(Reuters) – Ukraine’s defence ministry spokesman Oleksandr Motuzyanyk said on Friday that for, the first time since the start of its invasion, Russia used long-range bombers to attack the besieged port city of Mariupol.
Motuzyanyk said Russia was concentrating its efforts on seizing the cities of Rubizhne, Popasna and Mariupol.
(Reporting by Natalia Zinets; Writing by Alexander Winning; editing by John Stonestreet)
By Peter Hall
MANCHESTER, England – A consortium led by Chicago Cubs owners the Ricketts family has pulled out of the running to buy Premier League club Chelsea, the family said on Friday, leaving three bidders remaining.
Final bids for the club, which was put up for sale by owner Roman Abramovich following Russia’s invasion of Ukraine before sanctions were imposed on the oligarch by the British government, were submitted on Thursday.
The Ricketts family, who had partnered with U.S. billionaires Ken Griffin and Dan Gilbert, submitted a cash-only offer and had been included on the four-bid shortlist produced by U.S. Bank Raine Group, who are overseeing the sale.
“The Ricketts-Griffin-Gilbert Group has decided, after careful consideration, not to submit a final bid for Chelsea F.C,” the statement read.
“In the process of finalising their proposal, it became increasingly clear that certain issues could not be addressed given the unusual dynamics around the sales process. We have great admiration for Chelsea and its fans, and we wish the new owners well.”
The Ricketts family’s surprise withdrawal leaves groups led by LA Dodgers part-owner Todd Boehly, former Liverpool chairman Martin Broughton and Boston Celtics co-owner Steve Pagliuca as the remaining Chelsea bidders.
The Ricketts family had met with supporters groups after it emerged that the Chelsea Supporters’ Trust (CST) said that 77% of its members did not support their bid for the club.
The reaction was in response to leaked emails from 2019 in which American businessman Joe Ricketts described Muslims as his “enemy”. Joe was not involved in the Chelsea bid, with daughter Laura and son Tom fronting the consortium.
However sources close to the deal told Reuters that their withdrawal was not as a result of the fan reaction, but due to differences between the parties within the consortium.
They had outlined a list of commitments if their bid to buy Chelsea was successful, saying they would never allow the Premier League club to participate in a European Super League while also exploring the option of redeveloping Stamford Bridge.
(Reporting by Peter Hall; editing by John Stonestreet and Toby Davis)
By James Mackenzie
HUSARIVKA, Ukraine – Smashed tanks in the mud, destroyed buildings and mourning families mark a recaptured east Ukrainian village whose residents are contemplating the price both they and their former Russian occupiers have had to pay.
Ukrainian soldiers last month retook Husarivka, an agricultural village with a peacetime population of 500-600 around 150 km southeast of Kharkiv city, after heavy fighting following the Russian invasion on Feb. 24.
As Russian forces pull back after failing to take major cities including Kyiv and Kharkiv to refocus their offensive on the Donbas region in the southeast, residents of the surrounding areas are beginning to clean up after weeks of occupation.
Echoing accounts of ill-disciplined and poorly-supplied Russian forces from other localities in north and east Ukraine where the Russians have retreated, 79-year-old Nadezhda Syrova said young soldiers had gone house-to-house asking for food.
Some of the invading Russians said they were on a training exercise or there to clear Ukraine of bandits and “Nazis”, she added, standing on a patch of ground near her house.
“Where do you see bandits and Nazis here? We are just normal, peaceful people. Ukrainians,” she said.
In fields above the village, burned-out armoured personnel carriers and two smashed Russian anti-aircraft gun carriers sit abandoned in the mud surrounded by detritus including gas masks, computer printers and sodden footwear.
In the village itself, a destroyed Russian tank, already rusting, rests on the road, its blown off turret by its side.
A Ukrainian soldier said fighting went on for around three weeks with his side using anti-tank weapons, including artillery and foreign-supplied Javelin missiles, finally driving out two Russian battalion tactical groups.
“We bypassed the enemy from the right and the left, got into good positions and destroyed their equipment,” said the soldier, who spoke to reporters on condition he be identified only by his nickname Parker.
He said his unit had captured a Russian officer and two scouts from an engineering unit trying to plant mines around the village to stop the Ukrainian attack and had to fight off counter-attacks by what he described as Russian sabotage and reconnaissance groups.
“Three times we fought off attacks when they tried to enter,” he said.
BURNED BODIES
It was not possible to confirm his account independently but at least a dozen destroyed armoured vehicles, including tanks with the distinctive “Z” markings of Russian forces, remained in the village and surrounding fields.
Ukrainian authorities say their forces have killed almost 20,000 Russian troops and destroyed hundreds of tanks and armoured personnel carriers since the invasion began. Other estimates are much lower but Western officials estimate the numbers of Russian dead run into the thousands.
Ukraine also says that hundreds of Ukrainian civilians have been killed while under Russian occupation. Russia has denied targeting civilians but locals in Husarivka said several local people were killed or had disappeared.
Three bodies, burned beyond recognition, have been recovered from the cellar of one house and taken away to be investigated for possible signs of torture, they said.
The state of Husarivka matches accounts in a string of villages east of Kharkiv, a mainly Russian-speaking city near Ukraine’s northeastern border, which was targeted by President Vladimir Putin’s army from the first days of the war.
Though no longer threatening to enter the city, Russia has kept up a partial blockade and subjected it to days of increasingly heavy bombardment.
Kharkiv residential buildings and infrastructure have been hit, causing dozens of casualties, with more than 60 artillery and rocket attacks in one night this week. On Friday, Reuters journalists heard mortar rounds hit northern areas of the city.
(Additional reporting by Alkis Konstantinidis; Editing by Andrew Cawthorne)
(This April 14 story corrects first dateline from Washington to London)
By Sinead Cruise and Carolina Mandl
LONDON/NEW YORK – Russian companies and global banks including BNY Mellon, Deutsche Bank, Citigroup and JPMorgan could profit if Moscow moves to de-list Russian companies’ depositary receipts from foreign exchanges, according to two people familiar with the matter.
The potential windfall is due to the fees that bank issuers of depositary receipts can contractually charge investors when they cancel the product.
It is unclear how much companies and banks could make or if banks will charge the fees and risk angering investors who say it would be unfair given the extraordinary circumstances which have been triggered by Russia’s invasion of Ukraine.
However, the fees could potentially translate into hundreds of millions of dollars according to Reuters’ calculations based on fee data provided by the sources.
Assailed by Western sanctions, Moscow is preparing to de-list Russian company depositary receipts from foreign exchanges and convert them into local Russian securities in a bid to reduce foreigners’ control over these companies.
Depositary receipts are certificates issued by a bank representing shares in a foreign company traded on a local stock exchange. They allow investors to dabble in overseas stocks in their own geography and time zone.
There are more than 30 depositary receipts on Russian companies including Gazprom, Rosneft, Lukoil and Norilsk Nickel issued by BNY Mellon, Deutsche Bank, Citigroup, JPMorgan, among others, trading on U.S. and European markets.
Under standard agreements, depositary receipts can be canceled by the issuer or the investor. When that happens, the investor typically gets cash from the sale of the underlying shares, although they have the right to take custody of the shares instead.
Banks charge an administration fee, typically around $0.05 per receipt, which may be shared with the companies, two sources said.
If Moscow de-lists Russian depositary receipts, banks will have to cancel the products. Banks could still charge the fees, even though their hand was forced, according to three sources.
