseg.com )
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Energy & Natural Resources
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A logo of Turkey's Central Bank is pictured at the entrance of its headquarters in Ankara, Turkey October 15, 2021. REUTERS/Cagla GurdoganRegister now for FREE unlimited access to Reuters.comSummaryUnder pressure from Erdogan, bank cuts rate to 13%Last year's easing sparked currency crisis, stoked inflationAnnual inflation hit 24-year high of 79.6% in JulyBank says it acted to preserve economic momentum, jobsANKARA, Aug 18 (Reuters) - Turkey's central bank shocked markets on Thursday by cutting its main interest rate by 100 basis points to 13%, saying it needed to keep driving economic growth despite inflation hitting nearly 80% and a monetary tightening trend among its peers worldwide.The lira dropped as much as 1.2% to 18.15 per dollar as the bank took its latest step down the unorthodox policy path advocated by President Tayyip Erdogan that aims to provide targeted cheap credit to help boost Turkish exports.There had been virtually no signal that another rate cut was in the works and no economist polled by Reuters had predicted one, given that inflation has soared to 24-year highs, eating deeply into Turks' earnings and savings.Register now for FREE unlimited access to Reuters.comThe bank had held its main rate at 14% for the past seven months after cutting it by 500 basis points towards the end of last year. That policy easing sparked a currency crisis in December that sent inflation soaring.The rate cuts long urged by Erdogan - who holds sway over the bank after ousting several of its governors in recent years - have left real interest rates in deeply negative territory and have accelerated a cost-of-living crisis for Turkish households.Analysts expressed dismay at the decision. read more JPMorgan said in a note the move was "opportunistic," driven by a recent increase in forex reserves "alongside a weak global environment and sharp rise in local lending rates" that is weighing on economic activity.But the current policy mix "will eventually either lead to a policy reversal or to an economic downturn," the note said.The central bank's policy-setting committee said it needed to act because leading indicators pointed to a loss of economic momentum in the third quarter."It is important that financial conditions remain supportive to preserve the growth momentum in industrial production and the positive trend in employment in a period of increasing uncertainties regarding global growth as well as escalating geopolitical risk," it said in a statement.The new policy rate "is adequate under the current outlook", it said, adding the growing gap between its policy rate and rising loan rates was reducing "the effectiveness of monetary transmission"."We think the macroeconomic policy mix in Turkey has become more unsustainable with today's rate cut," wrote Goldman Sachs analysts in a note in which they forecast annualised inflation to rise to more than 90% and only ease to near 75% by year-end with the help of base effects."We recognise substantial upside risk to our forecast," the note added.Both Goldman and JPMorgan expect no more rate cuts in the near future, and JPMorgan sees a rate hike to 25% in the first quarter of 2023 and real rates to turn positive in the second half of next year.The currency crisis last year saw the lira fall 44% against the dollar, stoking inflation via imports. The currency has lost a further 27% so far this year while inflation hit 79.60% in July, partly stoked by fallout from the war in Ukraine.The lira on Thursday broke through 18 to the dollar for the first time since December and set a record closing low of 18.089.AGAINST THE GRAINWith supply constraints, consumer demand and fallout from the war stoking inflation globally, central banks across developed and emerging markets are jacking up interest rates.Turkey's inflation rate is among the highest worldwide while its real interest rate, at minus 67%, is among the lowest.Ozge Arslan, a teacher in Istanbul, said rising electricity and natural gas bills had forced her family to reduce their oven and kettle use and to take shorter showers.Opinion polls show such concerns have hit the popularity of Erdogan, who faces a tough election by mid-2023.He has made little mention of interest rates since June 6, when he said Turkey would continue cutting rather than raising them. read more The bank said inflation is driven by the lagged effects of rising energy prices, pricing formations not supported by economic fundamentals, and negative supply shocks.It repeated that disinflation should begin thanks to steps the bank and other authorities have taken to cool some forms of credit, along with an eventual end to the war.In the Reuters poll, all 14 economists had expected the benchmark one-week repo rate (TRINT=ECI) to remain unchanged this week. Only one economist predicted a cut later in the year.The bank last month raised its year-end inflation expectation to 60.4%, compared to economists' median estimate of 70%. It sees inflation peaking near 90% this autumn.Register now for FREE unlimited access to Reuters.comAdditional reporting by Ezgi Erkoyun in Istanbul, Marc Jones in London, Canan Sevgili in Gdansk and Rodrigo Campos in New York; Editing by Jonathan Spicer, Gareth Jones, Kirsten Donovan and Richard PullinOur Standards: The Thomson Reuters Trust Principles.
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Inflation
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Michael Hanschke/picture alliance via Getty Images Russia's invasion of Ukraine is shaping the lives and work of European climate activists, who are asking their governments to stop financing the war through fossil fuels. Katie Collins Senior European Correspondent Katie a UK-based news reporter and features writer. Officially, she is CNET's European correspondent, covering tech policy and Big Tech in the EU and UK. Unofficially, she serves as CNET's Taylor Swift correspondent. You can also find her writing about tech for good, ethics and human rights, the climate crisis, robots, travel and digital culture. She was once described a "living synth" by London's Evening Standard for having a microchip injected into her hand. See full bio 9 min read On the streets of Bonn and Brussels, Stockholm and Strasbourg, Vienna and Davos -- wherever Europe's political elite are gathering -- young climate activists are present. Over the past four months, their pleas for climate justice and an end to reliance on fossil fuels have gained urgency with the ongoing war in Ukraine.Above all else, they are asking for one thing: for European countries to cut financial ties with Russia by ceasing the purchase of fossil fuels from the country. If the purchases continue, the activists argue, those countries are financing Putin's war, which is causing death and destruction in Ukraine. Many believe that if Europe had taken more decisive action to move earlier to renewables (solar, wind, geothermal and hydro, for example), Russia might never have had the economic strength to invade Ukraine in the first place."We see Ukraine as one of the first climate wars," said Ukrainian activist Ilyess El Kortbi, who is a member of Fridays for Future, the international youth movement associated with Greta Thunberg. El Kortbi (whose pronouns are they/them) asks how many lives will be lost in order to keep feeding the world's addiction to fossil fuels.El Kortbi's is not a fringe viewpoint. Last week, Secretary General of the UN Antonio Guterres spoke at the Sixth Austrian World Summit in Vienna about how the world's biggest economies were doubling down on fossil fuels when they should be doing the opposite."New funding for fossil fuels is delusional," he said on Twitter. "It will only further feed the scourge of war, pollution and climate catastrophe."The energy crisis exacerbated by the war in Ukraine has seen a perilous doubling down on fossil fuels by the major economies.New funding for fossil fuels is delusional.It will only further feed the scourge of war, pollution & climate catastrophe. https://t.co/ppM3pOaqna— António Guterres (@antonioguterres) June 14, 2022
There's an intrinsic link among the scourges Guterres lists. Russia's unprovoked invasion of Ukraine in February has thrown the energy markets into chaos, which has caused fuel prices to rocket around the globe. This geopolitical crisis, the effects of which people are feeling keenly in their everyday lives, is happening against the backdrop of a world that's warming rapidly and feeling other consequences of climate change spurred by the burning of fossil fuels.As with the climate crisis more widely, it's fallen to the climate justice movement to call out this connection and challenge politicians over why they're continuing to pursue fossil fuels-based energy strategies. Climate justice activists have long pointed out that those who suffer the most from climate change have done the least to cause it. They are now turning their human rights-centered approach to the climate crisis to campaign for Europe to starve Russia, a major producer of fossil fuels, of all financing that would allow it to continue its assault on Ukraine.Reliable statistics are hard to come by, but to date, tens of thousands of citizens and soldiers are estimated to have died in Ukraine, which has leveled cities and devastated swaths of the country, while displacing over 13 million refugees within Ukraine and sending many to countries beyond, according to the UN.In Guterres, the activists have found a natural ally. But they've also been carrying their message to other high-ranking politicians around Europe.Sometimes that involves dramatic initiative. El Kortbi, for instance, broke protocol while meeting dignitaries at the World Economic Forum in Davos in May, to speak with Albert II, the crown prince of Monaco. Not only did El Kortbi feel listened to, but the prince returned to speak with them later at a side event and ask questions. El Kortbi showed him a Ukrainian flag signed by climate activists from around the world."I presented him this flag, telling this person that this flag belongs to young people from Ukraine who wish to live in peace and have a safe future, but some of them are already dead," they said. "I think he was touched."Fleeing war, fighting for the climateThe flag was one of few personal possessions El Kortbi had when they left home from the northeastern Ukraine city of Kharkiv on Feb. 23 and had no idea they would not be returning. "I left my hometown by accident," they said. Ukrainian Fridays for Future activist Ilyess El Kortbi at a protest in Germany. John MacDougall/AFP via Getty ImagesEl Kortbi was on a train to a peace-building conference in Kyiv when the news arrived that Russian troops had invaded on Feb.24. Through Fridays For Future, El Kortbi has friends from Syria and Afghanistan who have lived through war. Knowing something about the toll it's taken on those countries, their initial reaction when the train arrived in Kyiv was to try to volunteer with UNICEF (the UN Children's Fund).When UNICEF told El Kortbi to leave Ukraine, they traveled to the border with Hungary, where they were stopped because at 25 years old they were the right age to be drafted into the army. El Kortbi tried to explain that their disability (a lifelong neurological disorder and ongoing health problems stemming from being assaulted for their climate activism) prevented them from fighting, but no one would listen. In the end they had no choice but to cross the border illegally. They then traveled to Germany where activist friends provided shelter.El Kortbi is far from the only Ukrainian climate activist who has experienced a fundamental shift in life and work following the Russian invasion. Svitlana Romanko got involved in climate activism when she was employed by Chevron as an environmental expert to conduct a strategic impact assessment of the energy company's potential fracking activities between 2011 and 2013. "I found it extremely unjust and dangerous for the environment, for climate and for the local communities," she said. While working as a professor at Vasyl Stefanyk Precarpathian National University, she also spent her time campaigning against fracking, working as a zero fossil fuel campaign manager for climate justice organization Laudato Si Movement.When war broke out, everything changed. Over the past few months, Romanko has poured all of her energy into coordinating Stand Up for Ukraine, an alliance of 820 organizations from 57 countries campaigning to dry up Russia's oil, coal and gas revenues and phase out fossil fuels to restore peace. "If we won't act fast and rapidly transition to a clean community-owned energy [an approach based on renewable energy sources owned by and benefiting local communities] it won't be a last fossil-fueled war," she said via email. "It keeps me busy, motivated and resilient towards ending the global fossil fuel addiction that feeds Putin's war machine."Climate wars: A global struggleBut it hasn't been solely left to Ukrainian climate activists to carry the burden of asking governments globally to wean themselves off fossil fuels. Solidarity from the international climate movement has been "outstanding," said Romanko. "We understand that this is a critical moment in history that can lead us to ending fossil-fueled injustice and conflicts everywhere." On March 3, 120,000 people joined Fridays For Future on the streets of Hamburg, Germany, to protest against the war and for freedom from fossil fuels. Many of the group's activists are now putting all their energy into the dual causes. Dominika Lasota and Wiktoria Jędroszkowiak, both 20 years old from Poland, have been almost constantly on the move across the continent ever since. As the shock of Russia's invasion wore off, the organizing and protests began to taper off and many people started to go silent, said Lasota. If they didn't continue to hammer home the point, who would? "Ilyess will do it," she said, "but Ilyess is just one person." Dominika Lasota (right) protests with other climate activists outside the Russian embassy in Berlin. Monika Skolimowska/picture alliance via Getty ImagesTogether they've met with other activists to protest, with experts to learn more about Europe's dependency on Russian gas, oil and coal, and with politicians to try to get their support. As was the case at COP26, the UN climate summit held in Glasgow in November, these politicians are keen to invite them to speak at events and are quick to proclaim them the ones who hold the keys to solving the climate crisis.But there is a difference between being receptive to their message and reactive in a way that's adequate, said Lasota and Jędroszkowiak. The pair met with European Commission President Ursula von der Leyen for an hour and a half in March to talk about fossil fuels and Ukraine.They told her the war in Ukraine was a fossil fuel-based war and if Europe was to address it fully, it would need to completely phase out fossil fuels to be sure it was not funding any war or crisis. It would also need to transition to renewables, said Lasota, which "can be the energy of peace while fossil fuels fundamentally are an energy of war."Von der Leyen agreed with them wholeheartedly, she said, which gave them hope, but the subsequent lack of a gas embargo has been disappointing, as was watching the oil embargo descend into a topic for debate. It's hard to watch von der Leyen appear frequently on social media wearing blue and yellow (the colors of Ukraine), said Jędroszkowiak, and also see her tweet about striking new gas deals with Israel and other countries. A spokesman for Von der Leyen responded by highlighting the RepowerEU strategy, designed to move Europe away from reliance on Russian fossil fuels and toward renewables. "Since some member states are heavily dependent on gas from Russia it is clear that we will have to diversify from RUS gas first, before we can fully replace it with renewable energies," he said over email. "With almost all new gas suppliers to the EU we also negotiated long-term partnerships on clean energy supply and green hydrogen."Likewise, the pair were baffled when they confronted French President Emmanuel Macron in Strasbourg in May over failing to halt a controversial oil pipeline by French company Total and he told them he was powerless to stop it. "I'm like, are you for real?" said Lasota. "Who has more power than him?"From a fossil-fueled war to renewables and peaceThis week it will be four months since Russia invaded Ukraine, and though the initial shock has worn off, climate activists want people to see this as not just another geopolitical chess game. For many working at the grassroots level, it is deeply personal. "The war is a horrific experience," said Romanko. "Emotionally it's hard to expect the explosions every time after constant air alarms and see what severe and dreadful destruction, death, sexual violence and terror the war brought to our peaceful and beautiful country, people, children."El Kortbi was in tears while describing the impact on Ukrainians. Jędroszkowiak explained that Ukrainian friends she used to work with at Fridays For Future had been killed in the war. For climate activists, the link between the work they'd already been doing and this tragedy was immediately obvious and has influenced their entire lives. Wiktoria Jędroszkowiak holds a banner while protesting outside the TotalEnergies SE annual general meeting in Paris. Benjamin Girette/Bloomberg via Getty Images"It's about addressing the fact that the European community, which grants itself as the haven of democracy and freedom, is literally now sponsoring the war that is affecting our friends," said Lasota. "No war, no conflict, no crisis is just about specific people -- it's about all of us."She found that advocating for an embargo on fossil fuels was taking up so much of her time that she had to make major changes to her life. Hours after speaking with Macron, she received an email from her professor saying she would fail the year if she didn't return to her university within two days. The "chaos" around her left her feeling she had no choice but to put her studies on hold in favor of focusing on Ukraine and the climate crisis -- something that Jędroszkowiak has also had to do.It's clear that for these activists, some from Ukraine, others from surrounding countries, Russia's actions have changed the course of their lives and work. In some circles there are already talks about what Ukraine's green recovery should look like, but it's important not to jump too far ahead, said Lasota. As someone from Poland -- a country neighboring Ukraine that was once under Russian control -- she worries that for as long as Europe relies on fossil fuels, Russia will always remain a threat.El Kortbi is hopeful about the future of Ukraine, but that hope lies in people not leaders, they said. If the war is to end, renewables can no longer be viewed as a "solution of the future," when they are needed right now, they added. These sentiments were echoed by Romanko, who said she believes the fight for Ukraine's freedom can do what science demands and spur a transition to green energy."Fossil fuels themselves, like the missiles they finance, are weapons of mass destruction and the sooner we end their exploration and use and accelerate the clean energy revolution, the sooner we can all live in peace," she said.
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Energy & Natural Resources
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A Euro banknote is displayed on U.S. Dollar banknotes in this illustration taken, February 14, 2022. REUTERS/Dado Ruvic/Illustration/File PhotoRegister now for FREE unlimited access to Reuters.comSummaryEuro still above $1 but U.S. CPI a stern testRBNZ expected to deliver 50 bp hike, tone to drive kiwiSterling adrift as markets wait for Tories to choose leaderSINGAPORE, July 13 (Reuters) - The euro hovered a whisker above parity on the dollar on Wednesday ahead of U.S. inflation data, with traders wary a sky-high reading could force it to lows not seen in decades.Markets are also wary of a surprise from the Reserve Bank of New Zealand, which sets policy at 0200 GMT, with economists expecting a 50 basis point interest rate hike. read more The New Zealand dollar , which hit a two-year low of $0.6097 on Monday and inched up to $0.6119 in early trade, is vulnerable to a further drop if the central bank's statement is focused more on risks to growth rather than inflation.Register now for FREE unlimited access to Reuters.comThe common currency , meanwhile, is down nearly 12% this year and fell as low as $1.0005 on Tuesday as war on Europe's eastern edge has triggered an energy crisis that has hurt the continent's growth outlook. It last bought $1.0030.Economists forecast headline U.S. inflation accelerated to 8.8% year-on-year in June, a 40-year high, which is likely to reinforce expectations of interest rate hikes in response and help the dollar in a market nervous about both rates and growth."I think the U.S. dollar will keep increasing if the U.S. CPI is stronger than expected," said Commonwealth Bank of Australia strategist Joe Capurso in Sydney. "There's definitely a very good chance that the euro falls below parity tonight."The euro already fell beneath parity on the Swiss franc last month and is flirting with a drop beneath its 200-day moving average against the pound .Weakness in the euro and yen has vaulted the U.S. dollar index higher and it made a two-decade peak of 108.560 this week, hovering at 108.220 in early trade on Wednesday.The Japanese yen has taken a beating this year as the Bank of Japan sticks with its ultra-easy monetary policy in contrast with tightening nearly everywhere else.It was under pressure at 136.95 per dollar on Wednesday after hitting its lowest since 1998 on Monday at 137.75.The Australian dollar fell 0.2% to $0.6746, just above a two-year trough of $0.6712 made on Tuesday.Sterling has also slipped on the stronger dollar and analysts see it adrift in the wake of the resignation of British Prime Minister Boris Johnson last week.It last bought $1.1877, with gross domestic product data due at 0600 GMT the next hurdle, as traders expect May brought zero growth.Eight Conservatives are vying to succeed Johnson. read more "The combination of slow growth, debt and high inflation is likely to prove very tricky for the new Tory leadership," said Rabobank senior strategist Jane Foley."Although sterling investors will be hoping for a government less distracted by scandal and more focused on providing coherence around the post-Brexit economy, the jury is still out."Sterling may suffer a lack of fresh direction until the new PM is in place."The South Korean won was a fraction firmer in morning trade after the central bank raised interest rates by 50 basis points, in line with market expectations. read more In Wellington, where the New Zealand central bank has been in the habit of surprising markets, investors are fairly sure a hike is coming and are focused on the tone of the statement."Our dovish scenario comprises a 50bp hike, and a statement which emphasises the downside risks to the global economy," said Westpac analyst Imre Speizer, something which he expects could knock the kiwi half a cent lower and push down near-term rates.========================================================Currency bid prices at 0058 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Rae Wee and Tom Westbrook in Singapore; Editing by Jacqueline WongOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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Workers work at the construction site of a new apartment in Jakarta, Indonesia, July 27, 2016. REUTERS/Iqro RinaldiRegister now for FREE unlimited access to Reuters.comJuly 11 (Reuters) - Asian companies are likely to find it harder to refinance dollar-denominated debt, the decline in a key metric suggests, with the currency at a two-decade high and a recent surge in inflation forcing central banks to raise interest rates.The interest coverage ratio of these companies - a measure of how easily they can pay interest on outstanding debt - slipped to 5.1 at the end of March, the lowest in a year, dragged down partly by firms in China, South Korea, Indonesia and Vietnam.Reuters analysed 1,700 Asian companies (excluding financial firms) for which comparable data was available from Refinitiv. They had a combined market capitalisation of more than $1 billion.Register now for FREE unlimited access to Reuters.comAsian companies in total raised $338 billion in dollar and euro debt last year.But 2021 also saw the bottom in interest rates. By the end of March 2022, Asian companies' debt had surged to $6.7 trillion, up by a quarter from two years earlier.Now, the ascending greenback and rising central bank rates are making interest payments dearer for smaller Asian firms that do most business locally and do not have much exports to boost the value of their earnings.Also, business conditions have deteriorated as raw material prices have jumped and companies have struggled to pass the extra cost on to customers, squeezing margins. read more "Currency risk was put under the carpet in the past five years as interest rates remained low and regional currencies remained resilient to weaker economic conditions," said S&P Global analyst Xavier Jean."As rates increase, we think currency risk will feature more into fund-raising options and the ability and willingness of companies to fund in U.S. dollars and into distressed situations."The interest coverage ratio for Indonesian companies, which Jean said tended to be sizable borrowers in foreign currency, fell to -4.10 at the end of March, from a multi-year high of 25.13 at the end of September last year.The ratio for Chinese companies fell to 3.02 from 5.10 for the same periods.Chinese property firms, under pressure since the China Evergrande Group (3333.HK) crisis last year, will struggle to refinance debt, said Herald van der Linde, a senior equity strategist at HSBC.These companies have dollar bonds with a value of $12.9 maturing in the second half of 2022.An interest coverage ratio is operating profits divided by interest expenses.WEAK HEDGESThere is no indication, however, that most Asian companies will not meet debt payments. Indeed, their median score in another ratio - net debt to earnings before interest, tax, depreciation and amortisation - was at a seven-year low of 2.5 at the end of March. A ratio higher than 3 is considered a cause for concern.While large Japanese and South Korean companies, including SoftBank Group Corp (9984.T), issued billions in dollar debt last year, these are typically hedged against any appreciation in the dollar. A weak local currency also raises the value of their dollar assets and exports.But sketchy hedges for smaller firms in countries including Indonesia and Vietnam are likely to erode balance sheets."Indonesian home builders have high exposure to a stronger U.S. dollar, as their hedges are only partly effective, and most issuers' debt is mainly denominated in U.S. dollars while cash flows are denominated in the local currency," said Matt Jamieson, a senior analyst at Fitch.Asian home builders, utilities and raw-material suppliers are the key industries with forex debt maturing this year, he said.S&P's Jean said credit quality for at least one in eight companies could be pressured in the next 12 months because of rising interest rates. That number could rise to one in six if inflation persists.Dollar borrowing has already plummeted.Asian companies issued just 98 bonds denominated in dollars or euros in the first half of this year, the fewest in six years and down from 338 last year.Register now for FREE unlimited access to Reuters.comReporting By Patturaja Murugaboopathy in Bengaluru; Additional reporting by Gaurav Dogra in Bengaluru; Editing by Sayantani Ghosh and Bradley PerrettOur Standards: The Thomson Reuters Trust Principles.
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Asia Business & Economics
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By Matt McGrathEnvironment correspondentImage source, Getty ImagesSpending money on new coal, oil and gas as a result of the war in Ukraine is "delusional" according to the UN Secretary General. Many countries want to increase their own fossil fuel production in order to depend less on Russian supplies.Mr Guterres says that our global energy mix is broken, and more coal will only reinforce the "scourge of war, pollution and climate catastrophe."The UN chief says that renewable energy is the peace plan of the 21st century.In a video message to the sixth Austrian world summit meeting in Vienna, the UN secretary again took countries to task for their continued reliance on fossil fuels. National plans to reduce carbon emissions were "simply not good enough," Mr Guterres said, pointing to a disconnect between the views of scientists and citizens demanding action and governments that are "dragging their feet."Image source, Getty ImagesImage caption, UN Secretary General Antonio Guterres has hit out against new fossil fuel investmentThe war in Ukraine is seeing a renewed focus on fossil fuels by many countries who are worried about energy security in the wake of Russia's invasion.A number of countries have signalled that they will burn more coal in the short term, while others are seeking to boost gas imports.The European Union as a whole is seeking to end reliance on Russian supplies of oil and gas by 2027 but leaders acknowledge this will undoubtedly see more fossil fuel used over the next three years or so.In his speech, Mr Guterres repeated his view that this short-term response might close the window on a key climate goal. In the Paris climate agreement, nations agreed to try to keep global temperatures from rising by more than 1.5C this century, compared to pre-industrial times.But that means that emissions of climate warming gases have to be essentially slashed in half by 2030. Image source, Getty ImagesImage caption, There has been a rush to secure new supplies of LNGThe war in Ukraine is making that tough target even harder, experts believe. Mr Guterres argues that new exploration for oil and gas and building more infrastructure for fossil fuels is "delusional."He re-iterated his previous call for a rapid phase out of coal and a dramatic increase in spending on renewables like wind and solar."Had we invested massively in renewable energy in the past, we would not be so dramatically at the mercy of the instability of fossil fuel markets.The dramatic falls seen in the price of renewables over the past decade contrasted strongly with the rising costs of oil and gas, he added. Supporting calls by European leaders, Mr Guterres said that red tape and bureaucracies should be rapidly reformed to speed up renewable energy projects. Image source, Getty ImagesImage caption, Renewable energy is now far cheaper than it was a decade agoMr Guterres also called for increased spending on helping poorer countries live with the impacts of climate change. He said efforts to adapt to rising temperatures should be put on an equal footing with plans to cut emissions.Climate diplomats are currently meeting in Bonn for the first major gathering since the COP26 conference last November. There has been much debate on the lack of progress in meeting the goals agreed at the Glasgow climate pact. A lot of attention has focussed on the question of loss and damage, a phrase that essentially means the types of climate impacts that many developing countries are unable to adapt to. The meeting will prepare the ground for the next major conference, COP27 in Sharm el-Sheikh in Egypt later this year. Follow Matt on Twitter @mattmcgrathbbc.
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Energy & Natural Resources
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A solar energy plant in Borrego Springs, California.Stan Sholik/ZUMA Wire This story was originally published by the Guardian and is reproduced here as part of the Climate Desk collaboration.
The rapidly shrinking window of opportunity for the US to pass significant climate legislation will have mortal, as well as political, stakes. Millions of lives around the world will be saved, or lost, depending on whether America manages to propel itself towards a future without planet-heating emissions.
For the first time, researchers have calculated exactly how many people the US could save by acting on the climate crisis. A total of 7.4 million lives around the world will be saved over this century if the US manages to cut its emissions to net zero by 2050, according to the analysis.
The financial savings would be enormous, too, with a net zero America able to save the world $3.7 trillion in costs to adapt to the rising heat. As the world’s second largest polluter of greenhouse gases, the US and its political vagaries will in large part decide how many people in faraway countries will be subjected to deadly heat, as well as endure punishing storms, floods, drought and other consequences of the climate emergency. “Each additional ton of carbon has these global impacts—there is a tangible difference in terms of death rates,” said Hannah Hess, associate director at the research group Rhodium, which is part of the Climate Impact Lab consortium that conducted the study. “There’s a sense of frustration over the lack of progress at the national level on climate but every action at state or local level makes a difference in terms of lives.”
The lab’s new “lives saved calculator” uses a model of historical death records and localized temperature projections to come up with an estimate for the number of lives saved if emissions are eliminated. The analysis just looks at lives at risk from extreme heat, meaning the true climate toll would be higher due to other growing threats such as flooding and strong storms.
Just 10 US states could save 3.7 million lives worldwide by cutting their emissions to net zero, largely due to their high consumption of fossil fuels. Texas alone could save 1.1 million lives. But even action in less populous states would have a benefit: Idaho is capable of saving about 68,000 lives, Kansas could save 126,000 lives and Hawaii could save about 16,000 lives.
Hess said that rising heat this century will cause an uneven distribution of deaths around the world, mainly focused on areas such as north and west Africa, as well as south Asia. India and Pakistan recently endured a brutal heatwave of temperatures reaching 122F in some places, which killed several hundred people and was made 30 times more likely by the climate crisis.
“People have different abilities to adapt depending on the resources they have to protect themselves from extreme heat,” said Hess. “The hottest places don’t all face equally elevated risk of death; it’s closely tied to economic growth. Within the US there are impacts in places like southern California and Texas, but the US is really eclipsed by poorer regions of the world when it comes to these sort of deaths.”
The US has yet to pass any meaningful legislation to tackle the climate crisis. Joe Biden’s Build Back Better bill, which contained about $550 billion in climate spending, was killed off in the Senate earlier this year by Republican opposition and the intransigence of Joe Manchin, a pro-coal centrist Democrat who has opposed any measures to phase out a fossil fuel industry that kills 9 million people a year globally through air pollution alone.
Democrats still hope about $300 billion of this spending, mainly in the form of tax incentives to expand solar, wind and other renewable energy, could be salvaged in a separate bill and that Manchin, a crucial swing vote, may be amenable to passing this. But time appears to be running out, with Democrats expected to lose their tenuous hold on Congress in November’s midterm elections. “The bottom line is we got some tight windows here we have to work in, but we’ll see,” Manchin told reporters last week. “We’ve just got to make some decisions here.”
Fears over inflation and the impact of the war in Ukraine have overshadowed the increasingly urgent need for some sort of climate legislation, but these concerns could be abated by more domestic clean energy production, according to Paul Bledsoe, who was a science adviser to Bill Clinton’s administration and is now strategic adviser to the Progressive Policy Institute.
“Ironically these crises may have increased the likelihood that Congress will act on clean energy legislation,” said Bledsoe. “If you don’t want these oil shocks from things that happen overseas, you’ve got to reduce demand for oil at home. The imperatives of inflation and security are solved by the same clean energy technology and I think that factor will be enough to get this over the line.”
Failure to pass any legislation would leave the US, and the world, far short in the effort to avoid catastrophic climate impacts. It would also severely wound Biden, who has made climate action central to his administration.
“If the Democrats don’t act and their majorities are lost in the fall, it will leave the United States without an effective climate policy at this moment of crisis,” said Bledsoe. “It’s hard to imagine a more devastating outcome for both the party and the world. It’s unthinkable that it won’t get done. It would be devastating to Biden’s legacy.”
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Renewable Energy
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Everyone is screaming, crying, and throwing up over inflation, the economy, gas prices, interest rates, housing prices, food prices, the supply chain, the stock market, a bear market, and things of this nature. If you work at a tech company, you have probably received some sort of email from your CEO about uncertain times ahead, or perhaps you or someone you know were just laid off. If you have any cryptocurrency, you may have noticed that, uhh, things are bad. If you are lucky enough to have a 401(k) or stocks of any sort, you may want to avoid checking your balance. If you have a car and have filled it up with gas lately, you probably wanted to cry. There are many, many articles and explainers for people who read the Wall Street Journal or Bloomberg, all of which are talking about interest rates and the Fed and things like this. All of these articles are probably useful if you already believe you know how The Economy works, or are old and lucky enough to have had money or a job during previous crises in 2008 or 2000 or way back in the early 1980s; these articles are decidedly less useful if you’re new to the workforce or haven’t been paying attention to exceedingly boring press conferences largely given by old men wearing dark blue suits in dark blue rooms at podiums in Washington, D.C. I am not an economist and I am not an expert, but I do want to know what’s happening to the money we all need in order to live, so I spoke to some experts and read some articles and listened to some very long podcasts and believe I can at least posit a grand theory of everything that may help get you started on your exciting journey to learn about, uhh, macroeconomics.WHAT JUST HAPPENED I am writing this article because on Wednesday, U.S. Federal Reserve Chairman Jerome Powell announced that “the Fed” is increasing the "federal funds rate" by .75 percent, the largest increase since 1994, and revised how high this rate will eventually go by the end of the year. The "federal funds rate" is essentially the interest rate at which banks and institutions can borrow money, and affect the interest rates businesses and people will pay when they borrow money. This rate was 0 percent during much of the pandemic (free money!) and now has a target rate between 1.25 and 1.5 percent. This increase is designed to slow inflation by making it more expensive to borrow money, which will have knock-on ramifications for everyone even if you are not buying a house or a car, don’t have or want stocks, or own or aspire to own a company. What it means in concrete terms is that lots of people are probably going to lose their jobs soon as part of an explicit attempt to get people to buy fewer things, bring down wages, and basically slow “demand” in the economy so that the prices of things become lower or, at the very least, do not increase as fast as they have been increasing.Last month, Powell said “wages are moving up at levels that would not over time be consistent with 2 percent inflation over time. And of course, everyone loves to see wages go up and it’s a great thing, but you want them to go up at a sustainable level because these wages are to some extent being eaten up by inflation.” He also described trying to create a “path” to “get wages down and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially.”What this means in very real terms, according to Zach D. Carter, a writer in residence at Hewlett Foundation's Reimagining Capitalism initiative, is that people are going to lose their jobs. “Throughout the macroeconomic profession and monetary policy sphere people like to elide this point that raising interest rates will somehow magically bring prices down,” Carter told Motherboard. “They don’t talk about the mechanisms by which it actually lowers prices. The way it lowers prices is by reducing household income, specifically by reducing the income households get from labor.”The U.S. has had very low interest rates for a very long time, which has made it easy and inexpensive for companies to borrow money, which has allowed them to aggressively hire and grow (and also encouraged companies and investors to borrow money and recklessly speculate with it). This, along with COVID and what employers called a “labor shortage,” recently increased wages and led to record low unemployment, which workers got to enjoy for, like, three months before inflation started eating into what little gains they made; now rising interest rates will probably hurt a lot of people even more. Companies, meanwhile, have argued that they need to raise prices because they've had to pay workers more, all the while making record profits.“The way you reduce wages is basically through layoffs and pay cuts. When you raise interest rates, you are tightening financial conditions. You are making it harder for businesses to get loans to finance ordinary operations. When it becomes more expensive to borrow money, businesses cut costs in other places, notably labor,” Carter said. When people are laid off, people make less money so they buy fewer things, so prices go down. There are more people searching for jobs, the “labor crisis” eases, what little power workers recently gained shifts back to companies, and people have to accept jobs for less money than they have had to in recent years. More or less. This is already happening, of course, with layoffs hitting a variety of sectors and startup CEOs talking about how they need to do layoffs to weather whatever it is that is coming.HOW WE GOT HERE, OR: A BRIEF HISTORY OF THE LAST 30 MONTHSIn March 2020, everyone (mostly) accepted that a deadly novel coronavirus was spreading all over world, causing a very bad pandemic that has killed millions of people and continues on to this day. Businesses shut down, people were asked to stay home, and the stock market crashed. Congress pumped trillions of dollars into the economy to expand unemployment benefits, and gave everyone thousands of dollars in the form of stimulus checks. Interest rates, which are broadly set by the U.S. Federal Reserve and then trickle down to banks, mortgage lenders, venture capitalists and so on (this is a complicated process involving the Fed buying and selling things until interest rates are where it wants them) were set at historic lows, making it exceedingly cheap to borrow money both for corporations and for regular people. People stuck at home in their shitty apartments began to hate them and looked to either buy new houses or remodel the ones they already had. Demand and supply-induced shortages of lumber and building supplies caused prices of both to skyrocket, and happened as lumber mills shut down and it became hard to ship wood because of COVID. Low interest rates let people buy “more house” or let them get into the housing market for the first time because they didn't have to fork over as much to the bank for interest. House prices skyrocketed because we have a huge shortage of housing stock in the U.S. due to a bunch of bullshit that’s better explained in another article. This basic process played out in all sorts of areas and is why if you wanted to buy something like a guitar or a bicycle over the last while you may well have found yourself out of luck.All sorts of other things happened as well, as you surely recall: Payments on student loan debt were deferred; payments on mortgages were deferred; eviction moratoriums were enacted; and America generally, if temporarily, had a safety net more worthy of ostensibly the richest country in the world, with stimulus checks helping. All of this money had fewer places to go than it had, with restaurants/music venues/weddings in many parts of the country closed or canceled for months and travel plans off the table, leading to a record levels of savings for many Americans. At some point, people stuck at home begin buying more things with this money or their savings. COVID outbreaks and lockdowns all over the world, as well as supply chain issues, made some products, like microprocessors, harder to find and more expensive. Early in the pandemic, we began to label certain workers as “essential.” Some of them (rightfully) got hazard pay. In the short term, people were laid off from their jobs and realized that their jobs sucked anyway, and that they weren’t getting paid enough to deal with this shit. Employers began to realize they could no longer get away with paying people $7.50 an hour to do awful jobs where they were exposed to a deadly pandemic and were treated like garbage. Employers also began to complain about a “labor shortage,” by which they meant (and mean) they can’t hire people at low wages to work for their companies. At some point, companies realized that they could hire people, they just needed to pay them more. Average wages increased for the first time in a very long time (though they are still far behind the increase in corporate profits); people had more money. A bunch of people threw money at random cryptocurrencies and NFTs, as well as meme stocks like GameStop and AMC. Used car prices increased because new cars became difficult to find and because people stopped vacationing internationally; rich people in cities stopped taking public transit and bought cars instead. Reduced supplies of cars led to “inflation” in the used car market, meaning cars began to cost more. Some people began grumbling about inflation and said that inflation is bad, though this was more gestural than anything, since most people do not remember inflation because the last time really bad inflation happened in the U.S. was in the early 1980s. Smart people and economists claimed that inflation was most likely “transitory,” meaning it would last for a few months and only in specific sectors, and then would go away. Then Russia surrounded and invaded Ukraine. Many countries sanctioned Russia, a huge global provider of oil and natural gas. Energy prices increased all over the world as a result. War in Ukraine led to general uncertainty, as well as shortages of wheat, a large amount of which is grown in Ukraine and parts of Russia and which is a key ingredient in many foods (obviously). Giant oil companies jacked up the prices of oil even though they continued to make record profits. Food prices, which started rising in the pandemic, began rising even more; other stuff began to cost more because it costs more to ship it because gas is more expensive. People finally wanted to travel again, but plane tickets, hotels, and rental cars cost exorbitant prices. Rents went up to record levels because housing stock remained low. People kept buying a lot of stuff even though they had begun to worry about inflation, the thinking being that it is better to buy stuff now before inflation gets even worse and the dollar goes even less far than it does now. This makes inflation worse, not better, with the same ordinary working people who were just recently starting to enjoy moderately decent wages and being able to put a little money aside being hit the worstTo recap: People had a lot more money and little to spend it on besides physical objects and/or houses. At the same time, physical objects were getting harder to obtain for a variety of reasons, which made them more expensive, which made money worth less than it was worth before. THE FED, INTEREST RATES, INFLATION, BLAH BLAH. Very slowly at first—initially, the noticing seemed to come largely in the form of conservatives and right-wingers complaining about the prices of burritos and such in Joe Biden’s America, with liberals claiming that rising prices were not in fact rising—but then very quickly, people begin to panic about inflation, which means they are panicking about prices going up. The Federal Reserve, chaired by Powell, is responsible for keeping the economy stable, conducting monetary policy, maintaining maximum employment, keeping inflation at reasonable levels, etc. Powell is trying to avoid a "wage price spiral," where wages go up, so people buy more things, prices go up because of increased demand because people are buying more things, wages go up to match inflation, prices go up, and so-on forever until we all die. Thus, as Carter said, Powell is increasing interest rates to try to slow inflation, but it is not really clear that this is going to work, in part because a lot of the inflation we're seeing seems to be being driven by increased oil and energy prices, increased food prices, and other knock-on effects associated with the war in Ukraine, sanctions, and the pandemic. This is not something the Fed—or anyone—can really control other than using the one thing it can really do, which is set target interest rates, to make life so expensive that people don’t want to buy or do anything, which, after much suffering, will theoretically bring down the price of energy. (This is a bit like using a novelty-sized cartoon hammer to hit a nail.)"It looks like this is a story about energy, and particularly Ukraine," Carter said. "You have a tight supply squeeze on oil and energy prices, and some sectors where that passes through transparently like gas prices and airfare. But central banks usually don’t raise rates in response to oil price increases."The hard and bad truth is that to get energy prices down in the short term we probably need to have the war in Ukraine magically resolve itself, drill for more oil, get more oil from places like Saudi Arabia, more fully open the U.S.'s strategic oil reserves, or ideally, demand that oil companies stop arbitrarily taking record profits. "More oil," though, is not politically palatable for progressives or anyone who cares about climate change."The only way to get oil costs down is to get more oil. But if you do that, you are burning more fossil fuels, which could help reduce oil and gas prices, but if you’re going to do that, the sort of way to thread the needle is like—well, inflation is too politically toxic to do nothing," Carter said. "So we can get oil prices down now but have to couple that with reducing long term demand for oil. Financing green energy stuff, nuclear power, making changes to the way people use electricity and all the rest. This is a real tough position for progressives to be in because there’s no goldilocks situation where everything works out great."WHO THE HELL IS PAUL VOLCKER AND IS HE A KING OR A CLOWN?All of this has a bunch of people talking about Paul Volcker, who was the Fed chair from 1979 through the 1980s. Inflation was very high in the late 1970s and early 1980s, and, in 1981, Volcker bumped the interest rate to an astonishing 20 percent, which more or less ended inflation but fucked over a lot of people and shot unemployment up to 11 percent. Keep in mind that the headlines you’re seeing today are about federal-funds rate rising to 1.5-1.75 percent. Volcker, who said that “the standard of living of the average American has to decline” in order to reduce inflation, is now seen as a folk hero to some and as a giant idiot or cruel person by others, but this crisis has a certain type of person suggesting we increase interest rates a lot and deal with a lot of short-term pain to basically "get it over with.""The intellectual consensus is it was the brave, hard choice to make," Carter said of Volcker’s decision. "But it created a lot of pain. The unemployment rate went to double digits. He essentially engineered those layoffs. It was the Fed’s strategy because he believed price stability was the most important mission of the Fed. But at the time, it was very controversial."With the benefit of hindsight, many people now believe what Volcker did was over the top, an abuse of power, and also not super effective: "Volcker is viewed by some as doing the hard thing nobody else wanted to do," Carter said. "But there's a significant community of professionals who say he went way overboard and abused his authority to pursue a conservative monetary policy."Bear in mind that while macroeconomics is carried out by an ostensibly apolitical priesthood, it is as deeply political as anything in American life. The Reagan revolution—broadly, the complete triumph of capital over working people—was possible because to the extent that Volcker’s policies “worked,” they did so just in time for an economic boom timed to Reagan’s 1984 reelection campaign. As you evaluate what people are saying about whether what the Fed is doing is “working,” consider that some people will consider a crushing recession followed by a rapid pace of growth in 2024 to be just fine and others will want suffering and misery right up until about November 2024, for reasons having nothing to do with their abstract views on the Fed’s mandate or anything like that.DON'T WORRY, THE CORPORATIONS AND RICH WILL BE OKAs I mentioned earlier, workers enjoyed a very brief period in which unemployment was very low, poverty declined, and inflation-adjusted wages increased in a real way for the first time in forever. During this period, I hope you bought a yacht, because it is ending. When corporate profits, cash on hand, and stock buybacks are at all time highs (which has been the case for much of the last decade), everything is going fine and the government and stock market is happy. When inflation goes high and wages go high and workers show any sign of having any power at all, however, the stock market gets angry, corporations get angry, investors get angry, etc. and it must be corrected via monetary policy (raising interest rates, basically). It doesn't necessarily have to be this way. Carter said that historically there have been other levers to pull, most notably corporate shaming, price negotiation, and "yelling at CEOs to lower their prices." (There are also other ways to increase worker power without subjecting the public to inflation taxes—the decline in unionization since Reagan’s time, which has a great deal to do with why America has become so unequal, is largely about public policy, and different public policy would achieve different results.) While Biden has talked about oil companies making record profits, he hasn't indicated that anything is going to be done about it. In the 1960s, President John F. Kennedy simply worked to shame companies into keeping prices lower and threatened to regulate them. "In the 1960s, the Kennedy administration would invite steel and car companies to the White House and say if you agree to keep prices at this level and wages at this level, everyone will be happy," Carter said. "The overall aim was to rein in inflation with means other than high interest rates."ARE WE ALL SCREWED / HOW SCREWED ARE WE?The thing everyone is hoping for right now is a "soft landing," which means, basically, some amount of short-term pain that allows us to avoid a full-blown recession, followed by a recovery, until we all do this again sometime. It is possible that this will still happen but it will be complicated and require a multifaceted, competent approach from not just the United States but the entire world. Inflation is a problem but it is not the only problem, as Carter said. "I think we should not rule out the possibility of a soft landing. They raise rates now which prevents further wage growth from adding to existing inflationary pressures, those pressures from energy ease as a result of better using our strategic petroleum reserve, or, if the U.S. and EU get a lot more serious about rerouting trade and resource extraction [buying oil and food from other places], then things like the War in Ukraine aren’t as disruptive to prices," Carter said. "So you do have this long standing issue you have to deal with, but it’s not like there’s no options. Those are hard and they require a comprehensive look from an environmental perspective, foreign policy perspective, and domestic labor perspective. The idea that inflation is the thing that has to be fixed is not necessarily wrong, but there are ways to bring it down that are themselves more politically palatable."
