By David Shepardson

(Reuters) -The U.S. business of Fiat Chrysler Automobiles pleaded guilty to criminal conspiracy on Friday and will pay about $300 million in a plea agreement to resolve a multi-year U.S. Justice Department diesel emissions fraud probe, court documents show.

FCA US LLC, now part of Stellantis, will pay about $300 million in criminal penalties arising from its efforts to evade emissions requirements for more than 100,000 older Ram pickup trucks and Jeep sport-utility vehicles in its U.S. lineup.

“FCA US engaged in a multi-year scheme to mislead U.S. regulators and customers,” said Assistant Attorney General Kenneth Polite, adding the department will hold “accountable companies that seek to place profits above candor, good corporate governance, and timely remediation.”

U.S. District Judge Nancy Edmunds in Detroit set a July 18 sentencing date. The settlement includes a $203.6 million forfeiture penalty and a $96.1 million fine. The government noted FCA US previously paid a $311 million civil penalty and paid over $183 million in compensation to over 63,000 people as part of a class-action diesel lawsuit.

FCA US will be on probation for three years. The automaker must conduct an initial review of its compliance with the Clean Air Act and inspection and testing procedures, submit a report and prepare at least two follow-up reviews and reports. Reuters first reported the settlement last week.

The Justice Department said FCA US installed deceptive software features intended to avoid regulatory scrutiny and fraudulently help the diesel vehicles meet required emissions standards. The department said the company “purposely calibrated the emissions control systems” to produce less emissions during the federal test procedures then under normal driving conditions.

The guilty plea represents the final significant action U.S. officials are expected to take against FCA in the emissions fraud matter.

Stellantis confirmed the settlement Friday and said in its 2021 financial disclosures that approximately 266 million euros ($301 million) was previously accrued related to this matter at the time.

The affected diesel-powered vehicles span model years 2014 to 2016. FCA merged with French Peugeot maker PSA in 2021 to form Stellantis.

Three FCA U.S. employees have been indicted for conspiracy to defraud the United States and to violate the Clean Air Act and are awaiting trial.

The plea deal comes five years after Volkswagen AG pleaded guilty to criminal charges to resolve its own emissions crisis affecting nearly 600,000 vehicles in a scandal that became known as “Dieselgate.”

(Reporting by David Shepardson; Editing by Aurora Ellis)

By Laura Sanicola

(Reuters) – Oil settled higher on Friday, supported by expectations that OPEC’s decision to increase production targets by slightly more than planned will not add that much to global supply which should tighten as China eases COVID restrictions.

The Organization of the Petroleum Exporting Countries and allies, known as OPEC+, on Thursday agreed to boost output by 648,000 barrels per day (bpd) a month in July and August rather than 432,000 bpd as previously agreed.

Brent crude rose $2.11, or 1.8%, to settle at $119.72 a barrel by 1338 GMT. U.S. West Texas Intermediate (WTI) crude advanced $2, or 1.7%, to $118.87. Both benchmarks were up by $3 in after hours trading.

U.S. crude notched a sixth weekly gain on tight U.S. supply, which has prompted talk of fuel export curbs or a windfall tax on oil and gas producers.

“Yesterday’s OPEC+ decision and the ongoing acceleration in SPR releases is maintaining crude availability at an ample level especially with demand from the refiners appreciably downsized from a few years ago,” said Jim Ritterbusch, president of Ritterbusch and Associates LLC in Galena, Illinois.

The output hike could undershoot the pledged amount since OPEC+ divided the hike across its members and still included Russia, whose output is falling as sanctions have prompted some countries to avoid buying its oil since the invasion of Ukraine.

President Joe Biden publicly acknowledged that he may travel to Saudi Arabia soon, a trip multiple sources said was expected and could include talks with Saudi Crown Prince Mohammed bin Salman.

The visit would be aimed at bolstering U.S.-Saudi relations as Biden seeks ways to lower U.S. gasoline prices.

As recently as Wednesday, the White House said Biden still felt bin Salman was a “pariah” for what U.S. intelligence says was his role in the killing and dismembering of a political opponent, Washington Post journalist Jamal Khashoggi, in Turkey in 2018.

Supplies remain tight. On Thursday, a U.S. weekly inventory report showed crude stockpiles fell by a more-than-expected 5.1 million barrels. Gasoline inventories also dropped. [EIA/S]

U.S. energy firms this week left oil and natural gas rigs unchanged at 727 in the week to June 3, Baker Hughes Co BKR.N said in its closely followed report on Friday.

