By Michael S. Derby

NEW YORK (Reuters) – A little more than a year after a trading controversy rattled the Federal Reserve’s standing in Washington and beyond, new ethics missteps have hampered efforts by the U.S. central bank and its chief, Jerome Powell, to put the matter behind them.

Over recent weeks, Atlanta Fed President Raphael Bostic acknowledged that over the last few years he’d accidentally broken standards then in place defining permissible investment activity. Meanwhile, St. Louis Fed President James Bullard generated controversy for speaking behind closed doors to a banker group on Oct. 14, raising fears those financial professionals were getting insider information on central bank deliberations.

These latest events show that as far as the Fed has come in tightening its ethical standards, its work is not yet finished. The central bank has won praise for adoption of a new ethics code that may be the most stringent in the U.S. government, but the program has yet to be fully implemented. At the same time, an in-house Inspector General (IG) investigation into the regional Fed trading activities still hasn’t been released and it’s unclear when it will be.

“I give (the Fed) a letter A grade for the changes that they made, the pace that they made the changes, the kind of ethical leadership from Powell in calling for the (IG) to do the investigation and for committing to not participate or have any influence on the Inspector General’s report,” said Kaleb Nygaard, who studies Fed history at the University of Pennsylvania.

“But until that is fully out, I don’t think we can cast a full letter grade on them for their performance,” he said.

TIGHTENING THE RULES

Recent developments followed the revelation in September 2021 that Robert Kaplan and Eric Rosengren, then the presidents of the Dallas and Boston Fed banks, respectively, had actively traded in financial markets while helping set monetary policy for the Fed. Both Kaplan and Rosengren retired unexpectedly that month. At the start of this year, Fed second-in-command Richard Clarida stepped down early while also facing questions about his own trading activities.

All three now-former central bankers said their financial activities were consistent with an ethics code that limited when officials could trade and prohibited ownership of bank stocks. An IG report in July cleared Clarida and Powell, whose trading activities also were investigated, of wrongdoing.

In the wake of the Dallas and Boston Fed resignations, the Fed in February formalized a new code banning a wide range of securities ownership for policymakers, senior staff and their families. It also imposed limitations on when those bound by the code can shift their financial positions.

As part of that effort to improve oversight, a Fed spokesman said the central bank had so far doubled to six the number of staff involved in the ethics process.

Unresolved in that process are publicly available disclosures for top staff at regional Fed banks. Right now, only disclosures for the Fed chief, members of the Fed’s Board of Governors, top central bank staff and regional bank presidents are available. Given the quasi-private nature of the 12 regional Fed banks, there’s no formal mechanism to compel those institutions to release this information.

The new system also offers waivers for certain situations, and it remains unclear how that process will be managed. Some ethics experts have been concerned that if these waivers aren’t publicly disclosed they could allow the new rules to be undermined.

The Fed acknowledged giving a waiver in June to Richmond Fed President Thomas Barkin. It said on Friday the waiver Barkin requested deals with family trusts, which hold in part some prohibited company shares. The Fed noted that Barkin and his immediate family do not own, manage or benefit from the trusts in question, only that he “is primarily responsible for making decisions regarding distribution of the trusts’ assets to the trusts’ beneficiaries.”

A Fed spokesperson said “we are continuing to review our disclosure practices” for central bankers covered by the new policy, and for making public waivers.

A spokesperson for the Fed’s IG declined to say when the report on the regional Fed trading activity would be released or whether Bostic’s activities would be included in it or would be the focus of a separate probe.

REGIONAL REVIEW

Some observers of the Fed hope that as it moves forward with tightening up its ethical standards it will take a more rigorous look at the regional Fed banks, where the most notable trading activity happened.

The Fed faced some criticism last year for failing to identify the financial trading activity that ensnared the regional bank presidents. All of the regional Fed bank presidents had just been vetted for new five-year terms in a process led by Lael Brainard, then a Fed governor and now the central bank’s second-in-command.

The Fed committee that oversees the regional banks is now led by Governor Christopher Waller. Waller spent much of his career at the St. Louis Fed and, as a result, may have greater insight into how these institutions operate.

Peter Conti-Brown, a professor at the Wharton School of the University of Pennsylvania, said “I think the (Board of Governors) is extraordinarily lax in its oversight” of the regional Fed banks. He added that the complex central bank system is “awkward,” but “that awkwardness doesn’t give the Board license to ignore its oversight responsibilities.”