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Inflation
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CFTC Commissioner Caroline Pham wants to use the CFTC's remit to protect investors and safeguard crypto's future.CFTC Commissioner Caroline Pham Caroline Pham was sworn in to her post as Commisioner of the Commodity Futures Trading Commission (CFTC) in April 2022. She’s recognized as a leader in financial services compliance and regulatory strategy and policy, with deep expertise in derivatives, capital markets and digital innovation. Commissioner Pham previously worked at the CFTC as a Counsel and Policy Advisor under Scott O’Malia and worked at Citi in a number of market regulatory and strategic market roles. In this conversation we discuss the status of crypto regulation, the Lummis-Gillibrand bill, the historical context behind the CFTC’s and SEC’s jurisdictional divide and investor protections for crypto assets. Watch the full interview live on YouTube. Forbes: Thank you for joining us today. A lot is going on in crypto and in the regulatory world. What is it like being a regulator in crypto right now? Caroline Pham: Before I begin, I want to give my standard disclaimer, which is that the views that I'm sharing today are my own and do not reflect the views of the CFTC or any other commissioner. I have to say, being a regulator in crypto right now is so exciting. That is the reason why I gave up my former career to heed the call to public service, come back to the public sector and work on it. Right now is just such an inflection point where you have a trillion dollars in crypto assets that are out there, you have such widespread investigation and adoption of this technology. It's so important that we get the guardrails in place and that we build out the regulatory framework from the beginning. So that way the growth that we're seeing is in compliant digital asset markets and not in something that is outside the banking system or outside the regular financial system, which I've been calling “shadow banking 3.0.” It's really an opportunity to come in to try to use my experience and my expertise, both previously when I was at the CFTC after Dodd Frank but then also from the private sector, to get that balance right between innovation and between retail protections.
Forbes: The market cap has dropped below $2 trillion over the last six months or so, yet the industry keeps innovating. I know for instance, last month you participated in a roundtable with Sam Bankman-Fried related to innovative proposals to a novel way of clearing derivatives. How are you weighing all these competing pressures? Pham: Absolutely. First, one of the points that I've made recently in my public statements is that shifts in market structure are not necessarily new, either to the CFTC or to regulators generally. One of the parallels I drew was the electronification of markets and how we are seeing that with essentially the digitalization [of markets] into digital assets, where you can have assets that are essentially a tokenization of real assets. You take a real asset, make a representative token and then you put it on a blockchain. So with these efficiencies that you can see in the technology, a lot of times you can use the existing regulatory framework or you might need to update it to look at some guidance or some interpretations where you apply it to the new technology that is truly novel. But for the most part, the CFTC’s principles-based framework is technology neutral, which I do think is better. It means that the rules can be more evergreen; it means that they don't need to be updated all the time. That's just one example where I really see the ongoing digitalization and the growth in digital asset markets is almost very, very similar to the electronification of trading markets, where you've had equities, effects, fixed income, rates and so on. I think that's a really good parallel. I can't speak specifically about any applications that are pending before the CFTC right now, [but] I do think that it's very important to have that robust public debate and discussion. So I'm very pleased that we were able to have such a fulsome roundtable, with participants from all different sectors and aspects of the markets from your financial market infrastructures, like exchanges and clearing houses, all the way to end users, like the farmers and ranchers that the CFTC markets were originally built for. Forbes: Another example, aside from the digitization of markets, of how the CFTC approaches novel technologies and changes in market infrastructure is swaps. In past interviews you’ve mentioned how certain derivative contracts in crypto perhaps could be considered swaps. Can you expand on that?
Pham: When you look at the different crypto assets that are out there that are used for trading purposes, you have these sorts of novel and digitally native crypto assets like bitcoin, so those are digital commodities. But when you look at some of these other tokens, especially ones that aren't, for example, a tokenized security or some other financial instrument or sometimes you can see tokens that are essentially existing financial instruments but they've been rebranded to be called something else but look very similar to some kind of swap. The definition of a swap is very broad, so it is important to look at what we have that already exists. In particular, because many of these tokens could be structured as derivatives or they are structured as derivatives, we already have a comprehensive regulatory framework for that, which Congress put into place with the Dodd Frank Act, where it does have the jurisdiction delineated between the CFTC and the SEC – that's how we've brought the $700 trillion notional swaps markets under comprehensive regulation, from prudential requirements, like capital and margin, to business conduct requirements, risk management requirements, compliance program requirements and protections for not only market integrity, but also for users of the markets, including end users and customers. I think that's a really sensible way to look at it for when you're doing that technical legal analysis over what type of financial instrument or product that particular token is. First to identify what it is, then you know what rules go along with it.
Forbes: Let’s talk a little bit about regulation moving forward. There are plenty of other countries that have one financial regulator and everything fits under it, but in the U.S., we have sister agencies – the CFTC, the SEC, the CFPB, state regulators, etc. When I've interviewed SEC Commissioner [Hester] Pierce and former SEC Chairman Jay Clayton, they talked about the healthy relationship they have with the CFTC both in and outside of crypto. What is your perspective?
Pham: This is something I think has been recognized since the very early days of the Commodity Futures Trading Commission. Its predecessor agencies had been around since the beginning of the century. But the current structure of the Commodity Futures Trading Commission was put into law by Congress in 1974 and then I believe our first chairman was sworn in in 1975. So in the early 1980s, they realized that they needed to work out some of the jurisdictional lines between the SEC and the CFTC, so you have the Shad-Johnson Accord that was put into place. That was then-SEC Chairman Shad and then-CFTC chairman Phillip McBride Johnson, who was my professor in law school, so he actually taught me regulation of derivatives. That was, I think, the first time to really just draw a line because they realized the two agencies needed to work together, that we had some different financial products that had some [different] characteristics. One very good example of that is security futures. I won't bore you with all the details of how that got hashed out but it did take quite a bit of time, [but] it was one example where they needed to look at the different characteristics of products [that] might be the appropriate regulatory framework around that. Forbes: What are your thoughts on the Gillibrand Lummis bill?
Pham: I think this bill is a comprehensive attempt at laying out a really holistic regulatory framework, as I mentioned previously, over all different types of digital assets in the United States, with U.S. firms and with U.S. investors and consumers and there is, more broadly speaking, the retail public. I think it touches upon a lot of different issues that people have been struggling with over the years as far as trying to get regulatory clarity. All the way from tax issues, to what do you do with a token that is an ancillary asset that is not a securities offering from the first instance but how to provide disclosures around that to the SEC, while having it be regulated by the CFTC. I think that's a really thoughtful attempt to try to provide a runway for some of these different initiatives or projects that are getting started, at least in the early stages, when that's how they're being organized. Then they touch upon stablecoins. There's a lot of other different aspects of the bill as well, like requiring a study for a self-regulatory organization over digital assets, having an advisory committee that's comprised of both regulators and the public. I look forward to learning more about what the feedback is on this bill and to see what the legislative process is as it continues to develop and go forward.
Forbes: I think there is some hope that because it is a bipartisan bill, it has a better chance of passing than the Token Taxonomy Act and some other predecessors that fell short. What is most important to you in this bill as a CFTC Commissioner? Pham: One of my first principles, and really almost a guiding North Star for me, is that when we are regulating and when people are trying to navigate regulated markets, it's so important that there are clear rules of the road. It stems from that – you need to know what a product is and you need to know what the rules are that apply. If people are going to be putting in their hard capital investments, they're going to be dedicating their time and energy, harnessing American innovation, then it's incumbent upon us as regulators to make sure that there's a clear regulatory framework with clear rules of the road so that people can have the growth in compliant digital asset markets. I have found in all my various discussions, during my learning tours and my demos, which I've had both in the private sector and in the public sector in my current role, of some of these really innovative token projects, that people want to comply with. I think that the responsible actors in the crypto asset sector want to comply. They are just wringing their hands saying, well, but what do we do? Nobody will tell us what we do. They're spending millions of dollars on attorneys, on consultants and on lobbyists trying to figure out how [to] navigate this. There is a very serious concern that I found about national security and about American competitiveness. I think that's very compelling. I found it to be very sincere and I think that's something we can't forget either.
Forbes: I've heard it’s a national imperative, it's important for our economic standing to remain at the forefront of innovation, but how does that fit into national security for you?
Pham: When you look at traditional schools of thought around geopolitical power, you have of course military power and you have economic power. You have the U.S. dollar as the world's reserve currency. I think people are very concerned that [if], because of these innovations and digital assets in particular—there really is a movement towards certain stablecoins, for example, payment stablecoins that are not clearly digital fiat because that would be a CBDC, and they're also not tokenized commercial bank money—if there's ambiguity over regulation over what those stablecoins might be, people are really worried that there’s going to be a movement away from the U.S. dollar as the world's reserve currency. That is a national security issue for the United States as well as a monetary policy issue. That's just one example. But of course, if you have innovation, capital investment [and] talent, all moving offshore, that's something that people see as a concern as well. You've seen that with other sectors that have moved offshore that can put the U.S. at a competitive disadvantage – it can be detrimental to our standing in the world. From Covid you've seen some issues when we've got a lack of onshoring facilities. So these [are] really, things that people are thinking about and are concerned about. I think there are also concerns about what it means again, from a geopolitical perspective, should another currency arise as the world's reserve currency. Or if there's a non-state currency, so to speak, that becomes a world's reserve. That's another thing I think people are very concerned about. Forbes: One concern I've heard a few times about the bill, because the popular reading of it suggests that the CFTC will gain a lot more authority vis-à-vis the SEC when it comes to regulating the market should it pass in its current form, is that the CFTC does not have the same type of manpower as the SEC to effectively monitor this marketplace. How do you respond to that?
Pham: This is something interesting that people have put out there. If you look at just budget dollars and just headcount, the SEC has a bigger budget and the SEC has more headcount than the CFTC. But I think that also has a lot to do with the fact that the SEC regulates public capital markets and they regulate the private capital markets. Their rules are very prescriptive. It's very important that not only are there a lot of filings and applications that have to be reviewed, but there's also many, many enforcement actions over prescriptive rules, which means there are more violations of those rules, because they are so stringent. But with the CFTC, we have a principles-based regulatory framework and we have what our statute mandates as an effective system of self-regulation. So what we have at the CFTC is really harnessing the leverage of all these different market participants and these market infrastructures and making sure that they are also in charge of enforcing our rules. It's not just the CFTC that needs to enforce these rules, but it's also every single registered entity that has its own rulebook and has to enforce those rules as well. That's a really important way that the CFTC is able to make sure that from the top all the way down, we have effective enforcement. The CFTC has brought more than 50 enforcement actions in the crypto space since about 2015, when we first came out with our action that said that bitcoin was a commodity. It's really important that people understand that the CFTC regulates not only the most complex products in the world, and that the definition of a commodity is so broad that you're talking about hard commodities, like precious metals, gold and silver, along with energy products like oil and natural gas. It also includes food commodities, lumber, financial instruments, like interest rate swaps, and Treasury futures, and pretty much weather derivatives as well. There are [also] event contracts that are under the CFTC’s jurisdiction. So this is an incredibly broad swath of markets that's under CFC jurisdiction, which have worked well for decades in our regulatory framework through incredibly volatile times of market disruption and market stresses. That's something that people don't really understand—how broad the CFTC’s jurisdiction is, especially because we have global jurisdiction. I don't know any other regulator over the commodity derivatives markets with that kind of global jurisdiction. As a final point, I'll note that the CFTC regulates systemically important financial market infrastructures (FMIs) both U.S. and non-U.S., like exchanges and clearing houses, but also systemically important global financial institutions, banks, both U.S. and non-U.S. that are directly registered with us as swap dealers. That level of direct oversight over both FMIs as well as banks, U.S. and non-U.S., is incredibly broad. So I [don’t] think you have any regulator, besides maybe the Fed, but I would say that the CFTC actually directly regulates these FMIs to an extent that the Fed does not.
Forbes: To illustrate that for readers—a regulated exchange under your jurisdiction, like the CME, can choose to offer certain products and it's incumbent upon them to do the first regulatory check. The CFTC obviously, can come in if it feels that it's not an appropriate product, or it's not a commodity, for instance. But it's the regulated exchanges that self-authorize certain products. Is that how it works? Pham: We have this regime of self-certification. We require that when any exchange wants to list a new contract for trading it needs to certify that it meets all these different core principles and other specific requirements that we have, including that it's not susceptible to manipulation and other protections. Then it does go to the CFTC for review, [which is] where the CFTC can step in and say that this requires further review and approval by the CFTC before it can be listed. It is something that has been in place because of the need for new risk management products as truly users of the markets—like commercial end users or agricultural end users or corporate entities that are trying to hedge their different risks to dealers that need to manage their risk—as these new risk management products are developed, the CFTC statute requires that we promote responsible innovation and fair competition. So the method of self-certification, that framework around it, really facilitates that statutory purpose of mandate.
Forbes: You look at underlying markets and their vulnerability to manipulation. Bitcoin contracts have been offered by CME for quite some time; the SEC has so far refused to approve any spot ETF save for futures-based ETFs and inverse ETFs. How does the underlying spot bitcoin market impact the performance of futures contracts? In a more general sense, obviously, the unregulated derivatives market and crypto are far bigger than the spot market and far bigger than the regulated derivatives market. How does all that fit into your calculus?
Pham: It’s very important that whenever you have a type of financial product that has a reference asset, you really need to look at how that financial product is deriving its pricing, the model around its pricing and other risk management around the development of the model and [deployment of] that model. So the first thing for many of these products is: How are they structured? How are they built? What are the different ways that it deals with market risk in the specifications for that product? That's really where you start. But it's so important that again, when you look at how pricing is developed, when you look at what they use as benchmarks for that reference asset, the way that those benchmarks are put together, they need to be free from manipulation and not be readily susceptible to manipulation per our core principles. Looking at, for example, LIBOR, and all the work that's been done globally around strengthening benchmark reform is a really clear example of what can happen if you don't have robust methods around developing benchmarks. You then have products that use those reference assets for pricing purposes, so it's really something that's a much bigger issue that needs to be viewed in context and holistically. That's another reason why it's so important that we put regulation around the spot crypto markets because you do have other financial products that are keyed off the prices and the benchmarks that are being developed around crypto products, and we need to make sure that those are robust. That has been a concern that the SEC has pointed to as for why it's not yet approved a spot bitcoin ETF. We've seen that with our listed bitcoin futures markets that they have performed well, and especially because of the way that they are put together, we feel comfortable with those products. But it's always something where the deeper and more liquid the asset class, then I think you're going to find more reliability as well and better price discovery.
Forbes: One of the big recent investing trends is retail participation in derivatives markets, options in particular, both in crypto and in traditional equities. When do you think it might be appropriate, or what is an appropriate level of involvement, for retail traders to get involved in derivatives? In particular, margin, borrowing funds to invest, is something that can become particularly troublesome, especially for novice investors that don't quite understand what they're doing. How does the CFTC work to make sure that retail investors, to the extent they are able to participate in these markets, do so as responsibly as possible? Pham: This is such an important question, I'm so glad you are asking it. One of the things that I've been saying when we've tried to come up with a pragmatic approach to regulation of digital assets is that as we are looking forward, we have to also not forget to look back. These are issues that have been dealt with before and where there are lessons learned that we can take to heart and see what worked in the past and how things work since then, and how that will apply to perhaps this product and this asset class, and what really should we be taking forward from that. So for example, with retail foreign exchange products, that's an area where there was a lot of not only interest from retail participants, but there were also a lot of scams and fraud. It was awful how you always seem to have the scammers and the fraudsters moving in first into new and innovative areas, particularly ones that have a lot of press coverage and a lot of hype or whatever you want to call it. When you had that happening with the retail forex markets, that's where Congress stepped in and said, you know, what, the CFTC, which was experienced in this asset class, which was experienced with dealing with these products and with the different types of derivatives on forex, should have a comprehensive framework around it. So there's a registration framework, there are financial resource requirements, there are market conduct requirements and market integrity requirements. And there's reporting to regulatory requirements, compliance requirements, risk management requirements, the whole nine yards. I think looking at the retail forex example of how that regulatory framework was built around that space and whether it worked or how it could be improved. It is working. But if there's anything that could be improved, or something to make it maybe more fit for the purpose of crypto assets, I think that's one. But then there's another one; we have, again, a whole regulatory framework around spot, retail leveraged commodity transactions, so where people are trading on margin, or where there is financing. And again, that's another place where the Congress has given the CFTC that authority in our statute, and we've built up a whole regulatory framework around it. This has been around for a couple decades. So again, this is a really important place that as we are seeing what's happening right now that we have to not forget to look at the lessons learned that we have in the past and see what works, and if it works here, too.
Forbes: Is there anything that I did not ask that you'd like to share or mention?
Pham: Thank you. Yes, one of the things I keep saying that is so important is that regulators and the public sector really need to engage with the private sector. They need to engage with people who are running the businesses, who are putting their money where their mouth is, who are investing in these areas and building up firms and creating that innovation that is so characteristic of America and American markets. Through my global markets advisory committee—which are these federal advisory committees that different federal agencies can utilize to have a structured and formal way to engage with the public and to get public input into policy making issues of great import to the U.S.—I want to make sure that we are really looking at ensuring that there's a level playing field for global businesses and global markets around the world. In making sure that as we're building out responsible regulatory frameworks, we are promoting international engagement and global cooperation and coordination, because these are global markets. It's so important that you don’t have this instance, where there's a race to the bottom, or there's regulatory gaps between jurisdictions, or we have unintended consequences like market fragmentation or regulatory arbitrage. I'm really looking forward to using my global markets advisory committee to further explore these issues with the experts from the industry who are doing this every single day, including some of the different areas that we could look at, for example, our global market structure or also digital asset markets.
Forbes: Thank you. Maria Gracia Santillana Linares contributed to this article.
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Crypto Trading & Speculation
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Thousands have marched at pro-Palestine rallies around the nation as the violence in the Middle East reverberates through Australian communities.
An estimated 10,000 people marched through the Sydney CBD on Saturday afternoon after police green-lit the event, and many more attended events in Perth, Hobart and Brisbane as more information emerges from conflict-stricken Gaza.
The march in Sydney, organised by Palestine Action Group Sydney, marched from Town Hall towards Belmore Park.
Previous protests have been met with a heavy police presence after videos emerged of a group chanting anti-Jewish slogans within last week’s rally at the Sydney Opera House.
In the event page, Sydney’s rally organisers said they will not tolerate antisemitic chants, or any other conduct that vilifies any race or religion at Saturday’s rally.
They also said the burning of flags would not be tolerated, nor would any person bringing flags or any items associated with Hezbollah, Hamas or any other item associated with government-designated terrorist organisations.
The Sydney protest organiser, Fahad Ali, said more Australians – including the frontbench politicians Ed Husic and Anne Aly – are recognising the gravity of the situation in Gaza.
Husic, the minister for industry, on Thursday said Palestinians are being “collectively punished for Hamas’s barbarism”, which was immediately backed by Aly saying it was “difficult to argue” that Palestinians, including 1,000 children who had been killed, were not being “collectively punished”.
The comments from the first two Muslim ministers in an Australian federal government go further than the foreign minister, Penny Wong, who has urged all sides to show “restraint” in protecting civilian life.
Brisbane’s rally, organised by Queensland Muslims and Justice for Palestine Meanjin, took place at King George Square.
Perth’s rally, organised by Friends of Palestine WA, took place at the Supreme Court Gardens, while Hobart’s will take place at Hobart Town Hall.
More pro-Palestine protests will take place in Melbourne and Adelaide on Sunday.
The prime minister has provided $25m to Jewish and Islamic communities affected by the conflict, and while Ali welcomed the move, he said the government needs to take immediate action to urge a ceasefire, and that humanitarian aid reaches civilians.
“We’re faced with a humanitarian crisis in Palestine – the scale of which we have never seen before,” he said.
“It cannot be the case that we wash our hands of responsibility, when we have played a part in creating the conditions that have led up to this.”
Paul Power, the CEO of the Refugee Council of Australia, called on the government to work towards a peaceful resolution and to address the dire situation in Gaza.
More than 1650 Australians have left Israel and the occupied Palestinian territories since 7 October and commercial flights are available for others who wish to return home.
The foreign affairs department is in contact with registered Australians about departure options.
But the government has previously said there are 46 Australians in Gaza whose safety remains unknown.
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Middle East Business & Economics
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US Treasury Secretary Janet Yellen will visit India on November 11.(File)Washington: India will "benefit" from the proposed price cap on oil, Treasury Secretary Janet Yellen has said, arguing that the United States does not want Russia to "profit unduly" from the war by enjoying prices that are essentially very high due to its Ukrainian invasion.Developing countries like India and China have been increasingly buying discounted Russian oil as global energy prices remain high and Western nations seek to scale down their reliance on Russian energy."We want Russian oil to continue to supply global markets; stay on the market. But we want to make sure that Russia doesn't profit unduly from the war by enjoying prices that are essentially very high due to the war," Janet Yellen told PTI in an exclusive interview on Monday ahead of her trip to India later this week.India's oil purchase from Russia and the Ukrainian invasion are expected to be significant topics of discussion during her India trip, where Janet Yellen is travelling to primarily co-chair the US-India Economic and Financial Partnership (EFP) dialogue along with her Indian counterpart Union Finance Minister Nirmala Sitharaman."Our objective is to hold down the price that Russia receives for its oil and keep that oil trading. The gainers from this will be particularly those countries that do buy cheap Russian oil, and our hope would be that India would take advantage of this price cap, though its firms are bargaining with Russia," Janet Yellen said."If they (India) want to use Western financial services like insurance, the price cap would apply to their purchases. But even if they use other financial services, we believe the price cap will give them leverage to negotiate good discounts from world markets. We would hope to see India benefiting from this programme," the Treasury Secretary told PTI in response to a question.India, which imports nearly 85 per cent of its fuel requirement, until March imported just 0.2 per cent of all oil requirements from Russia.Russia now makes up for 22 per cent of India's total crude imports, ahead of Iraq's 20.5 per cent and Saudi Arabia's 16 per cent.India's G20 presidency will be another major topic of discussion during Janet Yellen's meetings with Indian leaders."We are very supportive of India's G20 presidency. We certainly want to make sure that it's a successful year," she said."There will be topics on our agenda for meetings. For example, climate change will be very important. We are both concerned about debt sustainability. A large number of low-and middle-income countries in this difficult global environment are encountering problems of unsustainable debt," she said."We need to figure out a way to deal with debt overhangs in a collective way. The multilateral development banks and their evolution and the rules of the digital economy, I think all of these areas will be a focus for India during the G20. I expect those are things that we'll discuss," Janet Yellen said."I'm sure we're going to also discuss the spill-overs of Putin's war in Ukraine, that's having negative spill-overs around the globe. This is something that G-20 will need to address. There's broad consensus in the G-20 that the best thing for the global economy would be for Russia to end its war," Janet Yellen told PTI in response to a question.(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)Featured Video Of The DayIndia's Forex Reserves Fall To Lowest Since July 2020
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Energy & Natural Resources
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Oil-producing countries have agreed to continued cuts in production in a bid to shore up flagging prices.
Saudi Arabia said it would make cuts of a million barrels per day (bpd) in July and Opec+ said targets would drop by a further 1.4 million bpd from 2024.
Opec+ accounts for around 40% of the world's crude oil and its decisions can have a major impact on oil prices.
Average diesel prices fell by a record 12p per litre in the UK last month, according to the RAC.
The seven hour-long meeting of the oil-rich nations, led by Russia, came amid a backdrop of falling prices and an over-supply of the commodity.
Total production cuts, which Opec+ has undertaken since October 2022, reached 3.66 million bpd, according to Russian Deputy Prime Minister Alexander Novak.
Opec+, a formulation which refers to the Organisation of Petroleum Exporting Countries and its allies, had already agreed to cut production by two million bpd, about 2% of global demand.
"The result of the discussions was the extension of the deal until the end of 2024," Mr Novak said.
'A Saudi lollipop'
In April, it also agreed a surprise voluntary cut of 1.6 million bpd which took effect in May, a move that briefly saw an increase in prices but failed to bring about a lasting recovery.
On Sunday, Saudi Energy Minister Prince Abdulaziz bin Salman said the cut of one million bpd could be extended beyond July if needed. "This is a Saudi lollipop," he said, in what is seen as a bid to stabilise the market.
Oil prices jumped more than $2 a barrel in early trading on the Asian markets on Monday, with Brent crude futures at $78.42 a barrel.
Analysis by Sameer Hashmi, Middle East business correspondent
Before the two-day Opec+ meeting started, it was widely expected the oil cartel would make production cuts to prop up prices. It appears most members were against the idea, as any cuts would impact oil revenues, which are crucial to keep running their economies.
Saudi Arabia's decision to make a voluntary reduction of one-million barrels per day was unexpected but does not come as a huge surprise. As the leader of the pack, and also the largest exporter of oil, it was the only one in a position to be able to lower output.
From Riyadh's point of view, it is crucial the price of crude remains over $80 a barrel for it to break even. Saudi officials want elevated prices to keep spending billions of dollars on ambitious projects spearheaded by Crown Prince Mohammed bin Salman, as he tries to diversify the kingdom's economy away from oil.
The move by the Saudis also underlines the uncertain outlook for demand for fuels in the months to come. Concerns about the global economy, especially recessionary fears in the US and Europe are expected to put further pressure on crude prices.
Oil producers are grappling with falling prices and high market volatility amid the Russian invasion of Ukraine.
The West has accused Opec of manipulating prices and undermining the global economy through high energy costs, according to Reuters. It has also accused the group of siding with Russia despite sanctions over the invasion of Ukraine.
In response, Opec insiders have said the West's monetary policy over the last decade has driven inflation and forced oil-producing nations to act to maintain the value of their main export.
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Energy & Natural Resources
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Europe and the UK are pouring 17,000 tons – or about 19 million bottles – of cooking oil into vehicle fuel tanks every day, even though it is up to two-and-a-half times more expensive than before 2021, according to new analysis.The equivalent of another 14 million bottles a day of palm and soy oil – mostly from Indonesia and South America – is also burned for fuel, the research says.Vegetable oil prices are spiralling in large part due to the war in Ukraine, which is Europe’s largest supplier of rapeseed and the world’s largest source of sunflower oil.But 58% of the rapeseed – and 9% of the sunflower oil – consumed in Europe between 2015 and 2019 was burned in cars and trucks, even though their climate impacts may be even worse than fossil fuels.Sign up to First Edition, our free daily newsletter – every weekday morning at 7am BST“Supermarkets have had to ration vegetable oils and prices are soaring,” said Maik Marahrens from the campaign group Transport & Environment, which carried out the research. “At the same time, we are burning thousands of tons of sunflower and rapeseed oil in our cars daily. In a time of scarcity we must prioritise food over fuel.”Despite acute food insecurity running at record highs, about 10% of the world’s grains are still turned into biofuels, enough to feed 1.9 billion people for a year on some estimates.If the land abroad used to grow the UK’s bioethanol were instead given over to food crops, an extra 3.5 million people a year could be fed, according to another study published by the Green Alliance on Monday. This would lower the impact of global undernourishment due to the war in Ukraine by 25-40%, the paper found.And if the UK, US and EU halved their collective use of crop-based biofuels, Ukraine’s previous grain exports – which fed about 125 million people – could be wholly replaced, the paper concluded.“At a time when Russia’s war threatens people in less developed countries with starvation, it’s indefensible to keep increasing biofuel use,” said Dustin Benton, the Green Alliance’s policy director. “Cutting back on biofuels is the fastest way of addressing global hunger in this crisis.”Dozens of studies have linked biofuels mandates to rocketing food prices because fuel crops increase demand for land – and reduce its supply. Biofuels played “a major role” in the food crises of 2008 and 2011, according to Timothy Searchinger, the Princeton University scholar and senior fellow at the World Resources Institute.He told the Guardian: “The rapid growth in demand for grain and vegetable oil for biofuels made it impossible for farmers to keep up, and government mandates for yet more growth in the future meant that those who held stocks of grain demanded very high prices to sell them because they anticipated prices would remain high in the future.”About 18% of the world’s vegetable oils – nearly all fit for human consumption – are used for biodiesel that is supposed to cut planet-heating greenhouse gases.But experts say that their lifecycle emissions can be even worse than fossil fuels because they displace food crop cultivation on to previously unfarmed land – often by means of deforestation.Global cropland is thought to have expanded by more than 100m hectares so far this century – an area around the size of Egypt – with about half that land coming from natural ecosystems, a hyper-acceleration of development compared with the previous 8,000 years.“The cost of biofuels is greater than the benefit from any reduced use of oil,” Searchinger said. “The error Europe and others have made is that they ignore this cost entirely. They act as though using land were free. The food crisis we are in reminds us that is not true.”To protect food security, the EU has already filleted the common agricultural policy, moving to allow crop production on fallow land and the derogation of crop rotation rules.Ariel Brunner, policy chief of Birdlife Europe, said: “There is a staggering hypocrisy in going after the last scraps of nature protection in the name of food security while continuing to burn vast amounts of food grown over millions of hectares.”A European Commission official said biofuels could reinforce food security and be a substitute for fossil fuels, while EU states would have Brussels’ support in using blended biofuel formulas that reduce the amount of land needed for feedstocks.“The contribution of biofuels produced from food and feed crops towards decarbonisation is limited, so their use should be limited,” the official added.The biofuels issue may be a flashpoint at a G7 heads of state summit on Sunday in Schloss Elmau, Germany, where the environment minister Steffi Lemke has already proposed limiting biofuels production to ease food shortages.A German government spokesperson said biofuels were not on the official agenda for a ministerial food security conference on Friday aimed at laying the groundwork for Sunday’s summit. But they added that fuel crops “will probably be one important part of discussions in the context of food security”.A No 10 spokesperson said: “Putin’s actions in Ukraine are creating aftershocks across the world, driving up energy and food prices as millions of people are on the brink of famine.“Only Putin can end this needless and futile war. But next week’s Commonwealth, G7 and Nato meetings will be a crucial opportunity for world leaders to come together to apply their combined weight to making life easier for households across the world. Nothing is off the table.”