For example, an investor in Rosneft with 150 million depositary receipts representing the same number of shares in the company could be on the hook for $7.5 million in cancellation fees, according to Reuters’ calculations.
Sweeping Western sanctions could make it challenging for banks to transfer the cash to some companies.
Regardless, some investors say the fees should not apply. One global asset manager told Reuters that if Russia passes the de-listing law there should be no fees as investors would have no choice in the matter. The other two sources, however, say banks still have to cover their costs.
BNY Mellon, Deutsche Bank, JPMorgan and Citigroup declined to comment. Russian companies did not respond to a Reuters emails seeking comment.
MARKET FREEZE
As Western sanctions pummeled Russian stocks from late February, the Moscow exchange closed and the Russian central bank banned foreigners from transferring shares out of their custody accounts. It also barred foreigners from selling Russian shares.
The restrictions made it nearly impossible for banks to cancel receipts when asked by investors anxious to slash their Russia exposure.
With curbs on custodians recently lifted, BNY Mellon, Citi and JPMorgan have resumed processing cancellations. But because the foreign banks still can’t sell the shares, investors have to take custody of them instead. To do that, investors need an account in Russia, which many don’t have.
As a result, a lot of investors are likely to hold onto the receipts for the time being, according to three people.
Many investors are worried, however, about the de-listing bill which Russia is preparing.
Aside from the potential cancellation fees, investors are worried about what will happen if they can’t open a local custody account.
In a note to clients, JPMorgan said clients may be able to open a Russian account under some unspecified circumstances if the new law is passed.
(Editing by Michelle Price, Megan Davies and Nick Zieminski)
By Layli Foroudi and LEA GUEDJ
BOBIGNY, France – Boxing coach Kab Thiam has voted in a French election twice: in 2002 to block the far right’s Jean-Marie Le Pen from power and again last Sunday for the hard left’s presidential candidate.
Now, though, with his favourite Jean-Luc Melenchon out, the 39-year-old does not plan to vote in the April 24 runoff. He finds both aspirants, incumbent President Emmanuel Macron and Marine Le Pen, daughter of Jean-Marie, distasteful.
“Macron and Le Pen share the same ideas,” Thiam said, between sparring with a young boxer at the Mohamed Ali gym in Bobigny, an ethnically-diverse northern suburb of Paris.
Melenchon won 60% of first round votes in Bobigny, which lies in France’s poorest administrative department Seine-Saint-Denis. Now his supporters in the Paris suburbs and beyond will be crucial to determining a tight-looking runoff.
Many, like Thiam, feel France has become increasingly Islamophobic as the Macron government has passed a raft of laws and measures that, it says, are to tackle religious extremism and preserve national secular values.
There are also perceptions that Macron is a “president of the rich”, aloof from the people, as he has adopted right-wing economic positions. That seems to be stopping another united front against the far right, as occurred in past votes, and may cause the lowest turnout in decades, polls show.
A Reuters analysis of first round results showed he struggled to garner support in low-income areas and will have a tough time reaching voters outside his base of educated, middle-class city dwellers.
Macron is, though, forecast to win by a narrow margin.
In a runoff between the same candidates in 2017, Macron won 79% of votes – above the national average of 66% – in Seine-Saint-Denis which voted overwhelmingly to keep Le Pen out.
Now, though, “Macron is polarizing in these areas because he is seen as being on the right and favouring the rich, while Le Pen is less scary than her father,” said Jean-Yves Dormagen, a professor at University of Montpellier.
“She has done everything to soften her discourse on the identity subject and so she seems reasonable and less racist.”
‘I LOOK AT MY POCKETS’
Growing up, Sami Mahdjoub, who brings his son to box at Thiam’s gym, remembers how his parents would invoke Jean-Marie Le Pen to persuade him to behave well, saying: “work hard at school or you will get deported.”
Nowadays, the 38-year-old Franco-Algerian said he no longer viewed the Le Pen name as a threat.
“I don’t listen to what she says, I look at what’s left in my pockets, and with Macron I have nothing,” Mahdjoub said. “With Le Pen will it be better? I don’t know.”
Melenchon has told his supporters not to vote for the far-right, but has not endorsed Macron. His party is holding an online vote on its stance, with the result due on Saturday.
Sabine Rubin, a Melenchon lawmaker in Seine-Saint-Denis, said she understood reluctance to vote for Macron.
“They see public services disappear, their own purchasing power dropping … the abandonment of these neighbourhoods is not new but now there is disdain on top of that,” she said.
Rubin cited past remarks Macron had made, including comments to one jobless man that all he needed to do was “cross the road” and ask for work.
But for many, Le Pen and her far right Rassemblement National party remain unpalatable too.
Melenchon voter Emma D’Angelo, an unemployed graduate from Bondy, cried at the results of the first round and considered burning her electoral card. But she has come round to the idea of voting Macron.
“For students it’s like choosing between the plague and cholera. We expect nothing from him but we’re going to vote for him because it is out of the question that Marine Le Pen wins,” said D’Angelo, 22, who is applying for masters programmes.
Carlos Tavares, another coach at the Mohamed Ali gym who described growing up in fear of Le Pen and far-right “skinheads”, said he was shocked friends may withhold their vote.
“To vote blank or to abstain, whose game are we playing? It’s Marine Le Pen we’re talking about. For me, it’s aberrant and scary,” he said.
(Reporting by Layli Foroudi and Lea Guedj; editing by Richard Lough and Andrew Cawthorne)
By Pavel Polityuk and Oleksandr Kozhukhar
KYIV/LVIV, Ukraine – (This April 14 story corrects paragraph 21 to make clear that Moldova did not directly accuse Russia’s army of trying to recruit its citizens; corrects third bullet point to say that Ukraine alleges Moscow is massing troops in Belarus and Transdniestria not Moldova and Transdniestria)
Russia said its lead warship in the Black Sea sank on Thursday after an explosion and fire that Ukraine claimed was caused by a missile strike, dealing a blow to Moscow as it readied for new attacks that were likely to determine the conflict’s outcome.
The Moskva, Russia’s flagship in its Black Sea fleet, sank as it was being towed to port in stormy weather, Russian news agencies quoted the defence ministry as saying.
Russia said earlier that over 500 crew aboard the Soviet-era missile cruiser were evacuated after ammunition on board exploded. Ukraine said it hit the warship with a Ukrainian-made Neptune anti-ship missile.
Russia, which has not acknowledged an attack, said the incident is under investigation. Reuters was unable to verify any of the statements, including whether the ship had sunk.
“While the cruiser ‘Moskva’ was being towed to the destination port, the ship lost stability due to damage to the hull from the fire,” the defence ministry said.
“In the stormy sea conditions, the ship sank,” it said.
The incident came as Russia’s navy continues its bombardment of Ukrainian cities on the Black Sea nearly 50 days after it launched the invasion. Residents of Odesa and Mariupol, on the adjacent Azov Sea, have been bracing for new Russian attacks.
The United States said it did not have enough information to determine whether the Moskva was hit by a missile.
“(But) certainly, the way this unfolded, it’s a big blow to Russia,” said national security adviser Jake Sullivan.
Russian forces have pulled back from some northern parts of Ukraine after suffering heavy losses and failing to take the capital Kyiv. Ukraine and its Western allies say Moscow is redeploying for a new offensive in the eastern Donbas region.