Managing communications issues at the regional level could also be an issue in the wake of Bullard’s recent closed-door talk to bankers, which the St. Louis Fed stressed came amid a very extensive slate of public commentary. His appearance may have skirted up against behavior the central bank’s official communications policy says should be avoided.

The St. Louis Fed said on Oct. 20 “we are listening to the commentary around this and will think differently about this in the future.”

(Reporting by Michael S. Derby; Editing by Dan Burns and Paul Simao)

(Reuters) -Tesla Inc boss Elon Musk said on Monday he will serve as chief executive of Twitter, the social media company he just bought for $44 billion, a move that Wall Street analysts have said could stretch the billionaire thin.

Musk, who also runs rocket company SpaceX, brain-chip startup Neuralink and tunneling firm the Boring Company, fired Twitter’s previous chief Parag Agrawal and other top company officials last week, and has proposed revisions to the platform’s user verification process, which has been free until now.

Responding to a tweet from author Stephen King that he would not be willing to pay $20 a month to keep the verified badge on Twitter, Musk replied: “How about $8?”

The billionaire said that introducing a price was the only way to defeat trolls and bots on the platform and that Twitter could not entirely rely on advertisers to pay its bills.

Musk announced his Twitter CEO role in a securities filing. In another filing on Monday, Musk revealed that he became the sole director of Twitter as a result of the takeover.

Musk had previously changed his Twitter bio to “Chief Twit” in an allusion to his planned move. Twitter on Monday declined to comment on how long Musk might remain CEO or appoint someone else.

“The following persons, who were directors of Twitter prior to the effective time of the merger, are no longer directors of Twitter: Bret Taylor, Parag Agrawal, Omid Kordestani, David Rosenblatt, Martha Lane Fox, Patrick Pichette, Egon Durban, Fei-Fei Li and Mimi Alemayehou,” Musk said in the filing.

Shortly afterward, Musk tweeted that the move to dissolve the board “is just temporary,” without elaborating.

Replying to a tweeted question on what was “most messed up at Twitter”, Musk tweeted on Sunday that “there seem to be 10 people “managing” for every one person coding.”

On Monday, Nick Caldwell, a general manager at Twitter’s Core Technologies indicated on his Twitter bio that he was no longer with the company. Caldwell and Twitter did not respond to Reuters’ request for comment outside regular business hours.

Since the takeover, which concluded last week, Musk has moved quickly to put his stamp on Twitter, which he had ridiculed for months for being slow to introduce product changes or take down spam accounts.

His teams began meeting with some employees to investigate Twitter’s software code and understand how aspects of the platform worked, according to two sources familiar with the matter.

Some staff who spoke with Reuters said they had received little communication from Musk or other leaders and were using news reports to piece together what was happening at the company.

Tesla’s stock has lost a third of its value since Musk made an offer to buy Twitter in April, compared with a 12% decline in the benchmark S&P 500 index in the same period.

(Reporting by Chavi Mehta in Bengaluru, Sheila Dang in Dallas and Sayantani Ghosh in San Francisco; Additional reporting by Shivani Tanna and Mrinmay Dey in Bengaluru; Editing by Muralikumar Anantharaman and Stephen Coates)

By Julie Gordon and Anna Mehler Paperny

OTTAWA (Reuters) -Canada plans to welcome a record 500,000 new permanent residents in 2025 and has boosted its targets over the next two years as the country looks to ramp up arrivals to address an acute labour shortage, Immigration Minister Sean Fraser said on Tuesday.

Canada now expects to welcome 465,000 new permanent residents in 2023, up 4% from a previous target, and 485,000 in 2024, up 7.5%.

“This year’s immigration levels plan will help businesses find the workers they need,” said Fraser in a statement.

He added the new targets would also allow Canada to fulfil commitments to help those fleeing violence and war in their home countries. Canada is projected to reduce the number of government-assisted refugees it resettles by about a third, from 23,550 in 2023 to 15,250 in 2025.

Prime Minister Justin Trudeau has sharply ramped up immigration since taking power in 2015. The country is on track to surpass its target of roughly 431,000 newcomers this year.

Canada is struggling with an acute shortage of workers, particularly in skilled trades and industries like healthcare. The most recent job vacancy data showed there were 958,500 open roles in Canada in August and 1.0 million unemployed people.

Many of the unemployed do not have the skills, or do not live in the right areas of the country, to fill those open positions.