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Energy & Natural Resources
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Rail strikes are 'entirely pointless and counterproductive' says transport secretary Upcoming rail strikes are "entirely pointless, counterproductive... and should never have been called", the transport secretary has told the House of Commons. He said rail industry "needs to help" transform itself to make it suitable for modern times."The railway is one of the nation's greatest legacies. The Industrial Revolution was forged upon it," Grant Shapps said.But, he says the railways have "fallen behind the times" and are in "desperate need of modernising and reform" with "some working practices that haven't changed for decades". "We put our money where our mouth is and committed £16 billion to support the railways through COVID," which he says is equivalent to "£160,000 per railways worker".However, responding former Labour leader Jeremy Corbyn accused the minister of "punishing those people that kept the railway system working" during the pandemic. Mr Shapps replied by comparing the median salary of a train driver (£59,000) to that of a care worker (£21,000) and nurse (£31,000). He says the medium salary within the rail sector is £44,000 - "significant above the sums of money which are paid on medium average in this country".When asked about negotiating with the unions, Mr Shapps said: "Only last month the leader of the RMT Mick Lynch says, and I quote, I do not negotiate with a Tory government." McDonnell says Starmer should apologise for 'Conservative Corbyn' comment at PMQs Former shadow chancellor John McDonnell has accused Sir Keir Starmer of "insulting" Jeremy Corbyn at PMQs and suggested the Labour leader make an apology to his predecessor.As reported in our post at 12.18pm, Sir Keir referenced a critical briefing document compiled by Tory backbenchers which referred to Boris Johnson as "the Conservative Corbyn.""I don't think that was intended as a compliment," Sir Keir added. UK 'disappointed' EU has launched legal action over NI Protocol Away from the Commons, the prime minister's spokesman has been reacting to the EU launching legal action against the UK. Brussels has taken the move due to the UK publishing legislation to override parts of the Northern Ireland Protocol.Boris Johnson's spokesman has said the UK is "disappointed" with the EU's decision.He said the latest proposals from Brussels would lead to more checks and controls and make the situation in Northern Ireland worse."We will consider these documents carefully and respond formally in due course, however we are disappointed the EU has taken this legal action today," the PM's spokesman said."The EU's proposed approach, which doesn't differ from what they have said previously, would increase burdens on business and citizens and take us backwards from where we are currently."The infractions are related to the implementation of the protocol in our recently published Bill. "It is difficult to see how scrapping grace periods and adding additional controls and checks would be the situation better." People smugglers 'abusing legal protections meant for those trafficked for modern slavery' People being smuggled across the English Channel are abusing legal protections meant for those trafficked for modern slavery, one Tory MP has said. Conservative MP Peter Bone told the Commons earlier: "People who are trafficked into this country are duped or coerced, they are exploited for sexual or labour purposes, people who are smuggled into this country willingly pay to do so and come for economic purposes."The first are victims and deserve the protection of the Modern Slavery Act, the second are not and deserve no protection from the Modern Slavery Act."That is being abused by people who are coming across in small boats. I hope the home secretary can sort this out."Priti Patel replied that it was in the "national interest" to ensure there are safeguards to protect people, but "we cannot allow people to exploit [these protections] for the wrong reasons." PMQs word cloud analysis - 'Investment' and 'economy' dominate By Daniel Dunford, senior data journalistLabour’s Keir Starmer tried to press the prime minister on issues concerning the economy – poor growth, tax hikes and the rising cost of living. Meanwhile, Boris Johnson tried to steer the discussion to rail strikes and Britain’s low level of unemployment, as well as investment – both in the UK from abroad and in the NHS from the government.Word cloud analysis of today's session shows"investment" as the main focus of the prime minister's contributions and "economy" the most prominent term used by Sir Keir Starmer.Yesterday’s failed Home Office flight taking UK migrants to Rwanda was only mentioned obliquely at the close of Boris Johnson’s final answer to Mr Starmer, and not at all by the Labour leader himself, suggesting that the Conservatives still believe the policy is a vote-winner among the public.There was one mention of Jabba the Hutt, and one of Obi-Wan Kenobi, as Mr Starmer accused Mr Johnson of attempting to perform "Jedi mind tricks" on the country.And mercifully the phrase "the ick" was also only mentioned once, a reference to Love Island where contestants are booted out if the public stop liking them. What is the government position on the European Convention on Human Rights? Earlier this morning cabinet minister Therese Coffey and junior minister Guy Opperman both gave interviews that seemed to play down the idea that the government would now move to pull out of the European Convention on Human Rights following the failed Rwanda deportation flight.The Convention, to which the UK is a signatory, is the basis on which the European Court of Human Rights judges cases brought before it.But as our deputy political editor Sam Coates points out in his latest update, the prime minister's spokesman has now insisted "all options are on the table" when it comes to the Convention.Sam says this suggests that contrary to the comments of ministers earlier, Number 10 is preparing to "lean in into the idea of yet another very big fight."Watch his analysis here: Government will do 'whatever it takes' to ensure Rwanda flights take off As well as hearing from Priti Patel in the Commons, the prime minister's official spokesman has been fielding questions from journalists at a regular Westminster briefing.He has said the government will do "whatever it takes" to make sure that deportation flights to Rwanda go ahead.The spokesman said ministers would be considering the ruling from the European Court of Human Rights but stressed that "all options are on the table".Asked if the government could withdraw from the European Convention on Human Rights, the spokesman responded: "We are keeping all options on the table including any further legal reforms that may be necessary."We will look at all of the legislation and processes in this round."Asked if a flight could take off before legal proceedings in the UK are finished, he said: "That is my understanding." 'The home secretary has no one to blame but herself' Labour's shadow home secretary Yvette Cooper calls the immigration policy a "shambles and shameful, and the home secretary has no one but herself to blame". She says Priti Patel knew she was planning to send torture victims to Rwanda and did not have the proper screening processes in place.Ms Cooper asks: "Can she confirm that it was the Home Office itself that withdrew a whole series of these cases on Friday and yesterday because they knew there was a problem with these cases that even without the ECHR judgment, she was planning to send a plane with just seven people on board because she'd had to withdraw most of the cases at the last minute."She also asks the home secretary how much "she promised Rwanda for each of the people she was planning to end yesterday, and how many Rwandan refugees she promised to take in return.""If she was serious about tackling illegal migration she would be working night and day to get a better joint plan with France to crack down on the gangs going into the water in the first place," she continues. "But she isn't because her relationship with French ministers has totally broken down."Ms Cooper says Ms Patel spent half a million pounds chartering a plane "she never expected to fly", calling it "government by gimmick".SNP MP Stuart McDonald calls it an "unworkable, immoral and illegal policy that "does nothing to stop illegal people smugglers". He says "it's not the lawyers who caused this flight to be cancelled, or any courts" but "government illegality". Priti Patel says preparations for next Rwanda flights 'have begun' She says the flight was paused "following a decision by an out-of-hours judge" at the European Court of Human Rights.She says the European Court did not rule that the removal policy was unlawful.She tells the House of Commons: "These repeated legal barriers are very similar to those that we experience with all other removal flights."And we believe we are fully compliant with our domestic and international obligations and preparations for our future flights and next flights have already begun.""We are a generous and welcoming country, as has been shown time and time again. Over 20,000 people have used safe and legal routes to come to the UK since 2015," she says."Our capacity to help those in need is severely compromised by those who come here illegally."She says illegal immigration is "not fair on those who play by the rules", especially at the cost of £5m per day. Rwanda, she says, has "been vilified" and is "a safe and secure country with an outstanding track record of supporting refugees and asylum and seekers and we are proud that we are working together".She says she will not let the "usual suspects" or "mobs" prevent asylum seekers from being sent to the African country. Theresa May says case of missing journalist in Brazil must be be made a 'diplomatic priority' Former prime minister Theresa May used her question to ask Boris Johnson to make the case of missing British journalist Dom Phillips a "diplomatic priority." Mrs May said: "My constituent Dominique Davis is the niece of Dom Philips, the British journalist missing in Brazil, alongside the indigenous expert Bruno Pereira. "Will my Right Honourable friend ensure that the government makes his case a diplomatic priority and that it works to do everything it can to ensure that the Brazilian authorities put the resources necessary to uncover the truth, and find out what has happened to Dom and Bruno?" Mr Johnson responded: "Like everybody in this House we are deeply concerned about what may have happened to him. FCDO officials are working closely with the Brazilian authorities. The minister responsible has raised the issue repeatedly," he added. Due to your consent preferences, you’re not able to view this. Open Privacy Options
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Workforce / Labor
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New Delhi: India’s foreign currency reserves have been sliding relentlessly since the Russia-Ukraine war broke out in February. According to the Reserve Bank of India’s (RBI’s) weekly statistical supplement, India’s forex reserves stood at $550.8 billion as of 9 September, the lowest since 2020, when it was $580 billion.
In the first week of January, India had forex reserves worth $633 billion, which means a fall of over $82 billion so far in the calendar year — the steepest in the past decade.
Graphic: Ramandeep Kaur | ThePrint
Of the $82 billion that has been wiped out in seven months, nearly half of the loss was reported in the past three months. India’s forex reserves depleted by $12.7 billion in June, by $14.4 billion in July and by $20 billion in August, according to RBI data. Since the first week of June, India’s forex plunged by about $47 billion — around $3.6 billion per week.
Depleting at this rate, the forex reserve plunge in 2022 could possibly be India’s biggest one since the Global Financial Crisis (GFC) of 2007-08. Last month in its bulletin, the RBI had mentioned that during the GFC, forex reserves plunged by around $70 billion.
In their analysis, RBI economists had estimated that by the end of July, India’s forex reserves had depleted by $56 billion, but mentioned that out of this, $20 billion was swap sale — which essentially means that this will return to the RBI. Hence, at present, the real plunge could be a little over $63 billion, if the sell-swaps are excluded. Steepest depletion in a decade
This depletion, compared to the past 10 years, is likely the steepest India has ever witnessed. There have been instances of India’s forex reserves depleting by the end of the calendar year — 2011 ($0.6 billion), 2012 ($1.7 billion), 2013 ($1.8 billion) and 2018 ($13.28 billion) — but they were marginal in terms of size.
In the remaining years, India had been reporting a rise in its forex reserves, with 2020 — the year the Covid-19 pandemic hit the world — being the most gainful year. That year India’s foreign currency assets rose by about $119 billion (to $580 billion by 2020-end from $461 billion by end of 2019). By the end of 2021, it grew by $52 billion to settle at $633 billion. On 3 September last year, India had seen its forex touch a record high of $642.45 billion.
Graphic: Ramandeep Kaur | ThePrint Also Read: Rupee’s fall to 80/dollar will impact twin deficits. But here’s why you shouldn’t panic Why has this happened?
The depletion in foreign currency means that the RBI has been selling dollars to tackle the falling value of the rupee, which in July reached an all-time low of Rs 80 per dollar.
One of the biggest reasons why this has happened is that the US Federal Reserve, America’s central bank, increased the key interest rates to check record high inflation rates. This year, the US Fed has increased the lending rate on four occasions so far — to 2.25-2.5 per cent in August from 0.25-0.5 per cent in March.
Through the hikes in lending rate, the US Fed looks to contract the purchasing power of the people using dollars as the currency. Resultantly, foreign portfolio investors in India have withdrawn more than $39 billion in the past one year, according to an analysis by the Economic Times.
A study conducted by Saurabh Nath, Vikram Rajput and Goplakrishnan S. of the RBI’s Financial Markets Operations Department, showed that during the GFC of 2008, India’s forex depletion had gone down by $70 billion. By the time their research was published (12 August), India’s forex reserves had already gone down by $56 billion.
The crux of the study, however, was that the currency volatility expectations from the rupee — compared to previous economic shocks — had come down. Currency volatility is a measure of the frequency and extent of changes in the value of currency of one country vis-à-vis another country’s currency.
The authors ascribed that during the 2008 crisis, the decline in forex was more than 22 per cent of India’s total forex reserves, which is just 6 per cent this time, simply because the country holds a lot more dollars now than it did 14 years ago ($282 billion). “The Reserve Bank has been able to achieve its intervention objectives with progressively lesser percentage drawdown in foreign exchange reserves,” the authors wrote.
Economist Radhika Pandey, a consultant at the National Institute of Public Finance and Policy (NIPFP), also believes that the situation is not too bad right now.
“Given the volatile global backdrop, capital flows would swing between inflows and outflows. As of now, the fall in reserves is not alarming. Reserves adequacy ratio remains comfortable. We are much better placed than the taper tantrum episode of 2014. But at the same time if the dollar continues to remain strong, the RBI would have to allow the rupee to slide,” she said.
Rajeswari Sengupta, associate professor at Mumbai’s Indira Gandhi Institute of Development Research, hinted that the RBI may have to have a re-look at its strategy. “The $80 billion [forex loss] is the price the RBI is having to pay to defend the rupee and keep it below a certain threshold level. But given the rising current account deficit, it might be more prudent to let the rupee find its own course. Depreciation of the rupee helps boost exports whereas losing reserves to prevent depreciation may not be a sustainable strategy,” she said. (Edited by Tony Rai) Also Read: Why RBI’s hoarding of forex reserves over currency concerns will be counter-productive
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India Business & Economics
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WASHINGTON (AP) — A transcript of an Oval Office interview Thursday with President Joe Biden by AP White House reporter Josh Boak. Where the audio recording of the interview is unclear, ellipses or a notation that the recording was unintelligible are used.AP: I wanted to thank you for taking the time to do this. BIDEN: Sure, happy to. AP: And I’m really interested in how you’re thinking and how you’re making choices during what seems like a really unique time in American history. BIDEN: Well, I’m making choices. It’s an interesting question. I’m making choices like I always have, in the sense that circumstances change but my objective doesn’t change. Does that make sense to you? For example, I have, uh, from the time I’ve entered public life, it’s been about how to give ordinary working-class and middle-class folks a shot (inaudible) .. instead of everything being viewed as from the top down. I’m not a big, is it working (a reference to the tape recorder). AP: Yeah, we’re good. BIDEN: I’m not a big believer in trickle-down economy, and, um, and so everything I look at from the time I took this office, but even before that when I was a senator all those years, is what’s the best shot to grow the economy from the bottom up and the middle out because when that happens everybody does well. The wealthy do very, very well. And the biggest thing I think that, when I came into this job, that I have the greatest frustration with the last four years, is that, um, uh, everything was constructed and built and arranged in order for the top 1 to 3% of the population to do very well. The rest was sort of, I mean that literally, everything else seemed to be an afterthought. AP: So, let me ask about that, right, because you’ve seen the polls. There’s a lot of voters who are very pessimistic. When I look at the consumer sentiment survey the University of Michigan puts out, even Democrats began to get really worried about a year ago regarding the economy and we’ve had people that have basically been through a pandemic, shortages of basic goods, inflation, some of the political divisions you’re seeing right now on the Hill with the Jan. 6 hearings, and also a war in Europe. And how do you as a president provide a sense of stability and strength ... (crosstalk)BIDEN: Well, if you notice, until gas prices started going up, which was about the same time, the University of Michigan survey, they had a very different view. Things were much more, they were much more optimistic. We came in and we started to grow the economy in significant ways. We were able to, ah, you know, go from 2 million shots in arms to 225 million. People were having access to dealing with the pandemic. We started opening up businesses, and opening up access to go back to work, etc. But then, in my experience, the way I was raised, if you want a direct barometer of what people are going to talk about at the kitchen table and the dining room table and whether things are going well, it’s the cost of food and what’s the cost of, of gasoline at the pump. I mean literally at the pump. And if you notice, you know, uh, gasoline went up a, you know, $1.25 right off the bat, almost, when, the, Putin’s war started. Um, and as I said at the time, by the way, I made it clear with helping Ukraine, and organizing NATO to help Ukraine, that this was going to cost. There was going to be a price to pay for it. It was, this is not going to be cost-free, but we had, the option of doing nothing was worse. If he in fact moved into Ukraine, took hold of Ukraine, and Belarus, where it is, and he’s been a threat to NATO, all those things would have even been more dire.AP: Why is that? Because it seems like you knew the risks on Ukraine with regard to higher gasoline prices ...BIDEN: Sure.AP: ... that carried political risks for you at home ... BIDEN: Sure. AP: ... so when, when your aides said, “Look at the situation,” how did you make that choice? What would you tell someone in Latrobe, Pennsylvania?BIDEN: I’m the president of the United States. It’s not about my political survival. It’s about what’s best for the country. No kidding. No kidding. So what happens? What happens if the strongest power, NATO, an organizational structure we put together, walked away from Russian aggression of over 100,000 troops marching across a border to try to, to occupy and wipe out a culture of an entire people. What, then, then what happens? What happens next? What do we do next? AP: What did you fear would happen next if you didn’t do?BIDEN: Oh, I fear what would happen next is you’d see chaos in Europe. You would see the possibility they continue to move. You already saw what they’re doing in Belarus. What would happen in the surrounding countries. Watch what would happen in Poland, and, and the Czech Republic and all the members of NATO. For example, you know, the reason Putin said he was going to go in was because he didn’t want them to join NATO. And, uh, he, he, he, he wanted the sort of the Finland-ization of NATO. He got the NATO-ization of Finland, instead. (laughter) No, I’m serious.AP: Yeah.BIDEN: And so, the idea that if the United States stood by, then what does China think about Taiwan? Then what does North Korea think about nuclear weapons beyond testing and pressure?AP: Do you think Americans have that sense of the stakes on a daily basis?BIDEN: No, I don’t. But I don’t think, look, on a daily basis, most households just trying to figure out how to put, before, even when things were going well, just figure out how to put food on the table, take care of the kids, pay for their education, just basic things. You know, look, um, one of the, I’ve always suggested to younger people that want to get into public life, I ask them two things: Have you figured out what’s worth losing over? Have you figured out what’s worth losing over? If you haven’t figured that out, don’t get in politics. Go into a more profitable org, enterprise. Go into business, go into commerce, don’t, be engaged. But unless you know what’s worth losing over, don’t get engaged. Number one. Number two. The purpose of public service is to promote views that you think are best for the American people. I made a commitment and I think I can say that I’ve never broken, if I make a commitment. I wasn’t going to run again, this time. I mean for real. I was not going to run. I just lost my son, I was teaching at Penn, I liked it, until all those guys came, come out of the woods ...AP: Charlottesville.BIDEN: ... the Charlottesville folks and this other guy said “good people on both sides” when an innocent woman was killed, etc. And, I made a decision. I’ve been doing this too long to do anything other than to try to do what was right. I mean, I’m not, there’s nothing noble about it. But it’s not worth it. So, you asked me what would I say to the American people. I’d say to the American people I’ve done foreign policy my whole career. I’m convinced that if we let Russia roll and Putin roll, he wouldn’t stop.AP: Let me ask on another hard choice you made. When you came into office, it seems as though you made the choice to prioritize job growth. Republicans right now are saying to voters that inflation started with your COVID relief package. BIDEN: Zero evidence of that. Zero evidence of that, number one. Number two, we’ve reduced the deficit by $350 billion last year. We reduced the deficit by a trillion, 700 billion this year. We grow the economy. Today, today, we have more people employed than, in a long, long time and we gained another 8.6 million jobs. And guess what? We still have hundreds of thousands of job openings.AP: So, so do you think that when Treasury Secretary Yellen said it might have made a marginal contribution to inflation that that was off? Did anyone apprise you (interrupted)BIDEN: Yeah, they apprised me.AP: of possible trade-offs?BIDEN: Now you just said two different things. You said Republicans said I caused inflation. She said it may have a marginal impact on it. Two different things. You could argue whether it had a marginal, minor impact on inflation. I don’t think it did. And most economists do not think it did. But the idea that it caused inflation is bizarre.AP: Let me ask, stepping back, after yesterday’s Fed meeting. I know that you’ve said: “Look, our economy is strong. We have these jobs. It’s the best look we’ve had in decades.” But then you’ve got serious economists who warn of a recession next year.BIDEN: Sure.AP: What should Americans believe?BIDEN: They shouldn’t believe a warning. They should just say: “Let’s see. Let’s see, which is correct.” And from my perspective, you talked about a recession. First of all, it’s not inevitable. Secondly, we’re in a stronger position than any nation in the world to overcome this inflation. It’s bad. Isn’t it kind of interesting? If it’s my fault, why is it the case in every other major industrial country in the world that inflation is higher? You ask yourself that? I’m not being a wise guy. Someone should ask themself that question. Why? Why is it? If it’s a consequence of our spending, we’ve reduced the deficit. We’ve increased employment, increased pay. There was a survey done uh, uh, by the, uh, I forget which one it was, which one it was now, about three months ago. You had more people had lower debt (inaudible) credit cards, more savings in their savings account, higher pay in the job they had, more satisfaction in the job they had and they were in good shape financially.AP: I believe that was a Fed survey. You see this interesting shift, though, in the Census pulse surveys, which show people are clearly employed in a way they haven’t been. They are less dependent on unemployment benefits and the government for aid, and yet more of them say they’re having trouble with meeting their weekly expenses. BIDEN: Well, two things.AP: What’s that paradox? BIDEN: Well, I think the paradox is, part of it is, I think what, the failure of the last administration to act on COVID had a profound impact on the number of people who got COVID and the number of people who died. Now here’s what I’m, I think Vivek Murthy is right and most of the international and National Psychological Association, whatever it’s, people are really, really down. They’re really down. Their need for mental health in America has skyrocketed because people have seen everything upset. Everything they counted on upset. But most of it’s a consequence of, of, of what’s happening, what happened is a consequence of the, the COVID crisis.People lost their jobs. People are out of their jobs. And then, were they going to get back to work? Schools were closed. Think of this. I think we vastly underestimate this. If you had, and instead of your child being, how old, five?AP: Five.BIDEN: Five years old. If your child had been 17 years old two years ago.AP: I’m not ready for that.BIDEN: Well get ready, man. Boy or girl?AP: Girl. BIDEN: Well I’ll tell you what, she’s gonna, she’s going to be crazy about you until about age 13. And then hang on. But all kidding aside, here’s the deal. Think about what it’s like for the graduating classes of the last three years. No proms. No graduation. No, no, none of the things that celebrate who we are. Think about it across the board. How isolated we’ve become. How separated we’ve become. Even practical questions like, you know, can you go out on a date? I mean (inaudible) the normal socialization, how does that take place? There’s overwhelming evidence it’s had a profound impact on the psyche of parents, children, across the board. And we lost a million people. And nine for every, according to a study, of those million people, nine significant family or close friends were left alive after they’re gone. AP: So you’re talking about a country that has undergone profound psychological trauma.BIDEN: Yes.AP: What can you as a president do to address that psychology ...BIDEN: Be confident.AP: ... to make people feel more optimistic. Be confident?BIDEN: Be confident. Be confident. Because I am confident. We are better positioned than any country in the world to own the second quarter of the 21st century. That’s not hyperbole. That’s a fact. AP: And do you think that’s because the U.S. is stronger, or because you see countries like China hitting speedbumps? BIDEN: Look, I’ve spent more time with Xi Jinping than anybody, any other world leader. Imagine — let me put it — let me ask you a rhetorical question, and, you know, I mean, obviously you don’t have to answer any of the questions. AP: I’ll answer whatever you need.BIDEN: No no. No no no. But think of this. Name me a single major company, country in the world where that world leader wouldn’t trade places with my problems for his in a heartbeat. Name me one. Not a joke.AP: Do you think that ...BIDEN: There are none.AP: Well so, so, I mean, do you think people wouldn’t want to be in Switzerland right now? BIDEN: No, Switzerland has their own problems right now. When I said major, I meant major power, so — but, no. I mean, you know, I just had the, the American, you know, the whole hemisphere, beautiful countries in the Caribbean and beautiful countries that are, have, that are middle-class countries that are having serious problems. Everybody’s having them. In the meantime, we have a little thing called climate change going on. And it’s having profound impacts. We got the tundra melting. We’ve got the North Pole, I mean, so people are looking and, and I think it’s totally understandable that they are worried because they look around and see, “My God, everything is changing.” We have more hurricanes and tornadoes and flooding. People saw what — I took my kids years ago to Yellowstone Park. They call me, “Daddy did you see what happened at Yellowstone, right?” Well, it’s unthinkable. These are 1,000-year kinds of events. AP: And yet you face a possible tradeoff in that climate change has this big impact. And yet Americans are unhappy about the cost of gasoline BIDEN: Sure.AP: And fossil fuels. And I’m curious, like, what does that mean for you if you have to say, we need to increase production in the short term and companies say, but we don’t have the long-term incentives? BIDEN: Well, I say in the short term, do the right thing. Instead of, you know, they’ve made 315 or 16 billion, 35 billion dollars, these major oil companies in the first quarter. So I think it’s three, twelve, five ... I don’t know how many times (inaudible). Don’t buy back your own stock. Don’t, don’t just reward yourselves. I mean, look, here’s what. A lot happened. One of the things I ran on when I was running is that I, I come from the corporate capital of the world, Delaware. More corporations incorporated in my state than all the rest of the United States combined. Not a joke. Literally.And, you know, they try to make me, my fr—, the MAGA party, tries to make me out to be this socialist. I got elected seven times, not just six, seven times, in that state. But one of the things that’s changed is the notion of what constitutes corporate responsibility. The fact that you’re in a situation where you have a Fortune 500 company, you got 55 paid zero taxes, made 40 billion dollars. Those surveys also show nobody, including Republicans in suburbia, think the tax system is fair. Billionaires paying 8%. All these things that are occurring that have to be shifted. It used to be, for example, I’ll give you one example. It used to, am I holding up?(Aide tells Biden time is almost up)BIDEN: OK. AP: So let me ask you because you brought it up, your domestic agenda. In speeches you’ve said your domestic agenda is key for helping the middle class and beating inflation. BIDEN: Yes. AP: Do you have the votes as of today, because … BIDEN: Yes. I think it’s changing. Well, first of all, I had the votes. If I had told you (garble) ... You’re not doing (inaudible). I’m impressed by your objectivity, how you write. I’m not being, I shouldn’t say that on the record because then you’ll get in trouble.AP: I’m in trouble anyway. So it’s OK. BIDEN: But all kidding aside. Usually (inaudible) the question I get asked in the beginning with the Recovery Act: Can you get this passed? How can you possibly do that? I got 1.9 trillion dollars. Saved the economy. It used to be long lines, people in nice cars like we drive. Lined up just to get a box of food in their trunk. People getting kicked out onto the street because they couldn’t pay the rent. Thousands and thousands of people. And guess what? It worked. Secondly, no, here’s the important point. The second piece of this is, that it also saw to it that we were able to provide for the funding for COVID, not only, not only the shots and the shots in arms, but also all the hospital costs. We were able to reduce the cost of insurance. My point is, people would say, “How can you get that done?” If I did, if any other president just passed that act, and the infrastructure bill, they’d say, “God almighty.” Name me a president that’s done anything like that before. At the same time.(Aide tells Biden time is up.)AP: I guess one of the reasons why I ask is you did something revolutionary on child poverty, and you know it, with the child tax credit, an idea that came in part from Newt Gingrich back in the day, Contract With America. And a lot of families had hope from that. They moved out of public housing.BIDEN: That’s right.AP: And then last year, they learned that their incomes were effectively going down. BIDEN: Yep. AP: And so when you present your agenda to the public, the reason why I’m asking if you have the votes is because people really want to know. BIDEN: Sure they want to know. And on that answer is no. Not one single Republican, not one, not one, would vote to extend it. We’re 50/50 and we lost one Democrat vote. So I’m one vote short on that piece. But for example, I’m going to be able to get, God willing, the ability to pay for prescription drugs. There’s more than one way to bring down the cost for working folks. Gasoline may be up to $5 a gallon, but somebody who has a child with stage two diabetes is paying up to a thousand bucks a month for the insulin.We can reduce it to 35 bucks a month and get it done. We have the votes to do it. We’re gonna get that done. That kinda thing. I can’t get it all done. That’s why I need the (inaudible) vote. One more thing. Let’s look at what our Republican friends are going to have to face with the Supreme Court decision on Roe. What they’re going to have to face in terms of the Supreme Court —the failure, the failure of this Republican Party to be willing to do anything to deal with the basic social concerns of the country. And so, I think, you know, I fully understand why the average voter out there is just confused and upset and worried. And they’re worried, for example, you know, can they send their kid back to, back to college? What’s going to happen? Are we going to take away the ability of people to borrow? So I think there’s a lot of reasons for people to want to know what comes next. And do I have the votes? I believe I have the votes to do a number of things. One, prescription drugs. Reduce utility bills by providing for, uh, I think, we’ll be able to get the ability to have a tax incentive for winterization, which would, they estimate, bring down the average bill for the family, normal home, 500 bucks a year.I think we would be able, we’re gonna get another $57 billion for semiconductors, so we don’t have the supply chain problem we had before, keeping down the cost of vehicles. I think we’re going to be in a situation where, we’re gonna — I know we are — where we’re going to reduce a person’s average internet bill by 30 bucks a month, because we have the money through the, through the uh, uh, infrastructure bill to provide internet across country.I think we’re going to be able to have a fair tax system, to have the votes, it’s going to be close, to have a minimum tax on corporations of 15%, make sure we’re in a situation where the people who in fact are, the idea that a billionaire is paying 8% of income and a teacher is paying 22%. I think we’re going to be able to get tax increases on super wealthy. Not a lot. Not a lot. I’m a capitalist. You should be able to (inaudible). For God’s sake, pay your fair share. Just pay, pay a piece of what you owe. And I think we’re gonna be able to do those kinds of things.AP: Were you surprised (crosstalk) ...(Aide tells Biden time is up.)BIDEN: I know I’m supposed to go. That’s the last question.AP: Were you surprised because you referenced the reason why you ran was Charlottesville. And I’m curious, have you been surprised when you say Republicans weren’t going to work with you at all on some of these issues? Did that surprise you, given what you knew that compelled you to run? And how do you deal with that environment? And how does that compare to your predecessors who are on the wall?BIDEN: Well, my predecessor on the wall didn’t pass the (inaudible) his first year, number one. Number two, the reason ... you know why that predecessor is on the wall. You never saw his picture in this office before. I asked my brother to put together the office for me — decide what desk I’d have. I didn’t realize the outgoing president had to be out 10 o’clock, the incoming president by 2 o’clock. And you pick what you want and you got to get it all in by then. So I (inaudible) Jon Meacham come in and he set my office up for me, and so the desk they picked, and you know everything, everything except the wallpaper. And I used to, I came in here for eight years in a row as the vice president. George Washington’s photograph is over there.And I looked and I said, “Why Franklin Roosevelt?” Not that I don’t like Franklin Roosevelt, but why put that big portrait of Franklin Roosevelt? And Jon Meacham said, “Because no one ever inherited that kind of big circumstances and dire, more dire straits than he did that last time.” I said, “Oh, that’s encouraging.”And I said, “Why Abraham Lincoln?” And he said, “The country’s never been as divided since the Civil War.” I knew those two things coming in. But what I also believed was I could get some of it done. There was a, I just was reading an article (inaudible) that article by the, uh, the guy talking about Biden and how he brought the country, brought Republicans together, Republicans and Democrats. Anyway, I’ll, I’ll get it to you. I’ll find it. Oh, here you go. New York Times Magazine. That’s factually correct. Now, there’s a lot I couldn’t get done.AP: Because you’re about to get the Ocean Safety Bill, which passed the House with bipartisan support. BIDEN: Well, yeah. By the way, And when you remember, I called for that, everybody said, “Oh, no, no no.” But guess what? It’s gonna pass. But my generic point is that, you know, we’re going to get gun safety. We’re not going to get what I wanted. We’re gonna get a part where everybody, we’re gonna get the, uh, the uh, uh, the, the Innovation Competition Act, a hundred million bucks is going to be invested outside of Cleveland by Intel. We’re going to have another 57 mil ... . You know, there’s forced arbitration I got rid of in sexual orientation, sexual harassment cases. Juneteenth I got passed, no one said it could be done. I’m not saying, “Look at all I’ve done.” But I knew that were probably, probably 15 sort of traditional, mainstream, conservative Republicans left. And I include in that — and I’m going to get myself in trouble, and I’ll get him in trouble, probably — but the minority leader from Kentucky. He’s a solid, mainstream guy. But you have the, ah, the folks from Texas. You have a lot of folks who are very, very MAGA. For example, Johnson, you know, and Scott, they’re. Every five years, Social Security, Medicare, Medicaid go out of existence. You’ve got to build them back. They, these guys mean it. I mean, why in the hell did you ever think that would happen in your lifetime, and you’re a young man?AP: I feel like I’m getting more gray hair every day, sir. (Laughter.) BIDEN: Well, I tell you what, well at least you’re keeping it. I’d settle for orange if I had more hair. But all kidding aside, I think this is a process and I think what you’re going to see this election is people voting their overall concerns as well. Even people who are not pro-choice are going to find it really, really off the wall when a woman goes across a state line and she gets arrested (garble) where she’s doing. Even people who are, you know, I mean, there’s so many things these guys are doing that are out of the mainstream of where the public is. And I think — but it is, I knew I was stepping into a difficult moment, but — Can I say something off the record? (Off-the-record discussion.)AP: Thank you, sir.
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Inflation
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World-first commercial drone delivery service Wing Aviation promised Canberrans hyper-convenience while cutting costs and carbon emissions, but almost five years after it started delivering household items to select ACT suburbs, the service has ceased locally.
Key points:
- Drone delivery service Wing Aviation has stopped flying in Canberra as it moves away from having its own warehouses
- Wing had been delivering food, drinks and medicine in parts of Gungahlin for almost five years
- The company says it will shift its business to operate out of major shopping centres
Wing Aviation — a subsidiary of Google's parent company, Alphabet — had been operating from Gungahlin for just under five years delivering food, coffee and pharmacy items direct to people's homes.
Wing's head of public policy Jesse Suskin told ABC Radio Canberra the company has moved away from having its own warehouses.
"Over the years, as we've been operating more and growing more, we've shifted our [operating] model from flying drones from our own facilities," he said.
"In Canberra, we had a warehouse in Mitchell, where the drones were taking off and landing and where merchants co-located their products with us. Now, we just put the drones at major shopping centres."Loading...
He said the change enabled more merchants to sign on "without that added step of a warehouse", and more customers to sign up.
Mr Suskin defined the new retail sites as "very large" spaces with more than 100 stores, and located in densely populated areas.
"[They are located] where there's a lot of traffic … where people have to wait 15 to 20 minutes just to get into the centre, to run in for that quick item," he said.
"We don't have a suitable shopping centre just yet, in the Canberra area."
Expert suggests community resistance played a role in Wing's decision
University of Western Australia Associate Professor Julia Powles has been studying drone delivery in Australia for the past five years through the UWA's Minderoo Tech & Policy Lab.
She suspects community resistance – starting in 2018, during a drone delivery trial in Bonython in Canberra's south — was also a key factor in Wing ceasing deliveries in the capital.
"[Bonython residents] came together and said, 'this is not right. A company is deciding that we should be the guinea pigs of, effectively, a junk food delivery service operating day and night and we can't do anything about it'," Ms Powles said.
In November of that year, 1,043 petitioners asked the Legislative Assembly to abandon that trial, and any planned future trials in the ACT, citing a limited public feedback process, transparency and governance issues, potential risks to pets and wildlife, and a compromised "right to peace, privacy and a good quality of life".
Ms Powles said there had also been community backlash in Gungahlin, where Wing expanded in 2019 after gaining approval from the Australian aviation authority, CASA.
At the time, the company estimated the expanded service would generate up to $40 million for ACT businesses, while Chief Minister Andrew Barr suggested the drone noise was similar to other residential sounds, like lawnmowers.
"It's an interesting demonstration of the power of technological promise and industry capture over regulators," Ms Powles said.
Wings not clipped completely
Wing's new business model already features a partnership with supermarket giant, Coles, for store-to-door delivery of small items to northern Gold Coast suburbs, and shopping centre services in the Queensland cities of Logan and Ipswich.
A second Logan site is opening in south-east Queensland this week.
"It all seems like a beautiful vision [but] what it masks is that this is a whole new arena of commerce in our skies," Ms Powles said.
"We've done fieldwork at the Logan site and they've got a very different demographic, very different dynamics of population growth, and much less community organisation to say 'Wait a minute, how are our cities being transformed by the overflight of, frankly, coffee and fried chicken-delivering drones, that are convenient … but have a dramatic impact on quality of life?'"
"That's what Canberra residents have consistently and effectively been resisting."
But Mr Suskin said despite ceasing deliveries in Canberra, Wing was maintaining some presence in the ACT.
"Canberra is a big part of our history and it's on our radar," he said.
"We [still] have pilots there, geospatial experts. There still will be some drones in the air from time to time, piloting new non-consumer delivery."
