Economy

Saudi Arabian Energy Minister Khalid al-Falih speaks to the media before the OPEC 14th Meeting of the Joint Ministerial Monitoring Committee in Jeddah
Saudi Arabian Energy Minister Khalid al-Falih speaks to the media before the OPEC 14th Meeting of the Joint Ministerial Monitoring Committee in Jeddah, Saudi Arabia, May 19, 2019. REUTERS/Waleed Ali

May 19, 2019

JEDDAH, Saudi Arabia (Reuters) – Saudi Arabian Energy Minister Khalid al-Falih said on Sunday that recent attacks on Saudi energy assets had put security of oil supply at risk but not affected his country’s output.

He also called on Saudi Arabia’s partners to condemn the attacks.

Four commercial ships were sabotaged off the coast of the United Arab Emirates last Sunday, and two days later drones attacked oil installations west of the Saudi capital Riyadh.

Falih was speaking in Jeddah, Saudi Arabia, ahead of a ministerial panel meeting of top OPEC and non-OPEC oil producers, including Saudi Arabia and Russia.

(Reporting by Rania El Gamal; Editing by Dale Hudson)

Source: OANN

Iraqi Oil Minister Thamer Ghadhban speaks to the media at the ministry's headquarters in Baghdad
Iraqi Oil Minister Thamer Ghadhban speaks to the media at the ministry’s headquarters in Baghdad, Iraq May 16, 2019. REUTERS/Khalid Al-Mousily

May 19, 2019

JEDDAH, Saudi Arabia (Reuters) – A major oil deal between Iraq and Exxon Mobil was “very close” but had been slowed by Exxon’s decision on Saturday to evacuate its international staff from the West Qurna oil field, Iraq’s Oil Minister Thamer Ghadhban said on Sunday.

“Had we concluded we would have signed a heads of agreement,” he said, referring to a preliminary document that would set out terms of cooperation on the South Integrated Project. “But now they are out of the country, why should I run after them?” he said at an oil meeting in Jeddah.

Iraqi oil officials say Exxon evacuated all of its foreign staff from the West Qurna 1 field on Friday and Saturday, about 60 people. The U.S. oil major has a long term contract to improve the field.

Its evacuation came days after Washington sent non-essential staff home from the U.S. embassy in Baghdad over what it said was a security alert caused by threats from Iran, which has close ties to Shi’ite militia groups operating in Iraq.

The United States is ramping up sanctions pressure on Iran, especially over oil exports. Iraq relies heavily on natural gas from Iran for its electricity supply, which is stretched during hot summer months.

Ghadhban said there were a number of ways Iraq could compensate in case Iranian gas supplies were reduced, including using gas oil stores in some power plants, but so far there had been no change in supplies.

Ghadhban separately said Iraq has almost 5 million barrels per day of oil capacity, with a current surplus capacity of around 400,000 bpd

“We are [producing] around 4.5 mln bpd, which is our production rate that we agreed to in December last year,” he said.

(Reporting by Stephen Kalin in Jeddah; Writing by Lisa Barrington; Editing by Peter Graff)

Source: OANN

FILE PHOTO: Federal Reserve Vice Chairman Clarida boards a bus to tour South Dallas as part of a community outreach by U.S. central bankers in Dallas
FILE PHOTO: Federal Reserve Vice Chairman Richard Clarida, boards a bus to tour South Dallas as part of a community outreach by U.S. central bankers, in Dallas, Texas, U.S., February 25, 2019. REUTERS/Ann Saphir/File Photo

May 19, 2019

By Trevor Hunnicutt

CAMDEN, N.J./PHILADELPHIA (Reuters) – Two top Federal Reserve officials went to Camden, New Jersey, on Friday, taking a different reading of the pulse of the U.S. economy by visiting what is by one measure the country’s lowest-income city, as the central bank seeks advice on how to do a better job.

Patrick Harker, president of the Philadelphia Fed, and Federal Reserve Vice Chair Richard Clarida spent the morning in Camden, which squats in the shadows of Philadelphia’s downtown skyscrapers but has the lowest median household income among U.S. cities.

The dichotomy of Philadelphia’s gleaming office buildings and destitute people on the streets of nearby Camden underlines the limits of Fed policy, even as most policymakers see the central bank’s dual mandate of price stability and maximum employment as having been met.

In July, the U.S. economy will celebrate 10 years of expansion, the longest on record.