The new targets will boost the number of economic immigrants by about 13% between 2023 and 2025, with steep increases in relatively small regional programs that help funnel people to provinces and regions outside major urban centres.

A record number of Canadians are now retiring, hastening a mass exodus of Canada’s most highly skilled workers and leaving businesses scrambling.

In a statement on Tuesday, the Business Council of Canada called for “bolder targets” in economic immigration.

The United Nations refugee agency said in a statement it welcomed “Canada’s leadership on refugee resettlement.”

Refugee lawyer Maureen Silcoff said Canada can do more to welcome vulnerable people. She contrasted Canada’s policy offering refuge to Ukrainians, who are officially temporary residents under a special program and not subject to a cap, and Afghans who face danger from the Taliban for working with Canada but whose numbers are capped.

“Given what’s going on in the world, given Canada’s needs and given Canada’s commitments, there’s more that can be done.”

There are many good reasons to increase immigration, said University of Waterloo economist Mikal Skuterud. But with rising interest rates, the tight labour market may slacken and newcomers may face challenges integrating, he said.

“We’re at a real kind of inflection point. There is a tremendous amount of uncertainty.”

(Reporting by Julie Gordon in Ottawa and Anna Mehler Paperny in Toronto; Editing by Josie Kao)

By Manas Mishra and Michael Erman

(Reuters) -Pfizer Inc on Tuesday raised its forecast for 2022 sales of its COVID-19 vaccine by $2 billion to $34 billion, and said new deals and drugs in development should help replace future declining vaccine sales and lost revenue from patent expirations.

The U.S. drugmaker’s shares rose 2.7% to $47.84 as its third-quarter profit beat estimates, mainly due to higher-than-expected sales of the vaccine it shares with German partner BioNTech.

The upbeat earnings also sent shares of rival COVID-19 vaccine makers higher. Novavax Inc and Moderna Inc were up roughly 2% each.

Sales of the Pfizer/BioNTech COVID vaccine are down from pandemic highs as many countries have neared the end of their primary vaccination campaigns. There are also concerns about soft demand for newly updated booster shots.

In response, Pfizer hopes to roughly quadruple the price of the vaccine in the United States once the government stops buying doses and sales shift to the private market.

Chief Executive Albert Bourla said in an interview that the company is trying to showcase what a “post-COVID crisis” Pfizer will look like.

COVID-19 treatments and vaccines will be multibillion-dollar franchises, he said, “but that will be stable, not with ups and downs. And the growth will be driven by the pipeline and the business development.”

Pfizer is expected to face the loss of patent protections for some key drugs between 2025 and 2030. The company has turned to deals such as its recent $5.4 billion acquisition of Global Blood Therapeutics Inc and its $11.6 billion purchase of Biohaven to beef up its pipeline of future products.

Bourla said the company’s internal pipeline should help replace lost growth from COVID sales and patent expirations, pointing to 19 products the company hopes to launch over the next 18 months that he said could deliver some $20 billion in annual revenue. These include treatments for ulcerative colitis and migraines, as well as its vaccine for respiratory syncytial virus (RSV).

The company said its experimental RSV vaccine was found to be effective in a late-stage study in preventing severe infections in infants when given to expectant mothers.

BMO Capital Markets analyst Evan Seigerman said some investors will point to the massive COVID vaccine beat as unsustainable, however, “we’re not yet throwing in the towel given an emerging pipeline and significant balance sheet flexibility.”

Third-quarter sales of the COVID vaccine came in at $4.40 billion, blowing past estimates of $2.60 billion.

However, $7.51 billion in sales of Paxlovid, the company’s COVID-19 antiviral treatment, fell short of estimates of $7.66 billion.

Pfizer reported adjusted earnings of $1.78 per share in the third quarter, beating analysts’ estimates by 39 cents.

(Reporting by Manas Mishra in Bengaluru; Editing by Shounak Dasgupta, Sriraj Kalluvila and Bill Berkrot)

By Shreyashi Sanyal and Ankika Biswas

(Reuters) -European shares gained on Tuesday, starting November on an upbeat note amid growing hopes that the U.S. Federal Reserve would slow down the pace of its interest rate hikes.

The pan-European STOXX 600 index rose 0.6% to hit a near seven-week closing high, with miners and retailers leading the gains.

Investors expect the U.S. central bank to raise its interest rates by 75 basis points on Wednesday, but hopes remain the central bank will deliver a smaller 50-bp increase in December.