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Consumer & Retail
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People smugglers 'abusing legal protections meant for those trafficked for modern slavery' People being smuggled across the English Channel are abusing legal protections meant for those trafficked for modern slavery, one Tory MP has said. Conservative MP Peter Bone told the Commons earlier: "People who are trafficked into this country are duped or coerced, they are exploited for sexual or labour purposes, people who are smuggled into this country willingly pay to do so and come for economic purposes."The first are victims and deserve the protection of the Modern Slavery Act, the second are not and deserve no protection from the Modern Slavery Act."That is being abused by people who are coming across in small boats. I hope the home secretary can sort this out."Priti Patel replied that it was in the "national interest" to ensure there are safeguards to protect people, but "we cannot allow people to exploit [these protections] for the wrong reasons." PMQs word cloud analysis - 'Investment' and 'economy' dominate By Daniel Dunford, senior data journalistLabour’s Kier Starmer tried to press the prime minister on issues concerning the economy – poor growth, tax hikes and the rising cost of living. Meanwhile, Boris Johnson tried to steer the discussion to rail strikes and Britain’s low level of unemployment, as well as investment – both in the UK from abroad and in the NHS from the government.Word cloud analysis of today's session shows"investment" as the main focus of the prime minister's contributions and "economy" the most prominent term used by Sir Keir Starmer.Yesterday’s failed Home Office flight taking UK migrants to Rwanda was only mentioned obliquely at the close of Boris Johnson’s final answer to Mr Starmer, and not at all by the Labour leader himself, suggesting that the Conservatives still believe the policy is a vote-winner among the public.There was one mention of Jabba the Hutt, and one of Obi-Wan Kenobi, as Mr Starmer accused Mr Johnson of attempting to perform "Jedi mind tricks" on the country.And mercifully the phrase "the ick" was also only mentioned once, a reference to Love Island where contestants are booted out if the public stop liking them. What is the government position on the European Convention on Human Rights? Earlier this morning cabinet minister Therese Coffey and junior minister Guy Opperman both gave interviews that seemed to play down the idea that the government would now move to pull out of the European Convention on Human Rights following the failed Rwanda deportation flight.The Convention, to which the UK is a signatory, is the basis on which the European Court of Human Rights judges cases brought before it.But as our deputy political editor Sam Coates points out in his latest update, the prime minister's spokesman has now insisted "all options are on the table" when it comes to the Convention.Sam says this suggests that contrary to the comments of ministers earlier, Number 10 is preparing to "lean in into the idea of yet another very big fight."Watch his analysis here: Government will do 'whatever it takes' to ensure Rwanda flights take off As well as hearing from Priti Patel in the Commons, the prime minister's official spokesman has been fielding questions from journalists at a regular Westminster briefing.He has said the government will do "whatever it takes" to make sure that deportation flights to Rwanda go ahead.The spokesman said ministers would be considering the ruling from the European Court of Human Rights but stressed that "all options are on the table".Asked if the government could withdraw from the European Convention on Human Rights, the spokesman responded: "We are keeping all options on the table including any further legal reforms that may be necessary."We will look at all of the legislation and processes in this round."Asked if a flight could take off before legal proceedings in the UK are finished, he said: "That is my understanding." 'The home secretary has no one to blame but herself' Labour's shadow home secretary Yvette Cooper calls the immigration policy a "shambles and shameful, and the home secretary has no one but herself to blame". She says Priti Patel knew she was planning to send torture victims to Rwanda and did not have the proper screening processes in place.Ms Cooper asks: "Can she confirm that it was the Home Office itself that withdrew a whole series of these cases on Friday and yesterday because they knew there was a problem with these cases that even without the ECHR judgment, she was planning to send a plane with just seven people on board because she'd had to withdraw most of the cases at the last minute."She also asks the home secretary how much "she promised Rwanda for each of the people she was planning to end yesterday, and how many Rwandan refugees she promised to take in return.""If she was serious about tackling illegal migration she would be working night and day to get a better joint plan with France to crack down on the gangs going into the water in the first place," she continues. "But she isn't because her relationship with French ministers has totally broken down."Ms Cooper says Ms Patel spent half a million pounds chartering a plane "she never expected to fly", calling it "government by gimmick".SNP MP Stuart McDonald calls it an "unworkable, immoral and illegal policy that "does nothing to stop illegal people smugglers". He says "it's not the lawyers who caused this flight to be cancelled, or any courts" but "government illegality". Priti Patel says preparations for next Rwanda flights 'have begun' She says the flight was paused "following a decision by an out-of-hours judge" at the European Court of Human Rights.She says the European Court did not rule that the removal policy was unlawful.She tells the House of Commons: "These repeated legal barriers are very similar to those that we experience with all other removal flights."And we believe we are fully compliant with our domestic and international obligations and preparations for our future flights and next flights have already begun.""We are a generous and welcoming country, as has been shown time and time again. Over 20,000 people have used safe and legal routes to come to the UK since 2015," she says."Our capacity to help those in need is severely compromised by those who come here illegally."She says illegal immigration is "not fair on those who play by the rules", especially at the cost of £5m per day. Rwanda, she says, has "been vilified" and is "a safe and secure country with an outstanding track record of supporting refugees and asylum and seekers and we are proud that we are working together".She says she will not let the "usual suspects" or "mobs" prevent asylum seekers from being sent to the African country. Theresa May says case of missing journalist in Brazil must be be made a 'diplomatic priority' Former prime minister Theresa May used her question to ask Boris Johnson to make the case of missing British journalist Dom Phillips a "diplomatic priority." Mrs May said: "My constituent Dominique Davis is the niece of Dom Philips, the British journalist missing in Brazil, alongside the indigenous expert Bruno Pereira. "Will my Right Honourable friend ensure that the government makes his case a diplomatic priority and that it works to do everything it can to ensure that the Brazilian authorities put the resources necessary to uncover the truth, and find out what has happened to Dom and Bruno?" Mr Johnson responded: "Like everybody in this House we are deeply concerned about what may have happened to him. FCDO officials are working closely with the Brazilian authorities. The minister responsible has raised the issue repeatedly," he added. PM brushes away question about the critical comments made by new cost of living tsar Labour's Anna McMorrin has read out a criticism of the prime minister made by the government's newly appointed cost of living tsar.David Buttress, founder of Just Eat, was appointed yesterday - but in January he posted on Twitter: "Why is it that the worse people often rise to the highest office and stay there?"Ms McMorrin said: "If his own tsar doesn't have faith in him, tell me why those struggling should?"The prime minister brushed off the question, saying "this is a government that gets on and delivers on our promises to the people, in particular getting Brexit done."I read the other day that she wants to go back into the single market and the customs union, that's the real policy of the Labour Party, Mr Speaker." Sexual assault survivors having to 'choose between their mental health and justice' Labour's Sarah Champion brings up the case of a Rotherham survivor who reported her experience to the police and was told not to go for counselling as "it could be used against them in court".She asks the PM to stop the Attorney General from challenging the rules to it is even easy for defence teams to access victims counselling notes "having an immediate chilling effect". Survivors "shouldn't be forced to choose between their mental health and justice". The PM replies that he will "look at the evidence she has, but I think these are very tentative and very difficult issues, particularly as regards the defence cases".He says courts are starting to see a "gradual improvement" in the prosecution rate "and that is because governments across departments are working together to take account of victims' needs". "I agree that progress isn't everything that I would like, but we are seeing progress," he adds. Analysis: Rail strikes question another opportunity for PM to flip attack back on Labour By Amanda Akass, political correspondentThe loud heckling from the Conservative benches during Labour MP Liz Twist's question about the pain ahead for ordinary families hit by the "biggest rail strikes in a generation" highlights a real awkwardness in Labour's position on this issue. The Conservatives have been accusing Labour of backing the strikes after a number of senior party figures expressed their support for the rights of unions to take industrial action. Liz Twist is asking a specific question about why ministers haven't met with the union leaders in a bid to stop the strikes - a key Labour attack line. Sir Keir Starmer is accusing the prime minister of wanting the strikes to go ahead to stoke division. But it's a division which is politically very useful for the under-pressure prime minister to exploit. This question gives him a useful opportunity to flip the attack back onto the opposition with his aside "we all know how much money the Labour front bench take from the RMT" and repeating the demand he's already made several times this PMQs for Labour to "come out and condemn the RMT" - in an echo of his claim to Sir Keir that.It's an uncomfortable moment for Labour after a question from one of their own MPs. Due to your consent preferences, you’re not able to view this. Open Privacy Options
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United Kingdom Business & Economics
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Europe needs to prepare immediately for Russia to turn off all gas exports to the region this winter, according to the head of the International Energy Agency, who has called on governments to work on reducing demand and keeping nuclear power plants open.Fatih Birol said reductions in supplies in recent weeks which the Kremlin has attributed to maintenance work could, in fact, be the beginning of wider cuts designed to prevent the filling of storage facilities in preparation for winter, as Russia seeks to gain leverage over the region.“Europe should be ready in case Russian gas is completely cut off,” he said in an interview with the Financial Times. “The nearer we are coming to winter, the more we understand Russia’s intentions.“I believe the cuts are geared towards avoiding Europe filling storage, and increasing Russia’s leverage in the winter months.”EU countries are racing to refill storage sites, with Germany hoping to reach 90% of capacity by November. Its stores are only half full.Member states have also been working to reduce their reliance on Russian fossil fuels, by sourcing gas from other countries, including the US, and speeding up the switch to renewable energy, although officials have conceded that the race to phase out Russian oil and gas would mean burning more coal and keeping nuclear plants going.Birol said emergency measures taken by European governments to reduce energy demand had probably not gone far enough, and urged countries to work on preserving energy supplies.“I believe there will be more and deeper demand measures as winter approaches,” Birol said. He added that gas supplies may need to be rationed, if Russia were to further reduce gas exports.Moscow has reduced or even cut off gas deliveries to several EU countries in recent weeks, in response to their decision to impose sanctions on the Kremlin over its invasion of Ukraine.Russian gas supplies to Europe received through the Nord Stream 1 pipeline – which runs under the Baltic Sea to Germany – have been falling.Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDeskLast week, Russia’s state-controlled energy company Gazprom announced the second cut to gas transported via the pipeline, reducing supplies to just 40% of capacity.The Italian energy firm Eni has reported a halving of Gazprom’s gas supplies to Italy, which gets about 40% of its imported gas from Russia. Meanwhile, the French network operator GRTgaz said France had not received any Russian gas via Germany since the middle of May.Kremlin spokesperson Dmitry Peskov last week blamed maintenance issues for the reductions in supply, a reference to earlier comments saying Russia was unable to secure the return of equipment sent to Canada for repairs.
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Energy & Natural Resources
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People change money at a currency exchange office in Istanbul, Turkey May 17, 2022. REUTERS/Dilara SenkayaRegister now for FREE unlimited access to Reuters.comANKARA, July 25 (Reuters) - The Turkish lira slipped again on Monday, sustaining a slow slide towards 18 against the dollar as concerns mounted about the government's foreign exchange policy in the face of surging inflation and fears of global recession.The slow depreciation could continue unless authorities find a new source of foreign funds to buffer depleted official reserves, analysts say. Adding to uncertainty over coming weeks, corporate depositors will decide whether to largely stick with special state-backed lira-protected accounts.The lira weakened as much as 0.4% to 17.8335 against the U.S. currency, trading at its weakest levels since a full-blown currency crisis in December, when it hit an all-time low of 18.4.Register now for FREE unlimited access to Reuters.com"We are seeing the lira losing limited value each day with the current policy. The balance in forex can only be achieved with the lira losing value, albeit limited," said a treasury desk trader at one bank.The lira has steadily weakened 6.3% this month.The Turkish Central Bank's quarterly inflation report on Thursday and the U.S. Federal Reserve's expected 75 basis-point interest rate hike on Wednesday were set to be key focuses of attention for investors this week.On Thursday the Turkish central bank is expected to again raise its end-year inflation forecast from 42.8% previously. According to a Reuters poll, annual inflation is expected to be 70% by end-2022. It hit a 24-year high near 80% last month.The rampant inflation was triggered by a series of unorthodox interest rate cuts which knocked 44% off the lira's value last year. It has weakened another 26% this year.Despite the unrelenting depreciation, the central bank is expected to keep its policy rate steady at 14% for at least another year, focusing instead on macro-prudential measures on loans and liquidity.The central bank's net forex reserves have tumbled to just over $6 billion this month, the lowest levels since 2002, with bankers calculating forex reserves excluding swaps to be minus $55 billion.The treasury desk trader said a big question is whether new foreign forex resources will flow into Turkey, given the need for fresh resources is at unprecedented levels.Authorities sought to stem the lira's decline from the end of last year with special bank accounts, dubbed KKM, protecting savers and corporates from large lira falls to discourage hoarding of U.S. dollars, euros or gold."Markets are monitoring the rollover of corporates' KKMs which begin this week and intensify over 3-5 weeks. We have not yet seen heavy forex demand due to KKM. But the issue of whether KKM rollovers will create forex demand will be important for the course of the lira," the trader said.(This story has been refiled to drop extraneous word in headline)Register now for FREE unlimited access to Reuters.comReporting by Nevzat Devranoglu;
Writing by Daren Butler;
Editing by Jonathan SpicerOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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At the U.S.-Africa Business Forum on December 14 in Washington, DC, as part of the U.S.-Africa Leaders Summit, President Biden announced the launch of a new Digital Transformation with Africa (DTA) initiative. A signature initiative of the Biden-Harris Administration, DTA will expand digital access and literacy and strengthen digital enabling environments across the continent. Working with Congress, this initiative intends to invest over $350 million and facilitate over $450 million in financing for Africa in line with the African Union’s Digital Transformation Strategy and the U.S. Strategy Toward Sub-Saharan Africa.Africa’s digital ecosystem offers massive potential to spur economic recovery, promote opportunity, advance social equality and gender equality, and create jobs. Africa’s digital transformation has opened new markets for U.S. exports and services; deepened partnership among African governments, the U.S. private sector, educational institutions, and the African diaspora; and increased productivity, competitiveness, and e-government service delivery. With new technologies transforming the way Africans live and work, DTA will foster an inclusive and resilient African digital ecosystem, led by African communities and built on an open, interoperable, reliable, and secure internet. This initiative will also seek to empower women and other marginalized people through and within the digital ecosystem. DTA aims to help countries rebuild economies impacted by the COVID-19 pandemic and advance U.S. national security, diplomatic, commercial, and development priorities. It will also advance commitments to invest in global infrastructure, including digital connectivity, under the Partnership for Global Infrastructure and Investment. The initiative will achieve its objectives along three core pillars: Pillar 1: Digital Economy and Infrastructure Objective 1: Expand access to open, interoperable, reliable, and secure Internet for African communities across sectorsObjective 2: Expand access to and adoption of key enabling digital technologies, platforms, and services and scale the African technology and innovation ecosystemObjective 3: Facilitate investment, trade and partnerships in Africa’s digital economy from the African diaspora, U.S. and like-minded allies Pillar 2: Human Capital Development Objective 4: Facilitate inclusive access to digital skills and literacy, particularly for youth and womenObjective 5: Foster inclusive participation in the digital economy through digital entrepreneurship and workforce developmentObjective 6: Strengthen the capacity of public sector employees to deliver digital services Pillar 3: Digital Enabling Environment Objective 7: Strengthen the capacity of authorities and the independence of regulators to develop, implement, and enforce sound policies and regulationsObjective 8: Support policies and regulations that promote competition, innovation, and investmentObjective 9: Promote governance that strengthens and sustains an open, interoperable, reliable, and secure digital ecosystem As a whole-of-government effort that harnesses the diverse tools and capabilities of the U.S. Government, DTA will include initiatives by the following departments and agencies: The United States Agency for International Development (USAID) will lead interagency efforts to increase digital skills and literacy, enhance digital entrepreneurship, and strengthen public sector digital service delivery. USAID will leverage existing capabilities and networks, such as through the Young African Leaders Initiative, to mobilize digital leaders, especially women and members of other marginalized communities, across sub-Saharan Africa to foster the growth of local digital businesses and ecosystems. Beyond this work, USAID will help facilitate investment and promote business friendly reforms to support the development of the digital sector. The U.S. Department of State will spearhead interagency efforts to strengthen the digital enabling environment. The Department of State’s Digital Connectivity and Cybersecurity Partnership will promote an open, interoperable, reliable, and secure digital ecosystem. Activities will include targeted information and communications technology (ICT) infrastructure efforts, such as testing and deployment of technologies, feasibility studies, promoting supplier diversity, and the use of trusted suppliers. The Department of State will support capacity building and technical assistance, to encourage enabling environments for innovation, cybersecurity, and digital capacity building in consultation with African partners. The Department of State will invite a delegation of regulators to Washington for regulatory technical assistance, and in March 2023, the United States will hold an Open RAN workshop in Africa.The Millennium Challenge Corporation (MCC) will work with its partner countries to address country-driven digital transformation priorities, harmonize regulatory and enabling environments, and attract private sector investment. MCC prioritizes long-term engagement to implement systemic changes and build the foundations of digital-driven economic growth in our African partner countries. To advance inclusive and resilient growth, MCC will ensure that digital skills and services reach underserved communities, youth, and women; promote digital innovation; and harness the private sector to drive economic growth and reduce poverty.The U.S. International Development Finance Corporation (DFC) is committed to supporting private sector investment in projects that expand access to affordable internet and telecommunications, as well as projects that leverage technology to fuel economic growth, such as financial technology and online education. DFC is improving mobile connectivity across Africa through, for example, $100 million of financing for Africell to support mobile network upgrades and expansions in the Democratic Republic of the Congo, The Gambia, and Sierra Leone to make mobile internet services more affordable and widely available. DFC is also advancing technology infrastructure across Africa through $300 million of financing to build and expand Africa Data Centres in South Africa, Kenya, and other countries in Africa to meet a growing demand connectivity.The Export-Import Bank of the United States (EXIM) will support DTA under its loan, guarantee, and insurance programs, including bolstering the competitiveness of U.S. exporters through the China and Transformational Exports Program. Power Africa is a U.S. Government initiative that works to increase access to power in sub-Saharan Africa and has helped deliver first-time electricity to nearly 159 million people. Power Africa will engage the private sector to expand digital access and strengthen the business enabling environment for trade and investment. For example, as part of its Health Electrification and Telecommunication Alliance, Power Africa will invest $10 million to improve internet access in rural health clinics and regional health facilities. The U.S. Trade and Development Agency (USTDA) will co-lead interagency efforts on digital economy and infrastructure. USTDA will fund grant-based project preparation and partnership-building activities to support the development of digital infrastructure across Africa. Leveraging its Access Africa initiative, USTDA will partner with U.S. industry and Africa’s public and private sectors to advance inclusive, secure, and sustainable digital infrastructure, including priority connectivity, cybersecurity, and smart cities projects. USTDA’s Access Africa portfolio has the potential to help unlock more than $1.5 billion in financing for digital infrastructure projects in close to 40 African countries.Prosper Africa is a U.S. Government initiative to increase trade and investment between African nations and the United States. Prosper Africa will serve as a one-stop-shop for businesses and investors, as well as coordinate interagency support, for deals in the ICT sector. Prosper Africa will engage the private sector to strengthen the business enabling environment for digital trade through the Prosper Africa Tech for Trade Alliance.The Department of Commerce will co-lead interagency efforts on the digital economy and infrastructure. The Department of Commerce will leverage regional digital attachés, located in South Africa and Egypt, to increase its focus on the digital sector through DTA and will co-chair Pillar 1: Digital Economy and Infrastructure with USTDA. Additionally, the Department’s National Telecommunications and Information Administration is pleased to announce its intention to work with the United States Telecommunication Training Institute to empower and develop the next generation of telecommunications and ICT leaders in Africa. The program will include a networking and mentorship event in Washington, DC, for young African leaders with U.S. tech, start-up, and government representatives, followed by a training workshop in Africa to help build out skills, knowledge, and digital leadership. ###
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Africa Business & Economics
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U.S. Dollar and Euro banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSummaryhttps://tmsnrt.rs/2RBWI5ENEW YORK, Aug 24 (Reuters) - The dollar gained against a basket of currencies on Wednesday, holding near a 20-year high as investors waited for a Friday speech by the Federal Reserve Chairman for fresh clues on how aggressive the central bank will be in its battle against inflation.Investors have pared back expectations that the Fed could tilt to a slower pace of rate hikes as inflation remains at 8.5% on an annual basis, well above the Fed's 2% target.The focus of Jerome Powell's speech in Jackson Hole will be on to what extent an economic slowdown might alter the Fed’s pace of tightening, or if the need to tame inflation pressures will override other economic factors.Register now for FREE unlimited access to Reuters.comThe dollar gained even after data on Wednesday showed that new orders for U.S.-made capital goods increased at a slower pace in July from the prior month, suggesting that business spending on equipment could struggle to rebound after contracting in the second quarter. read more "The dollar's still well bid and I think that the market's concluding that these data are not going to change the Fed's position about what's going to happen next month," said Marc Chandler, chief market strategist at Bannockburn Global Forex in New York."While the market might be swinging back and forth between inflation and recession, the central banks aren't. They are focused, it seems to be nearly exclusively, on inflation," Chandler said.Fed funds futures traders are pricing in a 59% chance that the Fed will hike rates by another 75 basis points at its September meeting, and a 41% probability of a 50 basis points increase.The dollar index was last up 0.42% at 108.99, holding just below a 20-year high of 109.29 reached on July 14. The euro was down 0.49% at $0.9919, after hitting a 20-year low of $0.99005 on Tuesday.The greenback dipped on Tuesday after data showed U.S. private sector activity was weaker than expected in August while sales of new U.S. single-family homes plunged to a 6-1/2-year low in July. read more The euro has been hurt by growth concerns as the region faces an energy crisis. Front-month Dutch gas , the benchmark for Europe, rose again on Wednesday as the prospect of a halt to Russian gas supplies through the main Nord Stream 1 pipeline for three days kept investors on edge. read more "The sharp jump in gas prices and the uncertainty about this going forward will continue to weigh on the euro for the time being," said DNB Markets FX analyst Ingvild Borgen Gjerd.Meanwhile, cyclical currencies such as the Australian and New Zealand dollars were under pressure from fears of a global growth slowdown.The Aussie fell 0.62% to $0.6886 and the kiwi slumped 0.72% to $0.6169.========================================================Currency bid prices at 9:43AM (1343 GMT)Register now for FREE unlimited access to Reuters.comAdditional reporting by Samuel Indyk in London; Editing by Kirsten DonovanOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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NEW YORK (AP) — One of the more reliable warning signals for an economic recession started blinking again.
The “yield curve” is watched for clues on how the bond market feels about the long-term outlook for the U.S. economy. On Tuesday, a closely followed part of the yield curve briefly lit up for the second time this year.
What is the yield curve?
At the center of the investing world are Treasurys, the IOUs the U.S. government gives to investors who lend it money. The yield curve is a chart showing how much in interest different Treasurys are paying.
On one end are shorter-term Treasurys, which get repaid in a few months or a couple years. On the other end of the chart are longer-term Treasurys, which take 10 years or decades to mature. Short-term yields closely follow expectations for what the Federal Reserve will do with overnight interest rates, while long-term yields move more on expectations for economic growth and inflation further in the future.
WATCH: Inflation rises faster than expected, pinching pocketbooks and spooking the markets
Usually, longer-term Treasurys offer higher yields than shorter-term ones, resulting in a chart with an upward sloping line. That’s in part because investors typically demand higher yields to lock away their money for longer, given the possibility of future rate increases by the Fed and the risk of inflation. But when investors are worried about a sharp downturn, perhaps because the Fed is pushing short-term rates too high too quickly, they’re willing to accept less for a Treasury maturing many years in the future.
When yields for short-term Treasurys are higher than yields for long-term ones, market watchers call it an “inverted yield curve.” And when that chart has a downward sloping line, Wall Street starts getting nervous.
Why care?
All the talk about charts and yields is tough to digest. An inversion in the yield curve is considered to be a reliable predictor of a recession, though at times they have inverted without a recession following.
READ MORE: Cost of necessities rose in May, leaving U.S. with new 40-year high in inflation
Some market observers, including officials at the Federal Reserve, view the relationship between 3-month and 10-year Treasurys to be more important. Every recession in the past 60 years has been preceded by an inversion of the yield curve between the three-month and 10-year Treasurys.
There’s usually some lag between the two. One rule of thumb says it takes about a year after the three-month Treasury yield tops the 10-year yield before the onset of recession, according to the Federal Reserve Bank of Cleveland.
What’s happening now?
At 1.75 percent, the three-month yield is still well below the 10-year yield of 3.48 percent, so no inversion there.
But on Tuesday, the two-year Treasury yield briefly crossed above the 10-year yield, before pulling back underneath at 3.42 percent. The two yields inverted previously in early April. Other, less-followed parts of the yield curve are also already inverted. Though they’re less consistent in predicting recessions as the three-month yield versus the 10-year, they show the trend is swinging toward pessimism.
Following an inversion in 2019, the global economy plunged into recession in less than a year. At that time, though, the bond market did not see the pandemic coming. It was focused on global trade tensions and slowing growth.
NEWS WRAP: Treasury Secretary Janet Yellen says inflation will remain high
Now, the two-year yield is surging as investors become convinced the Fed will act more aggressively. The central bank has already pulled its key overnight rate off its record low to try to beat down high inflation and is preparing to hike rates several more times by larger than usual amounts.
A report Friday that showed inflation is getting worse solidified expectations among many investors that the Fed will hike overnight rates by double, or perhaps triple, the usual amount at its next meeting.
The two-year yield has more than quadrupled in 2022 alone. The 10-year yield has also risen, but not as quickly.
So the yield curve just reflects the bond market’s thinking?
It could also have real effects on the economy. Banks, for example, make money by borrowing money at short-term rates and lending it out at longer-term rates. When that gap is wide, they make more in profit.
An inverted yield curve complicates that, though. If it causes banks to cut off lending — and thus growth opportunities for companies — it could help tighten the brakes on the economy.
Is it a perfect predictor?
No, an inverted yield curve has sent false positives before. The three-month and 10-year yields inverted in late 1966, for example, and a recession didn’t hit until the end of 1969.
Some market watchers have also suggested the yield curve is now less significant because herculean measures by the world’s central banks have distorted yields. Through the pandemic, the Federal Reserve bought trillions of dollars of bonds to keep longer-term yields low, after slashing overnight rates to nearly zero. It recently began start allowing some of those bonds to roll off its balance sheet, which should add upward pressure on longer-term yields.
Should I panic?
Fed Chair Jerome Powell would say no. Earlier this year, he said he pays more attention to the first 18 months of the yield curve than what’s going on between the two-year and 10-year yields.
“That has 100 percent of the explanatory power of the yield curve,” he said, and it’s not inverted.
READ MORE: Inflation, pandemic has small businesses on edge this summer
And even though the two-year and 10-year Treasury yields inverted twice this year, they may be just temporary blips rather than a lasting trend.
Many investors, though, are worried about a recession or the possibility of “stagflation,” which would be the painful combination of high unemployment and high inflation.
The bond market, of course, also seems to be more pessimistic. Just look at the yield curve.
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Bonds Trading & Speculation
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South Korean won, Chinese yuan and Japanese yen notes are seen on U.S. $100 notes in this file photo illustration shot December 15, 2015. REUTERS/Kim Hong-Ji//IllustrationRegister now for FREE unlimited access to Reuters.comSINGAPORE, July 4 (Reuters) - The dollar kept trade-sensitive currencies pinned near multi-year lows on Monday and the euro was under pressure as investors sought safety due to worries about slowing global growth.Data on Friday showed euro zone inflation surging to another record, adding to the case for the European Central Bank to raise interest rates this month. read more While the euro was flat at $1.0426 on Monday, it was barely above May's five-year trough of $1.0349, highlighting the market's preference for dollars as gloom clouds the outlook.Register now for FREE unlimited access to Reuters.comThe Australian and New Zealand dollars hit two-year lows on Friday and were not far from those levels during the Asia session, with the Aussie down 0.1% at $0.6809, after falling as low as $0.6764 on Friday. The kiwi held at $0.6203.Trade is likely to be lightened ahead of the Independence Day holiday in the United States.Safety flows tend to support the greenback, especially at the expense of export-driven currencies, when the world economy is weak. This has kept the dollar elevated even as growth fears have tempered U.S. rate hike expectations.The U.S. dollar index stood at 105.120, not far below last month's two-decade high of 105.790. The Atlanta Federal Reserve's much-watched GDP Now forecast has slid to an annualised minus 2.1% for the second quarter, implying the country was already technically in recession. read more "The Aussie and other commodity currencies and even euro and sterling will likely decline even more into the week, given markets currently are super-focused on the risk of a sharp slowdown in the global economy," said Carol Kong, a currency strategist at the Commonwealth Bank of Australia in Sydney.Sterling hit a two-week low of $1.1976 on Friday and last bought $1.2090.Ahead this week, Australia's central bank will meet on Tuesday and investors are also awaiting publication of minutes from last month's Federal Reserve meeting on Wednesday and U.S. employment data on Friday.Markets have priced in a 40 basis point (bp) rise in Australian interest rates, so the Aussie may not catch much of a boost if a hike of that size, or thereabouts, is delivered.Minutes of the Fed's June policy meeting on Wednesday are almost certain to sound hawkish, given the committee chose to hike rates by a super-sized 75 bps.The market is pricing in around an 85% chance of another hike of 75 basis points this month and rates at 3.25% to 3.5% by year end - before cuts in 2023.Against Asian currencies, the dollar held Friday gains that lifted it to its strongest levels in years on the Thai baht , Indonesian rupiah and Singapore dollar .Similarly, the dollar held firm against the Japanese yen, and was last trading at 135.24 per dollar .The Chinese yuan was one outlier, creeping higher to 6.6915 per dollar. China is emerging from lockdown and its equity markets have been drawing capital flows. Investors seem to regard it as a haven from stagflation risks in the West.========================================================Currency bid prices at 0457 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Rae Wee; Writing and additional reporting by Tom Westbrook; Editing by Sonali DesaiOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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Australian businesses will be 'victims' of Chinese economic sanctions if ban on TikTok expands to WeChat, China warns
China has warned that Australian businesses will suffer if the government takes on a Senate committee's recommendations to expand a ban on TikTok to WeChat.
The Chinese Communist Party mouthpiece, The Global Times, has warned Australian businesses will suffer if the government decides to ban China-based social media sites TikTok and WeChat.
China has prohibited Twitter, Facebook and YouTube along with search engines Google and Bing but it claims to be furious with the possibility of Australia introducing similar bans on its platforms.
TikTok is banned from government devices in Australia and a parliamentary committee has recommended the ban be extended to include government contractors and cover WeChat.
The Senate committee reviewing foreign interference on social media said it was “particularly concerned” with the risks posed by TikTok and WeChat whose headquarters are run “in and run from authoritarian countries like China”.
An editorial in The Global Times has hit back at the recommendation claiming it would set back the rebuilding of economic ties between China and Australia with local businesses to suffer.
“At a time when China-Australia relations are at a critical juncture, Australia should not repeat the mistake it made in 2018 in banning Huawei from its 5G wireless network. Many see this decision as the spark that set off bilateral economic clashes,” Hu Weijia wrote.
“If bilateral economic cooperation encounters challenges and difficulties again, Australian companies will become victims of setbacks in bilateral ties.
“The facts of the past few years have fully proven this point.”
Australia’s frosty relationship with China has begun to thaw under the Albanese Government which has attempted to reignite talks to wind back sanctions introduced during the previous administration.
The Global Times made no mention of China’s own bans on foreign social media companies and it warned that there could be action if Australia was to follow through on the Senate committee’s recommendations.
“China and Australia enjoy strong complementarity in strengthening economic cooperation,” Mr Weijia wrote.
“Australia should avoid being kidnapped by US' anti-China strategy.
“It is in line with the essential interests of businesses from both sides if the two countries continue to push economic and trade cooperation.”
The Senate committee said that China’s national intelligence law means the government can require companies to secretly cooperate with national intelligence agencies and that TikTok’s China-base employees can access Australian user data.
The report listed social media as “one of Australia’s most pressing security challenges” and tabled 17 recommendations including enforcing a ban on companies who do not have a business presence in Australia.