Yet at events in Camden and Philadelphia, the policymakers heard that while some progress is being made linking employers and workers, many Americans continue to struggle.

“What drives the racial wealth gap is income and the fact that for the last 50 years we’ve had crisis-level unemployment in certain demographics,” said Omar Woodard, executive director at GreenLight Philadelphia, a group focused on alleviating poverty, speaking on one of the Fed’s panels.

Camden’s population is 45 percent African-American, according to the U.S. Census Bureau.

Unemployment numbers draw out the divide across the country. Black U.S. unemployment stands at 6.7%, far higher than the more than 49-year low overall for Americans of 3.6%.

WHAT’S LIMITING GROWTH?

Friday’s events were the latest in a series of “Fed Listens” events that Clarida held around the country while the Fed considers whether to change its approach, for instance by keeping interest rates lower for longer to boost inflation expectations – something that might help drive growth.

It is unclear how directly the policy review will answer criticisms that the Fed has raised interest rates too much. President Donald Trump has repeatedly lambasted the Fed for raising rates, saying that it is holding back growth. The Fed, after hiking rates four times in 2018, has put any further rate increases on hold so far this year.

The Fed took extraordinary steps, including buying bonds, to support the economy in response to the 2007-2009 financial crisis, but it has been criticized both for doing too much and too little.

“I think we just have to be honest, when people ask us what’s limiting economic growth, it’s not monetary policy,” but other issues, including employers unable to find qualified employees, Harker told reporters.

The Fed is not planning to release the results of its current policy review until next year, but policymakers are clearly focused on whether they can effectively deal with the next recession with little room to lower rates from the current 2.25-2.50% level before they hit zero.

Tame inflation below the Fed’s annual target rate of 2% further complicates matters, making it, in theory, less likely that households and businesses will support the economy by spending during recessions because of diminished worries that their cash will lose value.

“Obviously if inflation is running below our 2% target, unemployment is low and wages are growing – seems to be a good thing,” Harker told reporters. But he quickly warned of the dangers of falling inflation.

“That starts a spiral that’s hard to turn around,” Harker said.

In recent speeches, Clarida has argued that inflation is less responsive to lower unemployment than in the past, a view that may lead the Fed to stimulate the economy more aggressively and lower rates faster in response to downturns.

Pinning inflation expectations at that 2% level is as important as ever, he has argued, because it may be even harder than in the past to tamp down out-of-control expectations of price hikes without damage to the economy.

Camden’s unemployment rate fell to 4.1% in March but it has ticked up from lows last year.

Central bank officials toured facilities of a nuclear fuel and waste management company in Camden that is doing on-the-job training for new employees and visited the Leadership, Education, and Partnership Academy University School, which is teaching robotics, engineering and computer coding, and enrolling high-school students in college courses before they graduate.

Students talked about wanting to see poverty alleviated in their community and showed the central bankers flying drones, video game machines and other projects. Harker, an engineer, told a teacher to pitch a student’s water-purification project on “Shark Tank.”

In a speech later, Harker said the Fed wants to make sure “we’ve got the right goals in place; that we’re still measuring the right things, and that the tools we use are still the best ones for the job.”

(Reporting by Trevor Hunnicutt; Editing by Leslie Adler)

Source: OANN

An Israeli flag flutters outside the Bank of Israel building in Jerusalem
An Israeli flag flutters outside the Bank of Israel building in Jerusalem August 7, 2013. REUTERS/Ronen Zvulun/File Photo

May 19, 2019

JERUSALEM (Reuters) – The stability of Israel’s banking system is not in danger in the event of a local macroeconomic shock such as a housing crisis, but banks nonetheless would be significantly affected, the Bank of Israel said on Sunday.

Israel’s banking regulator said it conducted a stress-test for the banking system to determine whether banks would be able to absorb losses without endangering their stability or the public’s deposits.

The test examined the resilience of banks to geopolitical events that would lead to higher interest rates, combined with a severe housing crisis and the collapse of a large business group.

“The results of the test show that the scenario will have a considerable impact on the banking system and although some of the banks will suffer losses, the scenario does not threaten the banking system’s stability and resilience,” the central bank said, noting that Tier I capital ratios are not expected to fall below the required 6.5% minimum for extreme scenarios.

“The banks’ capital ratios in the scenario are higher than those in previous stress tests.”