“All eyes are on the Fed, so I am expecting markets to cage up today … If the Fed surprises with a more dovish stance, I’m expecting a strong move higher in risk assets and the dollar to move much lower,” said Giles Coghlan, chief market analyst at HYCM.

A better-than-expected earnings season has recently helped pull the STOXX 600 higher, but worries remain about the euro zone slipping into a recession as the European Central Bank promised more monetary policy tightening to combat record high inflation.

Further, rumours based on an unverified note circulating on social media that China was planning a reopening from strict COVID curbs in March triggered a rush to luxury names, which have major exposure to China.

Luxury giants including LVMH, Kering, Pernod Ricard and Hermes International advanced between 1.9% and 3.0%.

Miners leapt 3.4%, while oil & gas stocks added 1.7%, as prices of oil and industrial metals rose against a weak dollar. [O/R] [MET/L]

“There are social media reports on China easing its zero-COVID policy and look at how much relief it has brought to markets starved for some good news out of China,” Coghlan added.

The earnings season has also been largely supportive for markets. Out of the 163 STOXX 600 companies that have reported results so far, 58.3% exceeded analyst estimates, Refintiv data showed. In a typical quarter, 53% companies beat estimates.

Prosus NV jumped 9.3% after the technology investment firm denied a press report on a potential sale of its 28% stake in Chinese software and gaming giant Tencent.

Italy’s Monte dei Paschi di Siena rose 4.9% as it said its up to 2.5 billion euro ($2.5 billion) capital increase had been 93% covered so far.

Dutch specialty chemicals maker DSM dropped 4.0% as it lowered its 2022 profit outlook.

(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Subhranshu Sahu and David Evans)

By Arunima Kumar

(Reuters) -Marathon Petroleum and Phillips 66 posted quarterly profits which cruised past Wall Street estimates on Tuesday, becoming the latest U.S. refiners to benefit from robust fuel demand and margins amid tight supplies.

U.S. refiners are posting strong profits with refineries running at record levels this year, strong export demand amid a squeezed supply due to Russia’s invasion of Ukraine and plant closings.

The sector has, however, drawn criticism from President Joe Biden, who said refiners were putting profits ahead of consumers and urged them to expand capacity.

Shares of Marathon rose as much as 4% to their all-time high of $118.09, while Phillips 66 jumped 5% to $109.66.

Top bosses of both refiners said market environment continues to be favorable and product demand remains strong.

“As supply remains constrained and demand continues to rebound, we maintain a bullish outlook towards the refining environment as we look into 2023,” said Michael Hennigan, Marathon’s chief executive officer, on a call.

Marathon, the largest U.S. refiner by capacity, said quarterly crude capacity utilization was about 98%, resulting in total throughput of 3 million barrels per day (bpd), 7% higher than a year earlier.

For the current quarter, it expects refinery throughput to be 2.9 million bpd.

Amid the bumper results, Marathon also increased its dividend by 30% to 75 cents per share and expects to commence share buy backs in November using the remaining $5 billion repurchase authorization.

“Marathon’s strong financial position and sizable share repurchase program should provide downside protection if oil demand falls…see an opportunity for increasing cash returns,” said Faisal Hersi, an analyst at Edward Jones.

Marathon’s refining and marketing margin doubled to $30.21 per barrel for the reported quarter compared with a year earlier.

Mirroring similar gains, rival Phillips 66’s realized refining margins tripled in the July-September quarter to $26.58 per barrel.

“(PSX) quarterly results were solid, in our view, as all four segments exceeded expectations, but the refining segment led the way,” Hersi added.

Phillips said it returned $1.2 billion through share repurchases and dividends during the quarter.

On an adjusted basis, Marathon reported a profit of $7.81 per share, beating average analysts’ estimate of $7.07, while Phillips 66’s adjusted profit of $6.46 per share smashed estimates of $5.04, according to Refinitiv data.

(Reporting by Arunima Kumar in Bengaluru; Editing by Krishna Chandra Eluri)

By Katharine Jackson

WASHINGTON (Reuters) -Education technology company Chegg Inc agreed to bolster its data protections as part of a consent agreement reached with the U.S. Federal Trade Commission (FTC), which had criticized company security practices, saying they exposed the personal data of millions of users.

The agency alleged that Chegg failed to act after suffering four security breaches since 2017, exposing sensitive information like dates of birth, family heritage and passwords.