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Australia Business & Economics
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Contents1Going out: Cinema2Going out: Gigs3Going out: Art4Going out: Stage5Staying in: Streaming6Staying in: Games7Staying in: Albums8Staying in: Brain foodGoing out: CinemaNopeOut nowFrom Get Out and Us director Jordan Peele comes a thriller combining elements of Spielbergian thrills and spills with another riveting performance from Get Out lead Daniel Kaluuya. One of the hottest don’t-miss-this-one tickets of the summer. Keke Palmer and Steven Yeun co-star.Blind AmbitionOut nowA feelgood documentary about refugees Tinashe Nyamudoka, Pardon Taguzu, Joseph Dhafana and Marlvin Gwese as they flee violence at home to become qualified sommeliers. They go on to to enter the Olympics of wine-tasting in France, representing Zimbabwe on the oenophile world stage. Cheers!EiffelOut nowStarring Romain Duris as Gustave Eiffel – yep, the guy who built a certain popular tourist attraction – this love story explores the relationship between Eiffel and his childhood sweetheart Adrienne Bourgès (Sex Education’s Emma Mackey). You might even describe it as a towering romance.Laal Singh ChaddhaOut nowFrom director Advait Chandan and starring Aamir Khan, this Hindi reworking of Forrest Gump hits most of the familiar beats, right down to “run, Laal, run!” and “Life is like a golgappa, your tummy might feel full, but your heart always craves more”. Kareena Kapoor Khan and Mona Singh co-star. Catherine BrayGoing out: GigsThirst class … Torres. Photograph: Shervin LainezTorres16 to 22 August; tour starts LeedsMackenzie Scott has two new albums of material to tour. Released just before the pandemic, 2020’s Silver Tongue was followed in 2021 by the higher intensity Thirstier, which bolted expansive choruses on to big grunge-pop songs. With five albums under their belt, Scott now has music for all “new normal” moods. Michael CraggAll Points EastVictoria Park, London, 19 to 28 AugustThe annual shindig returns with a typically eclectic lineup. Friday’s headliners Gorillaz are joined by the likes of Turnstile, Pusha T and Self Esteem, while Saturday sees the Chemical Brothers share top billing with Kraftwerk. Next weekend sees sets by Disclosure and Nick Cave and the Bad Seeds. MCKamasi WashingtonTroxy, London, 13 August When the west-coast bandleader’s multi-stylistic odyssey, The Epic, appeared in 2015, fans of all persuasions hailed a jazz renaissance. A thrilling performer, Washington brings his rousing ensemble to this UK gig, with acclaimed jazz, Afrobeat, and funk genre-crunchers Ezra Collective supporting. John FordhamSalomeUsher Hall, Edinburgh, 14 AugustThe Bergen Philharmonic with their principal conductor Edward Gardner do promise something special – their performance of Strauss’s Salome – only a concert version, alas – has one of the finest present-day interpreters of the title role, Malin Byström, heading a world-class cast; Johan Reuter is Jochanaan, Gerhard Siegel is Herodes and Katerina Dalayman is Herodias. Andrew ClementsGoing out: ArtSurreal thing … Maurizio Anzeri’s Lucy, 2018. Photograph: R Chambers/Maurizio AnzeriKnown and StrangeV&A, London, to 6 NovemberPhotography has been obsessed with the uncanny since it was invented. Its truthlike nature made Victorians try to capture ghosts and ectoplasmic entities on camera. This free display shows how that heritage survives in photography today as artists such as Dafna Talmor and Maurizio Anzeri create impossible landscapes and surreal montages.Alan DavieDovecot Studios, Edinburgh, to 24 SeptemberScotland’s answer to Jackson Pollock gets a mini retrospective that conveys his energy, intensity and rough magic. Davie, who died in his 90s in 2014, carved out a unique path in postwar British art, rejecting figuration and pop alike in his gnarled and savage abstract art. A tremendous painter.Our Place in SpaceMidsummer Common, Cambridge, to 29 AugustThis outdoor art event designed by the science-minded artist Oliver Jeffers tries to help adults and children alike visualise the scale of the solar system and where we stand in it. You can follow a six-mile trail from Cambridge to Waterbeach on which the planets are mapped. Feel small.PlatformFrench Institute, Edinburgh, to 28 AugustLynsey MacKenzie’s abstract paintings are windswept and exhilarating, like a breath of cool Edinburgh air. They suggest land and sea and life. Other artists in this show of emerging Scottish talent include Saoirse Amira Anis, whose video explores community through cooking, as well as Emilia Kerr Beale and Jonny Walker. Jonathan JonesGoing out: StageOver here! … Sarah Sherman.Sarah ShermanGilded Balloon Teviot, Edinburgh, 15 to 21 August; Soho Theatre, 22 to 25 AugustEdinburgh might not be your first port of call for weird, extremely online US comedy, but SNL star Sherman – known for her surreal, body horror-tinged skits – is one of a handful of US internet sensations trying her hand at the fringe prior to a brief London run. Rachel AroestiPhaedra and MinotaurTheatre Royal Bath, to 23 AugustA music/dance double bill with Britten’s Phaedra alongside a premiere from choreographer Kim Brandstrup, which tells the story of Phaedra’s sister Ariadne (who helped Theseus conquer the Minotaur) with three stellar contemporary dancers: Jonathan Goddard, Tommy Franzen and Laurel Dalley Smith. Lyndsey WinshipCruise Apollo theatre, London, to 4 SeptemberSoho in the 1980s. Michael has lost his partner to Aids and, diagnosed with the illness himself, is determined to live life to the max. Jack Holden’s one-man play is inspired by a real story he heard while volunteering for the LGBTQ+ helpline Switchboard. Miriam GillinsonMedeaThe Hub, Edinburgh, to 28 AugustMichael Boyd directs poet and playwright Liz Lochhead’s lyrical adaptation of Euripides’ brutal Greek tragedy. Adura Onashile stars as the vengeful mother. MGStaying in: StreamingUnion dues … Sean Bean and Nicola Walker in Marriage. Photograph: Rory Mulvey/BBC/The ForgeMarriage14 August, 9pm, BBC One and iPlayerAny drama with Nicola Walker is worth a watch, but this four-parter about a 30-year relationship tips into must-see territory thanks to her co-star (Sean Bean) and the show’s creator, Stefan Golaszewski. If Golaszewski’s sitcom Mum is anything to go by, Marriage will be a minutely observed, bittersweet delight.Red Rose15 August, 10pm, BBC Three and iPlayerA group of friends are threatened by a strange, dark, web-connected app that mysteriously appears on their phones in this new teen horror series, which promises to fuse standard social media dread with supernatural terror.She-Hulk: Attorney at Law17 August, Disney+Jennifer Walters (Tatiana Maslany) is just your average thirtysomething, romantically challenged, high-flying lawyer … who transforms into a green superhuman when she gets cross (much like her cousin Bruce Banner). Jameela Jamil, Tim Roth and Mark Ruffalo make up the starry supporting cast.Bad Sisters19 August, Apple TV+Fans of Aisling Bea and Sharon Horgan’s knotty sibling dynamic in This Way Up are in for a real treat. Horgan’s new Dublin- and London-set comedy-thriller revolves round the tight-knit Garvey clan (Anne-Marie Duff and Eve Hewson among them), who have pledged to look after each other following the deaths of their parents. RAStaying in: GamesWeb player … Marvel’s Spider-Man Remastered.Marvel’s Spider-Man RemasteredOut now, PCPC players now have the chance to play one of the most enjoyable superhero games around, web-swinging through a picture-perfect New York while foiling criminals.RollerdromeOut 16 August, PC, PS4/5This mix of rollerskating game and shooter is even more deadly than actual roller derby. Pull wild stunts and shoot rockets at your competitors in this stylish futuristic bloodsport. Keza MacDonaldStaying in: AlbumsReset piece … Panda Bear and Sonic Boom. Photograph: Ian WitchellPanda Bear and Sonic Boom – ResetOut nowReset may be the first album officially credited to Animal Collective’s Noah Lennox and Peter Kember but the pair go way back, with Kember producing Lennox’s 2011 solo album, Tomboy. Sonically Reset and Tomboy share a lot of common ground, fusing saturated psychedelia with off-kilter Beach Boys harmonies.Pale Waves – UnwantedOut nowWhile the Manchester quartet’s first two albums channelled 90s indie, Unwanted – produced by Zakk Cervini (Blink-182, Yungblud) – leans heavily towards pop-punk. Both Jealousy and Reason to Live come on like lost Avril Lavigne singles, while the acoustic The Hard Way shows off frontwoman Heather Baron-Gracie’s fragile vocals.Hudson Mohawke – Cry SugarOut nowThe Glaswegian electronic producer returns with his oversized fourth album, full to the brim with hyper-surreal, trap-infused beats and unexpected pockets of euphoria, its highlights include head-knocking recent single, Dance Forever.Danger Mouse and Black Thought – Cheat Codes Out nowIn a big week for collabs, Brian Burton and rapper Tarik Trotter team up for this guest-heavy hip-hop workout. Michael Kiwanuka adds his ghostly lilt to undulating single Aquamarine, while elsewhere the likes of A$AP Rocky, Run the Jewels and MF Doom also add their talents across 12 tracks. MCStaying in: Brain foodTrading account … Mobeen Azhar. Photograph: BBC/ForestScam Land: Money, Mayhem and MaseratisBBC iPlayerBBC Three’s premier sleuth Mobeen Azhar takes up a curious story for his latest series: a medical student who handed out free cash before being implicated in a forex trading scam. Azhar tries to track the culprit down.Mubi PodcastOnlineThe second series of arthouse streamer Mubi’s podcast tells the story of cinema through the history of its most remarkable theatres. Host Rico Gagliano narrates notable screenings from 70s suburban Minneapolis to Paris in the 1940s.MIT Direct to OpenOnlineSpearheading the movement towards open-access research, MIT has launched a new platform making thousands of its academic monographs available for free download. Browse tomes on electronic music, the legacy of Amazon’s commercial monopoly and more niches. Ammar Kalia
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Forex Trading & Speculation
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NEWYou can now listen to Fox News articles! South Carolina voters speaking with "Fox & Friends" Tuesday warned that the government needs to "get a hand on inflation" before the problem gets even worse."Fox & Friends" enterprise reporter Lawrence Jones spoke with diners at Sunrise Bistro in Johns Island about the issues they find most concerning as polls opened on primary day."Everything from work to driving to vacation to groceries, and housing… That's been one of our long-term problems and I think it's more severe now" a voter named Keith told Jones of inflation."It is time for change," a concerned mom of teenagers voting for Trump-backed House candidate Katie Arrington added.MIKE ROWE: LOW LABOR PARTICIPATION PAIRED WITH HIGH UNEMPLOYMENT A ‘MATTER OF NATIONAL SECURITY’ South Carolina First Congressional District GOP primary challengers Katie Arrington (L) and Nancy Mace (R) (Sean Rayford - Getty Images / Bill Clark, CQ-Roll Call, Inc - Getty Images)Another diner said crime in the area was a "big problem" and a lack of support for youth education and poverty."Young Black men… too many of them are losing their lives. We should be supporting the Ten Commandments. Thou shall not kill instead of denigrating Christians and faith. So, we really need to work with our youth. We really need to talk about faith and learning respect for life."One of the diners said he was old enough to live through the Jimmy Carter administration and sees "great similarities" with the Biden administration. The gentlemen said he likes incumbent Rep. Nancy Mace, R-S.C., however, he is switching his support for Arrington. "It affects all of us, everyone one of us, and we need to have things changed, and it seems like we have a current administration who seems out of touch with reality… we need the ability to reach across the aisle and be able to work with each other and I think we lost that."A Johns Island resident said President Biden divided the country, and it is now weakened.CLICK HERE FOR THE FOX NEWS APP"He has not done anything to help American people. He has done everything he could to destroy America," a voter named Paul said.Mace, the freshman representative in South Carolina’s 1st Congressional District – a key swing seat – faces a challenge from Arrington, a former state lawmaker backed by Trump, who nearly 17 months removed from the White House remains the most popular and influential politician in the GOP.Fox News' Paul Steinhauser and Austin Westfall contributed to this report. Joshua Q. Nelson is a reporter for FoxNews.com. You can find him on Twitter @joshuaqnelson.
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Inflation
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U.S. Dollar banknotes are seen in this illustration taken July 17, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSINGAPORE, Aug 9 (Reuters) - The dollar lurked just below recent highs on Tuesday as traders waited for U.S. inflation data due later in the week, which could take pressure off the Federal Reserve and put it on the greenback if it suggests the pace of price rises has peaked.The data is due on Wednesday and the anticipation is likely to keep things calm until then.The Australian and New Zealand dollars rose overnight and were steady in the pre-CPI calm in Asia. The Aussie held gains at $0.6977. The kiwi did likewise at $0.6276, leaving both just above their 50-day moving averages.Register now for FREE unlimited access to Reuters.comSterling held at $1.2081 and the euro was stuck just above parity at $1.0189, with the continent's energy crisis meaning it may miss out on a boost if the dollar weakened. The yen rose slightly to 134.75 per dollar.On Tuesday, a New York Fed survey showed consumers' inflation expectations fell sharply in July, perhaps easing some of the upward pressure on rates from last week's strong jobs figures. read more "Expectations that the Fed may announce another 75 basis point rate hike on September 21 have risen on the back of (Friday's) strong U.S. July payrolls report," said Jane Foley, senior currency strategist at Rabobank."Later this week, the July U.S. CPI inflation release is expected to show some moderation in inflation pressures," she said. "This may now be sufficient for the Fed to relax."Economists polled by Reuters see year-on-year headline inflation (USCPNY=ECI) at 8.7% -- incredibly high, but below last month's 9.1% figure.Money-market futures show traders see about a two-thirds chance of a 75 bp hike next month and have started pushing expectations for rate cuts back, deeper into 2023.Two-year Treasury yields , which track short-term U.S. rate expectations, held at 3.2157% on Tuesday, with benchmark 10-year yields 45 bps below that at 2.7572%.An upside CPI surprise could drive yields and the dollar higher."Investors have become increasingly sure in their view that inflation will drop back fairly quickly, and that it will subsequently remain around the Fed's target," said Thomas Mathews of Capital Economics."The market is arguably quite vulnerable to a surprise on inflation, should any evidence gather it is staying high longer than expected. That would also probably prompt a sharper response from the Fed, and see the bond market selloff resume in earnest."========================================================Currency bid prices at 0154 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Tom Westbrook. Editing by Sam HolmesOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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First came the drought. Then the bushfires. Then the floods. And then, on May 21, 2022, came the federal election. After nearly four years as Australian prime minister—a term in office marked by repeated and record-breaking natural disasters—the conservative Scott Morrison was ousted following a contest that hinged on climate change.“It’s a very clear illustration of the concern that Australians have and their desire for climate action,” says Amanda McKenzie, CEO of the Climate Council, a nonprofit organization dedicated to climate change communication. The hope is that the new Labor government will quickly improve Australia’s poor track record on carbon emissions.Australia certainly has a lot of catching up to do. Its efforts to mitigate climate change have been declared “highly insufficient” by the Climate Action Tracker, an independent project that assesses countries’ climate policies. Despite ranking 55th in the world in population, Australia is the 14th-highest emitter of carbon dioxide—and the fifth highest if its large fossil fuel exports are factored in. It is the world’s second-largest exporter of coal. On a per capita basis, the country is one of the highest emitters of CO2 in the world. The election delivered a mixed result—but one that could help change this. New prime minister Anthony Albanese’s center-left Labor Party gained the most seats in Parliament—far more than the incumbent coalition of the center-right Liberal Party and National Party, which took power in 2013. But it wasn’t a landslide, with Labor exceeding the number of seats needed to govern in its own right by just one.The surprise twist was the election of five new “teal” independents—so-called because of their campaign color. These candidates all ran on a platform of substantially stronger action on climate change than Labor, which in turn promised far more action on climate change than the coalition. Many teal independents won in previously secure Liberal Party electorates. The Australian Greens, who have the strongest climate policies of all the parties, also increased their electoral share from one to four seats in the lower house.Prior to the election, the Australian government had maintained a commitment to a 26 to 28 percent decrease in emissions by 2030 under the Paris Agreement, which was compatible with around 3 degrees Celsius of warming. Labor went into the election with a range of climate and energy promises, including a commitment to a 43 percent reduction in emissions, which McKenzie says is “certainly not enough.” Analysis suggests this is still consistent with 2 degrees of warming. The teal candidates’ platforms aim for a 60 percent reduction, and the Greens’ for a 74 percent decrease. “Our analysis from a scientific perspective is it needs to be a 75 percent reduction this decade,” McKenzie says.The hope is that the climate-focused independent and Green presence in Parliament will push Labor towards even greater climate action, says Frank Jotzo, director of the Centre for Climate and Energy Policy at Australian National University in Canberra. “For the government, this should mean a license to do more rather than less on climate change.”One of Labor’s election promises on energy and emissions is to strengthen the existing cap-and-trade system for big carbon emitters, known as the Safeguard Mechanism. Under this, big polluters are required to buy or surrender carbon credits to offset any direct emissions that exceed an agreed-to baseline. Labor’s plan is to reduce the emissions baselines for these emitters over time. “The government will then need to resist industry pressure to keep the ambition low,” Jotzo says, warning that industry will lobby hard for baselines to be eased.This is exactly what happened under the coalition government after it set up this cap-and-trade scheme. Companies continually pushed for adjustments to their baselines, eventually resulting in a 32 percent increase in the emissions they were allowed to produce.Another pillar of Labor’s election platform was its National Electric Vehicle Strategy. In 2020, less than 1.4 percent of all light vehicles sold in Australia were EVs, compared to around three-quarters of all light vehicles sold that year in Norway. Overall just 0.12 percent of all light vehicles in Australia are electric. Manufacturers such as Volkswagen have held off from entering the Australian market because of a lack of incentives for EVs.So going into the election, Labor promised to remove import tariffs and lower taxes on some EVs, and to accelerate the rollout of charging infrastructure. But they haven’t gone far enough, Jotzo says. “They have not committed to do what in many countries is the single biggest driver of electric car uptake, and that is to introduce fleet-wide emission standards,” he says. Requiring all car manufacturers to meet emission targets across their entire range encourages massive investment in electric models to offset the emissions from petrol and diesel models.But the biggest fly in Australia’s climate action ointment is its fossil fuel reserves—particularly coal and gas—and the question of how the country can safely and smoothly transition away from those both for domestic use and export.“Because it’s an extractive resource, the government owns it, it generates royalties for the government, and renewables don’t do that,” says Samantha Hepburn, a professor and expert on mining and energy law at Deakin University in Melbourne. In contrast, renewable projects will generate very little income for the government. “When we talk about energy transition, I don’t think that phrase really captures it—it’s a revolution.”Some progress on renewables was made during the coalition government. A long-running renewable energy target required large-scale energy producers to generate 33 terawatt-hours of renewable energy by 2020, and this was easily met in 2019. But the absence of a new target created a climate of uncertainty in the renewables sector that then saw a drop in investment in new projects.Labor’s “Powering Australia” policy now promises to upgrade the grid to enable better integration of renewables, to invest in solar banks and community batteries across the country, and to deploy low-emission technologies.But the current global gas crisis, precipitated by the Russian invasion of Ukraine, has plunged Australia into a world of energy misery largely of its own making. There are no export controls on its extensive east-coast gas reserves, which are now being sold at incredible prices on the international market, with none set aside for domestic use. Domestic gas prices have therefore skyrocketed, and there is not yet enough renewable energy to pick up the slack. Meanwhile, Australia’s aging network of coal-fired power stations has been steadily winding down over the past decade.“There is no more important time to be talking about energy and climate change in Australia than right now, and what we’re inheriting is a decade-long failure to tackle these issues of climate, energy, and security,” says Madeline Taylor, deputy director of the Centre for Energy and Natural Resources Innovation and Transformation at Macquarie University in Sydney.But Labor has long supported keeping at least some fossil fuels in Australia’s energy mix, even before the current gas crisis, and it has grappled with some in its ranks that opposed taking a stronger stance on climate action. Labor also previously backed the potential fracking of the enormous gas reserves of the Beetaloo Basin in the Northern Territory, and it says it will still allow new gas and even coal projects that meet environmental standards.Taylor, and many others, argue that Australia’s wealth of renewable resources—in particular sun, wind, and waves—should instead see it become a global green-energy superpower. As well as servicing the domestic energy market with renewables, there has been a push for Australia to become an exporter of renewable energy in the form of green hydrogen.Labor has not made specific commitments to this vision, beyond a National Reconstruction Fund that covers investment in renewable and low-emission energy technologies, including the manufacture of wind turbines and hydrogen electrolyzers. However the Greens are shooting for a complete phase-out of fossil fuels in Australia by 2030, and for the country to invest in green hydrogen as an export industry.With Labor's razor-thin majority in Parliament, the hope is that the Greens and climate-focused independents will be a vocal and powerful climate conscience for the ruling party.“There are so many reasons why we need increased ambition on energy and climate change,” Taylor says. “The community wants this. Industry wants it. It’s now time for the government to actually present some certainty.” The recent climate-fueled devastation in Australia has shown how high the stakes are.More Great WIRED StoriesApple just killed the password—for real this timeWelcome to the Great ReinfectionStar Wars has a fandom problemThis is what flying car ports should look likeGoogle's Russian empire faces an uncertain futureHere are the best Netflix shows to binge-watch right now
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Australia Business & Economics
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Australia apologizes for thalidomide tragedy as some survivors listen in the Parliament gallery
Survivors of the harmful morning sickness drug thalidomide were in the public gallery when Australia’s Parliament made a national apology for what was described as one of the darkest chapters in Australia’s medical history
CANBERRA, Australia -- Survivors of the harmful morning sickness drug thalidomide were in the public gallery Wednesday when Australia’s Parliament made a national apology to them on the 62nd anniversary of the drug being withdrawn from sale in the country.
Thalidomide, also sold under the brand names Contergan and Distaval, was available in 46 countries and caused birth defects, stillbirths and miscarriages.
Survivors with limb deformities and one with no limbs were in the House of Representatives gallery to hear Prime Minister Anthony Albanese’s apology.
“Today, on behalf of the people of Australia, our government and this Parliament offers a full unreserved and overdue apology to all thalidomide survivors, their families, loved ones, and carers,” Albanese said.
“This apology takes in one of the darkest chapters in Australia’s medical history,” he added.
Doctors had assured pregnant women that the drug was safe.
“There was no system for properly evaluating the safety of medicines, and the terrible cruelty of thalidomide, is that far from being safe, just one dose was enough to cause devastating harm,” Albanese said.
Trish Jackson, who has heart and lung problems as well as limb deformities caused by her mother taking the drug while pregnant, welcomed the apology.
“All those years of ... banging our heads against brick walls of politicians have finally paid off,” Jackson told Australian Broadcasting Corp.
The apology was recommended in 2019 by a Senate inquiry into the support that was available to aging thalidomide survivors.
The government will fulfill another recommendation Thursday by opening a memorial in Canberra in recognition of thalidomide survivors and their families.
Australia established a support program in 2020 that is providing lifelong assistance to 148 survivors, and Albanese said his government was reopening the program to survivors who had yet to register.
Jackson said the support program needed to be simplified.
“It is so physically demanding to get anything back like for medications and stuff that ... a lot of survivors just don’t bother because it’s too hard for them to do it,” Jackson said.
She said some doctors had never heard of thalidomide and did not understand survivors' problems.
“It’s not just the missing limbs. There’s so much internal damage as well,” Jackson said. “Thalidomide’s a drug that just keeps on giving us problems.”
A class-action lawsuit by Australian and New Zealand thalidomide survivors against the drug’s British distributor Diageo Scotland Ltd. was settled a decade ago for 89 million Australian dollars ($81 million).
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Australia Business & Economics
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Taipei, Sept. 14 (CNA) Shares in Taiwan tumbled almost 1.6 percent Wednesday as investors were affected by disappointing U.S. inflation data released overnight that sent the Dow Jones Industrial Average plunging by nearly 1,300 points, dealers said.Large cap tech stocks, in particular in the semiconductor industry, led the fall on Taiwan's market, amid expectations that the United States Federal Reserve will adopt a more aggressive approach on interest rates to fight inflation, dealers said.The Taiex, the Taiwan Stock Exchange's benchmark weighted index, ended down 236.10 points, or 1.59 percent, at 14,658.31 after moving between 14,522.70 and 14,699.78. Turnover totaled NT$186.135 billion (US$6 billion).The market opened down 1.34 percent following a 3.94 percent fall in the Dow and a 5.16 percent plunge in the tech-heavy Nasdaq index Tuesday, when Washington reported that the consumer price index (CPI) rose a higher-than-expected 8.3 percent year-on-year in August, dealers said.Sell-off on Wall StreetThe sell-off focused on semiconductor heavyweights and spread to large cap old economy stocks to push the Taiex down by about 370 points before bargain hunters entered, helping the Taiex offset some of its earlier losses by the end of the session, they said."I think government-led funds were among the bargain hunters in a bid to shore up market confidence amid volatility on U.S. markets," Hua Nan Securities analyst Kevin Su said."Still, the government-led funds' support failed to reverse the weakness as market sentiment was badly hurt by the U.S. CPI data," Su said."Some investors now expect the Fed to raise its key interest rates by a full percent, compared with the previous market consensus of 75 basis points, at a policymaking meeting next week."Tech stocksSu said the electronics sector was hit hard by expectations of a more hawkish Fed, falling 1.91 percent to close at 675.52, with the semiconductor sub-index shedding 2.33 percent.Contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), the most heavily weighted stock in the local market, closed 2.64 percent lower at NT$480.00, after hitting a low of NT$476.00."I suspect TSMC was among the market heavyweights backed by government-led funds today," Su said. "Such buying from government-led fund is likely to continue if there is more volatility in the U.S., and the stock could find short-term technical support at NT$472."In addition to TSMC, Su suspected government-led funds also bought into power management solution provider Delta Electronics Inc., which lost only 0.37 percent to close at NT$268.00 after hitting a low of NT$262.00.Among other semiconductor stocks, smaller contract chipmakers United Microelectronics Corp. fell 1.47 percent to end at NT$40.15, and Powerchip Semiconductor Manufacturing Corp. lost 1.25 percent to close at NT$31.60.IC packaging and testing services provider ASE Technology Holding Co. shed 3.73 percent to end at NT$82.70.Also in the electronics sector, iPhone assembler Hon Hai Precision Industry Co. lost 2.27 percent to close at NT$107.50, and Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., also dropped 2.02 percent to end at NT$1,940.00.Financial stocksSu said bargain hunting was also seen among select financial stocks, including Mega Financial Holding Co., which fell 0.86 percent to close at NT$34.75 after coming off a low of NT$34.55.Among other financial stocks, Fubon Financial Holding Co. lost 1.73 percent to end at NT$56.70, Cathay Financial Holding Co. dropped 1.83 percent to end at NT$42.85, and CTBC Financial Holding Co. ended down 1.98 percent at NT$22.30.In the old economy sector, Formosa Plastics Corp. shed 2.44 percent to close at NT$88.10, and Formosa Chemicals & Fibre Corp. lost 2.01 percent to end at NT$68.10"However, the transportation sector outperformed the Taiex, closing above the previous closing level as bulk cargo shippers attracted buying," Su said.Shipping firmsThe transportation sector rose by 0.38 percent, pushed higher by an overnight rise of more than 12 percent in the Baltic Dry Index, which monitors freight rates for bulk cargo shippers.Bulk cargo shipper U-Ming Marine Transport Corp. rose 4.87 percent to close at NT$39.85, and Sincere Navigation Corp. gained 1.47 percent to end at NT$20.75.Buying also spread to container cargo shippers, with Yang Ming Marine Transport Corp. and Wan Hai Lines Ltd. closing 0.98 percent and 1.80 percent higher, respectively, at NT$71.80 and NT$79.10."Cautious sentiment is expected to continue into next week, when the Fed holds a two-day policymaking meeting that ends on Sept. 21," Su said. "But government support will likely offset foreign institutional selling and prevent the Taiex from falling below 14,500 points."According to the Taiwan Stock Exchange, foreign institutional investors sold a net NT$13.53 billion in shares Wednesday.Related NewsSept. 14: U.S. dollar tops NT$31 mark to hit 3-year high on Taipei forexSept. 13: Taiwan shares end up but gains capped before U.S. inflation dataSept. 12: Tax revenue hits new high despite fall in stock transaction taxSept. 10: Foreign institutional investors record net fund outflows for AugustSept. 9: Central bank governor expects Taiwan's CPI growth to fall below 2% in 2023Sept. 6: Forex reserves continue to fall after central bank's intervention in marketAug. 20: Taiwan dollar could remain weak; sound economy expected to cap fall
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Asia Business & Economics
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Men look at an electric monitor displaying the Japanese yen exchange rate against the U.S. dollar and Nikkei share average in Tokyo, Japan September 14, 2022. REUTERS/Issei Kato Register now for FREE unlimited access to Reuters.comTOKYO, Sept 22 (Reuters Breakingviews) - The Bank of Japan is sticking with its ultra-loose monetary policy after the U.S. Federal Reserve implemented another 0.75% rate hike, defying predictions — and bond market bets — that central bank chief Haruhiko Kuroda would have to adjust. That’s understandable, but it will make it harder to moderate an increasingly volatile exchange rate.The yen , currently trading around 144 per dollar, is at its weakest since 1998, but more important is the rate of change. It has lost 29% since a peak in December 2020, and is down 47% over the last decade due to two quick, steep corrections in 2012 and 2014, respectively. That’s a byproduct of Shinzo Abe’s successful war on deflation. A see-sawing foreign exchange rate, though, makes executives nervous. Exporters including carmakers Nissan Motor (7201.T) and Toyota Motor (7203.T), and drugmaker Takeda Pharmaceutical (4502.T), which reported nice forex tailwinds in its last quarterly report, are benefitting from unexpected exchange rate gains on paper. However, a currency that can flatter earnings one quarter can wreck them in the next.The major risk is that the United States, fighting runaway inflation, enters a harsh recession. An abrupt reversal to the Fed’s current tightening bias would see Japanese corporates and speculators back into yen assets, causing it to rebound as sharply as it fell. (By Pete Sweeney)Register now for FREE unlimited access to Reuters.comJapan's unorthodox monetary policy has increased the yen's volatilityFollow @Breakingviews on Twitter(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)Capital Calls - More concise insights on global finance:Sea CEO’s distress call will make tech waves read more U.S. trustbusters’ red faces match legal red tape read more Big SPAC unwind has consequences for few read more Oyo will check into public markets in better shape read more Register now for FREE unlimited access to Reuters.comEditing by Robyn Mak and Thomas ShumOur Standards: The Thomson Reuters Trust Principles.Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.
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Forex Trading & Speculation
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NEWYou can now listen to Fox News articles! White House press secretary Karine Jean-Pierre struggled to provide a coherent answer on how President Joe Biden will address skyrocketing gas prices during a press briefing Tuesday and started to say the president is trying to "elevate" Americans' pain.Jean-Pierre made a verbal error that American citizens may find painfully funny: "The president has been very clear in making sure that he does everything that he can to elevate—to alleviate the pain that American families are feeling when it comes to gas prices."Gas prices have risen astronomically, putting massive financial pressure on working Americans. Her gaffe was quickly picked up and roasted by various commentators. White House Press Secretary Karine Jean-Pierre during a daily press briefing at the White House in Washington, U.S. May 26, 2022. (REUTERS/Jonathan Ernst)Sen. Ted Cruz, R-Texas, quipped that the gaffe was a "Freudian slip from the Biden admin."Arizona Republican Party Chairwoman Dr. Kelli Ward commented that Jean-Pierre had "got it right the first time" by saying Biden is elevating the pain."She's doing just great at this job," contributing editor at The Spectator Stephen L. Miller sarcastically quipped about Jean-Pierre. Fox News contributor Katie Pavlich observed, "Elevating the pain. Correct."WAPO COLUMNIST TELLS AMERICANS NOT TO CAST VOTES BASED ON HIGH GAS PRICES: ‘NEITHER PARTY HAS A SERIOUS PLAN’Elsewhere in the press briefing, Jean-Pierre continued to offer vague assurances that America is not entering an economic recession, even as Americans face very real economic problems on a daily basis. She denied flatly that America is in any form of a recession, but said the "focus" instead should be on our "stable" future: "Right now we don’t see a recession. Right now, that is, we’re not in a recession right now. Right now we’re in a transition where … we are going to a place of stable and steady growth and that's going to be our focus." A Ukrainian tank drives next to a destroyed Russian vehicle in the Kharkiv region on April 14. (REUTERS/Alkis Konstantinidis)NO MORE ‘PARIAH’ STATE AS BIDEN SEEKS HELP FROM THE SAUDIS AS GAS PRICES SKYROCKETEarlier in June, she called upon oil companies to provide gasoline at more affordable prices as a matter of "patriotic duty," appearing to shift some blame for the gas crisis from Russia towards the gas industry itself: "We know where to put the blame on the war, but oil companies, they have refineries, they have responsibility, too. What they have been doing is taking advantage of the war."She added further that "we are calling on them to do the right thing, to be patriots here and not to use the war as an excuse or as a reason to not put out production, to not do the capacity that is needed out there." Fuel prices at a Chevron gas station in Menlo Park, California, US, on Thursday, June 9, 2022. Stratospheric Fuel prices have broken records for at least seven days with the average cost of fuel per gallon hitting $4.96 as of June 8, according to the American Automobile Association. (Photographer: David Paul Morris/Bloomberg via Getty Images)CLICK HERE TO GET THE FOX NEWS APPBiden himself recently issued controversial messaging on the topic of rising gas prices, suggesting "we’re going through an incredible transition" and pitching the bold claim that "we’ll be stronger and the world will be stronger and less reliant on fossil fuels when this is over." Alexander Hall is an associate editor for Fox News Digital. Story tips can be sent to Alexander.hall@fox.com.
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Inflation
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Mr Sunak met with the former Labour prime minister as he spent around 12 hours in the United Arab Emirates for the climate change conference.
The Telegraph understands that while their discussion did not last for more than a couple of minutes, it touched on the politics of the Middle East as turbulence in the region continues amid the Israel-Hamas war.
Mr Sunak and Sir Tony briefly discussed the situation on a day that saw a week-long pause in hostilities come to an end as fighting resumed between Israeli troops and Hamas terrorists.
Britain joining the United States in the invasion of Iraq has come to define Sir Tony’s 10-year premiership, with a backlash to the decision continuing to overshadow many other aspects of his decade in power.
Sir Tony has continued to take a keen interest in foreign policy since leaving office, not least through his think tank the Tony Blair Institute.
The Institute has controversially continued to advise Saudi Arabia in the wake of the murder of the journalist Jamal Khashoggi, an act it has strongly condemned.
It came as Mr Sunak also discussed the Israel-Hamas war with Qatari and Jordanian leaders on the sidelines of the main Cop28 programme.
Speaking to broadcasters on Friday, Mr Sunak said: “We’ve been consistent that we want to see sustained humanitarian pauses so that more aid can get into the people of Gaza but also the hostages can come out.
“Those are critical ingredients. And as we’ve said, everyone needs to adhere to the terms of these agreements.”
A Downing Street spokesman said Mr Sunak had thanked Amir Sheikh Tamin bin Halad Al Thani, the Qatari ruler, for “facilitating” a humanitarian pause during their meeting.
The spokesman added: “The Prime Minister reiterated that Hamas had demonstrated that it could not be a partner for peace and could have no future in Gaza.”
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Middle East Business & Economics
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After more than two years of strict Covid-19 border controls, Japan reinstated visa-free travel to 68 countries on Tuesday.Maki Nakamura | Digitalvision | Getty ImagesThe Japanese yen's slump against the U.S. dollar has sparked some worry in Japan, but that could encourage more travelers to visit the country again, according to analysts — though they say a significant rebound in the tourism sector won't happen without the return of Chinese tourists.After more than two years of strict Covid border controls, Japan reinstated visa-free travel to 68 countries on Tuesday. Package tours are no longer necessary, the Japan National Tourism Organization (JNTO) reported. The daily entry limit of 50,000 people and the on-arrival PCR test at the airport have been scrapped. However, it is still mandatory for travelers from all countries and regions to submit a negative Covid test certificate or proof of vaccination, JNTO said. With the easing of restrictions and the depreciating yen, tourism to the country will return quickly — especially from Asia, said Jesper Koll, director of financial services firm Monex Group told CNBC.Koll said that although travelers from Europe and the U.S. are important in aiding Japan's tourism recovery, "the bulk of the enthusiasm and the bulk of travel" still come from countries like Singapore, the Philippines and Thailand. "The cheapness of the yen obviously increases the probability of tourism contributing greatly to the economy," Koll said. "As the restrictions get rolled back further, and the capacity of inbound flights open up, I expect that we will see inbound spending and inbound tourism accelerate very, very quickly." In 2019, Japan welcomed 32 million foreign visitors and they spent about 5 trillion yen, but inbound spending is now only one-tenth of that, according to a Goldman Sachs note from September. The investment bank estimated that inbound spending could reach 6.6 trillion yen ($45.2 billion) after a year of full reopening, as travelers will be encouraged to spend more because of the weak yen."Our ball-park estimation points to potentially larger inbound spending of ¥6.6 tn (annual) post full reopening versus the pre-pandemic level of ¥5 tn, partly helped by the weak yen," the note said. The Japanese currency plunged to a fresh 24-year low and was at 146.98 against the greenback during London's trading hours on Wednesday.Japanese officials intervened in the forex market in September when the dollar-yen hit 145.9."I don't think the yen has been as cheap as it is now in living memory," said Darren Tay, Japan economist at Capital Economics, said on CNBC's "Squawk Box Asia" on Tuesday. "Tourists were already clamoring for borders to reopen … So I think the weak yen will serve as another motivating factor" for them to travel to Japan again. Although flight ticket prices to Japan have increased since the announcement was made, tourists will still get a bang for their buck when they spend in Japan, Koll said."You can eat twice as many hamburgers, twice as much sushi for your dollar here in Japan compared to the United States, and even compared to the rest of Asia," he added. Chinese tourists 'hold the key'The outlook for Japan's tourism recovery looks promising, but "the overall impact on Japan's economy may not be a net positive" as Chinese tourists have yet to return, Tay said."Chinese tourists actually make up a large amount of what foreign tourists spent back in 2019 … They're still pursuing a zero-Covid strategy so they won't be returning anytime soon," he said. Goldman Sachs said Chinese tourists, who made up 30% of foreign visitors to Japan in 2019, could return only in the second quarter of 2023. Once China fully reopens, inbound spending from Chinese visitors has the potential to increase from 1.8 trillion yen in 2019 to 2.6 trillion yen — 0.5% of Japan's gross domestic product, said Yuriko Tanaka, economist at Goldman Sachs. "Chinese visitors hold the key to a bona fide rebound in inbound spending," Tanaka said.Without visitors from China, it could take some time before inbound spending in Japan returns to pre-pandemic levels, Koll said. But strong demand from the rest of Asia could drive inbound spending to return "relatively quickly" to over $3 trillion by March 2023.Outlook for yen As markets expect the U.S. Federal Reserve to hike interest rates by 75 basis points in November, the yen will continue to weaken as the dollar continues to strengthen, said Koll. "You've got the widening interest rate differential [between Japan and the U.S.], and the Federal Reserve is not done yet. There is at least one more interest rate hike in the cards," he said. He added that yen could weaken further toward the 155 level, strengthening only next spring — and that wouldn't be the result of action from Japan, but of the Fed signaling that it has "stepped enough on the brake."