Most of the losses expected in the stress scenario would be in the credit portfolio — an average of 12.2 billion shekels ($3.4 billion) a year, or 1.2 percent of the portfolio.

“Rising unemployment, the decrease in GDP and the housing crisis make it difficult for households and the business sector to meet their obligations, which causes serious losses in the banks’ credit portfolio and damage to their equity,” the regulator said.

Losses may partly be mitigated by the higher interest rates, which would boost net interest income, it added.

The central bank said the results attest to the stability of banks even in an extreme situation and reflect the requirements placed on banks in recent years in order to strengthen their capital.

Last week, Bank of Israel Governor Amir Yaron said that despite the central bank’s efforts to maintain banking stability “we must not be complacent. We must continue thinking of where the next crisis may come from, and continue monitoring and strengthening the system’s resilience.”

(Reporting by Steven Scheer)

Source: OANN

A man walks past the headquarters of the PBOC in Beijing
A man walks past the headquarters of the People’s Bank of China (PBOC), the central bank, in Beijing November 20, 2013. China will lift controls on deposit rates when conditions are ripe, the central bank vice governor said on Wednesday, as part of efforts to push forward a market-based interest rate regime. REUTERS/Jason Lee (CHINA – Tags: BUSINESS)

May 19, 2019

BEIJING (Reuters) – China’s central bank will maintain basic stability of the yuan exchange rate within a reasonable and balanced range, according to comments posted on its website on Sunday.

Pan Gongsheng, deputy governor of the People’s Bank of China (PBOC), told the PBOC-run Financial News in an interview that the central bank was confident in its ability to maintain stable operation of China’s foreign exchange market.

The PBOC will also make the necessary counter-cyclical adjustments and strengthen macro prudential management according to changes in the situation, as well as combating illegal and irregular behavior and safeguarding good order on the foreign exchange market, said Pan, who is also director of the State Administration of Foreign Exchange.

(Reporting by Tom Daly and Xiaochong Zhang; Editing by Alison Williams)

Source: OANN

Illustration photo of an Isreal Shekel note
An Isreal Shekel note is seen in this June 22, 2017 illustration photo. REUTERS/Thomas White/Illustration

May 19, 2019

By Steven Scheer

JERUSALEM (Reuters) – Israel’s central bank is expected to hold the line on short-term interest rates this week for a fourth straight decision amid a strengthening shekel that has helped to contain inflation while the economy sped ahead in the first quarter.

Ten of 11 economists polled by Reuters said policymakers would leave the Bank of Israel’s benchmark rate at 0.25% when it announces its decision at 4 p.m. (1300 GMT) on Monday. One economist predicted an increase to 0.5%.

After making a surprise increase from 0.1% on Nov. 26, the central bank has left the key rate unchanged at its subsequent policy meetings in January, February and April.

Most economists believe the next rate increase will take place later this year, citing a surprising moderation in inflation last month and a shekel that last week hit a new record high versus a basket of currencies of Israel’s largest trading partners.

The central bank’s own economists project a rate increase to 0.5% towards the end of the third quarter of 2019 and two more hikes in 2020 to bring the rate to 1.0% by the end of next year.

The strong shekel, which has also gained versus the dollar and euro, helped to moderate Israel’s inflation rate to 1.3% in April from an expected 1.5% and 1.4% in March. Israel has an official inflation target of 1%-3%.

Israel’s economy remains strong, with annualized growth of 5.2% in the first quarter, partly boosted by a rush to buy cars ahead of a tax hike in the second quarter. Growth is expected at around 3.5% this year.

Economists said the Bank of Israel would have a tough time raising rates when central banks around the world are poised to loosen policy this year.

“This poses a dilemma for the Bank of Israel since present policy rates are not in line with the tight labor market, the high fiscal deficit, and the recent renewal of housing price increases,” Bank Hapoalim economist Victor Bahar said.

“The chances of a rate hike in coming months has declined significantly.”

Minutes of the April 8 decision showed that four of the five monetary policy members voted to leave rates unchanged, while one voted for a hike on a view that the rate was not in line with the state of the economy while inflation has been within the target for some time.

Similarly, Bank Leumi Chief Economist Gil Bufman forecast a quarter-point rate increase this month, saying growth was strong in the first quarter even after stripping out the surge in car sales, while inflation remains within the government’s target.