The proposed FTC order would require the company to limit the data it can collect, offer users access to data collected about them and implement multifactor authentication, the commission said in a statement on Monday.

Marc Boxser, a spokesperson for Chegg, said the company had worked with the FTC to “find a mutually agreeable outcome and will comply fully” to resolve issues that it said took place more than two years ago.

(Reporting by Katharine Jackson; Additional reporting by Diane Bartz; Editing by David Gregorio)

By Chibuike Oguh

NEW YORK(Reuters) -Private equity firm KKR & Co Inc’s after-tax distributable earnings fell 11% in the third quarter from a year earlier on a steep drop in transaction fees, although the result came in ahead of expectations.

Initial public offerings and debt refinancings, which KKR’s capital markets unit helps arrange, were down sharply this quarter, while the Federal Reserve’s hiking of interest rates pushed about financing costs and fueled stock market volatility.

After-tax distributable earnings – which represents cash used to pay dividends – fell to $823.7 million. That translates to after-tax distributable earnings per share of 93 cents, greater than the average analyst forecast of 85 cents, according to Refinitiv data. KKR’s shares were up 1.18% at $49.24 per share around noon on Tuesday.

KKR said income from its capital markets unit tumbled 41% to $116.1 million a year earlier. Income from investments made out of its balance sheet fell to $285 million, a 36% slide as the firm cashed out fewer assets from its private equity portfolio amid the volatility.

“High levels of inflation are clearly impacting global consumers, while the sharp increase in interest rates has had multiple knock-on effects that will invariably slow much of the global economy,” said KKR Chief Financial Officer Robert Lewin during an analyst earnings call on Tuesday.

KKR said its private equity funds depreciated by 4% during the third quarter. Opportunistic real estate funds were down 1% while leverage credit funds gained 1%.

By contrast, Blackstone Inc reported a 0.3% decline in its corporate private equity funds and a 0.6% drop in its opportunistic real estate funds.

KKR’s fee-related earnings rose 2% to $541.8 million due to an increase in management fees owing to strong fundraising and the closing of its acquisition of Japanese real estate asset manager Mitsubishi Corp-UBS Realty Inc.

KKR struck deals worth $16 billion during the quarter, raised $13 billion of new capital, generated $496.5 million as carried interest, and held $113 billion of unspent capital.

Total assets under management stood at $496 million. The firm declared a regular dividend of 15.5 cents per share.

(Reporting by Chibuike Oguh in New York; Editing by Edwina Gibbs and Josie Kao)

By Hyunjoo Jin

(Reuters) – Elon Musk has championed Tesla Inc’s driver assistance Autopilot and “Full Self-Driving” software as innovations that will both improve road safety and position the electric vehicle maker as a technology leader.

But the Tesla systems – and Musk’s claims about them – face their biggest challenge since the launch of Autopilot in 2015 as a series of lawsuits and a criminal case over fatal Tesla accidents head to court.

Here is a list of legal and regulatory challenges to Autopilot:

CRIMINAL CASE IN CALIFORNIA

A Model S driver charged with manslaughter after a fatal accident while using Autopilot in 2019 in Los Angeles faces a trial set to start Nov. 15. Tesla was not charged, but the Tesla system and the company’s claims about it are expected to be in focus. The trial is being watched by legal experts as a kind of test case for the responsibility of a human driver who was in a car partly driving itself.

The family of one of the two people who died in the crash has also sued Tesla and the driver, claiming Tesla should have taken steps to safeguard abuses of Autopilot. That trial is scheduled for July.

FLORIDA LAWSUIT

A lawsuit against Tesla is set to go to trial in February over an accident that killed the 50-year-old Tesla Model 3 owner Jeremy Banner when his car struck a tractor trailer at the intersection of a highway in Florida in 2019. This is scheduled to be the first civil lawsuit related to Autopilot that goes to trial.

MOUNTAIN VIEW ACCIDENT

A 2018 crash involving a Tesla Model X killed the driver, Apple engineer Walter Huang, when it swerved and slammed into a concrete divider on a freeway in Mountain View, California. A lawsuit by his wife against Tesla is scheduled to go to trial in March.

The National Transportation Safety Board investigated both the California and Florida accidents, and blamed both the driver and Tesla. The NTSB said drivers relied too heavily on the Autopilot system, while Tesla failed to restrict the use of Autopilot or to adequately monitor driver attentiveness.