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Asia Business & Economics
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Japanese yen and U.S. dollar banknotes are seen with a currency exchange rate graph in this illustration picture taken June 16, 2022. REUTERS/Florence Lo/IllustrationRegister now for FREE unlimited access to Reuters.comSummaryYen rallies on flight to safetyEuro/dollar falls to 20yr low of $1.0140Steady or strong U.S. jobs data could lift USD - analystsSINGAPORE, July 8 (Reuters) - The Japanese yen and the U.S. dollar rose in Asia on Friday as investors leapt to safe assets after former Japanese prime minister Shinzo Abe was shot, and as market jitters grew ahead of highly anticipated U.S. jobs data.Abe was shot on Friday while campaigning, a government spokesman said. His condition was unknown. read more The yen rose as much as 0.5% immediately after the news, before steadying around 135.60 per dollar.Register now for FREE unlimited access to Reuters.com"I think the yen is just playing its safe-haven role," said Bart Wakabayashi, branch manager at State Street in Tokyo."FX market players (are) pretty much ingrained in the way they trade," he said, instinctively buying dollars and yen on bad news.The move comes with a broader shift in sentiment on the yen. It fell nearly 16% on the dollar through the first half of 2022, but has lately found support as global growth fears rattle markets, and from the risk of a central bank policy shift.The euro is seeing no such sympathy and has been sliding towards parity on the dollar as investors worry that an energy crisis brought on by the uncertainty of gas supply from Russia can tip the continent into recession.The euro is down more than 2% this week and touched a two-decade low of $1.0140 in Asia trade. Its decline has lifted the U.S. dollar index to two-decade highs, and it hovered near those levels at 107.080 on Friday."Europe is exposed to large risks around energy dependency, a cost of living crunch on the consumer, and fragmentation risk. This spells euro/dollar lower," said analysts at Citi.The Australian dollar slipped with the mood on Friday, but seems set to eke out a steady week, with help from a infrastructure-led stimulus program announced in China that traders hope will boost demand for raw materials.It last sat 0.3% lower at $0.6820. The New Zealand dollar fell 0.2% to $0.6167.Sterling also looks set to have navigated a week of British political chaos relatively well. It is down 0.7% on the week, but held most of a Thursday bounce after Prime Minister Boris Johnson quit, ending uncertainty about his future.The pound last bought $1.2015 and was on course for its best week in more than two years on the ailing euro .While surging energy prices look to take the wind out of confidence and growth in Europe, investors have also been worried about the U.S. economy, even though the most recent data has been better than expectations.U.S. non-farm payrolls figures (USNFAR=ECI) are the next indicator, due at 1230 GMT, with economists forecasting some 268,000 jobs were added in June.A stronger figure could allay some recession worries, but would probably add to rate hike bets and could lift the dollar."Stronger payrolls gains would underpin expectations for an ever more aggressive Fed policy stance," said Commonwealth Bank of Australia strategist Carol Kong in Sydney.Deutsche Bank strategist Alan Ruskin also said that merely meeting expectations would be enough to contribute to talk of "'U.S. exceptionalism' in the face of a global energy shock."That can keep the dollar well bid, "with euro/dollar parity the most obvious multi-day/week target," he said.The dollar has also been standing tall in emerging markets, driving several Asian currencies to multi-year lows this week and India's rupee to a record trough.Bitcoin has mounted a semblance of a recovery, meanwhile, gaining nearly 14% on the week to $22,000.========================================================Currency bid prices at 0503 GMTAll spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Tom Westbrook, additional reporting by Vidya Ranganathan
Editing by Sam Holmes, Shri Navaratnam and Kim CoghillOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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NEW YORK, Sept 21 (Reuters) - The Federal Reserve raised its target interest rate by three-quarters of a percentage point to a range of 3.00%-3.25% on Wednesday and signaled more large increases to come in new projections showing its policy rate rising to 4.40% by the end of this year before topping out at 4.60% in 2023 to battle continued strong inflation.The U.S. central bank's quarterly economic projections, meanwhile, showed the economy slowing to a crawl in 2022, with year-end growth at 0.2%, rising to 1.2% in 2023, well below the economy's potential. The unemployment rate is projected to rise to 3.8% this year and 4.4% in 2023. Inflation is seen slowly returning to the Fed's 2% target in 2025.Fed Chair Jerome Powell at a press conference after the Fed announced raised its benchmark rate by 75 basis points for a third straight meeting, said achieving a soft landing is "very challenging," and policymakers are unsure if the process of tightening policy will lead to a recession or how deep any contraction might be.Register now for FREE unlimited access to Reuters.comSTORY: read more MARKET REACTION:STOCKS: The S&P 500 (.SPX) seesawed and was last off 52.18 points, or 1.35%, at 3,803.75BONDS: Benchmark 10-year note yields briefly spiked then fell . The price rose 12/32 to yield 3.526%, from 3.573% late on Tuesday. The 2-year note yield surged. The note was last down 5/32 in price to yield 4.0441%, up from 3.964%.FOREX: The dollar index was up 0.998%, with the euro down 1.24% to $0.9846.COMMENTS:KEVIN NICHOLSON, GLOBAL FIXED INCOME CIO, RIVERFRONT INVESTMENT GROUP, VIRGINIA"The Fed’s hawkish comments reiterated its commitment to getting inflation under control. With the median dot plot showing 4.375% by year-end, we believe that equity markets will be capped in the near term. The path of equities will depend on earnings growing because with interest rates rising at such a rapid rate we do not see multiple expansion. While the Fed is attempting to squash inflation through rate hike, the process is making fixed income a relevant asset once again.""Until there is a major slowdown in inflation the Fed will continue to hike. Financial markets are finally getting the message that the Fed will not blink, so we believe that there are more hikes to come. No one knows what the actual terminal rate will be, so in the meantime it is like a long road trip where the kids keep asking….are we there yet?CHRIS ZACCARELLI, CHIEF INVESTMENT OFFICER, INDEPENDENT ADVISOR ALLIANCE, CHARLOTTE, NC“To the extent the market trades down, then they are hearing Powell correctly - the Fed is going to raise rates until inflation comes back down and they will cause a recession in the process.”“To the extent the market trades higher, it is based on the hope that inflation will come down before the Fed causes pain to the economy — an extremely unlikely Fairy Tale ending.”PAUL NOLTE, PORTFOLIO MANAGER, KINGSVIEW INVESTMENT MANAGEMENT, CHICAGO"Fed commentary was pretty hawkish. Looking at 30-year bonds, the rise in price (drop in yields) is an indication that the markets are seeing a much higher chance of recession over the coming 12 months. Markets are/will be very volatile, so I’m sitting on the sidelines and watching until probably Friday or Monday before moving any money around."BRIAN COULTON, CHIEF ECONOMIST , FITCH RATINGS"The third 75 bps hike in a row and the maintenance of references to broad based price pressures and future hikes ahead underscore how the Fed is now singularly focused on trying to control inflation. Based on our expectation that the Fed will take the rates to 4% by December, this will be one of the fastest episodes of Fed tightening in the post war period."MATT STUCKY, SENIOR PORTFOLIO MANAGER, NORTHWESTERN MUTUAL WEALTH MANAGEMENT COMPANY, MILWAUKEE, WISCONSIN"The big takeaway here is not so much the decision to raise by 75 basis points. In terms of discussion in the statement, we have been thinking about the Federal Reserve policy as moving in one direction but increasingly, as they've moved into hawkish territory as markets have started to pencil in a terminal fed funds rate in 2023 approaching four and a half percent, that we might start to get at least an acknowledgement that the risks are becoming two-sided in terms of monetary policy stance. Certainly there are risks of inflation, but the opposite side of that is there are risks to the overall economy...there continues to be, at least so far, not any kind of concrete acknowledgement that risks are growing to the forward economic outlook... The Fed remains singularly focused on fighting inflation. So this is a pretty hawkish 75 basis point increase when it comes to how the text reads."LINDSEY BELL, CHIEF MARKETS & MONEY STRATEGIST, ALLY"The 75 basis points increase was expected. What the market is reacting to is the update to expectations for rates for the out-years. They moved significantly higher ... The market would've liked to see the number come down in 2023. What it's telling us is that the Fed is expecting to rates to continue to move higher into 2023.""The silver lining is that six members think rates are going to stay steady and one thinks they can come down in 2023.""Now the question is what is the market is going to price in here. What do we really believe will happen? There's a camp that says whatever the Fed guides to has typically been the floor and not the ceiling. This communication is basically signaling that the Fed's going to continue to be aggressive and remain hawkish. That's going to continue to put pressure on stocks. It doesn't leave a lot of room to the upside for investors going into the end of the year.""Right now it doesn't feel great because the Fed's going to stay hawkish. They're not backing down. Where we end the day is going to be predicated on Powell's speech."BRIAN JACOBSEN, SENIOR INVESTMENT STRATEGIST, ALLSPRING GLOBAL INVESTMENTS, MENOMONEE FALLS, WISCONSIN“The unusual has become usual. Not only did the Fed hike another unusually large 75 bps today, it is basically saying it will do it again in November. Thinking that these types of hikes aren’t going to cause pain down the road is the triumph of hope over experience.”ELLEN HAZEN, CHIEF MARKET STRATEGIST, F.L.PUTNAM INVESTMENT MANAGEMENT, WELLESLEY, MASSACHUSETTS“The stock market is taking this in stride, it did go down a little bit but it’s not too dramatic. The updated statement of economic projections suggest that the Fed is reluctantly, slowly, catching up to reality in terms of their anticipation for everything – for inflation, for core inflation, for GDP. You look at the difference between December, to march, to June, to now, in all of those metrics and what they are projecting and they are finally catching up with what the market has already known for quite some time. So perhaps the equity market was a little bit optimistic they might soften the language, which they did not do, but in general most of this was priced into the equity market."A lot of times you see (the market) do something on the day of and then something else the next day, investors might want to reserve judgment until tomorrow.”THOMAS HAYES, CHAIRMAN AND MANAGING MEMBER, GREAT HILL CAPITAL, NYC“This is as hawkish as it gets and the only way to back off it is in the press conference if Powell says we're going to remain data dependent.”“As we found through history, the initial knee jerk reaction tends to be wrong. But markets really do want to see Powell signal some flexibility moving forward in order to kind of stabilize the market. So I think you want to hear him say 'data dependent,' 'flexible,' but at the same time stand firm in terms of their commitment to bring inflation down.”RYAN DETRICK, CHIEF MARKET STRATEGIST, CARSON GROUP, OMAHA“It was a rather hawkish 75 basis point hike, and (the Fed) left the door wide open for even more rate hikes before the end of the year.”“The dot plots confirm more hikes are coming than were previously expected.“The Fed is willing to produce a good deal of pain to the economy, and potentially to the stock market in order to rein in the runaway inflation we’ve been seeing this year.”“The economic expectations from the Fed are quite disappointing. The economy is quickly slowing.”“Yields and the dollar both moved higher on the hawkish Fed stance, pressuring stocks once again.”Register now for FREE unlimited access to Reuters.comCompiled by the U.S. Finance & Markets Breaking News teamOur Standards: The Thomson Reuters Trust Principles.
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Interest Rates
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Pound and U.S. dollar banknotes are seen in this illustration taken January 6, 2020. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comLONDON, June 27 (Reuters) - Sterling fell versus the euro on Monday andflattened against the dollar amid more post-Brexit tensions and persistent economic growth worries in Britain.British Prime Minister Boris Johnson said on Monday parliament could pass legislation this year to scrap some of the rules on post-Brexit trade with Northern Ireland that his government agreed in 2020 with the European Union. That would set up further clashes with the European Union and potentially harm sterling, analysts said. read more The legislation, which would unilaterally replace parts of that bilateral deal - known as the Northern Ireland protocol - is due to be sent back to parliament's lower house for a second reading. That is one of the stages of the law's passage through the legislature.Register now for FREE unlimited access to Reuters.comRisk-sensitive sterling had risen in London morning to a two-week high versus the dollar, lifted by an equity market rally. But by 1110 GMT, it was flat at $1.2273.Against the euro, sterling fell 0.3% to 86.24 pence ."Although some hawkish remarks from Bank of England officials have lent support to the pound recently, UK growth concerns remain a thorn in the side of sterling investors," said Jane Foley, head of forex strategy at Rabobank in London."If the UK slips closer to a trade war with the EU over the Northern Ireland protocol, these fears would be accentuated," she said.BoE Chief Economist Huw Pill said on Friday that interest rates would remain the central bank's main monetary policy tool as it prepares to start selling bonds, reversing part of its economic stimulus push. read more The central bank began raising borrowing costs in December last year, increasing Bank Rate to 1.25% from a record low of 0.1% in an attempt to tackle inflation, which rose to a 40-year high of 9.1% in May.Recession fears and political scandals have also contributed to weakening sterling, down almost 10% against the dollar since the beginning of the year.Johnson's Conservatives lost two parliamentary seats on Friday, a new blow to Britain's prime minister, whose authority has been battered by revelations of breaking lockdown rules at his Downing Street office during the COVID-19 pandemic. read more Register now for FREE unlimited access to Reuters.comReporting by Joice Alves; Editing by Susan Fenton and Chizu NomiyamaOur Standards: The Thomson Reuters Trust Principles.
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United Kingdom Business & Economics
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A polar bear sow and two cubs are seen on the Beaufort Sea coast within the 1002 Area of the Arctic National Wildlife Refuge.U.S. Fish and Wildlife Service | ReutersA coalition of environmental groups this week sued the Biden administration in an effort to stop more than 3,500 permit applications from energy companies to drill for oil and gas on federal lands.The groups argued the administration hasn't considered the damage that climate-changing carbon dioxide emissions from drilling does to endangered species, and that permit approvals in Wyoming and New Mexico violated federal laws including the Endangered Species Act.The groups said burning fossil fuels from drilling is heating the planet and damaging imperiled species like Hawaiian songbirds, desert fish, ice seals and polar bears. The administration's approved permits, they said, will release up to 600 million metric tons of greenhouse gas emissions.The lawsuit is the latest attempt by environmentalists to pressure the administration to halt new drilling permits. Earlier in his term, Biden sought to commit to his campaign promise to suspend new drilling on federal lands, but was thwarted after legal challenges from GOP-led states and the oil industry. "Fossil fuels are driving the extinction crisis, and the Bureau of Land Management is making things worse by failing to protect these imperiled species," Brett Hartl, government affairs director at the Center for Biological Diversity, said in a statement.The Center for Biological Diversity, WildEarth Guardians and the Western Environmental Law Center filed the lawsuit against the Bureau of Land Management in the District Court of Washington, D.C., on Wednesday.An Interior Department spokesman declined to comment on the litigation.As U.S. energy prices soar, the Biden administration has encouraged companies to increase drilling, arguing they can produce more by using some of the 9,000 unused and available permits. This month, the administration is set auction off drilling leases in states including Colorado, Montana, New Mexico, Nevada, North Dakota, Utah and Wyoming.Oil and gas industry representatives said that multiple rounds of environmental analysis are conducted before an oil and gas permit on public land is issued, and that environmental groups have several opportunities to file suit during various stages of planning.Kathleen Sgamma, president of the Western Energy Alliance, a trade group that represents the oil and gas industry, said the climate groups "will not be satisfied until federal oil and natural gas is shut down completely, yet that option is not supported by law.""They're trying to use the courts to deny Americans energy and drive up prices because they can't convince Congress to change the law," Sgamma said in a statement. "Shutting down federal oil and natural gas does nothing to address climate change, but merely shifts the production to private lands or overseas." The groups argued that the Bureau of Land Management violated the National Environmental Policy Act by failing to consider how approving the permits would impact the environment. They also said officials failed to stop "unnecessary and undue" damage to federal lands as required by the Federal Land Policy and Management Act."The Bureau of Land Management has admitted that continued oil and gas exploitation is a significant cause of the climate crisis, yet the agency continues to recklessly issue thousands of new oil and gas drilling permits," said Kyle Tisdel, climate and energy program director with the Western Environmental Law Center.
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Energy & Natural Resources
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- Summary
- Australian Indigenous leaders call for a week of silence
- Reconciliation is dead, says one Indigenous leader
- More than 60% of Australians voted 'No' in referendum
SYDNEY, Oct 15 (Reuters) - Australian Indigenous leaders called on Sunday for a week of silence and reflection after a referendum to recognise First Peoples in the constitution was decisively rejected.
More than 60% of Australians voted "No" in the landmark referendum on Saturday that asked whether to alter the constitution to recognise Aboriginal and Torres Strait Island people with an Indigenous advisory body, the "Voice to Parliament", that would have advised parliament on matters concerning the community.
Australia's first referendum in almost a quarter of a century needed a national majority and majorities in at least four states to pass. All six states rejected the proposal.
"This is a bitter irony," the Indigenous leaders said in a statement. "That people who have only been on this continent for 235 years would refuse to recognise those whose home this land has been for 60,000 and more years is beyond reason."
They said they would lower the Aboriginal and Torres Strait Island flag to half-mast for the week and urged others to do the same.
The outcome is a major setback for reconciliation efforts with the country's Indigenous community and damages Australia's image in the world regarding how it treats First Nations people.
Unlike other nations with similar histories, such as Canada and New Zealand, Australia has not formally recognised or reached a treaty with its First Peoples.
Aboriginal and Torres Strait Island people make up 3.8% of Australia's 26 million population and have inhabited the country for about 60,000 years. But they are not mentioned in the constitution and the country's most disadvantaged people by most socioeconomic measures.
"It's very clear that reconciliation is dead," Marcia Langton, an architect of the Voice, said on NITV. "I think it will be at least two generations before Australians are capable of putting their colonial hatreds behind them and acknowledging that we exist."
Reconciliation Australia, an Indigenous body, said the community was left to grapple with the "ugly acts of racism and disinformation" that they said were a feature of the debate.
Australian Indigenous leader and former national rugby union player Lloyd Walker said the path to reconciliation seemed difficult now but the community needed to keep fighting.
"We can say it got out-voted but there was still 40% of the people that wanted it. Years and years ago we wouldn't have that percentage for sure," Walker said.
'REFLECT HARD'
Prime Minister Anthony Albanese staked significant political capital on the Voice referendum, but his critics say it was his biggest misstep since coming to power in May last year.
Opposition leader Peter Dutton said it was a referendum "that Australia did not need to have" and that it only ended up dividing the nation.
One of the biggest reasons for the loss was a lack of bipartisan support, with leaders of the major conservative parties campaigning for the "No" vote.
No referendum has passed in Australia without bipartisan backing.
"Much will be asked of the role of racism and prejudice against Indigenous people in this result," leaders said in the statement. "The only thing we ask is that each and every Australian who voted in this election reflect hard on this question."
Read Next
Additional reporting by Cordelia Hsu and Jill Gralow; Editing by Chizu Nomiyama, Muralikumar Anantharaman and William Mallard
Our Standards: The Thomson Reuters Trust Principles.
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Australia Business & Economics
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A woman holds Euro banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/IllustrationRegister now for FREE unlimited access to Reuters.comSINGAPORE, July 8 (Reuters) - The Japanese yen rose by nearly half a percent against the U.S. dollar on Friday, in what appeared to be safe-haven buying in the minutes after news that former prime minister Shinzo Abe had been shot.The yen rose as far as 135.33 per dollar after news that Abe had been taken to hospital after collapsing while delivering a speech in the western city of Nara, after gunshot-like sounds, according to reports by public broadcaster NHK.Kyodo News said the former premier, architect of the Abenomics brand of reforms, was unconscious and appeared to be in cardiac arrest. read more Register now for FREE unlimited access to Reuters.comThe euro was pinned at a 20-year low, licking its wounds at the end of its worst week in two months as investors braced for Europe to tip in to recession, while markets awaited U.S. jobs data to set the next direction for the dollar.The euro is down more than 2% this week on fears that gas shortages loom in Europe and economic growth will suffer. It hit a two-decade trough of $1.0144 overnight and is barely clinging on above parity, last buying $1.0161.The euro's slide has vaulted the U.S. dollar index to a two-decade high of 107.270 this week, and the index was last just below that level and up 0.04% in Asia at 107.02."Europe is exposed to large risks around energy dependency, a cost of living crunch on the consumer, and fragmentation risk. This spells euro/dollar lower," said analysts at Citi.The Australian dollar rose 0.3% on Friday to $0.6850, scraping from a two-year low of $0.6762, with help from a infrastructure-led stimulus program announced in China that traders hope will boost demand for raw materials.Sterling also looks set to have navigated a week of British political chaos relatively well. It is down 0.3% on the week, but bounced a bit overnight when Prime Minister Boris Johnson quit, ending uncertainty about his future.The pound last bought $1.2053 and was on course for its best week in more than two years on the ailing euro .The New Zealand dollar rose 0.3% to $0.6192 and looks set for a steady week. Growing unease at the world's economic outlook has steadied a sliding Japanese yen , as investors look for safety.While surging energy prices look to take the wind out of confidence and growth in Europe, investors have also been worried about the U.S. economy, even though the most recent data has been better than expectations.U.S. non-farm payrolls figures (USNFAR=ECI) are the next indicator, due at 1230 GMT, with economists forecasting some 268,000 jobs were added in June.A stronger figure could allay some recession worries, but would probably add to rate hike bets and could lift the dollar."Stronger payrolls gains would underpin expectations for an ever more aggressive Fed policy stance," said Commonwealth Bank of Australia strategist Carol Kong in Sydney.Deutsche Bank strategist Alan Ruskin also said that merely meeting expectations would be enough to contribute to talk of "'U.S. exceptionalism' in the face of a global energy shock."That can keep the dollar well bid, "with euro/dollar parity the most obvious multi-day/week target," he said.The dollar has also been standing tall in emerging markets, driving several Asian currencies to multi-year lows this week and India's rupee to a record trough.Bitcoin has mounted a semblance of recovery, meanwhile, gaining nearly 15% on the week to $22,100.All spotsTokyo spotsEurope spotsVolatilitiesTokyo Forex market info from BOJRegister now for FREE unlimited access to Reuters.comReporting by Tom Westbrook, additional reporting by Vidya Ranganathan
Editing by Sam Holmes & Shri NavaratnamOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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The seized Russian-flagged oil tanker Pegas is seen anchored off the shore of Karystos, on the Island of Evia, Greece, April 19, 2022. REUTERS/Vassilis TriandafyllouRegister now for FREE unlimited access to Reuters.comSummaryCompaniesMontepeque helped design dominant oil pricing mechanismSays Russia could stop selling oil, ask for higher bidsSays cap would lead to stampede for cheap crudeLONDON, July 18 (Reuters) - Market forces would quickly undermine any scheme to impose a price cap on Russian oil, one of the architects of benchmark global oil prices said, even if the United States and the European Union can convince top Asian importers to take part.Many countries have imposed sanctions on Russia following its invasion of Ukraine, which Moscow calls a "special military operation".The measures have failed in one of their prime aims: to reduce Russia’s massive revenues from natural resource exports, as international oil prices climbed to 14-year highs shortly after the invasion began on Feb. 24. They remain above $100 a barrel.Register now for FREE unlimited access to Reuters.comWestern leaders have proposed addressing that through an oil price cap to limit how much refiners and traders can pay for Russian crude.The history of similar attempts to limit the price suggests that a cap would lead to higher, not lower prices, and to the emergence of a grey market for Russian oil, said Jorge Montepeque, who is credited with reforming some of the most important benchmarks for pricing oil."All these mandates to fix prices have been tried before during high inflation," Montepeque said."The U.S. tried to fix prices for oil in the 1970s, the UK tried fixed forex prices in the 80s, Mexico tried fixed tortillas prices. And then - boom! - the market settles. It is a waste of time."U.S Treasury Secretary Janet Yellen is touring Asia to try to persuade more nations to join the cap scheme. read more It is designed to prevent Russian President Vladimir Putin from generating more revenues for the war in Ukraine, while allowing Russian oil to flow to avoid a further price spikes and wider inflation.Brazil, China, India and some African and Middle Eastern countries have refused to condemn the Russian invasion and have increased imports of Russian energy, which sells at deep discounts to global benchmarks because many European refiners have stopped buying Russian oil since the invasion.Yellen has said China and India stood to benefit from the cap as they could buy Russian oil even more cheaply than they do now. Little progress has been reported to date on the design of the scheme or in enlisting the biggest buyers of Russian oil."Let's assume, everyone - every possible buyer in the world - agrees," Montepeque said."Then Russia says: 'I am not selling a drop of oil. Bid me!' Immediately the system breaks down as buyers have an alternative to the market price of oil."Montepeque was head of market reporting at commodity price reporting agency Platts, a unit of McGraw Hill Financials Inc, between 2002-2016.He has been credited with creating Platts' market-on-close (MOC) pricing mechanism, better known simply as "the window", which every working day prices billions of dollars of oil sales, futures and other derivatives, and which has become the dominant oil price mechanism.Platts and its rivals, including privately-held Argus Media and ICIS, provide prices for opaque over-the-counter commodities markets.Those prices are used in formulas to settle much of the world’s global trade in raw materials.After leaving Platts in 2016, Montepeque later worked for Italy's Eni and helped set up another pricing agency.BUYERS' STAMPEDEGlobal oil demand has recovered quickly from the pandemic, leaving the oil market short of supply as producers struggle to recover from a lack of investment in 2020-2021.Demand stands at around 100 million barrels per day and leading members of the Organization of the Petroleum Exporting Countries Saudi Arabia and the United Arab Emirates are pumping at near capacity. Russia produces around 10 million bpd or 10% of global oil.Montepeque says capping prices when markets are so tight is particularly difficult."Look at Iran. If there is a differential between the market price and your price - demand will always be there," he says.Iran was forced to reduce exports to nearly zero when under pressure from U.S. sanctions, the world faced a glut of oil and refiners had plenty of alternative suppliers they could use.But as demand recovered and supply lagged, Iran boosted exports of crude and fuel to China and other Asian consumers to well above 1 million bpd.Even if Russia agreed to supply buyers paying at the limit set by the price cap scheme, buyers would challenge the system, Montepeque said, as they would have a strong financial incentive to buy cheaper oil to maximise profits or to resell it."Someone like India will say - it is my million barrels," he said. "I need it more than anyone else. So buyers will bid this oil up themselves. There would be a queue of people all the way to St. Petersburg trying to buy cheap oil."Register now for FREE unlimited access to Reuters.comReporting by Dmitry Zhdannikov; editing by Barbara LewisOur Standards: The Thomson Reuters Trust Principles.
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Energy & Natural Resources
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Australia’s prime minister confirmed Thursday he will visit China later this year after talks with China’s premier, who said Beijing was ready to resume bilateral exchanges after years of friction.
The announcement by Australian Prime Minister Anthony Albanese on the sidelines of a Southeast Asia summit in Indonesia came after a years-long break in relations over political and economic issues including Chinese sanctions on Australian imports.
“I… confirmed the invitation from President Xi,” Albanese told reporters after talks with Chinese Premier Li Qiang, adding he “will visit China later this year at a mutually agreeable time”.
The trip would be the first to China by an Australian prime minister since 2016.
Li told Albanese China was ready to work with Australia to resume exchanges in different areas, Chinese state news agency Xinhua reported, without mentioning specific areas.
He said the Asia-Pacific region was the shared home of both countries and Beijing would work with Australia to safeguard peace and stability in the region, according to Xinhua.
China’s foreign ministry spokesperson Mao Ning said Beijing welcomed the planned visit and that “a healthy and stable China-Australia relationship serves the fundamental interests of the two peoples”.
Albanese thanked President Xi Jinping for the invitation and said his talks with Li were “constructive” and “positive”, adding the two countries needed more dialogue to improve relations.
“This was an important meeting. I told premier Li that we would continue to cooperate where we can, disagree where we must and engage in our national interest,” he said.
Albanese last met Xi on the sidelines of the G20 summit on the Indonesian resort island of Bali in November.
Australian delegation in China
Australia sent a delegation of industry, government, academic, media and arts representatives to Beijing on Thursday for talks with their Chinese counterparts.
Such exchanges were stopped in 2020 and their resumption is the latest sign of a thaw.
Australian Foreign Minister Penny Wong said last week those renewed discussions illustrated “another step towards increasing bilateral engagement and stabilising our relationship with China”.
China was angered by Australia’s legislation against overseas influence operations, its ban on Chinese telecoms giant Huawei from 5G contracts, and its call for an independent investigation into the origins of the Covid-19 pandemic.
But relations appear to have warmed since the centre-left government in Canberra adopted a less confrontational approach to China following Albanese’s election victory last year.
However, issues remain in the relationship.
Australia expressed “deep concerns” last month about the “ongoing delays” in the case of an Australian academic jailed in China on espionage charges.
Chinese-born Australian Yang Jun has been jailed since 2019 and said in a note shared with friends and family last month that he feared dying in prison if he did not receive medical attention.
Beijing said it was handling his case properly, and that it was “a country ruled by law”.
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Australia Business & Economics
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Europe needs to prepare immediately for Russia to turn off all gas exports to the region this winter, according to the head of the International Energy Agency, who has called on governments to work on reducing demand and keeping nuclear power plants open.Fatih Birol said reductions in supplies in recent weeks the Kremlin has attributed to maintenance work could, in fact, be the beginning of wider cuts designed to prevent the filling of storage facilities in preparation for winter, as Russia seeks to gain leverage over the region.“Europe should be ready in case Russian gas is completely cut off,” he said in an interview with the Financial Times. “The nearer we are coming to winter, the more we understand Russia’s intentions.“I believe the cuts are geared towards avoiding Europe filling storage, and increasing Russia’s leverage in the winter months.”EU countries are racing to refill storage sites, with Germany hoping to reach 90% of capacity by November. Its stores are only half full.Member states have also been working to reduce their reliance on Russian fossil fuels, by sourcing gas from other countries, including the US, and by speeding up the switch to renewable energy, although officials have conceded that the race to phase out Russian oil and gas would mean burning more coal and keeping nuclear plants going.Birol said emergency measures taken by European governments to reduce energy demand had probably not gone far enough, and urged countries to work on preserving energy supplies.“I believe there will be more and deeper demand measures as winter approaches,” Birol said. He added that gas supplies may need to be rationed, if Russia were to further reduce gas exports.Moscow has reduced or even cut off gas deliveries to several EU countries in recent weeks, in response to their decision to impose sanctions on the Kremlin over its invasion of Ukraine.Russian gas supplies to Europe received through the Nord Stream 1 pipeline – which runs under the Baltic Sea to Germany – have been falling.Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDeskLast week, Russia’s state-controlled energy company Gazprom announced the second cut to gas transported via the pipeline, reducing supplies to just 40% of capacity.The Italian energy firm Eni has reported a halving of Gazprom’s gas supplies to Italy, which gets about 40% of its imported gas from Russia. Meanwhile, the French network operator GRTgaz said France had not received any Russian gas via Germany since the middle of May.Kremlin spokesperson Dmitry Peskov last week blamed maintenance issues for the reductions in supply, a reference to earlier comments saying Russia was unable to secure the return of equipment sent to Canada for repairs.
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Energy & Natural Resources
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US, allies in talks on naval task force to protect shipping in Red Sea after Houthi attacks
After three vessels were struck by missiles fired by Iranian-back Houthis in Yemen, the White House says the U.S. may establish a naval task force to escort commercial ships in the Red Sea
WASHINGTON -- The White House said Monday that the U.S. may establish a naval task force to escort commercial ships in the Red Sea, a day after three vessels were struck by missiles fired by Iranian-back Houthis in Yemen.
National security adviser Jake Sullivan said the U.S. has been in active conversations with allies about setting up the escorts though nothing is finalized, describing it as a “natural” response to that sort of incident.
On Sunday, ballistic missiles fired by Yemen’s Houthi rebels struck three commercial ships, while a U.S. warship shot down three drones in self-defense during an hourslong assault, the U.S. military said. It marked an escalation in a series of maritime attacks in the Mideast linked to the Israel-Hamas war.
“We are in talks with other countries about a maritime task force of sorts involving the ships from partner nations alongside the United States in ensuring safe passage,” Sullivan told reporters. He noted similar task forces are used to protect commercial shipping elsewhere, including off the coast of Somalia.
The Houthi attacks imperil traffic on one of the world’s most vital shipping lanes and with it global trade overall. The U.S. Energy Information Administration says 8.8 million barrels of oil a day are shipped through the Red Sea and the narrow straits of the Bab al-Mandab within range of the Houthis, making it one of world trade’s most crucial chokepoints. The ships carry oil and natural gas from the Gulf to Europe, the United States and China.
The Red Sea and Bab al-Mandab are also part of a vital route for commercial shipping overall, carrying millions of tons of agricultural products and other goods to markets yearly.
Sullivan said that while the Houthis had “their finger on the trigger," the group's Iranian sponsors were ultimately responsible.
“The weapons here are being supplied by Iran,” Sullivan said. “Iran, we believe, is the ultimate party responsible for this.”
Sullivan said the U.S. does not believe that all three of the ships struck by the Houthis had ties to Israel, saying, “It goes to show you the level of recklessness that the Houthis are operating.”
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AP writers Jon Gambrell and Ellen Knickmeyer contributed reporting.
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Middle East Business & Economics
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Australians have resoundingly rejected a proposal to recognise Aboriginal people in its constitution and establish a body to advise parliament on Indigenous issues.
Saturday’s voice to parliament referendum failed, with the defeat clear shortly after polls closed.
To succeed, the yes campaign – advocating for the voice – needed to secure a double majority, meaning it needed both a majority of the national vote, as well majorities in four of Australia’s six states.
The defeat will be seen by Indigenous advocates as a blow to what has been a hard fought struggle to progress reconciliation and recognition in modern Australia, with First Nations people continuing to suffer discrimination, poorer health and economic outcomes.
More than 17 million Australians were enrolled for the compulsory vote, with many expats visiting embassies around the world in the weeks leading up to Saturday’s poll.
The vote occurred 235 years on from British settlement, 61 years after Aboriginal Australians were granted the right to vote, and 15 years since a landmark prime ministerial apology for harm caused by decades of government policies including the forced removal of children from Indigenous families.
The referendum had been a key promise that Labor party took to the federal election in 2022, when it returned to power after years of conservative rule.
Support for the voice to parliament had been strong in the early months of 2023, polling showed, but subsequently began a slow and steady decline.
All major polls had foreshadowed that the no campaign would succeed and the voice would be rejected. Nationwide support for the voice was hovering at about 40% in the week before the vote, with coverage of the campaign being overshadowed by the outbreak of war in the Middle East in the crucial final days.
The concept for the advisory body, which would have included Indigenous representatives from each of Australia’s six states and two territories voted in by their local Indigenous electors, was developed and endorsed by Aboriginal and Torres Strait Islander leaders in 2017. A majority of Indigenous voters supported the proposal, according to polling.
It was envisaged to provide Australia’s government with non-binding advice on issues affecting about 4% of the population who identify as Indigenous.
There is an eight-year gap in life expectancy for Indigenous Australians compared with non-Indigenous Australians, a suicide rate twice the national average, and comparatively poorer outcomes for health, education and infant mortality.
While such an advisory body could have been created through legislation, the proposal was designed to enshrine its existence in the constitution so it could not be removed by future governments.
The referendum question, to amend Australia’s constitution to recognise the first peoples of Australia by establishing Aboriginal and Torres Strait Islander voice to parliament, was deliberately vague. The failure of Australia’s previous referendum in 1999 – to become a republic and acknowledge Indigenous ownership – was seen to have failed because it put forward a specific model to voters.
Exactly what the voice advisory body would look like and how it would function were to be determined only once the concept had won approval.
Opposition to the voice seized on this ambiguity, adopting a campaign slogan of “if you don’t know, vote no”.
But reasons for the decline in support were broad.
The prime minister, Anthony Albanese, and his ministers were prominent faces of the yes movement, and while Labor did not lead the campaign, the government’s focus on the referendum was seen alongside its handling of other national issues.
It weathered accusations that it championed the voice push while failing to deliver tangible improvements for citizens facing cost of living pressures and a housing crisis hurt the yes side.
Meanwhile, the Liberal party in opposition formally backed the no vote, with senior Indigenous members speaking out against the voice.
Arguments against the proposal included that no such representative body was needed, that it was introducing race into the constitution, and that the voice would divide the nation.
Opposition also emerged from the far left of progressive politics and a minority of grassroots Indigenous activists, who rejected the voice while calling for more significant reconciliation measures, including a treaty with Aboriginal Australians.
Indigenous advocates from each side of the debate reported receiving a surge in racist abuse and prominent Aboriginal personalities across Australian media also complained of the toxic nature of debate and online vitriol.
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Australia Business & Economics
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Maya Levin for NPR
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Rimah Shahada poses in her daughter Aseel's bedroom in Qalandiya refugee camp in Ramallah, West Bank Nov. 22.
Maya Levin for NPR
Rimah Shahada poses in her daughter Aseel's bedroom in Qalandiya refugee camp in Ramallah, West Bank Nov. 22.
Maya Levin for NPR
LONDON and RAMALLAH, Israeli-occupied West Bank — Rimah Shahada's living room is filled with deflated balloons.
For the past week, she'd been preparing a homecoming celebration — with balloons, stuffed animals and welcome home cards — for her 17-year-old daughter, Aseel, who's been in an Israeli prison hospital since Nov. 11. Aseel was shot in the leg that day by Israeli soldiers, who said she lunged at them with scissors at a military checkpoint near the refugee camp where the Shahada family lives, in the Israeli-occupied West Bank.
The teenager is one of thousands of people arrested in the West Bank and East Jerusalem since Hamas' Oct. 7 attack on Israel, according to Israeli prison service figures, Palestinian officials and human rights groups. Many of them, like Shahada, are being held without charge or trial. Israel released about 240 Palestinian detainees and prisoners, in exchange for over 100 hostages freed by Hamas, as part of a weeklong truce that ended Friday.
Maya Levin for NPR
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Rimah Shahada holds an image of her daughter Aseel on her phone in Qalandiya refugee camp in Ramallah, West Bank Nov. 22.
Maya Levin for NPR
Rimah Shahada holds an image of her daughter Aseel on her phone in Qalandiya refugee camp in Ramallah, West Bank Nov. 22.
Maya Levin for NPR
"My hope's all gone now, sadly," says Rimah Shahada, 37. An NPR team had visited her home in the Qalandiya refugee camp near Ramallah last week, and reconnected with her by phone on Friday.
"We can't reach her, no one tells us anything about her," Shahada says of her daughter. "And now they're hitting Gaza again. God be with the martyrs in Gaza. I hope this war ends."
When Hamas militants stormed parts of southern Israel on Oct. 7, they killed about 1,200 people and took more than 240 hostages back to the Gaza Strip, according to Israeli officials. Since then, Israel's bombardment and invasion of Gaza have killed more than 15,000 Palestinians there, according to health officials in Gaza. Both Hamas and Israel say a prime aim is to free the prisoners or captives held by the other side. After the past week's swaps, Israel estimates 137 hostages are still held in Gaza.
The resumption of fighting between Israel and Hamas has dashed hopes of families like the Shahadas for the further release of the more than 10,000 Palestinians who remain in Israeli jails.
Aseel Shahada's name had been published on an Israeli government database of Palestinian prisoners eligible for release as part of the temporary truce with Hamas — which gave her family hope that her release was imminent. But only about 240 of the 350 names published were released before the exchanges stopped Friday.
Another woman from their refugee camp was among those released in the past week. Shahada's name was just after hers on the list. Her mother believes that if the truce had held for one more day, she would have been reunited with her daughter.
"The neighbor's daughter came out, but my daughter didn't," Rimah Shahada says.
Maya Levin for NPR
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Daily life in Qalandiya refugee camp in Ramallah, West Bank, on Nov. 22.
Maya Levin for NPR
Daily life in Qalandiya refugee camp in Ramallah, West Bank, on Nov. 22.
Maya Levin for NPR
Since Oct. 7, Israel has arrested 12 times more Palestinians than it has released as part of prisoner exchanges
Shahada's family says the teenager was upset about the Gaza war, but denies she was ever violent. They say they don't know how she could have gotten a weapon on her way home from school that day. They haven't been able to talk to her since the incident.
As of Friday, Israel was holding 7,677 Palestinians as what it deems security inmates, and another 2,873 Palestinians as administrative detainees — which means they can be held without charge, indefinitely. More than 1,500 of the arrests were made in November alone. These figures were sent to NPR by HaMoked, an Israeli nonprofit that offers legal aid to Palestinians living under occupation. It draws data directly from Israel's prison service.
The top Palestinian official overseeing prisoners' affairs, Qadoura Fares, who belongs to the Fatah party, Hamas' rival, says more than 3,000 Palestinians have been arrested in the West Bank and East Jerusalem in total since Oct. 7.
"The majority of them, 90% of them, are victims — not prisoners," Fares told NPR in an interview last week at his office in Ramallah. He says most of them are minors accused of nonviolent offenses.
"These are people Israel has decided to arrest for endangering Israeli security — without clarifying why, how, with whom," Fares says.
Fares accuses Israel of stepping up arrest raids during the latest Gaza war, in order to intimidate Palestinian communities and also have more detainees to negotiate with in prisoner exchanges.