Russia launched its assault in part to dissuade Ukraine from joining NATO. But the invasion has pushed Finland, which shares a long border with Russia, and nearby Sweden to consider joining the U.S.-led military alliance.
Moscow warned NATO on Thursday that if Sweden and Finland join, Russia would deploy nuclear weapons and hypersonic missiles in a Russian enclave on the Baltic Sea, in the heart of Europe.
Commenting on Russia’s military setbacks, CIA Director William Burns said the threat of Russia potentially using nuclear weapons in Ukraine cannot be taken lightly, but that the agency has not seen much practical evidence reinforcing that concern.
STAGING TROOPS
Russia’s navy has fired cruise missiles into Ukraine and its Black Sea activities are crucial to supporting land operations in the South and East, where it is battling to seize full control of the port of Mariupol, its main target in the Donbas.
Russia said on Wednesday more than 1,000 Ukrainian marines from one of the units still holding out in Mariupol had surrendered. Ukrainian officials did not comment.
If taken, Mariupol would be the first major city to fall to Russian forces since they invaded, allowing Moscow to reinforce a land corridor between separatist-held eastern Donbas areas and the Crimea region it seized and annexed in 2014.
Ukraine said thousands of people were believed to have been killed in Mariupol, where efforts were under way to evacuate civilians. On Thursday, Russia’s defence ministry said 815 people had been evacuated from the city over the past 24 hours. Ukraine said that figure was 289.
Ukrainian officials have long warned that Russia was massing troops for assaults in the East, including on Kharkiv, Ukraine’s second-largest city.
But Ukraine’s deputy defence minister, Hanna Malyar, said on Thursday that Russia was also staging troops along the country’s borders with Belarus and Moldova’s breakaway Transdniestria region. Authorities in Transdniestria, bordering southern Ukraine, denied Russia was preparing forces there.
Asked about reports that Russia’s army was trying to recruit Moldovan citizens in Transdniestria, Moldova’s foreign minister said “these are dangerous things and should be discouraged”. Moscow’s foreign ministry did not respond to a request for comment.
Maylar said that shelling in Kharkiv had killed four civilians, with missile strikes there and in the Donetsk and Zaporizhzhia regions in the South. Donetsk Governor Pavlo Kyrylenko said three civilians were killed in the region.
Russia said Ukraine had carried out a helicopter attack on the Russian Bryansk region, the latest of several cross-border attacks that Moscow has said may trigger a retaliatory strike on Kyiv.
Seven people were injured in the Bryansk attack, which hit residential buildings, Russian officials said. Another Russian region, Belgorod, said a village there was attacked but that no one was wounded. Neither side’s statements could be verified. Ukraine’s military did not reply to requests for comment.
‘TERRIBLE THINGS’
Moscow’s incursion, the biggest attack on a European state since 1945, has seen more than 4.6 million people flee abroad, killed or wounded thousands and raised fears of conflict between Russia and the United States, the world’s top nuclear powers.
Andriy Nyebytov, head of the Kyiv region police, said more than 800 bodies had been found in three districts which had been occupied by Russian forces.
“We are finding terrible things: buried and hidden bodies of people who were tortured and shot, and who died as a result of mortar and artillery fire,” Nyebytov said in televised comments. His statements could not immediately be verified.
Russia has denied attacking civilians and said some reports have been staged for propaganda purposes.
Warning that spillover effects from the Ukraine war were worsening crises elsewhere, U.N. aid chief Martin Griffiths on Thursday released $100 million in emergency funding for Somalia, Ethiopia, Kenya, Sudan, South Sudan, Nigeria and Yemen.
(Additional reporting by Natalia Zinets and Elizabeth Piper in Kyiv, Max Hunder in London, David Ljunggren in Ottawa and Reuters bureaus; Writing by Rami Ayyub and William Maclean; Editing by Nick Macfie, Daniel Wallis and Cynthia Osterman)
(Reuters) – Several buyers of Russian gas have agreed to switch to payments in roubles, Russian Deputy Prime Minister Alexander Novak said on Friday.
“We expect the decision (to switch to roubles) from other importers,” he added, in comments published in the ministry’s in-house magazine. He did not disclose the identities of customers who had already switched.
President Vladimir Putin said last month that buyers of Russian gas from “unfriendly” countries should pay in roubles, a move rejected by European Union authorities under the bloc’s sanctions regime against Moscow.
Putin has warned Europe it risked having gas supplies cut unless it pays in the Russian currency as he seeks to retaliate over the sanctions, imposed over what Moscow calls its “special military operation” in Ukraine.
In March, he proposed that energy buyers open accounts at Gazprombank, where payments in euros or dollars would be converted to roubles.
Armenia made several payments for supplies of Russian natural gas in roubles, its Economy Minister Vagan Kerobyan said in an interview with Russian media outlet RBC on Friday.
Hungary’s Foreign Minister Peter Szijjarto said on Monday that Hungary planned to pay for Russian gas in euros through Gazprombank.
(Reporting by Reuters; editing by John Stonestreet)
PARIS -French President Emmanuel Macron and his far-right challenger Marine Le Pen on Friday called the pay package of Franco-Italian carmaker Stellantis’ CEO “shocking” with excessive executive pay now a hot topic in France’s tight-run presidential election.
Just 9 days ahead of a runoff that will determine who will lead the European Union’s second-largest economy for the next five years, opinion polls show Macron is only slightly ahead of Le Pen in a contest that could potentially go either way.
The 2021 compensation package for Stellantis CEO Carlos Tavares adds up to around 19 million euros ($20.5 million), plus a stock package worth some additional 32 million euros and long-term compensation of about 25 million euros.
“We’re talking about astronomical sums here … we should put a cap on these, this could work if we act at a European level,” Macron told franceinfo radio.
“People can’t have purchasing power problems, difficulties and anxiety in their lives and see sums like this,” Macron said, adding that otherwise “society going to blow up”.
Le Pen echoed his comments.
“Of course it is shocking. It’s even more shocking when it’s a CEO who has put the company in difficulty and gets considerable sums,” she told BFM television, suggesting one way to offset such remuneration was to develop staff shareholdings.
The company said in a statement that it does not comment on politicians’ positions and said the group had gone from near bankruptcy to a leading position under Tavares’ leadership.
It added that it had paid out as much to staff as to shareholders – 1.9 billion euros – and said that Tavares’ pay was 90% variable depending on company performance and lower than at rivals GM and Ford.
Just over 52% of the company’s shareholders voted on Wednesday against the compensation package in a consultative vote.
($1 = 0.9257 euros)
(Reporting by Benoit Van Overstraeten and Leigh Thomas, Editing by Kirsten Donovan)
SHANGHAI – Tesla is preparing to resume production at its Shanghai plant on Monday following a three-week stoppage, having received the go-ahead from local authorities, two people familiar with the matter said.
The Shanghai factory, located in the Pudong district east of the city’s Huangpu River, suspended production on March 28 after the city started rolling out lockdown measures to combat a surge in COVID-19 cases that were later implemented city-wide.
The plan for resuming production has the blessing of local authorities but could still be subject to change depending on how the epidemic situation develops in the city, said the people, who declined to be named as the matter is private.
One of people said the U.S. carmaker planned to start with one shift and would gradually ramp up.
Tesla and the Shanghai government did not immediately respond to a request for comment.
The latest stoppage was the longest since the factory started production in late 2019 and has led to an output loss of more than 50,000 units, according to calculations based on internal output plans seen by Reuters.