In 2018, Tesla said the driver’s hands in the Mountain View accident were not detected on the wheel for 6 seconds prior to the collision, and that he did not take action to avoid the accident.

DEPARTMENT OF JUSTICE INVESTIGATION

Tesla is under criminal investigation in the United States over claims that the company’s electric vehicles can drive themselves, three people familiar with the matter told Reuters.

The Justice Department investigation potentially could conclude with criminal charges against the company or individual executives, the people familiar with the inquiry said.

CALIFORNIA INVESTIGATION

In August, California’s transportation regulator accused Tesla of “deceptive practice” of advertising suggesting its driver assistance technology provided autonomous vehicle control.

California’s Department of Motor Vehicles (DMV) could suspend Tesla’s license to sell vehicles in California and require the company to make restitution to drivers.

California’s DMV is also conducting a separate safety review which could force Tesla to seek regulatory permits to operate its vehicles in California.

The DMV said it “remains in the discovery stage of this proceeding,” without elaborating.

NHTSA INVESTIGATION

In June, the National Highway Traffic Safety Administration upgraded its defect investigation into 830,000 Tesla vehicles with Autopilot, a required step before it could seek a recall. The auto safety regulator is reviewing whether Tesla vehicles adequately ensure drivers are paying attention.

NHTSA has asked for information on Tesla’s internal camera and what role it plays in monitoring driver attentiveness, as part of the probe.

Since 2016, NHTSA has opened nearly 40 special investigations involving 19 deaths in crashes involving Tesla vehicles.

CLASS ACTION

In September, Tesla was sued in a proposed class action accusing the EV maker and Musk of having deceptively advertised Autopilot and FSD as fully functioning or “just around the corner.”

The lawsuit filed in federal court in San Francisco said Tesla did this to “generate excitement” about its vehicles, drive up its stock price and become a “dominant player” in EVs.

Tesla did not respond to questions from Reuters about the lawsuits and investigations mentioned above.

(Reporting by Hyunjoo Jin in San Francisco; Editing by Lisa Shumaker and Matthew Lewis)

By Soo-hyang Choi and Hyonhee Shin

SEOUL (Reuters) -South Korea moved to calm public outrage on Tuesday over a Halloween party crush that killed more than 150 people, most of them young, promising a speedy and intensive inquiry and calling for tough new safety measures to prevent similar disasters.

The death toll from the crush at a crowded Halloween street party on Saturday climbed to 156 with 151 injured, 29 of whom were in serious condition. At least 26 citizens from 14 countries were among the dead.

Tens of thousands of revellers – many in their teens and twenties and dressed in costume – had crowded into narrow streets and alleyways of the popular Itaewon district for the first virtually unrestricted Halloween festivities in three years.

The country’s chief security officer, Interior Minister Lee Sang-min, apologised on Tuesday, vowing to find out the cause of the incident and prevent similar cases from recurring.

“As the minister overseeing the safety of the public, I express sincere apologies over the incident,” Lee said, adding that the government had “limitless responsibility over the safety of our people” as he addressed a parliamentary session televised live.

He has come under sharp public criticism after saying that deploying more police would not have prevented the disaster.

Seoul Mayor Oh Se-hoon also tearfully apologised during a media briefing and said the city government would put all available administrative resources “until every citizen can return to their normal lives”.

National Police Commissioner General Yoon Hee-keun earlier on Tuesday acknowledged crowd control at the scene was “inadequate,” noting that police had received multiple reports warning of possible accidents on the night of the disaster.

“The police will speedily and rigorously conduct intensive inspections and investigation on all aspects without exception to explain the truth of this accident,” Yoon told a news conference.

Prime Minister Han Duck-soo said the ongoing investigation would cover whether government agencies’ on-site responses were adequate. He pointed to inadequate institutional measures for crowd management as a cause of the deadly surge.

President Yoon Suk-yeol has declared a week of national mourning, saying the country had too many safety disasters. He said better responses were critical, including improved crowd control.

“We should come up with concrete safety measures to manage crowds, not only on these streets where this massive disaster took place but at other places like stadiums and concert venues where large crowds gather,” he said at a cabinet meeting.

All the victims have been identified and memorial altars have been set up at the Seoul city hall and in the Itaewon district, where citizens paid their respects.