Demand is rising too. China’s financial hub Shanghai and capital, Beijing, have relaxed COVID-19 restrictions and the Chinese government has vowed to stimulate the economy.

Oil held gains after U.S. data showed employment increased more than expected in May, signs of a tight labor market.

(Additional reporting by Sonali Paul in Melbourne and Muyu Xu in Singapore; Editing by Kirsten Donovan, Edmund Blair and David Gregorio)

By Saqib Iqbal Ahmed and Stefano Rebaudo

NEW YORK -The U.S. dollar rose against a basket of currencies on Friday after a better-than-expected U.S. employment report pointed to a tight labor market that could keep the Federal Reserve on an aggressive path of interest rate hikes.

Nonfarm payrolls increased by 390,000 jobs last month, the Labor Department said in its closely watched employment report on Friday. Economists polled by Reuters had forecast payrolls increasing by 325,000 jobs in May.

The U.S. Dollar Currency Index, which tracks the greenback against six other major currencies, was 0.4% higher at 102.16 after rising as high as 102.22 following the jobs report. For the week, the index was up about 0.5%.

“We had a pretty solid nonfarm payrolls number,” said Minh Trang, senior currency trader at Silicon Valley Bank in Santa Clara, California.

“The strong jobs data is supportive of the expectations of additional rate hikes going into the second half of the year,” Trang added.

The Fed has raised interest rates by three quarters of a percentage point this year, and most Fed policymakers back raising interest rates another half of a percentage point at each of their next two meetings.

Cleveland Federal Reserve Bank President Loretta Mester said on Friday she is looking for “compelling” evidence that inflation has peaked before reducing the pace of the Fed’s interest rate hikes from what policymakers say are likely to be half-point increments in both June and July.

Investors have mixed views on the greenback, which is still close to two-decade highs against a basket of peers.

George Saravelos, global head of forex research at Deutsche Bank, said the dollar is “pricing a safe-haven risk premium that is so extreme it rarely has persisted over time and is now in the process of unwinding.”

Bullish analysts argue that the Fed’s tightening cycle is based on a sturdier growth story than Europe’s, especially after the Russian oil embargo, which might hurt the euro zone economy.

The dollar rose 0.8% to a more than three-week high of 130.85 yen, with the Japanese currency not far from the two-decade low touched in May as the Bank of Japan (BoJ) stuck to its super-low interest rate policy stance.

BoJ Governor Haruhiko Kuroda – who has said the bank will not roll back its massive monetary stimulus as the recent rise in inflation was driven mostly by raw commodity costs and likely temporary – said on Friday it was undesirable for prices to rise too much when household income growth remains weak.

“Everybody, including the ECB, talks about higher rates and so forth, but we are not seeing that sort of chatter when talking about the BOJ,” Silicon Valley Bank’s Trang said.

“I think that’s why you have seen such an exaggerated move to the downside for the yen,” Trang added.

In cryptocurrencies, bitcoin slipped 3.0% to $29,513.95, as the world’s largest digital currency by market value continued to struggle to overcome a bout of selling pressure that has taken it below the $30,000 level.

(Reporting by Saqib Iqbal Ahmed; editing by Jonathan Oatis and Will Dunham)

By Elizabeth Dilts Marshall and Noor Zainab Hussain

(Reuters) -Citigroup Inc Chief Executive Jane Fraser said on Friday that Europe was more likely than the United States to slip into a recession, as she joined other global bank CEOs this week to warn about the health of the global economy.

Fraser, head of the third-largest and most globally focused U.S. bank, recently returned from a world tour with stops in Asia, Europe and the Middle East, where she said her conversations focused on “the three Rs.”

“It’s rates, it’s Russia and it’s recession,” Fraser said, speaking at an investor conference in New York.

But Fraser said in Europe, “the energy side was really having an impact on a number of companies in certain industries that are not even competitive right now.”

“Because of the cost of electricity and the cost of energy, some of them are shutting down operations. So Europe definitely felt more likely to be heading into a recession than you see in the U.S.,” Fraser added.

Fraser said in the United States, the question is more about interest rates than recession.

“It’s certainly not our base case that it will be, but it’s not easy to avoid either,” Fraser added.