Ongoing production at the plant could be impacted by difficulties in procuring auto parts, however, as logistics in the city and surrounding areas have been severely disrupted by China’s COVID curbs.
He Xiaopeng, the chief executive officer of Chinese electric-car maker Xpeng, said on Thursday that automakers in China may have to suspend production in May if suppliers in Shangahi and surrounding areas were not able to resume work.
(Reporting by Zhang Yan, and Brenda Goh; Editing by Kirsten Donovan)
By Uditha Jayasinghe
COLOMBO – A plan by Sri Lanka’s state-owned national airline to lease nearly two dozen aircraft has sparked public criticism and opposition condemnation as the country struggles with its worst financial crisis in decades.
Sri Lanka is struggling with low reserves that have declined more than 70% over the past two years to $1.93 billion at the end of March.
The dollar crunch has caused acute shortages of fuel, food and medicines, with rolling power cuts for hours a day for more than a month.
On Tuesday, Sri Lanka suspended some external debt repayments and said it would instead use meagre dollar cache to focus on essential imports.
Protesters demanding President Gotabaya Rajapaksa resign have been staging daily sit-ins outside his office.
Tender notices for the lease of 42 aircraft were published on the airline’s website on Thursday.
SriLankan Airlines has been struggling with a fall in tourism because of the COVID-19 pandemic and the economic crisis.
In 2019/20, SriLankan Airlines reported a loss of 44.14 billion Sri Lankan rupees ($140.90 million) against 41.70 billion Sri Lankan rupees in the previous year.
“This must be a joke?!,” a member of parliament from the main opposition Samagi Jana Balawegaya (SJB) alliance, Harsha de Silva, said in a post on Twitter.
“Sri Lanka is bankrupt; no fuel, gas or medicine. Where the hell is money for this nonsense?! Better immediately clarify.”
Another opposition party, the United National Party (UNP), demanded that the carrier cancel the proposal while numerous Sri Lankans expressed their disapproval online.
“What good is new aircraft when you won’t have fuel to fly,” said Twitter user Shiv Theyagamurti.
The airline’s chairman, Asoka Pathirage, said the carrier was looking for 21 planes to lease in an initial round as part of its 2022-2025 business plan to replace aircraft that would be phased out of its existing fleet.
“We are only looking at availability in the market. SriLankan Airlines will finance these leases and we will not depend on funds from the government,” he told Reuters.
“The airline has been making profits. We do have debt but we have to make money to repay them.”
The government will begin talks with the International Monetary Fund for a loan programme on Monday.
(Reporting by Uditha Jayasinghe in Colombo; Editing by Robert Birsel)
By Guy Faulconbridge
LONDON – Moody’s said Russia may be in default because it tried to service its dollar bonds in roubles, which would be one of the starkest consequences to date of Moscow’s exclusion from the Western financial system since President Vladimir Putin’s invasion of Ukraine.
If Moscow is declared in default, it would mark Russia’s first major default on foreign bonds since the years following the 1917 Bolshevik revolution, though the Kremlin says the West is forcing a default by imposing crippling sanctions.
Russia made a payment due on April 4 on two sovereign bonds – maturing in 2022 and 2042 – in roubles rather than the dollars it was mandated to pay under the terms of the securities.
Russia “therefore may be considered a default under Moody’s definition if not cured by 4 May, which is the end of the grace period,” Moody’s said in a statement on Thursday.
“The bond contracts have no provision for repayment in any other currency other than dollars.”
Moody’s said that while some Russian eurobonds issued after 2018 allow payments in roubles under some conditions, those issued before 2018 – such as those maturing in 2022 and 2042 – do not.
“Moody’s view is that investors did not obtain the foreign-currency contractual promise on the payment due date,” Moody’s said.
The Russian finance ministry did not respond to a request for comment on Friday. Finance Minister Anton Siluanov told the Izvestia newspaper earlier this month that if Russia is forced into a default, it will take legal action.
Before Putin’s Feb. 24 order for what he casts as a special military operation in Ukraine, Russia was rated as investment grade. But its sovereign bonds have become a target in what the Kremlin says is an economic war waged by the United States.
Russia in 1998 defaulted on $40 billion in domestic debt and devalued the rouble under President Boris Yeltsin because it was effectively bankrupt after the Asian debt crisis and falling oil prices shook confidence in its short-term rouble debt.
In 1918 Bolshevik revolutionaries under Vladimir Lenin repudiated Tsarist debt, shocking global debt markets because Russia then had one of the world’s biggest foreign debt piles.
This time, Russia has the money but can’t pay because the reserves – the world’s fourth largest – that Putin ordered be built up for just such a crisis are frozen by the United States, European Union, Britain and Canada.
DEFAULT
As Russia could not and would not borrow right now, a default would be largely symbolic, marking the tumultuous finale to its post-Cold War attempt to integrate into the West’s financial architecture.
While Russia has only $40 billion in international bonds outstanding across 15 dollar or euro-denominated issues, its corporates have built up vastly more foreign debt.
The U.S. Treasury this month halted Russia’s ability to use foreign currency reserves held by the Russian central bank at U.S. financial institutions to pay its debt.
The Kremlin says the West has already defaulted on its obligations to Russia by freezing its reserves, and that it wants a new system to replace the Bretton Woods financial architecture established by the Western powers in 1944.
S&P earlier this month lowered Russia’s foreign currency ratings to “selective default” on increased risks that Moscow will not be able and willing to honor its commitments to foreign debtholders.
Russia’s economy is heading for the worst contraction since the years following the 1991 fall of the Soviet Union, with soaring inflation and capital flight.
(Reporting by Guy Faulconbridge; Editing by Kim Coghill and Frances Kerry)
By Zohra Bensemra and Joseph Campbell
BORODYANKA, Ukraine – After surviving World War Two and the fall of the Soviet Union, among other seismic events, Zinaida Makishaiva now has her chickens to thank for getting through her most recent ordeal – the brief but brutal occupation of her town by Russian troops.
The 82-year-old was not too shaken when Russian tanks first showed up in early March in Borodyanka, northwest of the Ukrainian capital Kyiv, but then Grad missiles smashed into her home, destroying her chicken coop.
A neighbour next door was killed by shelling. And then Russian troops began to visit every day.
Her daily routines, established since early childhood when she started “rural work”, were soon punctured by shelling and missile attacks.
“Scared doesn’t fully describe how I felt. I felt dead, senseless… I didn’t have time to bring logs because of the shelling, small and big. That’s how they destroyed all those houses… What I know is: one missile – no house,” said Makishaiva, who spent much of her life in Ukraine’s Black Sea port city of Odesa.
“The doors were blown out. I took the chickens in because I needed something to eat. I didn’t have anything to eat except for potatoes, just that. There is no water, no gas, nothing.”
The Russian troops came in three waves, she said, the first being the most violent. One day several soldiers entered her house, demanding that she stay in the cellar.
“‘Get in the cellar, you old bitch!’ (the Russian troops said). I told them: ‘Kill me, but I won’t go’,” said Makishaiva.
EGGS
During the days of occupation, Makishaiva braved crossfire to fetch pails of water from a nearby well.
When food was scarce, she still had the eggs laid by her own chickens. Her family was far away, as her one son and three grandchildren live in different parts of the country.
Since Borodyanka was retaken by Ukrainian forces over a week ago, Makishaiva, who used to love dancing the waltz when she was younger, walks more than three hours a day, past shattered buildings and wrecked Russian tanks, to collect whatever food aid is available at the town’s community centre or church.