Maya Levin for NPR
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A Palestinian official overseeing prisoner affairs, Qadoura Fares, sits in his office in Ramallah, West Bank, on Nov. 22. Fares was also released as part of a prisoner exchange deal in 1994 after being held in prison for 13 years.
Maya Levin for NPR
A Palestinian official overseeing prisoner affairs, Qadoura Fares, sits in his office in Ramallah, West Bank, on Nov. 22. Fares was also released as part of a prisoner exchange deal in 1994 after being held in prison for 13 years.
Maya Levin for NPR
Israel acknowledges stepping up arrest raids. It says it's targeting members of Hamas and other militant groups in order to thwart future attacks — especially during a time of war.
Hamas' ability to penetrate Israeli security — to kill and kidnap so many people on Oct. 7 — prompted many Israelis to ask whether militants had help from Palestinians elsewhere, including in the West Bank. Polls show wide support for Hamas in the West Bank, and there have been demonstrations there in support of the militant group.
The West Bank has been under Israeli military occupation since Israel captured the territory in the 1967 Mideast war. Under Israeli military law, Palestinian suspects can be held for up to eight days before seeing a judge — who can then classify them as administrative detainees, and extend their seizure indefinitely.
Before this war, the United Nations and human rights groups had criticized the application of military law to Palestinian civilians. They've also criticized the uptick in Israeli arrest raids since the war began.
"The scale of detentions and arrests [of Palestinians in the West Bank and East Jerusalem] since the 7th of October, and those without charges or trial, is unprecedented," Budour Hassan, an Amnesty International researcher based in the West Bank, tells NPR. "Palestinian detainees are telling us about humiliation and reprisals, even though they had nothing to do with the Oct. 7 attacks. It's a tactic of collective reprisal against all Palestinians."
The prison figures show that out of a total of at least 10,550 Palestinians in Israeli custody, nearly 40% of them are held without charge. Many of them are accused of nonviolent offenses.
Last month, Israel amended its counterterrorism law to make "consumption of terrorist materials" — reading or sharing content considered pro-Hamas online, for example — a new criminal offense. The law has been criticized by rights groups groups, including Article 19 and Adalah, as being ambiguous and far-reaching.
"It makes thoughts subject to criminal punishment ... and criminalizes even passive social media use," the human rights group Adalah says.
More than a third of Palestinians in Israeli custody have not been charged
That's what happened to Ayah Jalal Mohammed Tamimi.
The 20-year-old college student was arrested at her home in East Jerusalem on Oct. 9, two days after the Gaza war began, and accused of incitement — for a post on Instagram Stories, which quoted the Quran. (The post expired after 24 hours, so NPR was not able to verify Tamimi's account. She says it was simply a Quranic verse, posted without commentary.)
Tamimi spent 50 nights in jail before being released Tuesday, as part of the now-halted nightly exchanges of hostages and prisoners that were part of the temporary Israel-Hamas truce. She was never charged, and wasn't allowed a phone call from jail — not to a lawyer or her family, she says.
"They gave us plain bread. But we were always hungry, and it was cold," Tamimi tells NPR by phone from her home in East Jerusalem.
Wahaj Bani Moufleh/Middle East Images/AFP via Getty Images
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Newly released prisoners are surrounded by supporters during a welcome ceremony following the release of Palestinian prisoners from Israeli jails in exchange for Israeli hostages held in Gaza by Hamas since the Oct. 7 attacks, in Ramallah in the occupied West Bank, early on Thursday.
Wahaj Bani Moufleh/Middle East Images/AFP via Getty Images
Newly released prisoners are surrounded by supporters during a welcome ceremony following the release of Palestinian prisoners from Israeli jails in exchange for Israeli hostages held in Gaza by Hamas since the Oct. 7 attacks, in Ramallah in the occupied West Bank, early on Thursday.
Wahaj Bani Moufleh/Middle East Images/AFP via Getty Images
Last month, Israel's national security minister declared a three-month "prison emergency," which allows for prisoners to be given floor mattresses, rather than beds. The text of the declaration says that "many more detainees are expected to be absorbed in the near future in view of the state of war."
Another freed prisoner, 17-year-old Malik Mohammed Arafat Deeba, says he felt that change. Israeli prison conditions worsened after the war broke out, he says. Deeba was arrested in his East Jerusalem neighborhood last summer for stone-throwing — something he denies. He too was never charged, but was jailed for five months, before being released Tuesday as part of the now-halted truce.
"After the war began, the food got really bad, and they didn't give us enough of it," Deeba tells NPR by phone. "We were treated terribly. They cut us off from the world, we had no way of contacting our families."
His mother, Nihal Deeba, tells NPR she had been allowed to visit her son in jail until Oct. 7, when such visits were halted. She has another son, Arafat, age 20, who remains in Israeli custody. She'd been hoping the truce would last longer, and that he too might be freed.
"These are our children, our brothers and sisters," Nihal Deeba says. "I pray that all the prisoners are freed, and that the prisons are emptied."
Most of the Palestinians freed during the past week's exchanges were teenage boys. They also included several teenage girls and several dozen adult women. The gender of some of them is unclear, because their names could be male or female. Most of them are listed as being from the West Bank and Jerusalem.
None had been convicted of murder. Some have been accused or convicted of violence, including stabbings that injured Israeli security officers or civilians. Other offenses include stone-throwing, incitement and membership in what Israel considers a terrorist group.
Before the releases, Israel published lists of names of jailed Palestinians who were eligible to be part of the exchanges. It allowed Israeli citizens to petition their Supreme Court if they objected to any of the names. Some groups representing victims of terrorist attacks said they planned to appeal some names. But the court historically has not intervened to block such releases, and it did not do so this week.
Palestinian protest icon was among those released in prisoner exchanges
Among some 30 Palestinians released Wednesday night was Ahed Tamimi, now 22, who as a teenager became a symbol of Palestinian defiance to military occupation. In 2017, a video went viral showing Tamimi slapping and kicking Israeli soldiers in her home village in the West Bank. She pleaded guilty to assault charges, and has been in and out of Israeli prison since then. (Ahed Tamimi has no relation to Ayah Jalal Mohammed Tamimi.)
John MacDougall/AFP via Getty Images
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Newly released activist Ahed Tamimi (center) is greeted by relatives during a welcome ceremony following the release of Palestinian prisoners from Israeli jails in exchange for Israeli hostages held in Gaza by Hamas since the Oct. 7 attacks, in Ramallah in the occupied West Bank early on Thursday.
John MacDougall/AFP via Getty Images
Newly released activist Ahed Tamimi (center) is greeted by relatives during a welcome ceremony following the release of Palestinian prisoners from Israeli jails in exchange for Israeli hostages held in Gaza by Hamas since the Oct. 7 attacks, in Ramallah in the occupied West Bank early on Thursday.
John MacDougall/AFP via Getty Images
Ahed Tamimi had been arrested again last month, this time for an Instagram post. Israeli media say the post referred to Adolf Hitler and contained threats to "slaughter" Jews.
Her family says there are dozens of fake accounts under Tamimi's name, and that she did not post the message in question. The account it was posted on, which carried Tamimi's name and photo, has since been deleted.
On her release, Tamimi told reporters that her Israeli jailers had threatened to hurt her family — including her father, who remains in another Israeli prison — if she spoke out about conditions in jail. She said there was little food or water, and that she had been forced to sleep on the prison floor.
With prisoner releases suspended, Palestinian families pray for another truce
Rimah Shahada fears the conditions her 17-year-old Aseel is enduring in an Israeli prison hospital. She says she has no information about her daughter's condition. But she says she has a feeling that somehow she'll see her daughter again.
"I hope all the detainees are released, and bring joy to their parents," Shahada says.
Maya Levin for NPR
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Aseel Shahada's cousins and sister prepare bracelets for her possible return this week in her bedroom in Qalandiya refugee camp in Ramallah, West Bank, on Nov. 22.
Maya Levin for NPR
Aseel Shahada's cousins and sister prepare bracelets for her possible return this week in her bedroom in Qalandiya refugee camp in Ramallah, West Bank, on Nov. 22.
Maya Levin for NPR
Her younger children, along with their cousins, have been making beaded friendship bracelets to give to Aseel upon her return.
"Praise be to God, I'm staying patient," their mother says.
Lauren Frayer reported from Ramallah and London. Fatima Al-Kassab reported from London.
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Middle East Business & Economics
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NEW YORK, Oct 27 (Reuters) - U.S. economic growth rebounded more than expected in the third quarter amid a continued decline in the trade deficit, but that overstates the economy's health as the Federal Reserve's aggressive interest rate increases curbed consumer spending.Gross domestic product increased at a 2.6% annualized rate last quarter, the Commerce Department said in its advance GDP estimate on Thursday, ending two straight quarterly decreases in output, which had raised concerns that the economy was in recession. Economists polled by Reuters had forecast GDP growth rebounding at a 2.4% rate.Story read more Commerce Dept linkMARKET REACTION:STOCKS: S&P 500 futures turned 0.33% higher, pointing to a firm open on Wall StreetBONDS: U.S. 10-year yields eased to 4.0196%; Two-year yields eased to 4.4120% after the release;FOREX: The dollar was steady against the euro after briefly pairing a gain, leaving the euro/dollar pair off 0.9%COMMENTS:JOE MANIMBO, SENIOR MARKET ANALYST, CONVERA, WASHINGTON“With the U.S. data I think it’s a relief that we saw the economy bounce back more than expected after being in a funk over the first half of the year.”“The dollar is rebounding in light of the stronger-than expected data and the ECB emphasizing a gloomy outlook for the eurozone economy. It’s a reminder that nothing fundamentally has changed in terms of the euro and negative fundamentals have put renewed pressure on the single currency.”PAUL ASHWORTH, CHIEF NORTH AMERICA ECONOMIST, CAPITAL ECONOMICS, TORONTO (by email)"The 2.6% annualised rebound in third-quarter GDP looks impressive, but it was entirely due to a 2.7% boost from net external trade. Final sales to domestic purchasers, a better measure of underlying economic demand, increased by only 0.1% annualised, the worst showing since the second quarter of 2020 when the pandemic struck."Overall, while the 2.6% rebound in the third quarter more than reversed the decline in the first half of the year, we don’t expect this strength to be sustained. Exports will soon fade and domestic demand is getting crushed under the weight of higher interest rates. We expect the economy to enter a mild recession in the first half of next year."BRIAN JACOBSEN, SENIOR INVESTMENT STRATEGIST, ALLSPRING GLOBAL INVESTMENTS, MENOMONEE FALLS, WISCONSIN“GDP was a weak bounce from the negative prints in Q1 and Q2. Lots of negatives add up to a positive for the Fed, though. Weak spending and slower inflation are what they’ve been hoping for.”PETER CARDILLO, CHIEF MARKET ECONOMIST, SPARTAN CAPITAL SECURITIES, NEW YORK“What were seeing is an economy that has snapped back from two quarters of negative GDP, and it’s probably opened the debate as to whether or not the economy was in recession in the first two quarters of the year. Inflation has probably peaked and that’s key here.”“Does that change what the Fed’s going to do? It raises the possibility of one more rate hike in December and then a pause.”“Even though these numbers raise the debate over economy, (the drop in core capital goods) means less corporate spending ahead and that raises the prospects of negative growth in the first quarter of 2023.”“Consumer spending was lower than what we’ve seen, it’s a good indication that higher interest rates are biting into the pocketbooks of the consumer.”“Continuing jobless claims points to a weakening labor market. That’s what the Fed wants to see. The Fed wants to see pain on Main Street.”Compiled by the Global Finance & Markets Breaking News teamOur Standards: The Thomson Reuters Trust Principles.
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Interest Rates
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Xi's broken almost all norms: CNN Beijing Bureau Chief reacts to China's new leadership 03:02 - Source: CNN Hong Kong CNN Business — China’s yuan tumbled on Tuesday to its lowest level in nearly 15 years on Tuesday as investors fled Chinese assets amid fears about Xi Jinping’s dramatic move to tighten his grip on power in a major reshuffle of Communist Party leaders On the tightly controlled domestic market, the yuan dropped sharply, hitting the weakest level since late 2007. It was last down 0.6% at around 7.3 per dollar. The currency has lost 15% against the US dollar this year. In trading outside of mainland China, the yuan briefly plunged to around 7.36 per dollar early Tuesday, the lowest level on record, according to Refinitiv, which has data going back to 2010. It later pared losses, trading at 7.33 by 3:35 p.m. Hong Kong time (3.35 a.m. ET). The currency was pegged at 8.28 to the US dollar for years until 2005 when China moved to a “managed floating exchange rate.” It then appreciated steadily, climbing to a peak of nearly 6.01 in 2014. The declines came alongside a historic market rout for Chinese assets worldwide. On Monday, Chinese stocks plummeted in Hong Kong and New York, wiping out billions of dollars in market value. Hong Kong’s benchmark Hang Seng (HSI) Index closed down 6.4%. The Nasdaq Golden Dragon China Index, which tracks many popular Chinese companies listed on Wall Street, dived more than 14%. On Tuesday, the Hang Seng (HSI) slipped further and was down 0.2% in afternoon trading. The huge sell-offs came just days after the ruling Communist Party unveiled its new leadership for the next five years. In addition to securing an unprecedented third term as party chief, Xi packed key positions with staunch loyalists. A number of senior officials who have backed market reforms and opening up the economy were missing from the new top team, stirring concerns about the future direction of the country and its relations with the United States. International investors spooked by the outcome of the leadership reshuffle dumped Chinese assets despite the release of stronger-than-expected Chinese GDP data on Monday. They’re worried that Xi’s tightening grip on power will lead to the continuation of Beijing’s existing policies and further dent the economy, which despite the rebound last quarter is still growing way below the official 5.5% target for this year. China’s leadership reshuffle “sparked worries about the continuation of market-unfavourable policies and increasing risk of policy mistakes under President Xi’s power domination in coming years,” said Ken Cheung, chief Asian forex strategist at Mizuho Bank. “Foreign investors took action to cut their exposure on Chinese assets,” he said, adding that the Chinese currency was faced with mounting capital outflow pressure. The Chinese yuan, together with other major global currencies, has weakened rapidly against the dollar in recent months. The greenback has surged to the highest level in two decades against a basket of major counterparts, boosted by a hawkish Fed that attempts to contain runaway inflation. The yuan is on track to log its worst year since 1994 — when China devalued its currency by 33% overnight as part of market reforms.
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Forex Trading & Speculation
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Climate and environment groups have criticised comments by the new resources minister, Madeleine King, in support of new gas development, saying it is inconsistent with what climate science says is required to limit global heating.In an interview with the Sydney Morning Herald, King said new gas fields such as Santos’ Narrabri development in northern New South Wales would help avoid a future power crisis.“It avoids a crisis, is what it does, because it means more gas closer to your systems,” King said of the Narrabri project.Santos’ project was approved by the NSW Independent Planning Commission and the federal government in 2020. It would not produce gas before 2025.It has faced strong opposition from community and environment groups and traditional owners who have raised concerns about its effects on the climate, water and the Pilliga forest.Tim Buckley, the director of Climate Energy Finance, said the energy crisis on the east coast would not be solved by more greenfield fossil fuel developments.The International Energy Agency and the United Nations have said new fossil fuel projects are incompatible with limiting warming to 1.5C.“Any discussion about gas as a transition fuel is ignoring the climate science, ignoring methane venting and fugitive emissions, and it’s ignoring the whole supply chain analysis and the reality that methane emissions are skyrocketing way in excess of the corporate data,” Buckley said.“Methane is now one-quarter of global CO2 equivalent emissions and we have a climate emergency.”Buckley said new gas developments would take years to come online and would not address skyrocketing prices.“Domestic east coast gas production has tripled in the last decade, and so it is totally fact-free spin to say yet more production will somehow lower the record-high gas prices,” he said. “Excessive exports from the east coast of Australia is the problem.”Andrew Stock is a retired energy executive and a retired foundation director of the Clean Energy Finance Corporation.He is now a councillor for the Climate Council and said the work of both the IEA and the UN made clear there was “no room in the climate balance of the planet for new gas developments”.Stock said the states with the lowest energy prices in the national market were those that had diversified strongly into renewables and storage, such as South Australia.“What government should be doing is working very hard to put in place a transition plan to renewables and storage, and away from fossil fuels, because that makes Australia independent to what’s going on in the rest of the world,” he said.National energy ministers have agreed to the creation of a transition plan to decarbonise the economy, the acceleration of work by the Energy Security Board on building extra capacity for electricity supply, and an investigation by regulators of the purchase and storage of gas to reduce the risks of shortages.King told the Sydney Morning Herald she wanted to decarbonise the economy but had to “accept some of the realities of our current energy mix”. Sign up to receive an email with the top stories from Guardian Australia every morning Sign up to receive an email with the top stories from Guardian Australia every morningChris Gambian, the chief executive of the Nature Conservation Council of NSW, said King’s support for the Narrabri development would do nothing to solve the immediate energy shortfall and “it ignores the obvious need for domestic gas reservation”.“It also disregards the significant environmental damage that the local community at Narrabri has been seriously concerned about for many years.”Gomeroi traditional owners voted overwhelmingly against entering into an agreement with Santos for its Narrabri gas project. The matter is the subject of proceedings in the national native title tribunal.Gomeroi traditional owner Karra Kinchella said there had been resistance to the Santos project for more than a decade and “that’s not going to change just because Ms King wants it to”.“What gets me the most is that if we had started the transition to renewable energy ten years ago, the Pilliga wouldn’t be at risk now,” she said.King told Guardian Australia in a statement: “The government is committed to achieving net zero emissions by 2050 and gas will remain an important energy source during the energy transition. Gas is able to ensure reliability and security of energy supply as coal generation comes to an end.”The minister said gas developments had “the potential to supply the increased demand for gas generation during the energy transition” as would greater investment in renewables and energy storage.“If developments like Narrabri stack up environmentally and commercially, and receive necessary approvals, then they should go ahead,” King said. “That includes environmental approvals and native title processes.”
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Energy & Natural Resources
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New Zealand has won its trade dispute with Canada over access for dairy products under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) free trade agreement.
Under the agreement, New Zealand gained better access for dairy products in the Canadian market, but complained that Canada was manipulating quotas to block exporters.
An independent panel has ruled that the dairy quotas were improperly used to keep out dairy exports and protect its powerful domestic industry.
Trade Minister Damien O'Connor said the ruling was a significant win for New Zealand producers.
"Canada was not living up to its commitments under CPTPP, by effectively blocking access for our dairy industry to upscale its exports. That will now have to change."
He said the Canadian blocking tactics cost New Zealand exports about $120 million over three years.
First dispute
It was the first CPTPP trade dispute and New Zealand's first under any free trade agreement.
"Today's ruling will give exporters confidence and certainty that the mechanisms in place will ensure they receive the market access that all members agreed to."
The dispute centred on the ability of New Zealand exporters to use Canada's 16 dairy tariff rate quotas, which allow a certain amount of produce either tariff free or at a low rate and when that is filled a higher tariff applies to further volumes.
The panel found that Canada was granting priority access to its own domestic dairy processors, and was also keeping out local retailers who would have been potential buyers of New Zealand produce.
However, the three person panel turned down, by a two to one majority, two lesser aspects of New Zealand's complaint about consultation over quota changes, and the implementation of new quotas.
Australia strongly supported the New Zealand position making its own submissions as an interested third party.
O'Connor said Canada remained a close diplomatic and trade partner, and the panel mechanism allowed a neutral way to resolve the dispute.
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Middle East Business & Economics
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NEWYou can now listen to Fox News articles! Twitter users reacted to Biden climate czar John Kerry's assertions that the U.S. "absolutely" does not need to drill for more oil and gas amid an ongoing energy crisis and record-high gas prices, lambasting him for being "out of touch" and for prompting a strategy that is not "feasible."Kerry, speaking at an event hosted by the University of Southern California's Center of Public Diplomacy last Friday, railed against fossil fuels, saying that energy security concerns are "driving" complaints that the U.S. needs to perform more domestic drilling and return to coal. "No, we don't," he said. "We absolutely don't. And we have to prevent a false narrative from entering into this…" An RNC Research tweet captured the statement and sparked outrage from critics and commentators alike, with several noting the departure from other top Democrats' narratives. BIDEN THREATENS OIL COMPANIES WITH ‘EMERGENCY POWERS’ IF THEY DON'T BOOST SUPPLY AMID INFLATION SPIKE Former Secretary of State John Kerry at the Tech For Good Summit in Paris at the Elysée Palace. (Julien Mattia/NurPhoto via Getty Images)"Ketchup Kerry is out of touch with reality," radio host Justin Barclay wrote in a quote tweet.Gasbuddy writer Patrick De Haan, who frequents energy issues including soaring gas prices, criticized Kerry for his natural energy push, saying "let’s see that private jet fly on solar please."MEDIA LOVE BIDEN'S HIGH GAS PRICES WHILE ORDINARY AMERICANS STRUGGLE WITH PUMP RECORDSRadio host Buck Sexton, among the most recognizable critics, ripped Kerry as well, writing that "he absolutely does not care that millions of Americans can’t afford gas and are running up debt on their grocery bills," and adding that "Kerry thinks people who didn’t marry into fortunes created by other men (twice!) are chumps who must suffer to save the climate."Additional commentary came from bestselling author and entrepreneur Vivek Ramaswamy, who said he disagreed with the U.S. Special Presidential Envoy for Climate and from editor and writer Jazz Shaw, who jabbed at Kerry by saying he had yet to figure out which Orwellian "Animal Farm" character he is trying to play. Oil rigs (iStock)"Relying on foreign oil imports while pretending to use wind & solar is not a feasible strategy," Ramaswamy wrote.Other Democrats have been criticized for mixed messaging on domestic energy policies, including President Biden, who, in the past, demanded less reliance on fossil fuels, yet recently sent a letter to seven oil executives demanding to know why the flow of gas has been restricted from the market. Energy Sec. Jennifer Granholm, took to mainstream outlets early Thursday to double down on the president's recent rhetoric, contrasting Kerry in some ways, while simultaneously admonishing fossil fuel dependence in another.Circling back to other Democrats, market strategist Martin Pelletier slammed party leaders – including Kerry – for "mixed signals" on Twitter.CLICK HERE TO GET THE FOX NEWS APP"Such mixed signals from this govt. Drill more oil wells or we will tax you, drill less oil wells because of climate change," he wrote, quote tweeting the RNC.Others wondered if Biden and Kerry discuss the issue or if Democrats seeking reelection this November stand by Kerry's statement, including Michael Graham, publisher and managing editor of Inside Sources, who asked, "How many Democrats running for re-election in 2022 agree with this top level Biden admin official?" Taylor Penley is a production assistant with Fox News.
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Energy & Natural Resources
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You can’t see them or hear them, but there are huge, hidden forces propelling the United States into the energy future. Last year, the Biden administration committed to eliminating half the country’s greenhouse gas emissions by 2030, a critical step in fighting climate change. Half sounds like a lot—and it is—but scientists think it’s doable. Different teams have modeled how exactly this decarbonization might play out—by rolling out more solar and wind energy, for example, and more electric vehicles—and landed on several paths to cutting emissions in half in the next eight years. A new paper in the journal Science took six of these scenarios and found that they share several major points: the keys to a clean-energy future. “Reducing our emissions by 50 percent is technically feasible, it's economically viable, and there are massive additional benefits,” says Lawrence Berkeley National Laboratory energy economist Nikit Abhyankar, a coauthor of the paper. “So this is what we call a no-regrets strategy.”The first area where those scenarios agree is that we’ll have to target the power and transportation sectors. To halve emissions, Abhyankar says, by 2030 the US grid will need to be running on about 80 percent carbon-free electricity (including hydropower and nuclear power), up from 40 percent today. The good news is that we’re already heading in that direction. In recent years, the US has been making significant progress in its effort to ditch coal for natural gas power plants. Yes, that gas is still a fossil fuel that spews carbon, but not nearly as much as coal. Meanwhile, the costs of solar and wind energy are cratering. The price of solar technology has dropped 99 percent in the past four decades. And it’s getting less expensive for homeowners and utilities to store renewable energy: Between 1995 and 2018, the production of lithium-ion batteries jumped 30 percent per year while getting 12 percent cheaper each year. Earlier this month, the California utility PG&E commissioned a battery storage system that can provide power to over 200,000 homes for four hours. For homeowners, Tesla’s (very expensive) Powerwall battery can both charge a car and power a home during an outage, providing some independence from the grid.The bigger challenge is the grid itself. The switch to renewables is happening on ancient infrastructure designed for on-demand energy generation—if you need more electricity, you burn more fossil fuels. The US grid is also actually three distinct grids with little interconnection: eastern and western grids, and one just for Texas. That means if demand spikes in one region and the sun isn’t shining or the wind isn’t blowing there, operators can’t import large amounts of power from elsewhere. This is the intermittency challenge of renewables: They’re critical to fighting climate change, but the grid just isn’t designed for them. But, Abhyankar says, wind and solar power has gotten so cheap, and energy extraction so much more efficient, that this may not be a big problem in the short term. Extremely efficient panels and turbines can still generate enough electricity to make economic sense, even for regions that don’t have the number of sunny days Phoenix has, or the wind the Midwest has. That opens up the option of generating green energy locally, instead of having to import it across state lines. “Contrary to the conventional way of planning the grid—where you’ll choose the best of the best resource, site the renewable capacity there, and carry that electricity long distances—that trend has started changing because of the falling costs,” says Abhyankar. “And that might play a major role up to 2030 or so.”That said, he adds that it’s not a permanent solution. A future grid that runs entirely on renewables needs to be more flexible, since operators won’t be able to burn fossil fuels to fill temporary gaps between energy demand and generation. (At night during a heat wave, for instance, people could be running lots of air conditioners, but there would be no sun to power them.) That means the infrastructure must be rebuilt to make it capable of shuttling renewable power over long distances. “In the long run, though, there’s just no alternative: We have to upgrade the transmission,” he says. EVs may also prove to be valuable assets for smoothing out power supply and demand by forming a distributed network of car batteries that—along with home solar panels—grid operators could tap into when needed. “If we could leverage the batteries from electrical vehicles or batteries in homes, for instance, or if we could operate the rooftop [photovoltaics] of a set of customers and have them coordinate to provide a certain service to support our transmission network, that would absolutely help in trying to cope with intermittency,” says Patricia Hidalgo-Gonzalez, who is director of the Renewable Energy and Advanced Mathematics Laboratory at UC San Diego and wasn’t involved in the new paper. “That could alleviate the stress in the grid very dramatically as we have more and more renewables.”The studies agreed on two more points: the economic and health benefits of decarbonization. Every step of the fossil fuel lifecycle, from extraction to processing to burning, is terrible for the human body. “There are massive non-economic benefits,” Abhyankar says of transitioning to clean energy. “What we found is this transition might also avoid over 200,000 premature deaths, and over $800 billion to a trillion dollars of other health [costs].” As more cars go electric, for example, air quality will improve, reducing the number of people affected by respiratory diseases. The final point of agreement among the studies Abhyankar and his colleagues reviewed is that it’s not the expense that will hold back the deployment of renewables, batteries, and EVs. “The key point is: Cost is not going to be very high,” says Abhyankar. “In fact, some studies found it might result in significant consumer savings.” For instance, although putting solar panels on a home can be a costly upgrade—especially without a significant tax rebate—in the long run it will save the homeowner money. Instead, the stumbling block is the policies needed to deploy them at a wider scale. Even though Democrats currently control Congress and the White House, they’ve struggled to pass substantial climate legislation. The Build Back Better program would have juiced the manufacturing of renewable tech in the US, among other climate benefits, but West Virginia Senator Joe Manchin torpedoed it. “It comes as absolutely no surprise that we’re nowhere near on track of meeting our target of reducing greenhouse gas emissions by roughly half by 2030,” says environmental economist Mark Paul of the New College of Florida. “I think that everybody across the climate and policy community is well aware that we’re going to absolutely blow past those targets, unless we have sizable action in Washington.”And everywhere, for that matter. For instance, states could mandate that more of their energy generation come from renewables, while the feds could give bigger tax rebates for people to buy EVs and cities could invest in charging stations for them, especially in lower-income neighborhoods. Another bottleneck, Paul says, is the lack of skilled labor to deploy and maintain solar and wind systems, and energy-saving home technologies like heat pumps. Public investments in trade schools could help boost this workforce. “This actually presents a pretty profound economic opportunity to revitalize the American working class that’s been struggling,” says Paul. “We just need policy to steer the ship in the right direction and ensure that this transition happens as quickly as possible.”
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Energy & Natural Resources
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Economic growth is threatening to stagnate after a brief, stimulus-induced pandemic bounce, the wages share of the economy remains near record lows and productivity growth is weak across much of the developed world. What is going wrong?
Key points:
- Mark-ups have more than doubled and profits almost quadrupled since the early 1980s in the US
- Economists say a lack of competition and the market power of a handful of dominant firms is to blame
- Regulation to break down monopolies and tax reform are suggested solutions
An increasing number of economists are pointing the finger at the growing market dominance of a handful of mega-firms, particularly in the tech sector.
Jan Eeckhout, a professor of economics at Pompeu Fabra University in Barcelona, is a global leader in this field and was a keynote speaker at the recent Australian Conference of Economists, hosted by the Economic Society of Australia in Brisbane.
Professor Eeckhout and his team have studied detailed US data going back to the 1960s about the mark-ups and profits of American firms.
They found that mark-ups were consistently in the range of 20-30 per cent until the early 1980s, since when they have jumped to around 60 per cent above production costs.
Likewise, the profit rate has almost quadrupled over the period since 1980 from around 2 per cent to between 7-8 per cent of sales revenue.
"The most important part of it is there's a huge change in how this is distributed," Professor Eeckhout added.
"There are some firms that make enormous profits and most firms, if you look at a distribution, do worse now, or at least no better, than they did in the '80s."
Professor Eeckhout labels these "superstar" firms, and said the phenomenon is not limited to the US.
"We have a data set that spans the entire world, it's about 70,000 firms, the pattern globally is very similar to the pattern in the United States," he observed.
Competition law, globalisation and the rise of tech
So, what happened from the early 1980s that sparked this shift?Loading...
Professor Eeckhout has identified three factors: weak competition law enforcement, that has allowed the build-up of monopolies and oligopolies; globalisation, which has entrenched economies of scale; and technological change.
He said it is the latter that has contributed most to increased market power for a handful of mega-firms.
"Technologies that are high set-up cost and low production cost," he observed.
"High startup costs are the perfect ingredient to create monopolies and natural monopolies.
"Firms invest a lot in order to gain that position of dominance. It's a winner-take-all type of technology in the digital age."
Ross Garnaut, who is an emeritus professor of economics at both ANU and Melbourne University, argues that the internet era has had an even worse effect on economies outside the US, where most of the tech giants are based.
"The increase in the share of the economy of sectors in which rents are important has been very powerful over the last half dozen years," he told ABC News.
"The growth of expenditure on information technology services, very little increased investment in Australia associated with providing those services in Australia, but very large amounts of Australian income going on those things, an increase in the rent share going to those particular companies."
Professor Garnaut said this phenomenon, along with mistakes in monetary policy and high levels of unskilled immigration, contributed to what he has labelled Australia's "dog days" over the six or seven years prior to the pandemic — a period of stagnant economic growth and wages that he fears will soon return.
"The increased importance of non-competitive parts of the economy, I think, is part of the story," he said.
Higher prices, lower wages
Professor Eeckhout said the increased dominance of superstar firms not only meant rising profit margins, pushing up prices for consumers, but also lower wages growth, smaller profits for other firms, less business dynamism, reduced innovation and less job switching, increasing the chance of skills misallocation and potentially reducing productivity.
Speaking at the same conference, federal Assistant Competition Minister and former economics professor Andrew Leigh said increasing market power can even reduce the effectiveness of interest rates to contain inflation.
"Over recent decades, Australia has seen a rise in market concentration and mark-ups, and an increase in monopsony power," he observed.
"Our biggest firms have more power to push prices up, and to keep wages down.
"There are many reasons this matters, but an important one is because it weakens the transmission of monetary policy.
"Companies with high mark-ups are less likely to respond to interest rate changes, putting the burden on to young, low mark-up firms."
Breaking a 'vicious circle'
Professor Eeckhout argues the best way to immediately tackle this problem is through improved competition policy, particularly more aggressive enforcement of existing laws to break a "vicious circle".
"The more market power you have, the more profits you make, the more you can influence policy and legislation, that legislation is more favourable for you, which gives you more market power and more profits," he said.
"And that circle is just very difficult to break. Because these firms basically know that they're much more powerful than the ones who are supposed to control that, which is the competition authority.
"I hope we can convince politicians that competition policy is really redistributive policy."
Professor Eeckhout has also done research as to whether extra taxes on the dominant firms and subsidies to startups would help address the imbalance.
He finds subsidies are counterproductive, but some kind of super profits tax on the dominant firms could improve competition, lower tax burdens elsewhere and improve overall economic welfare.
"If you can now tax these dominant firms' profits instead of taxing labour income, so it seems to be that this is a no-brainer to take to the voter," he added.
Professor Garnaut, who has business interests in several startup clean energy firms, sees business tax changes as a critical part of the solution.
"We need to shift the burden of business taxation away from firms operating in a competitive environment towards economic rent," he argued.
"We need to shift the burden of tax away from companies which are investing and innovating in Australia, towards those who are just earning income without investment in innovation."
And Professor Garnaut and some colleagues have come up with some specific proposals to try and achieve that.
"First, to allow immediate expensing of all capital expenditure and, going further than that, to allow negative cash flows to be cashed out, receipt of a tax credit that's cashed out," he said.
"Secondly, as an accompaniment of that, the denial of any deduction for interest or financing — such a deduction is not justified if you've got immediate expensing of capital expenditure.
"And the third essential element is I would deny a tax deduction for all imported services that are not directly linked to the provision of the service in Australia."
Mr Garnaut said that last provision would address some of the arrangements multinational companies set up to shift earnings made in Australia overseas to lower-tax jurisdictions.
"Fine for one of the tech companies that's selling products in Australia with very high margins to get a deduction for expenditure on those services, but only to the extent that those expenditures are related to the provision of services in Australia," he explained.
"So that if they do some innovation in Australia, treat them like any other business, so give them immediate deductibility for capital expenditure.
"But if they're simply selling into Australia a product that's been developed in Seattle they can't extract a large rent for that, probably going back to a tax haven where they don't even pay tax in the United States."
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Inflation
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Japanese stakeholders in the Sakhalin 1 oil and gas project in eastern Russia will retain their stake in the undertaking by joining a new Russian operator recently established under a decree, the industry minister said Friday, as the project remains a vital source of energy for resource-poor Japan.
Japan's government and companies, including major trading houses Itochu Corp. and Marubeni Corp., have invested in the project through Tokyo-based Sakhalin Oil and Gas Development Co. If the Russian side approves the company plan decided at Friday's shareholders meeting, Japan will be able to keep its stake in the project.
Undated photo shows a facility of the Sakhalin 1 oil and gas development project. (Photo courtesy of Exxon Neftegas Ltd.)(Kyodo) The move comes amid international sanctions on Russia over its invasion of Ukraine.
"While Japan is reliant on the Middle East for over 90 percent of its crude oil imports, Sakhalin 1 is an extremely important project as an alternative source outside the Middle East," Economy, Trade and Industry Minister Yasutoshi Nishimura told reporters.
Sakhalin Oil and Gas Development held a 30 percent stake in the project, which started producing crude oil on the island of Sakhalin, north of Japan, in 2005. Under the decree signed by President Vladimir Putin, foreign business partners had one month from the launch of the new operator in October to decide whether to invest in the new company.
Tsuyoshi Hachimura, an executive vice president of Itochu, said at a press conference on its earnings report that it will join the new operating firm of Sakhalin 1 from the perspective of energy security in keeping with the government's policy.
The government has indicated Japan, which is highly dependent on energy imports, will maintain its stake in the Sakhalin 1 and 2 energy projects, despite imposing economic sanctions on Russia over its invasion of Ukraine.
Exxon Mobil Corp. of the United States, a major stakeholder in Sakhalin 1, announced its withdrawal from the project in March.
Russia has authorized investments by Japanese trading houses Mitsui & Co. and Mitsubishi Corp. in Sakhalin 2, while British oil major Shell PLC, which held an approximately 27.5 percent stake in the previous company, exited from the project. Related coverage:
Putin signs decree to create new operator for Sakhalin 1 oil project
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Energy & Natural Resources
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A new policy that decriminalizes the possession of small amounts of illicit drugs took effect on Saturday in the Australian Capital Territory (ACT), which includes the national capital of Canberra and surrounding areas. The jurisdiction is the country’s first to adopt the policy change.
Lawmakers for the territory approved the new decriminalization policy a year ago, passing the bill from Labor MP Michael Pettersson through the ACT Legislative Assembly. It removes criminal penalties for simple drug possession and instead makes possession punishable by a warning, fine or participation in a drug diversion program.
The fine of AU$100 (about $64 USD) could be waived if a person voluntarily completes the program.
The change applies to eight drugs and sets specific possession limits for each substance.
Here’s the possession limit for each drug under the new decriminalization policy:
- Cocaine: 1.5 grams
- Heroin: 2 grams
- MDMA: 3 grams
- Methamphetamine: 1.5 grams
- Amphetamine: 2 grams
- Psilocybin: 2 grams
- Lysergic acid: 2 milligrams
- LSD: 2 milligrams
The bill also reduces the maximum penalty for possession of drugs that aren’t specifically decriminalized to a maximum of six months of incarceration.