On Wednesday, JPMorgan & Chase Co’s Chairman and Chief Executive Jamie Dimon described the challenges facing the U.S. economy as akin to a “hurricane,” while Goldman Sachs President and Chief Operating Officer John Waldron said on Thursday the current economic turmoil is one of the most challenging he has ever faced.

Tesla Inc CEO Elon Musk added to the downbeat sentiment, saying he has a “super bad feeling” about the economy and needs to cut about 10% of jobs at the electric carmaker, in a message sent on Thursday titled “pause all hiring worldwide.”

However, Cleveland Federal Reserve Bank President Loretta Mester told CNBC on Friday that she doesn’t see a “hurricane” ahead, but “we have to realize that the risks of recession have gone up.”

Major central banks, already plotting interest rate hikes in a fight against inflation, are also preparing a common pullback from key financial markets in a first-ever round of global quantitative tightening expected to restrict credit and add stress to an already-slowing world economy.

“It feels like the ECB is a few months behind where the Fed has been in getting its arms around inflation and without quite the same flexibility that U.S. has,” Fraser said, referring to the European Central Bank.

The U.S. job market stayed strong in May, data on Friday showed, with employers hiring more workers than expected and maintaining a fairly strong pace of wage increases. U.S. stock indexes fell on Friday as the solid jobs report supported the view that the Federal Reserve would continue on its aggressive policy tightening path to cool decades-high inflation.

“When we look at what the clients are talking to us about from a macro perspective, I think the confidence is still pretty good amongst the CEOs and the CFOs,” Fraser added.

Fraser said she also expects U.S. equity markets to enter a period of less volatility and for the Chinese government to launch a fresh round of fiscal stimulus in the coming months, as that country begins to open up from COVID-19 pandemic-related lockdowns.

In China, Fraser said she “wouldn’t be surprised to see action taken on fiscal stimulus.”

(Reporting by Elizabeth Dilts Marshall and Noor Zainab Hussain; Writing by Denny Thomas; Editing by Nick Zieminski, Will Dunham and Jonathan Oatis)

By Andrea Shalal and Trevor Hunnicutt

REHOBOTH BEACH, Del. -U.S. President Joe Biden compared Tesla unfavorably to Ford on Friday, while sarcastically wishing Chief Executive Elon Musk “lots of luck” on his “trip to the moon” after the billionaire expressed reservations about the economy.

Musk wrote in an email to executives that he has a “super bad feeling” about the U.S. economy and needed to cut about 10% of jobs at the electric carmaker, Reuters reported earlier on Friday.

Asked by Reuters about Musk’s comments, Biden suggested maybe the issue was with Tesla.

“While Elon Musk is talking about that, Ford is increasing their investment overwhelmingly,” Biden said. “Ford is increasing investment and building new electric vehicles. Six thousand new employees, union employees I might add, in the Midwest.”

“So, you know, lots of luck on his trip to the moon,” he added.

Musk replied on Twitter: “Thanks Mr President!” with a link referencing NASA’s April 2021 award of a $2.9 billion contract to Musk’s SpaceX to build a spacecraft to bring astronauts to the moon.

It is not the first salty exchange between the 79-year-old commander-in-chief, who admits to an occasional Irish temper, and South Africa-born Musk, 50, who became the world’s wealthiest man as a serial entrepreneur but has turned his attention to U.S. political debates and a Twitter takeover.

Biden has made electric vehicles (EVs) the centerpiece of a plan to make the United States a manufacturing powerhouse, compete with China and thwart climate change. But he has lavished far more attention on Musk’s unionized competitors in Detroit.

Musk has frequently fired off harsh tweets directed at the president, complaining about the lack of acknowledgement and has been critical of Biden’s union-first, subsidy-heavy approach to building the EV market.

Musk said last month he would no longer vote for members of Biden’s Democratic Party because they have “become the party of division & hate.”

He promised to restore Republican former President Donald Trump’s access to Twitter after acquiring the social media platform.

Tesla delivered results beyond Wall Street forecasts in April, after raising prices to stave off inflation pressures stalking the auto industry.

Shares fell more than 8% on Friday after Reuters published the report on Musk’s email, as investors worried the CEO’s remarks signaled problems ahead. On Tuesday, Musk said workers not coming into the office for 40 hours per week would be let go.