Thirty days of sleepless nights are now a thing of the past, with the help of the herb valerian.
“It’s calmer now, we have radio again. There was nothing for a month, I felt deaf, no conversations, except with my dogs and cat,” she said.
“Now when the radio says it’s midnight, I take some valerian and sleep soundly until 5. The dreams are better now, more happiness. Because it was so bad before, so many people died. It was frightening.”
“What God decides will happen. I’ve been through two wars and now this. I pray that this has passed and the fighting won’t come back again,” Makishaiva said.
Russia sent tens of thousands of troops into Ukraine on Feb. 24 in what it called “a special operation” to demilitarise and “denazify” its southern neighbour.
Kyiv and its Western backers say this is a pretext for an act of unprovoked aggression. Ukrainian forces have mounted stiff resistance to the invasion and the West has imposed sweeping economic sanctions on Russia.
(Editing by Gareth Jones)
FRANKFURT – The euro zone economy faces slower economic growth and higher inflation as Russia’s invasion of Ukraine pushes up costs, disrupts trade and hits confidence, a European Central Bank poll of economists showed on Friday.
Economists polled in the ECB’s Survey of Professional Forecasters (SPF) put inflation at 6% this year, or twice as high as predicted just two months ago, and saw it staying just above the ECB’s 2% target in the longer term.
“Regarding the near-term outlook, respondents viewed high inflation as being primarily determined by ‘cost-push’ rather than ‘demand-pull’ factors, and considered that the conflict in Ukraine had re-ignited and amplified price pressures that had started to show signs of peaking,” the ECB said in a press release.
Growth was seen slowing to 2.9% this year from 4.2% in the previous SPF and the ECB said “almost all” respondents attributed their downward revisions to the repercussions of the Russian invasion of Ukraine.
“Aside from higher energy and food commodity prices, disruptions in some sectors and the sanctions imposed, they noted that the situation had resulted in falls in business and consumer confidence and loss of purchasing power for households,” the ECB added.
2022 2023 2024 longer term
HICP (%) 6.0 2.4 1.9 2.1
GDP GROWTH (%) 2.9 2.3 1.8 1.4
(Reporting By Francesco Canepa; editing by Kirsten Donovan)
By Leika Kihara and Takahiko Wada
TOKYO -The Bank of Japan (BOJ) is likely to raise its inflation forecast for this fiscal year to near 2% at this month’s policy meeting as global commodity inflation drives up energy and food costs, said three sources familiar with the bank’s thinking.
While the upgrade will bring inflation closer to its 2% target, the central bank will stress its resolve to keep monetary policy ultra-loose to underpin a fragile economic recovery, the sources said.
“Consumer inflation may accelerate to near 2% this fiscal year, but mostly due to rising fuel and food costs,” one of the sources said.
“It’s too early to withdraw stimulus because wage growth is slow and the economy is still weak,” the source said.
Two other sources echoed that view.
In new quarterly projections due to be released at the April 27-28 policy meeting, the BOJ will likely lift its core consumer inflation forecast for the current fiscal year through March 2023 to above 1.5% from the present estimate of 1.1%, the sources said.
A Reuters poll in March showed analysts expect core consumer inflation to hit 1.6% in fiscal 2022.
The board is also expected to trim this fiscal year’s growth forecast, the sources said, as rising raw material costs caused by the Ukraine war hurt global trade and domestic consumption.
The BOJ’s current forecast, made in January, is for the economy to expand 3.8% this fiscal year, far faster than the 2.6% growth projected in a Reuters poll.
NO EXIT IN SIGHT
Lingering supply constraints, soft consumption and the pinch from global commodity inflation have cast doubt on the BOJ’s view the economy is picking up and headed for a steady recovery.
While the BOJ still expects the economy to recover, it will likely warn of rising risks to the outlook as the Ukraine crisis weighs on global and domestic demand, the sources said.
Analysts say Japanese inflation likely won’t gain the kind of momentum seen in countries like the United States, where rising prices are accompanied by strong wage growth, prodding central banks to plan aggressive interest rate increases.
The BOJ’s new projections will likely show consumer inflation slowing back to around 1% in fiscal 2023 as the impact of recent fuel price rises tapers off, the sources said.
In the current forecasts, the BOJ expects core consumer inflation to hit 1.1% in fiscal 2023.
Several BOJ executives, including Governor Haruhiko Kuroda, have said core consumer inflation will likely accelerate to around the bank’s 2% target from April due to rising fuel costs and the dissipating effect of past cellphone fee cuts.
They have also said the BOJ won’t respond to cost-push inflation with tighter policy, and it will maintain stimulus until inflation stably hits 2% on the back of strong wage growth.
At the policy meeting, the BOJ is widely expected to maintain a pledge to guide short-term interest rates at -0.1% and cap long-term borrowing costs around 0%.
(Reporting by Leika Kihara and Takahiko Wada; Editing by Shri Navaratnam and Bradley Perrett)
By Josh Horwitz and Sarah Wu
SHANGHAI/TAIPEI – Shipments of some Apple products, as well as Dell and Lenovo laptops are likely to face delays if China’s COVID-19 lockdowns persist, analysts said, as curbs force assemblers to shut down and closed-loop arrangements get harder to maintain.
China’s race to stop the spread of COVID-19 has jammed highways and ports, stranded workers and left countless factories awaiting government approval to reopen – disruptions that are rippling through global supply chains.
Apple Inc supplier Pegatron Corp said this week it would suspend its plants in Shanghai and Kunshan, where according to supply chain experts it produces the iPhone 13, the iPhone SE series, and other legacy models.
Quanta Computer Inc, which produces some three-quarters of Apple’s Macbooks globally, also shut operations, which could impact delivers more severely, analysts said.
The final impact on Apple’s supply chain is uncertain and depends on factors including how long lockdowns persist.
The company may also consider re-routing production out of Shanghai and Kunshan to factories elsewhere, such as Shenzhen, which currently is not under lockdown, analysts said.
“Apple may consider transferring the orders from Pegatron to Foxconn, but we expect the volume may be limited due to the logistics issue and the difficulty of equipment adjustment,” said Taipei-based Eddie Han, a senior analyst at Isaiah Research. Foxconn is the trade name of Hon Hai Precision Industry Co Ltd .
As a worst-case scenario, Pegatron may fall behind on 6 million to 10 million iPhone units if the lockdowns last two months and Apple cannot reroute orders, Han said.
Apple did not respond to a request for comment.
The chief executives of Huawei Technologies Co Ltd and Xpeng Inc have flagged huge economic costs if factories in Shanghai cannot resume production soon.
Shanghai is approaching its third week of lockdown and has shown no sign of a wide re-opening.
Forrest Chen, research manager at Trendforce told Reuters that if lockdowns lift in a few weeks, there is still a chance to recover.
However, “if the lockdown lasts longer than two months, there is already no way to recover. At that point, after lockdown lifts, there would be a shortage for end-users,” he said.
Some suppliers may be able to re-route production.
Unimicron Technology Corp, which makes printed circuit boards for companies including Apple, told Reuters the impact of the Kunshan lockdown so far has been minor and that it can rely on other plants in the Hubei province and Taiwan to support production.
But logistics and transport remain a nationwide issue, as cities across China enact measures.
One factory owner in Kunshan told Reuters that the district government had announced protocol for re-opening but provided no date for implementation.