(Reporting by Soo-hyang Choi and Hyonhee Shin; Writing by Jack Kim; Editing by Gerry Doyle and Jacqueline Wong)

By Jacob Gronholt-Pedersen and Nikolaj Skydsgaard

COPENHAGEN (Reuters) -Danes went the polls on Tuesday with Prime Minister Mette Frederiksen hoping for a vote of confidence in her handling of the pandemic and for her leadership to overcome soaring inflation and geopolitical insecurity.

The election has turned into a battle for centrist voters, with former prime minister Lars Lokke Rasmussen likely to become a king-maker with his new party, the Moderates, as neither the ruling left nor the right-wing opposition looks set to win a majority.

The vote comes as high energy prices and the highest inflation in four decades eat into household economies, and only a month after the sabotage of two pipelines carrying gas from Russia to Germany through Danish waters fuelled an unprecedented sense of insecurity among Danes.

Polls indicate that Frederiksen, 44, and her Social Democratic Party will gain slightly to again become the biggest party in parliament.

It is however far from certain that she will be able to stay in power. A poll published late on Monday by Gallup for daily Berlingske showed that 24% of voters had not yet made up their minds.

“I’ve been in doubt. It wasn’t until I stood inside the ballot box that I chose who to vote for,” Vibeke, who declined to give her surname, told Reuters outside a polling station in Copenhagen.

“I was actually leaning towards the Moderates. But I don’t know about Lars Lokke Rasmussen, whether he might be much more right-wing than you think. That is why I stuck with the Social Democrats,” she said.

Frederiksen, who became Denmark’s youngest-ever prime minister in 2019, is seeking to form a broad coalition across the traditional left-right divide, arguing that political unity is needed at a time of international uncertainty.

After a trailblazing election campaign, polls now indicate that Rasmussen and his Moderates, founded only four months ago, stand to become the third biggest party in parliament, behind the Social Democrats and his former party, the Liberals.

“I voted for the Moderates. I think they will come up with something fresh, something new,” Anders Lindeburg Moller, a university student, told Reuters in Copenhagen.

While Rasmussen backs the idea of a broad government, he has stubbornly declined to say whom he would choose to lead a new government.

“I’ve never experienced a government across the middle, so it would be interesting to see how that might work. Can they even agree on anything?” Moller said.

Although Rasmussen has not formally announced his candidacy to become prime minister, polls indicate voters would prefer him over right-wing candidates Jakob Ellemann-Jensen of the Liberal Party and Soren Pape Poulsen of the Conservatives.

“That’s not in my mind. The idea is to create a new political situation,” Rasmussen told reporters on Tuesday when asked if he hoped to become prime minister for the third time.

MINK AFFAIR

Frederiksen was widely applauded for steering Denmark safely through the COVID pandemic, but her tenure was stained by a controversial decision to cull the country’s entire mink herd in late 2020 over fears that they could spread a mutated variant of the coronavirus.

The order turned out to be illegal, resulting in the exit of a minister and a parliamentary probe. While Frederiksen avoided any legal consequences, it did result in fading support for her party and it shortened her tenure after a threat of a no-confidence vote forced her to call an early election.

The mink affair has also fuelled criticism from opposition lawmakers of Frederiksen seeking to centre power around herself and her office.

“I think she’s become a little bit too focused on power,” said Vitus Duus, a part-time student, whose primary concern is the economy and climate change.

“I have not been satisfied with the economic thinking of the leftist government, which is why I have voted for the right wing,” he told Reuters.

Frederiksen is under pressure to come up with solutions to the highest inflation in decades. So far, the government has been careful to use its favourite tools during the pandemic – massive aid packages and looser fiscal policy to stimulate the economy.

Tight spending leaves little room to provide assistance or to improve health care and other welfare services, a key topic in the campaign.

The right-wing opposition is worried that generous economic policies of a left-leaning government will stoke inflation and herald an economic crisis similar to the late-1970s and early 1980s.

The latest poll by Voxmeter indicates a 49%-41% lead for the left-leaning block over the right-leaning block, with the Moderates polling at 10% of votes.

Polling stations close at 8 p.m., followed immediately by two exit polls.

Public broadcasters DR and TV2 will give initial estimates of the results later in the evening, with a reliable, preliminary outcome due to be announced between midnight and 2 a.m. Wednesday morning.

(Reporting by Jacob Gronholt-Pedersen and Nikolaj Skydsgaard, additional reporting by Stine Jacobsen; Editing by Nick Macfie and Andrew Heavens)