Before Biden’s comment on Musk, the president had just given a speech of his own touting higher-than-expected U.S. job growth in May and rebuffing criticism of his handling of inflation, which is perched near 40-year highs.

But he warned that job growth could slow in the coming months as the Federal Reserve raises interest rates to cool inflation.

“We aren’t likely to see the kind of blockbuster job reports month after month like we had over this past year,” he said. “But that’s a good thing. That’s a sign of a healthy economy.”

JPMorgan Chase & Co Chairman Jamie Dimon said this week that “you gotta brace yourself” for a coming economic “hurricane.”

Other executives and analysts, however, have said the strong U.S. labor market, consumer savings and robust demand could help the economy achieve a “soft landing” to more sustainable growth at lower levels after a speedy recovery from the COVID-19 pandemic.

(Reporting by Andrea Shalal and Trevor Hunnicutt; Editing by Chizu Nomiyama, Heather Timmons, Nick Zieminski and Marguerita Choy)

By Foo Yun Chee

BRUSSELS -EU countries and EU lawmakers are set to agree on a common charging port for mobile phones, tablets and headphones on June 7 when they meet to discuss a proposal that has been fiercely criticised by Apple, people familiar with the matter said.

The proposal for a single mobile charging port was first broached by the European Commission more than a decade ago after iPhone and Android users complained about having to use different chargers for their phones.

The former is charged from a Lightning cable while Android-based devices are powered using USB-C connectors.

The trilogue next Tuesday will be the second and likely the final one between EU countries and EU lawmakers on the topic, an indication of a strong push to get a deal done, the people said.

Outstanding issues include broadening the scope of the proposal to laptops, a key demand by EU lawmakers that is likely to impact Samsung and Huawei and other device makers, the people said.

EU lawmakers also want to include wireless charging systems to be harmonised by 2025 while EU countries and the Commission wants a longer lead-in period for technical reasons.

Apple was not immediately available for comment. It has previously said the inappropriate use of dated international standards stifles innovation and that forcing users to change to new chargers could create a mountain of electronic waste.

(Reporting by Foo Yun Chee; editing by Jason Neely and Christina Fincher)

By Ann Saphir

(Reuters) -The Federal Reserve may need to continue raising rates at the current clip through September unless there is “compelling” evidence that inflation has peaked based on a range of data, Cleveland Federal Reserve Bank President Loretta Mester said on Friday.

Mester and other policymakers, including Fed Chair Jerome Powell, have already signaled they expect to follow last month’s half-point interest rate hike with two more in June and July.

“I’m going to come into that September meeting and if I don’t see compelling evidence, then I could easily be a 50-basis-point (vote) in that meeting as well,” Mester told CNBC.

There’s no reason the Fed needs to make that decision yet, she added, though so far she does not feel she’s seen enough data to convince her that inflation is beginning to decline.

“My starting point will be, do we need to do another 50, or not, have I seen compelling evidence that inflation is on that downward trajectory, then maybe we can go to 25” basis points, she said. “I’m not in the camp that thinks we need to stop in September.”

Mester is the last Fed policymaker scheduled to speak publicly before a communications blackout ahead of the central bank’s next meeting June 14-15. On Thursday, Fed Vice Chair Lael Brainard similarly signaled she would not support a pause in rate hikes in September.

Traders of interest rate futures are pricing in expectations for the Fed to raise the policy rate to a range of 2.75%-3% at year end, two full percentage points higher than it is today.

Investors and chief executives are increasingly voicing concern that those rate hikes, coupled with inflation running at 40-year highs and other risks, will induce what JPMorgan Chase & Co CEO Jamie Dimon said could be an economic “hurricane.” Tesla Inc CEO Elon Musk said he has a “super bad feeling” about the economy.

“I don’t see a hurricane,” Mester said. “But we have to realize that the risks of a recession have gone up,” not just because of rate hikes but also because of Europe’s slowdown amid Russia’s war in Ukraine and the COVID-19 shutdowns in China that have pinched demand there and also tangled supply chains further.

Still, she said, the Fed is on track for further tightening.

“The process is bring interest rates up, keep that going, look at how demand is reacting to that – we’ve already seen tightening of financial conditions and that will help temper demand – and other things are going to happen on the supply side,” Mester said, adding that she thinks there is a “good case” that the Fed will be able to slow the economy without creating severe problems.

(Reporting by Ann SaphirEditing by Chris Reese and Jonathan Oatis)