Laptop makers may also suffer, including Compal Electronics Inc, a Taiwan-based company that makes PCs for Dell Technologies Inc and Lenovo Group Ltd from its plants in Kunshan. Chen estimates that roughly 50% of Compal’s laptop production is located in Kunshan.
Compal told Reuters on Friday that it had not halted production in Kunshan. Dell and Lenovo did not respond to emails seeking comment.
(Reporting by Josh Horwitz in Shanghai and Sarah Wu in Taipei; Editing by Sayantani Ghosh and Christopher Cushing)
By Ben Blanchard and Yew Lun Tian
TAIPEI/BEIJING -China said it conducted military drills around Taiwan on Friday as a U.S. Congressional delegation visited the island in a show of support to a fellow democracy, with Beijing blaming the lawmakers for raising tensions with their “provocative” trip.
China’s military sent frigates, bombers and fighter planes to the East China Sea and the area around Taiwan, the People’s Liberation Army Eastern Theatre Command said, in a statement released as the lawmakers were holding a news conference in Taipei.
“This operation is in response to the recent frequent release of wrong signals by the United States on the Taiwan issue,” it said, without mentioning the visiting U.S. delegation.
“The U.S. bad actions and tricks are completely futile and very dangerous. Those who play with fire will burn themselves,” it said.
China’s Defence Ministry, in a separate statement, said the U.S. visit was “deliberately provocative” and had “led to further escalation of tension in the Taiwan Strait”.
Taiwan is a frequent source of tension between Beijing and Washington.
Republican U.S. Senator Lindsey Graham told Taiwan President Tsai Ing-wen during the delegation’s meeting with her that the war in Ukraine and provocative behaviour by China have united U.S. opinion in a way not seen before.
“To abandon Taiwan would be to abandon democracy and freedom,” he said. “There’s a backlash growing in the world to thuggery – to the bad guys.”
Senator Bob Menendez, chairman of the Senate Foreign Relations Committee, said the technology hub is a “country of global significance” and its security has implications for the world.
The bipartisan group of six lawmakers arrived for their two-day visit on Thursday, in a previously unannounced trip.
Such visits, and a reference to Taiwan as a “country”, always anger Beijing, which dismisses any suggestion that Taiwan is a country. China regards the island as one of its provinces.
The United States has no formal relations with Chinese-claimed Taiwan but is its most important international backer and arms supplier.
Menendez acknowledged the Chinese government was “very unhappy” with the delegation’s visit but said that would not dissuade the group from supporting Taiwan.
“With Taiwan producing 90% of the world’s high-end semiconductor products, it is a country of global significance, consequence and impact, and therefore it should be understood the security of Taiwan has a global impact,” Menendez told Tsai.
Taiwan has been heartened by the U.S. support offered by the Biden administration, which has repeatedly talked of its “rock-solid” commitment to the democratically governed island.
That has added to strains in Sino-U.S. relations.
Russia’s invasion of Ukraine has also put Taipei on alert for any possible moves by Beijing to use the Ukraine crisis to make a move on the island. The government though has reported no sign that China is about to invade.
Taiwan has complained for the past two years or so of stepped-up Chinese military activity, including almost daily air force flights into Taiwan’s air defence zone, but not close to the island itself.
(Reporting By Ben Blanchard and Yimou Lee in Taipei, and Yew Lun Tian and Tony Munroe in Beijing; Editing by Muralikumar Anantharaman, Robert Birsel and Edmund Klamann)
SYRACUSE, NEW YORK – DAEQUON D. PERKINS, age 25, and MARK W. BAKER, age 44, both of Utica, New York, pled guilty today for their participation in a fentanyl conspiracy.
The announcement was made by United States Attorney Carla B. Freedman; Oneida County District Attorney Scott McNamara, New York State Police Superintendent Kevin P. Bruen, Timothy Foley, Acting Special Agent in Charge. U.S. Drug Enforcement Administration (DEA), New York Division; John B. Devito, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Chief Mark Williams, Utica Police Department.
PERKINS pled guilty today to conspiring to distribute and possess with intent to distribute 40 grams or more of a mixture and substance containing fentanyl, and to distribution of a mixture and substance containing fentanyl. As part of his guilty plea, Perkins admitted that beginning no later than May 2021, he agreed with others to distribute 40 grams or more of a mixture containing fentanyl to customers in the Utica, New York area. Perkins also admitted that on May 27, 2021, he distributed approximately 1.75 grams of a fentanyl mixture in Utica.
At sentencing on August 10, 2022, PERKINS faces a minimum term of 5 years and up to 40 years in prison, a post-incarceration term of at least 4 years and up to life of supervised release, and a maximum fine of $5,000,000.
BAKER pled guilty to conspiring to distribute and possess with intent to distribute 40 grams or more of a mixture and substance containing fentanyl, possession with intent to distribute a mixture and substance containing fentanyl, possession of a firearm in furtherance of a drug-trafficking crime, and possession of a firearm and ammunition by a felon. As part of his guilty plea, Baker admitted that beginning no later than May 2021, through at least August 4, 2021, he agreed with others to distribute 40 grams or more of a mixture containing fentanyl to customers. Baker further admitted that on August 4, 2021, at his residence in Utica, he possessed a fentanyl mixture he intended to distribute to others, a .40 caliber semiautomatic pistol, two 12-gauge shotguns, and multiple rounds of ammunition of various calibers, which he possessed in furtherance of drug-trafficking. Baker also acknowledged that in 2010, he was convicted of drug conspiracy charges in the United States District Court for the Northern District of New York, for which he was sentenced to 27 months’ imprisonment.
At sentencing on August 10, 2022, BAKER faces a minimum term of 15 years and up to life in prison, a post-incarceration term of at least 8 years and up to life of supervised release, and a maximum fine of $8,000,000.
A defendant’s sentence is imposed by a judge based on the particular statutes the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case is being investigated by New York State Police-Special Investigations Unit (NYSP-SIU), investigators from the Oneida County District Attorney’s Office, members of the City of Utica Police Department, DEA, ATF, and is being prosecuted by Assistant U.S. Attorney Matthew J. McCrobie.
By Mei Mei Chu
KUALA LUMPUR -Italian confectionary giant Ferrero said it will stop sourcing palm oil from Sime Darby Plantation after the United States found the Malaysian planter used forced labour, in a reputational blow for the palm producer and for Malaysia.
Labour practices across the Southeast Asian country have come under scrutiny in the past two years, with six companies including Sime Darby banned by U.S. customs over forced labour allegations.
Palm oil, the most widely used vegetable oil, is a key ingredient in Ferrero Rocher chocolates and Nutella spread, giving the iconic products their smooth texture and shelf life.
“On 6th April, we have requested all our direct suppliers to stop supplying Ferrero with palm oil and palm kernel oil sourced indirectly from Sime Darby, until further notice,” Ferrero told Reuters by email.
“Ferrero will comply with the U.S. Customs and Border Protection’s decision,” it said.
Although Ferrero buys relatively little of the edible oil from Sime Darby, its move – following similar halts by Cargill Inc, Hershey Co and General Mills Inc – could hurt Sime Darby’s standing as a leader in sustainably produced palm oil.
Sime Darby told Reuters it has taken steps in the area of human rights and that all its stakeholders who are committed to sustainability can be assured of its commitment and leadership in the industry. Ferrero is not a customer, it added.