“Canberrans know that drug use is a health issue and today our laws now reflect our values,” Pettersson said in an Instagram post on Saturday.
At the time his bill passed, Pettersson called the plan a “sensible, evidence-based approach to drug policy” that puts public health over criminal punishment.
“The bill is about harm reduction, reducing ordinary people’s interactions with the criminal justice system,” Pettersson said. Across the world, he added, the war on drugs “has destroyed countless lives and decimated whole communities. It’s based on flawed science and misinformation. It has not stopped drug use. It has not reduced drug use.”
Ahead of the new law taking effect, Sen. Michaela Cash, a Liberal Party member representing Western Australia, attempted to scuttle the policy change in the national legislature. Earlier this month, Cash said the shift would turn the nation’s seat of government into “the drug capital.”
“I effect, they’ve created a parking fine scheme that applies to the possession of ice, speed, heroin, cocaine and other things,” Cash said, according to an Australian Broadcasting Corporation report. “I would implore the [federal] government, please don’t turn your back on people in the ACT.”
Labor Sen. Tim Ayres of New South Wales said Cash’s effort to derail the plan was “an extraordinary intervention” into ACT’s jurisdictional affairs. If Cash wants to intervene in ACT politics, he said, she should consider moving to the district and running for the legislative assembly.
ACT decriminalized marijuana in the early 1990s, and lawmakers approved a separate non-commercial cannabis legalization bill from Pettersson that took effect in 2020. That law allows adults 18 and older to possess and grow marijuana for personal use.
Pettersson has said the jurisdiction’s marijuana decriminalization policy provided a “framework” for the new, broader decriminalization law.
Lawmakers made some changes to Pettersson’s drug decriminalization bill last year in response to recommendations from ACT’s executive government. Methadone was dropped from the original list of decriminalized substances, for example, and implementation was delayed until this month.
The main opposition to the legislation came from Canberra Liberals, who argued that the “radical reform” would lead to increased drug use and impaired driving.
The party’s leader, Jeremy Hanson, said at the time that the shift was “not going to change the number of people going into the criminal justice system, and it’s not going to fix the problem that we have now which is not enough people being able to access treatment.”
Earlier this year, Australia’s national government rescheduled two substances, psilocybin and MDMA, to provide access to people with PTSD and treatment-resistant depression.
The substances weren’t legalized for broad use, but by placing them in Schedule 8 for therapeutic use under the country’s drug code, psychiatrists who meet the required standards can legally prescribe the psychedelics. The drugs will remain in the stricter Schedule 9 for unauthorized use.
In September, a study of more than 2,300 Australian medical patients with chronic health conditions found that those who used medical marijuana saw significant improvements in overall quality of life and reductions in fatigue during the first three months.
Photo courtesy of Dominic Milton Trott.
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Australia Business & Economics
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NEW YORK, Aug 26 (Reuters) - The U.S. economy will need tight monetary policy "for some time" before inflation is under control, a fact that means slower growth, a weaker job market and "some pain" for households and businesses, Federal Reserve Chair Jerome Powell said on Friday in remarks warning there is no quick cure for fast rising prices."Reducing inflation is likely to require a sustained period of below-trend growth. Moreover, there will very likely be some softening of labor market conditions. While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses," Powell said in prepared remarks for a speech to the Jackson Hole central banking conference in Wyoming.STORY: read more TEXTRegister now for FREE unlimited access to Reuters.comMARKET REACTION:STOCKS: S&P 500 (.SPX) extended lower. It lost 82.44 points, or 1.96%, to 4,116.68
BONDS: U.S. Treasury 10-year yield turned down. The price was last off 2/32 to yield 3.0316%, up from 3.024% late on Thursday.
FOREX: The dollar index cut a loss and was off 0.018%COMMENTS:SANDRA HOLDSWORTH, HEAD OF RATES, UK, AT AEGON ASSET MANAGEMENT“Chairman Powell spoke today at Jackson Hole where he maintained and reiterated the hawkish stance the US Federal Reserve is taking towards the current high levels of inflation."In a short and concise speech, he made several points. Firstly, that the economy was still showing strong underlying momentum and that the labour market in particular remains out of balance. Second, that interest rates will continue to rise to a restrictive stance and importantly stay there for some time. Partly because the Fed views it will take time for inflationary forces to decline, but also because in previous inflationary episodes it was a mistake to relax policy too early.“In short, the speech was hawkish and we would expect yields of government debt to continue to rise.”STEVEN OH, GLOBAL HEAD OF CREDIT AND FIXED INCOME, CO-HEAD OF LEVERAGED FINANCE, PINEBRIDGE INVESTMENTS, LOS ANGELES"Powell’s short but direct speech was focused on delivering a message to the market to reset expectations for a longer period of maintaining tighter monetary policy conditions in order to successfully combat inflation. He provided a historical context and justification for the need to maintain levels once the current cycle peak is reached and indicated the Fed’s willingness to do so even in the face of a recession and rising unemployment. So, the headline summary is that we are getting closer to the peak but we will plateau for an extended period prior to any potential path downward."SIMON HARVEY, HEAD OF FX ANALYSIS, MONEX EUROPE, LONDON“It was pretty much in line with what we're expecting and that's even though they don't want to give forward guidance.”“They are going to try and guide markets to the idea that they're going to slow down the pace of the hiking cycle, but they're going to offset that with the idea that rates are going to be restricted for longer. And that was what was stressed within the actual statement, that duration is now the preference – having a longer period of tighter monetary policy as opposed to, you know, continuing front loading it at the expense of potentially having to cut rates in the future.”“I don't think markets necessarily priced this correctly to begin with.”QUINCY KROSBY, CHIEF GLOBAL STRATEGIST, LPL FINANCIAL, CHARLOTTE, NC“This was a speech for his legacy because this Fed has been tarnished for its stubborn "transitory" view of rising inflation, which was exacerbated by a perception that Powell wouldn't be tough enough to do what's necessary to expunge inflation from the economy.”“By invoking the work of other Fed chairman (Volcker), who have had to deal with inflationary pressures, Powell made it clear how he wants to be perceived: as a Fed chair who restored price stability in order to restore a strong economic foundation!”SALMAN AHMED, GLOBAL HEAD OF MACRO AND STRATEGIC ASSET ALLOCATION AT FIDELITY INTERNATIONAL, LONDON“Given the backdrop of easing financial conditions since early July, as we expected, we have seen a pushback by Fed Chair, Jerome Powell, on the market's assessment of an immediate pivot by warning against loosening policy sooner rather than later. Whilst inflation has started to show signs of a turn, some of the more resilient and persistent components remain elevated. In addition, the labour market remains tight. The one sector which is showing signs of clear slowdown in activity is housing. In his speech, Chair Powell kept a rate rise of 75bp on the table for September. We have now revised the terminal rate to around 4% from 3.5% previously, and think rates may remain higher for longer, which seems more consistent with the Fed's stance of keeping policy restrictive until clearer signs of economic and inflation slowdown appear.”BRENT SCHUTTE, CHIEF INVESTMENT OFFICER, NORTHWESTERN MUTUAL WEALTH MANAGEMENT COMPANYAn eagle tops the U.S. Federal Reserve building's facade in Washington, July 31, 2013. REUTERS/Jonathan Ernst/File Photo“He certainly focused on the expectations channel and so talked a lot about rational expectations which the Fed believes guide what happens with making inflation permanent. He focused on not loosening policy too early but he didn't mention going any further on a hawkish side.”“The Fed wants to talk tough because they don't want inflation to become ingrained in the economy. That was Powell's key point that inflation expectations are important. He very rarely mentioned anything else.”“To me, next week's labor report would be the determining factor on whether the Fed goes 50 or 75. The market’s big fear was that the Fed would hike rates, demand would cool but inflation won’t. You're seeing inflation cool. At the same time, demand is weakening. That's going to continue and the market has sniffed that out, despite all the commentary that's out there to the contrary.”RYAN DETRICK, CHIEF MARKET STRATEGIST AT CARSON GROUP“Jackson Hole has only reiterated the Fed’s desire to bring down inflation at all costs, even admitting to do so could bring some pain to households. That comment took investors by surprise and hammers home how serious they are about raising rates to fight inflation.”“The hope of a dovish pivot was squashed, at least for now. Powell needs to see more than just one month of improving inflation data and he made it clear that continued tightening is the path he will take.”SIDDHARTH SINGHAI, CHIEF INVESTMENT OFFICER, IRONHOLD CAPITAL"As expected the Fed will continue to raise rates to combat inflation and until they can bring it down to about 2%. This means that the risk free rate is going to go up steadily and that could end up compressing valuations big time both for equity and fixed income markets. We expect a big correction in valuations for both of the above mentioned markets."Investors should be extremely cautious and should be invested in high quality businesses with pricing power and investors should also look to global markets to hedge their exposure to dollar, we believe buying high quality businesses in both developed and key emerging markets is a great way to approach what could be a multi year high inflationary environment."IAN LYNGEN, HEAD OF US RATES STRATEGY, BMO CAPITAL MARKETS, NEW YORK"Powell's comments were remarkably in line with market expectations. He emphasized that the size of the September rate hike hinges on the 'totality' of the data -- this is telling in two regards: 1) there will be a hike (which was a given;) and 2) July's inflation data isn't enough to take 75 bp off the table -- so the debate remains 75 vs 50 at least until we see the September 13 release of August's CPI. Powell went on to add that restrictive policy will be required for 'some time' -- a sentiment which speaks to the Fed's efforts to push back against the rate cuts being priced into late 2023. Moreover, the comment that history cautions against prematurely loosening policy is in keeping with the idea that the FOMC will achieve terminal and attempt to keep rates that high for an atypically long period of time. But that's a 2023 problem, isn't it?"ERIC WINOGRAD, DIRECTOR, DEVELOPED MARKET ECONOMIC RESEARCH, AT ALLIANCEBERNSTEIN, NEW YORK"I would say that his remarks were in line with what we expected and with what other Fed speakers have said in the last few days. We don’ think it requires any significant change to an investment view or to our portfolios—we expect a period of sustained below-trend growth and persistently tight monetary policy as the Fed struggles to bring inflation back under control, and that’s what Chair Powell told us this morning. Equity markets may struggle somewhat with the idea that rates could stay elevated for longer than they expected, but we don’t view that as a surprise."JOE MANIMBO, SENIOR MARKET ANALYST, CONVERA, WASHINGTON, DC“I think so far it’s playing out in classic ‘buy the rumor sell the fact’ for the greenback. We saw the dollar rally…in the run up to Mr Powell’s speech, and then Mr Powell’s remarks were largely in line with expectations. I think that left the dollar a bit vulnerable to some profit taking.”“I think overall the Fed chairman was really hawkish, but not above and beyond what had been priced in and I think the jury is still out on whether or not we see a 50 or 75 basis point rate hike next month. So I think that uncertainty is somewhat capping dollar gains, and where we go from here its going to be payrolls next week and inflation - the next consumer price index in mid-September, and that should give us some clarity on how aggressively the Fed moves next month.”ANTOINE BOUVET, SENIOR RATES STRATEGIST, ING, LONDON"It was hawkish, as expected. Powell’s message is clear, the Fed is far from done in its fight against inflation. He refrained from explicit references to financial conditions which was the main risk to financial markets today, but he implicitly endorsed other FOMC members’ comment that the Fed will be in no hurry to cut (rates) next year."Also, the text is peppered with Volcker references. All in, this should be enough for the weakness in front-end bonds to be maintained but nothing earth-shattering. Market reaction is justifiable sanguine."RICH STEINBERG, CHIEF MARKET STRATEGIST, THE COLONY GROUP, BOCA RATON, FLORIDA"I don't think there are any great surprises. I think he did what he wanted to accomplish, which is make the markets know the Fed is serious: 'Were going to keep fighting good fight,' and this is what the mandate of the Fed is. What we have essentially done is we've extended the conversation of seeing what the data looks like in the coming weeks to see if we get 50 or 75 (basis points of hiking in September.) I'm still in the camp that even though things are slowing, and you got some relief from the PCE today, the Fed has much more risk of being too dovish too early than being too aggressive."MICHAEL PEARCE, SENIOR US ECONOMIST, CAPITAL ECONOMICS, NEW YORK"Fed Chair Jerome Powell’s keynote speech at Jackson Hole added to the tide of recent Fed speakers pushing back against market expectations that the Fed is close to pivoting toward rate cuts. Nevertheless, as inflation (including core) falls faster than officials expect over the next 12 months, we still expect the Fed to be lowering interest rates again in H2 2023."Register now for FREE unlimited access to Reuters.comCompiled by the Global Finance & Markets Breaking News teamOur Standards: The Thomson Reuters Trust Principles.
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Interest Rates
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‘On-demand’ services might have made people feel wealthy, but now the model is in jeopardy © FT montage/Dreamstime Receive free Employment updatesWe’ll send you a myFT Daily Digest email rounding up the latest Employment news every morning. First there were Uber drivers who would come to your door at the push of a button. Now there are people who will bring you a packet of biscuits and some ibuprofen.It is easy to see the appeal of the new glut of ultrafast delivery apps, which promise to bring groceries to customers in as little as 10 minutes. One investor in the sector was won over after ordering some pistachios and a can of coke that arrived in seven minutes. To have people at your beck and call is not a new idea. In countries like Britain, it used to be commonplace for affluent households to have servants. Mrs Beeton’s Book of Household Management, published in 1907, said a household with an income of £1,000 a year should keep two or three servants, while even one on £200 a year should have a “young girl for rough work”. In some highly unequal countries such as India, wealthy households still have servants. “On-demand” apps have enabled a mass-market version of the luxury of having people at your disposal to do things for you — albeit an atomised collection of people you don’t know and probably won’t see again. Gig companies have sometimes played explicitly on this theme. One of Uber’s early slogans was “everyone’s private driver”. Getir, one of the ultrafast delivery apps, says it is “democratising the right to laziness”.For some critics, the growth of this new “servant economy” is a symptom of resurgent economic inequality and an underclass without better options. But there is another factor that has powered its rise: investors have been subsidising consumers by funding companies that often charge less for these services than it costs to provide them.Now that model is in jeopardy. The big problem is that the money is drying up. A decade of cheap money has given way to high inflation, gloomy growth forecasts and higher interest rates. Investors are beginning to get nervous about piling money into lossmaking companies. Shares in listed companies such as Uber, Lyft and Deliveroo have dropped sharply. Many of the ultrafast delivery apps are also cutting jobs in an attempt to show investors they are serious about profitability. “Channelling Jerry Maguire, we need to show them the money,” Uber’s chief executive Dara Khosrowshahi explained to staff in a recent memo.But making money is likely to mean paying workers less or charging customers more. This is a bad time to try either. Unemployment is low and job vacancies are high in many countries from the US and UK to Europe and Australia. Workers have more options than before. In addition, the high price of petrol makes driving around all day particularly expensive.On top of that, courts, regulators and lawmakers are becoming stricter about the need for employment rights and protections for gig workers. The UK’s Supreme Court ruled last year that Uber actually employs its drivers, which means it owes them the minimum wage, holiday pay and pension contributions. The EU has also set out plans to give employment rights to many gig workers currently treated as self-employed. A number of the new ultrafast delivery apps, including Getir and Gorilla, already employ their workers.Charging higher prices to customers will be tricky, too. Unemployment might be low but high inflation is eating into people’s pay packets. In the UK, the Bank of England has predicted the worst squeeze on disposable incomes for at least 30 years. There are already signs that people are cutting back on discretionary spending — and nothing is more discretionary than paying someone to bring a packet of biscuits to your house. Companies like to talk about the vast size of their TAMs, or “total addressable markets”. In its initial public offering document, Uber said its TAM was “all passenger vehicle miles and all public transportation miles in all countries globally”.Customers clearly value the slick technology deployed by gig companies such as Uber. But how much demand will remain for such services once their prices rise?It remains to be seen how many of these companies will survive the next few years and in what form. But the golden era for consumers of on-demand services is surely coming to an end. In the decade after the 2008 financial crisis when wage growth was fairly stagnant for many, perhaps these apps gave us a sense we were wealthier than we really were, albeit with some hidden long-term costs. Laziness might have been democratised — but not for long.sarah.oconnor@ft.comGet alerts on Employment when a new story is published
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Unemployment
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Israel’s South Gaza Strikes Intensify Despite Blinken’s Warning
The switch in focus toward the densely-populated south followed the end of a week-long truce between Israel and Hamas.
(Bloomberg) -- The Israel Defense Forces increased strikes on Hamas targets in the southern Gaza Strip, a day after US Secretary of State Antony Blinken urged Israel to do all it can to protect civilian lives and as talks to renew a ceasefire hit a deadlock.
The switch in focus toward the densely-populated south followed the end of a week-long truce between Israel and Hamas. Israel said Saturday it pulled its negotiating team out of Qatar after talks on another cease-fire reached an “impasse.”
Israel’s strikes on Saturday were focused on the Khan Younis area in southern Gaza, where the military said it had struck more than 50 Hamas targets with airstrikes, tank fire and its navy.
Blinken’s message to Israeli Prime Minister Benjamin Netanyahu has grown more stern on each of his three visits to the region since Hamas, which is designated a terrorist organization by the US and European Union,, attacked Israel on Oct. 7.
Aides bristled during Blinken’s first trip at any suggestion that Israel heed humanitarian concerns as it prepared an initial response to the Hamas attacks. The second time around, Blinken stressed that that Israel’s conduct of the war mattered.
By this week, as estimates of Palestinian deaths in Gaza since Oct. 7 climb above 15,200, according to the Hamas-run health ministry, Blinken gave a direct warning to Israel’s war cabinet — that the devastation unleashed on northern Gaza must not be repeated. More than 70% of those killed in the recent Gaza attacks are said to be women and children.
That shift in tone underscored a growing sense of alarm among senior Biden administration officials about what fresh crisis awaits now that the Gaza war has resumed and Israel turns its military attention to Gaza’s south. Hundreds of thousands of civilians have fled there in Israel’s orders — and now have nowhere else to flee.
Publicly, Israel remained defiant. Hours after Blinken left, the Hamas-run border crossing authority said no aid had been delivered since the truce had ended early Friday. The evacuation of wounded people and dual nationals to Egypt, and the return of Gazans stranded in Egypt, also stopped.
Aid resumed on Saturday, the Palestinian Red Crescent said in a post on X, formerly Twitter.
Gaza authorities also reported that some 100 people had been killed in a fresh round of Israeli airstrikes. Another 100 or more were killed in the bombing of a house in the Jabalia camp in the northern Gaza Strip that had been used as shelter for families and displaced persons, according to Palestinian TV.
Blinken’s evolving message has reflected President Joe Biden’s own change in stance as his administration responds to pressure from Arab allies, human-rights activists and Americans back home — especially the left flank of his own party — who believe the civilian death toll is too high.
“I made clear that after the pause it was imperative that Israel put in place clear protections for civilians and for sustaining humanitarian assistance going forward,” Blinken said in Dubai, moments before boarding a plane back to Washington.
Whether it makes a difference is an open question. A senior US official, who asked not to be identified discussing private deliberations, said Israel genuinely seems to be trying to meet US demands on creating civilian safe zones, and heard Blinken’s insistence that results on the ground — like fewer civilian casualties — are more important than intent.
In what may be an attempt to protect civilians, the Israel Defense Force has begun using a micro-zone map in Gaza to issue alerts to residents in certain areas, urging them to evacuate immediately.
Read More: White House Says Israel ‘Mindful’ of Need to Protect Civilians
Netanyahu, who warned during the week-long pause that Israel’s campaign wasn’t over, was similarly unsparing in his description of the nation’s goals. The senior US official said Blinken asked the Israelis how much longer they expected the campaign to last, and didn’t get a clear answer.
“Our forces are charging forward,” Netanyahu said on Friday. “We continue to fight with all our might until we achieve all our objectives — the return of all our hostages, the elimination of Hamas, and ensuring that Gaza will never again pose a threat to Israel.”
Those concerns masked what otherwise has been a success: under intense pressure from the US and with mediation by Qatar, Israel and Hamas managed seven days of a truce in which dozens of Israeli hostages captured in the Hamas attack had been freed, along with many more Palestinian prisoners held in Israel.
Read more: The West Bank Is Being Reshaped Along With Gaza Post-Oct. 7
Israel had also allowed more and more humanitarian aid to flow, and US officials had impressed upon Netanyahu to take their concerns into account. Blinken said the US was still focused on making sure the conflict doesn’t spread in the region — so far, a successful effort — and looking toward what he called a “just, lasting and secure peace” for the Palestinian territories.
Yet as the truce collapsed, Israel and the US saying Hamas had carried out a deadly attack and reneged on commitments to release more women hostages. Hamas said Israel was to blame - a familiar cycle of finger-pointing.
Blinken told reporters that Hamas had fired rockets at Israel while the cease-fire was still in effect, and, separately, killed Israelis at a bus stop.
Earlier: Hamas Popularity in West Bank Stalls Israeli Bid to Crush It
“Clearly the first phase of the operation, before the cease-fire, exacted such an enormous cost,” said Brian Katulis, vice president of policy at the Middle East Institute in Washington. “A lot of those people were told to move south. Now the campaign’s moving south. And that’s the real worry that a lot of people in the administration have.”
Defense Secretary Lloyd Austin, speaking to reporters in California on Friday, said that each time he speaks to his Israeli counterpart, Yoav Gallant, “I remind him of the necessity to make sure that we’re protecting innocent civilians and creating pathways for civilians to move out of out of the battle space.”
Outside experts said the idea of creating civilian safe zones and doing more to avoid a humanitarian catastrophe wouldn’t be easy for Israel, given that doing so would likely put more of its soldiers in harm’s way.
For Israeli, “if they’re going to firm up the rules of engagement to reduce these civilian casualties, the implication there, which is absolutely direct, is that they will have to take more on-the-ground military casualties,” Frank Ledwidge, former military intelligence officer and lecturer in strategy at Portsmouth University in the UK, told Bloomberg Radio. “Let’s see if they have the appetite for that.”
--With assistance from Iain Marlow and Peter Martin.
(Recasts with talks deadlocked in second paragraph.)
©2023 Bloomberg L.P.
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Middle East Business & Economics
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With a two-letter word, Australians have struck down the first attempt at constitutional change in 24 years, major media outlets reported, a move experts say will inflict lasting damage on First Nations people and suspend any hopes of modernizing the nation’s founding document.
Early results from the Australian Electoral Commission (AEC) suggested that most of the country’s 17.6 million registered voters had written No on their ballots, and CNN affiliates 9 News, Sky News and SBS all projected no path forward for the Yes campaign.
The proposal, to recognize Indigenous people in the constitution and create an Indigenous body to advise government on policies that affect them, needed a majority nationally and in four of six states to pass.
Supporters of the Yes vote had hailed it as an opportunity to accept the outreached hand of First Nations people and to work with them to solve problems in their most remote communities – higher rates of suicide, domestic violence, children in out-of-home care and incarceration.
However, resistance swelled as conservative political parties lined up to denounce the proposal as lacking detail and an unnecessary duplication of existing advisory bodies.
No campaigns gained momentum with slogans that appealed to voter apathy – “If you don’t know, vote No” – and a host of other statements designed to instil fear, according to experts, including that it would divide Australia by race and be legally risky, despite expert advice to the contrary.
Rejection of high-profile campaign
No shortage of high-profile voices lent their support to the Yes campaign.
Constitutional experts, Australians of the Year, eminent retired judges, companies large and small, universities, sporting legends, netballers, footballers, reality stars and Hollywood actors flagged their endorsement. There was even an unlikely intervention by US rapper MC Hammer.
Aussie music legend John Farnham gifted a song considered to be the unofficial Australian anthem to a Yes advertisement with a stirring message of national unity. But opinion polls continued to slide to No.
Objections came thick and fast from the leaders of opposition political parties, who picked at loose threads of the proposal. “Where’s the detail?” they asked, knowing that would be decided and legislated by parliament.
Some members of the Indigenous community said they didn’t want to be part of a settler document, demanding more than a body that gives the government non-binding advice. Other Australians were completely disengaged.
Yes campaigner Marilyn Trad told CNN that volunteers making calls to prospective voters had to break the news to some – this week – that there was indeed a referendum.
Kevin Argus, a marketing expert from Royal Melbourne Institute of Technology (RMIT), told CNN the Yes campaign was a “case study in how not to message change on matters of social importance.”
“From a public relations perspective, what is proposed is quite simple – an advisory group to government. Not unlike what the business council, mining groups, banking groups and others expect and gain when legislation is being drafted that affects the people they represent,” he said.
Argus said only the No campaign had used simple messaging, maximized the reach of personal profiles, and acted decisively to combat challenges to their arguments with clear and repeatable slogans.
What does the result mean?
The result means no constitutional change, but the referendum will have lasting consequences for the entire nation, according to experts.
For First Nations people, it will be seen as a rejection of reconciliation by Australia’s non-Indigenous majority and tacit approval of a status quo that is widely considered to have failed them for two centuries.
Before the vote, Senator Pat Dodson, the government’s special envoy for reconciliation, said win or lose, the country had a “huge healing process to go through.”
“We’ve got to contemplate the impact of a No vote on the future generations, the young people,” he told the National Press Club this week. “We already know that the Aboriginal youth of this country have high suicide rates. Why? They’re not bad people. They’re good people. Why don’t they see any future?”
Maree Teesson, director of the Matilda Center for Research in Mental Health and Substance Use at the University of Sydney, told CNN the Voice to Parliament had offered self-determination to Indigenous communities, an ability to have a say over what happens in their lives.
“Self-determination is such a critical part of their social and emotional well-being,” she said.
Teesson said a No vote doesn’t just maintain the status quo, it “undermines the self-determination of Aboriginal and Torres Strait Islander people.”
“I do hope that we don’t lose the possibility of the hope that this gave our nation and that we somehow work to find another way to achieve that,” she said.
Some experts say more broadly the No outcome could deter future leaders from holding referendums, as it could indicate that the bar for constitutional change – written into the document in 1901 – is too high.
The last time Australians voted down a referendum was in 1999 when they were asked to cut ties with the British monarchy and become a republic – and little has changed on that front since then.
“The drafters of the constitution said this is the rulebook and we’re only going to change it if the Australian people say they want to change it – we’re not going to leave it up to politicians,” said Paula Gerber, professor of Law at Monash University.
“So that power, to change, to modernize, to update the constitution has been put in the hands of the Australian people. And if they are going to say every time, “If you don’t know, vote No,” then what politician is going to spend the time and money on a referendum that can be so easily defeated?”
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Australia Business & Economics
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LONDON, June 29 (Reuters) - Britain will discuss temporary business visas as part of Free Trade Agreement talks with India but any deal will not contain broader immigration commitments or access to Britain's labour market for Indian workers, trade minister Kemi Badenoch said.
Britain launched trade talks with India in January last year, and Prime Minister Rishi Sunak has stressed that he won't sacrifice quality for speed in negotiations.
Last year interior minister Suella Braverman sparked a row with comments about the possible impact of Indian migrants in trade talks, citing concern both with any "open borders migration policy with India" and those who overstay visas.
Badenoch set out Britain's stance in response to a question about how government ensures it "speaks with a single voice on migration and mobility in relation to a UK-India trade agreement," and avoids "disruptive political off-stage noises."
"An FTA with India will not contain commitments on immigration or provide access to the UK domestic labour market," Badenoch said in a written response to lawmakers published on Thursday.
"There will also be no agreement to anything which undermines the principles or functioning of the UK's points-based immigration system, or which undermines the UK's ability to control its own border."
She added that the negotiations would discuss business mobility, "which would make it easier for highly skilled professionals to deliver services in each other's markets on a short-term and temporary basis."
Negotiators were also exploring provisions to facilitate the mutual recognition of professional qualifications where it might be possible with regulators, she said.
Badenoch has previously warned that the deal may not have everything that the services sector would want.
She did not make reference to when negotiations, which have not made quick progress this year, would conclude by, saying she would update lawmakers "in due course" on the talks.
Our Standards: The Thomson Reuters Trust Principles.
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United Kingdom Business & Economics
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A cashier checks Indian rupee notes inside a room at a fuel station in Ahmedabad, India, September 20, 2018. REUTERS/Amit DaveRegister now for FREE unlimited access to Reuters.comMUMBAI, Aug 22 (Reuters) - The Indian rupee was trading lower versus the dollar on Monday as China's yuan led a broader decline in Asian currencies on concerns over the Federal Reserve's rate hike path.The rupee was trading at 79.86 per U.S. dollar by 0542 GMT, down from 79.7750 in the previous session, edging closer to its Jul.19 record low of 80.0650.The dollar index on Monday reached 108.285, the highest since July 15. The offshore Chinese yuan dropped to 6.8518 to the dollar, the lowest in nearly two years, after China cut its benchmark lending rate and lowered the mortgage reference by a bigger margin, adding to last week's easing measures.Register now for FREE unlimited access to Reuters.com"The global backdrop remains conducive for USD/INR to aim for fresh all-time high over this week," said Anindya Banerjee, head of research for forex and interest rates at Kotak Securities.As long as the dollar index remains strong and the yuan under pressure, USD/INR will threaten 80 levels, Banerjee said.Expectations that the Fed will keep hiking rates and U.S. rates will stay high for long are supporting the dollar and lifting Treasury yields. Fed officials have signalled that the U.S. central bank was committed to raising rates as high as necessary to tame inflation. The bets that the Fed could turn dovish later next year have had to be scaled back.In line with broadly hawkish comments from officials recently, Richmond Fed President Thomas Barkin said on Friday the "urge" among central bankers was towards faster, front-loaded rate increases.Investors are now turning focus to comments of Fed Chair Jerome Powell when he addresses an annual global central banking conference in Jackson Hole, Wyoming, on Friday.Indian shares, tracking decline in Asian shares and U.S. equity futures, dropped. The BSE Sensex (.BSESN) was down more than 1%, adding to Friday's decline.USD/INR forward premiums were slightly higher. Oil prices declined 1.3%.Register now for FREE unlimited access to Reuters.comReporting by Nimesh Vora
Editing by Dhanya Ann ThoppilOur Standards: The Thomson Reuters Trust Principles.
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Forex Trading & Speculation
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Israeli authorities are investigating claims by US researchers that some investors may have known in advance about the Hamas plan to attack Israel on 7 October and used that information to earn millions of dollars by short-selling Israeli shares.
Research by law professors Robert Jackson Jr from New York University and Joshua Mitts of Columbia University found significant short-selling of shares leading up to the attacks that triggered the war.
Short-sellers place bets on shares that they expect to fall in price. They pay a fee to borrow shares in a company and then sell them in the hope of buying them back at a lower price and pocketing the profit.
“Days before the attack, traders appeared to anticipate the events to come,” the researchers wrote, citing short-selling of an exchange traded fund that broadly tracks the performance of the Israeli stock exchange that “suddenly, and significantly, spiked” on 2 October.
“And just before the attack, short-selling of Israeli securities on the Tel Aviv Stock Exchange (TASE) increased dramatically,” they wrote in their 66-page report. One of the researchers told the Telegraph newspaper that it was not inconceivable that the profits from this short-selling were “above $100m”.
Their research was based on data from the Financial Industry Regulatory Authority.
The Israel Securities Authority (ISA) said it was aware of the matter and that it was “under investigation by all the relevant parties”. A spokesperson for the ISA did not elaborate, and Israeli police did not immediately comment.
According to the research, the short-selling observed prior to 7 October “exceeded the short-selling that occurred during numerous other periods of crisis”, including the recession after the financial crisis in 2008, the 2014 Israel-Gaza war, and the Covid-19 pandemic.
In one example documented in the research, 4.43m new shares in Leumi, Israel’s largest bank, were sold short between 14 September and 5 October. Leumi’s share price dropped by almost 9% on 8 October in the immediate aftermath of the attack.
The report notes that the sharpest increase in short-selling occurred during what is normally a time of relatively little activity in Israel due to Jewish holidays.
The research also found that while there was no increase in shorting of Israeli companies on US exchanges, there was an “unusual increase” in “risky” trades just before the attacks. “Our findings suggest that traders informed about the coming attacks profited from these tragic events, and consistent with prior literature we show that trading of this kind occurs in gaps in US and international enforcement of legal prohibitions on informed trading.”
The professors noted similar patterns of short-selling in early April, when it was reported that Hamas was initially planning its attack on Israel.
Short-selling “peaked on April 3 at levels very similar to those observed on Oct 2, and was far higher by an order of magnitude than other days prior to April 3,” they said.
News of the study was first reported on Israel’s financial news website The Marker.
Reuters contributed to this report
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Stocks Trading & Speculation
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ISTANBUL, Sept 29 (Reuters) - Turkish President Tayyip Erdogan said on Thursday he had advised the central bank to lower its policy rate at its upcoming meetings, a day after saying he expects interest rates to come down to single digits by year-end.Turkey's central bank cut its policy rate by 200 basis points to 12% in the last two months, delivering shocks to markets after inflation surged to 80% in August.The rate cuts are part of Erdogan's unorthodox policy of lowering rates to lower inflation. An easing cycle at the end of last year sparked a currency crisis stoking inflation, which is now at 24-year highs.Register now for FREE unlimited access to Reuters.comSpeaking at the general assembly of a merchants' confederation, Erdogan repeated his unorthodox view that lower rates will lead to lower inflation."My biggest battle is against interest. My biggest enemy is interest. We lowered the interest rate to 12%. Is that enough? It is not enough. This needs to come down further," he said."We have discussed, are discussing this with our central bank. I suggested the need for this to come down further in upcoming monetary policy committee meetings," Erdogan added.On Wednesday, Erdogan said interest rates will come down to single digits by year-end, despite a global tightening cycle, an ailing currency and soaring energy prices.Turkey's lira, which hit its record low of 18.55 against the dollar on Thursday, fell some 29% this year on top of a 44% fall last year on concerns over unorthodox economic policies.The currency has been less reactive to similar comments from Erdogan than in the past, largely due to the central bank adopting a more dominant role in the forex market since December.Ipek Ozkardeskaya, senior analyst at Swissquote, said the lira is not as weak as it should be thanks to the central bank's role in the forex market."The Turkish central bank is trying to weather the sell-off and the downside pressure but obviously there is only so much that they can do when the global winds are flowing so violently against the lira," she said."This whole thing is a time bomb."Register now for FREE unlimited access to Reuters.comReporting by Ali Kucukgocmen and Nevzat Devranoglu;
Additional reporting by Bansari Mayur Kamdar in Bangalore
Editing by Alison Williams, Alexandra HudsonOur Standards: The Thomson Reuters Trust Principles.
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Interest Rates
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Story at a glance Hundreds of scientists took part in protests across the globe to call for urgency in addressing climate change. Over 1,000 scientists took part in protests in more than 25 countries this past week. The protests come in the wake of a UN report stating humanity only has three more years to curb greenhouse gas emissions and avoid more severe climate disasters. Hundreds of scientists from around the world took part in protests last week to apply pressure on government agencies to make “rapid and deep” cuts to greenhouse gas emissions before it’s too late. In London, 25 scientists glued pages of scientific papers, along with their hands, to the windows of the Department of Business, Energy and Industrial Strategy to force the agency to look at the climate research they say the British government has been ignoring, The Guardian reported. In Madrid, over 50 protesters were arrested after taking to the streets and throwing fake blood on the steps of the Spanish Parliament’s Congress of Deputies. America is changing faster than ever! Add Changing America to your Facebook or Twitter feed to stay on top of the news. In Los Angeles, NASA scientist Peter Kalmus and three other people were arrested on Wednesday after they chained themselves to the front door of a Chase Bank building in protest of the company’s investment in fossil fuels. “We’ve been trying to warn you guys for so many decades that we’re heading towards a f—— catastrophe, and we’ve been being ignored,” said Kalmus, Business Insider reported. “The scientists of the world are being ignored, and it’s got to stop. We’re not joking. We’re not lying. We’re not exaggerating.” Kalmus and his fellow protesters were met with 100 LAPD officers in riot gear and arrested, according to Salon. The protests were part of a week of civil disobedience organized by Scientist Rebellion, the scientific branch of the climate change activist group Extinction Rebellion. More than 1,000 scientists from over 25 countries took part in the protests to highlight the findings from a United Nations Intergovernmental Panel on Climate Change report stating humanity only has three more years to cut greenhouse gas emissions. The report states that “rapid and deep” cuts to greenhouse gas emissions are needed by 2025 to keep the planet below 1.5 degrees Celsius of global warming and avoid the most severe climate disasters. If nothing is done to curb emissions by 2025, greenhouse gas emissions will cause a median global warming temperature of 3.2 degrees Celsius by 2100, according to the report. READ MORE STORIES FROM CHANGING AMERICA WOLVERINE CAPTURED, COLLARED IN ‘ONCE-IN-A-LIFETIME EXPERIENCE’ FOR UTAH RESEARCHERS WILDLY RARE VIDEO SHOWS YELLOWSTONE BEAR JOIN IN WOLF HUNT — AND STEAL FOOD IN ‘KLEPTOPARASITIC’ DRAMA RESEARCHERS CAPTURE FOOTAGE OF RARE DEEP SEA FISH WITH TRANSLUCENT HEAD ‘I THOUGHT I WAS GOING TO DIE’: MAN SUDDENLY ATTACKED BY PACK OF OTTERS Published on Apr. 15, 2022
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Energy & Natural Resources
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