“We are also in regular communication with all key stakeholders, particularly customers who have their own commitments,” it said.
Sime Darby’s shares were down 4% on Friday afternoon, weaker than the main Malaysian stock index, which was 0.3% lower.
“It’s very critical that Sime move fast to further alleviate any concern following the departure of some of these key customers,” said Ivy Ng, regional head of plantations research at CGS-CIMB Research, adding that other buyers could also suspend purchases as the labour concerns drag on.
Ferrero, responding to queries this week from Reuters about suppliers receiving its requests to stop buying from Sime Darby, said it does not buy directly from the Malaysian firm, which it said supplies 0.25% of its palm oil volumes.
MORE HALTS
Following a 2020 decision to ban imports due to the presence of “forced labour indicators” at Sime Darby, U.S. customs said in January it had sufficient evidence of forced labour and that the firm’s goods were subject to seizure.
Ferrero said its products and brands in the United States had stopped sourcing from Sime Darby in January 2021.
Sime Darby has promised “sweeping changes” to its governance and some labour practices following the U.S. finding.
Palm oil is one of the cheapest and fastest-growing vegetable oils, used in products from food to cosmetics to biodiesel. But the industry has faced scrutiny over the years for widespread deforestation in Southeast Asia and exploitation of migrant workers.
Migrant workers from countries like Indonesia, India and Bangladesh account for around 80% of the palm oil labour force in Malaysia, the world’s biggest producer of the commodity after neighbouring Indonesia.
Ferrero says it uses only certified sustainable palm oil. It sources 85% of its palm oil from Malaysia, which traditionally has a better reputation for sustainability than Indonesia.
U.S. commodities trading giant Cargill, in a move not previously reported, said in March it had suspended purchases from Sime Darby pending more information on the firm’s measures to address the labour allegations.
Cargill said on its website that Sime Darby had taken “very constructive and potentially transformative” steps, but it needed more information to determine whether the planter was meeting the trader’s sustainability standards.
Sime Darby said its supply of bulk products to Cargill in India has been taken up by other customers. “We value all our customers and are certainly in discussions with Cargill,” it said.
Cargill declined to say how much palm oil it sources from Sime Darby.
Last year, U.S. food company General Mills said it has issued global “no buy orders” on Sime Darby while chocolate maker Hershey asked suppliers to ensure no Sime Darby oil enters its global operations.
(Reporting by Mei Mei Chu; Editing by A. Ananthalakshmi and William Mallard)
SHANGHAI -Automakers in China may have to suspend production in May if suppliers in Shanghai and surrounding areas are not able to resume work, He Xiaopeng, the chief executive officer of Chinese electric-car maker Xpeng, said on Thursday.
Growing lockdowns to stop the spread of COVID-19 in China are clogging highways and ports and shutting countless factories – disruptions that are rippling through global supply chains for goods ranging from electric vehicles to iPhones.
Some Chinese authorities are trying to resolve the situation, said He on his personal Wechat feed which was seen by Reuters, adding he hoped more government departments can provide support.
His comments were echoed by Huawei’s Consumer Business Group CEO Richard Yu, who also warned of huge economic costs if factories in Shanghai couldn’t resume production. Yu said all technology and industry firms would have to stop production in May if their suppliers are in Shanghai, the official Securities Times reported on Friday.
Sales in the world’s biggest auto market plunged in March as COVID curbs took their toll.
Tesla Inc was among the automakers feeling the pain of limits on production.
The U.S. automaker has suspended production at its Shanghai plant since March 28, leading to an output loss of more than 40,000 units, according to Reuters calculations. The manufacturing hub in Shanghai makes 10,000 Model Ys and 6,000 Model 3s per week, said a person familiar with the matter.
Nio also suspended production at its Hefei factory – even though there were no local-level curbs – because suppliers from other areas had stopped work.
Carmakers with production facilities in China’s northeastern provinces are resuming production as those places emerge from lockdowns.
State-owned Chinese automaker FAW Group has resumed some production at its Hongqi plant in Jilin while BMW said all of its plants in the city of Shenyang restarted operations on Thursday.
(Reporting by Zhang Yan, Brenda Goh; Editing by Muralikumar Anantharaman and Kim Coghill)
BEIJING -Growth in new home prices in China was flat again in March versus the previous month, government data showed on Friday, pointing to fragile demand as growing COVID-19 lockdown measures dampened consumer confidence.
Average new home prices in 70 major cities were unchanged on a month-on-month basis for the second time in a row, according to Reuters calculations based on March data from the National Bureau of Statistics (NBS).
On a year-on-year basis, new home prices rose 1.5%, the slowest pace since November 2015, and easing from a 2.0% gain in February.
Over 60 cities have eased curbs on home purchases to support the ailing property market, after a government campaign to reduce developers’ high debt levels pushed the sector into a deep chill in the second half of 2021.
Banks in over 100 Chinese cities have lowered mortgage rates by around 20 to 60 basis points since March，central bank official Zou Lan said on Thursday.
But after signs of improvement in January, a surge in cases of the highly transmissible Omicron variant and strict virus lockdown measures have again cooled demand in many cities.
In tier-one cities, prices gained 0.4% on month, narrowing from a 0.5% rise in February, while growth in tier-two cities was zero.
“The growth slowdown in first-tier cities in March was mainly due to the impact of the COVID pandemic, indicating weaker market expectations,” said analyst Xu Xiaole at Beike Research Institute.
More cities are likely to relax property curbs in the near future, and demand will be gradually released, said Xu.
The property market in the commercial hub of Shanghai slowed with home prices rising at the slowest pace in four months, at 0.3% month-on-month.
Shanghai is in the midst of China’s worst outbreak since the virus emerged in Wuhan in late 2019, reporting more than 20,000 cases daily amid an unprecedented citywide lockdown. Dozens more cities are in partial or full lockdown.
Price growth in Shanghai does not reflect the overall market situation, said analyst Lu Wenxi at property agency Centaline.
“The growth in new home prices in Shanghai will further ease in April,” Lu added.
In March, transactions by value of newly built homes in Shanghai slumped 27% from a month earlier to 36.2 billion yuan ($5.68 billion)，financial magazine Yicai said.
China’s State Council, or cabinet, on Wednesday said more policy measures are needed to support the economy, but analysts are unsure if interest rate cuts would quickly reverse the slump as long as the government maintains its zero tolerance COVID-19 policy.
In the first 12 days of April, new home sales by volume in 30 cities surveyed by Wind were down 55.6% year-on-year, analysts at Nomura said in a client note on Wednesday.
($1 = 6.3739 Chinese yuan renminbi)
(Reporting by Liangping Gao and Ryan Woo; Editing by Muralikumar Anantharaman and Christopher Cushing)
TOKYO – Japan’s core consumer inflation likely accelerated in March from a year earlier but was still well short of the Bank of Japan’s price goal, a Reuters poll showed, bolstering the view that the BOJ will lag way behind other central banks in normalising policy.
Separate data is expected to show Japan’s trade balance remained deep in the red, stoking worries about surging import costs of fuel and commodities, while the yen’s weakening to 20-year low past 126 versus the dollar this week adding to the pain.
Next week’s data would underscore the challenge for Japan’s central bank. The weak yen has emerged as a political hot-button issue as lawmakers demand measures to cushion the blow from rising inflation.
The nationwide core consumer price index (CPI) data, to be released by the internal ministry at 2330 GMT on April 21, likely rose 0.8% in March from a year earlier, faster than a 0.6% gain in February, the poll of 18 economists showed on Friday.
“The pace of rises in the core CPI likely returned to pre-pandemic levels,” said Takeshi Minami, chief economist at Norinchukin Research Institute.
“The natiowide core index probably picked up in March as import inflation has strengthened due to the weak yen, rising crude oil and commodity prices.”
Still, rising headline inflation does not mean the BOJ would rush to unwind its monetary stimulus anytime soon. On the contrary, the central bank is expected to stick with its powerful stimulus for some time given the view that the current cost-push inflation is far from sustainable, analysts say.
Its long elusive inflation target is 2%.
The trade data, to be issued by the Ministry of Finance at 2350 GMT on April 19, will probably show Japan’s trade balance remained in a deficit of 100.8 billion yen in March, narrowing from 668.3 billion yen seen in the previous month.
Imports likely jumped 28.9% in the year to March, outpacing a 17.5% gain in exports, the poll showed.
(Reporting by Tetsushi Kajimoto; Editing by Kim Coghill)
SHANGHAI -China’s central bank kept borrowing costs of its medium-term policy loan unchanged for the third straight month as expected on Friday, despite Beijing calling for more monetary stimulus to cushion an economic slowdown.
The People’s Bank of China (PBOC) said it was keeping the rate on 150 billion yuan ($23.52 billion) worth of one-year medium-term lending facility (MLF) loans to some financial institutions unchanged at 2.85% from the previous operation, to “maintain banking system liquidity reasonably ample”, according to an online statement.
Thirty-one out of the 45 traders and analysts, or nearly 70% of all participants in a Reuters poll, forecast no change to the MLF rate.
Instead, markets increasingly expect an imminent reduction in the amount of cash banks must set aside as reserves, after the State Council, or cabinet, called on Wednesday for the timely use of such monetary tools.
Global investment banks including Citi expect such a reserve requirement ratio (RRR) reduction could be delivered as early as Friday, with many expecting more easing measures still on the way.
“We doubt the forthcoming RRR cut will be the last easing move either, given the severe headwinds facing China’s economy,” said Julian Evans-Pritchard, senior China economist at Capital Economics.
“We continue to anticipate another 20 basis points of policy rate cuts this year and a further acceleration in credit growth.”
The recent fast spread of COVID-19 cases has induced lockdowns in a dozen of cities across the country, including the financial hub of Shanghai, raising concern over wider disruptions to economic activity.
That means policymakers will need to offer more stimulus to ensure the economy is on course to hit this year’s growth target of around 5.5%, analysts say.
A latest Reuters poll showed China’s economic growth is likely to slow to 5.0% in 2022 amid renewed COVID-19 outbreaks and a weakening global recovery, piling pressure on the central bank to ease policy further.
With 150 billion yuan worth of MLF loans maturing on Friday, the operation resulted in zero net cash injection into the banking system.
The central bank also injected 10 billion yuan through seven-day reverse repos while keeping the borrowing cost unchanged at 2.1%, according to an online statement.
($1 = 6.3775 Chinese yuan)
(Reporting by Winni Zhou and Andrew Galbraith; Editing by Muralikumar Anantharaman and Lincoln Feast.)
By Leika Kihara
TOKYO -Japanese Prime Minister Fumio Kishida said the central bank’s monetary policy is aimed at achieving its 2% inflation target, not at manipulating currency rates, brushing aside the view the country must end an ultra-low interest rate policy to stem sharp yen declines.
Kishida also said the recent rise in domestic inflation was due mostly to a global spike in crude oil and raw material costs, rather than the weak yen.
“The Bank of Japan (BOJ) is conducting monetary policy to achieve its 2% inflation target, not to manipulate currency rates,” Kishida told parliament, when asked by an opposition lawmaker about the relationship between the yen’s declines and the central bank’ prolonged ultra-loose policy.
“The government hopes the BOJ continues to strive toward achieving its inflation target, with an eye on economic, price and financial developments,” he said on Friday.
The yen slumped to a fresh 20-year low of 126.56 against the dollar on Friday, as investors focused on the gap between the U.S. Federal Reserve’s aggressive rate hike plans and the BOJ’s pledge to maintain its ultra-low policy for the time being.
While a weak yen boosts Japanese exports, it inflates import costs for energy and food products that have already seen prices jump due to the war in Ukraine.
Some lawmakers have blamed the BOJ’s ultra-easy policy for accelerating yen declines and adding pain to households and firms by pushing up living costs.
Under a policy dubbed yield curve control, the BOJ pledges to guide short-term rates at -0.1% and cap long-term borrowing costs around 0% to fire up inflation to its 2% target.
(Reporting by Leika Kihara; Editing by Himani Sarkar and Kim Coghill)
GALLOWAY TOWNSHIP, NJ – The following incidents were reported by the Galloway Township Police Departments between April 3rd and April 9th.
Larry J Quellette Jr., 49 of Egg Harbor Twp., NJ was arrested by Ofc Diamond Fuentes and charged with Possession of CDS, Distribution of CDS, Possession of Drug Paraphernalia and Distribution of Drug Paraphernalia on April 8.
Alfred S. Jones Jr., 53 of Egg Harbor Twp., NJ was arrested by Ofc. Diamond Fuentes and charged with Possession of CDS, Distribution of CDS, Possession of Drug Paraphernalia and Distribution of Drug Paraphernalia on April 8.
James J. Brinamen Jr., 52 of Highlands, NJ was arrested by Ofc. Sangenys Estrella-Garica and charged with Hindering on April 8.
Brittni M. Hamilton, 30 of Atlantic City, NJ was arrested by Ofc. David LaSassa and charged with Assault on Health Care Worker on April 8.
Ta’ise Washington, 18 of Sicklerville, NJ was arrest by Ofc. Zachary Gadaire and charged with Resisting Arrest and Obstruction on April 7.
Thomas W. Sear Jr., 18 of Mays Landing, NJ was arrested by Ofc. Zachary Gadaire and charged with Resisting Arrest and Obstruction on April 7.
Juveniles: 1
A 16 year old Male of Mays Landing, NJ was arrested by Ofc. Zachary Gadaire and charged with Resisting Arrest and Obstruction of April 7.
RAMSEY, NJ – A student who called in a fake school shooting threat is facing multiple charges, including false public alarm, terroristic threats, and harassment. According to Bergen County Prosecutor Mark Musella Luke Natoli, 18, was arrested on charges of false public alarm, terroristic threats, and harassment. The arrest is the result of an investigation conducted by the Bergen County Prosecutor’s Office under the direction of Chief Jason Love and the Montvale Police Department under the direction of Chief Joseph Sanfilippo.
“On Tuesday, April 12, 2022, the Bergen County Prosecutor’s Office was notified by the Montvale Police Department that an unknown telephone caller using technology to anonymize his calling line identity (“caller ID”) placed a telephone call to a Bergen County high school official claiming that he was going to bring a gun to a sport’s practice that afternoon,” Musella said. “First responders and school officials took measures to ensure the safety of the campus while members of the Bergen County Prosecutor’s Office Cyber Crimes Unit and the Montvale Police Department initiated an investigation to trace the call.”
Prosecutor Musella said, as a result of the investigation, it was determined that Natoli placed the alarming telephone call, which was a hoax threat. Detectives located him in Poughkeepsie, New York later that day, with the assistance of the Poughkeepsie Police Department.