(Reporting by Steven Scheer; Editing by Alison Williams)

Source: OANN

Illustration photo of an Isreal Shekel note
An Isreal Shekel note is seen in this June 22, 2017 illustration photo. REUTERS/Thomas White/Illustration

May 19, 2019

By Steven Scheer

JERUSALEM (Reuters) – Israel’s central bank is expected to hold the line on short-term interest rates this week for a fourth straight decision amid a strengthening shekel that has helped to contain inflation while the economy sped ahead in the first quarter.

Ten of 11 economists polled by Reuters said policymakers would leave the Bank of Israel’s benchmark rate at 0.25% when it announces its decision at 4 p.m. (1300 GMT) on Monday. One economist predicted an increase to 0.5%.

After making a surprise increase from 0.1% on Nov. 26, the central bank has left the key rate unchanged at its subsequent policy meetings in January, February and April.

Most economists believe the next rate increase will take place later this year, citing a surprising moderation in inflation last month and a shekel that last week hit a new record high versus a basket of currencies of Israel’s largest trading partners.

The central bank’s own economists project a rate increase to 0.5% towards the end of the third quarter of 2019 and two more hikes in 2020 to bring the rate to 1.0% by the end of next year.

The strong shekel, which has also gained versus the dollar and euro, helped to moderate Israel’s inflation rate to 1.3% in April from an expected 1.5% and 1.4% in March. Israel has an official inflation target of 1%-3%.

Israel’s economy remains strong, with annualized growth of 5.2% in the first quarter, partly boosted by a rush to buy cars ahead of a tax hike in the second quarter. Growth is expected at around 3.5% this year.

Economists said the Bank of Israel would have a tough time raising rates when central banks around the world are poised to loosen policy this year.

“This poses a dilemma for the Bank of Israel since present policy rates are not in line with the tight labor market, the high fiscal deficit, and the recent renewal of housing price increases,” Bank Hapoalim economist Victor Bahar said.

“The chances of a rate hike in coming months has declined significantly.”

Minutes of the April 8 decision showed that four of the five monetary policy members voted to leave rates unchanged, while one voted for a hike on a view that the rate was not in line with the state of the economy while inflation has been within the target for some time.

Similarly, Bank Leumi Chief Economist Gil Bufman forecast a quarter-point rate increase this month, saying growth was strong in the first quarter even after stripping out the surge in car sales, while inflation remains within the government’s target.

(Reporting by Steven Scheer; Editing by Alison Williams)

Source: OANN

File photo of fifty-euro notes at the Belgian Central Bank in Brussels
FILE PHOTO: Fifty-euro notes are seen at the Belgian Central Bank in Brussels in this December 8, 2011 file photo. REUTERS/Yves Herman

May 19, 2019

MILAN (Reuters) – The euro zone inflation is not where the European Central Bank wants it, ECB policymaker Klaas Knot said in an interview published by Italian daily Corriere della Sera on Sunday.

The current situation “is not full convergence to below but close to 2%, I think. We have a figure in mind that is clearly closer to 2% than the number we have seen over the last five, six years or so,” said Knot, the Dutch central bank governor.

“The only thing that we can do is to keep the pressure up, make sure the economy continues to perform at high levels of capacity utilization and the economy continues to print GDP numbers in excess of potential growth. At some point this chain of events will also lead to higher prices.”

(Reporting by Francesca Landini; Editing by Peter Graff)

Source: OANN

Residential buildings under construction are seen in Jinpu New District in Dalian, Liaoning
FILE PHOTO: Residential buildings under construction are seen in Jinpu New District in Dalian, Liaoning province, China March 19, 2018. China Daily via REUTERS

May 19, 2019

BEIJING (Reuters) – China’s housing regulator has urged four more cities to prevent their residential property markets from overheating in the latest sign that authorities are not about to relax their grip on the real estate business in order to spur the economy.

The cities of Suzhou, Foshan, Dalian and Nanning have been told by the Ministry of Housing and Urban-Rural Development to stabilize land and housing prices as well as market expectations, the official Xinhua news agency reported late on Saturday.

Six other cities were warned by the ministry last month to monitor the growth of home prices in their markets, after some cities, including, Foshan quietly started to relax some curbs since December to spur demand.

China’s home property market is a key plank of the economy, influencing tens of related sectors such as construction and financial services.

The sector has held up well despite a slowdown in growth in the world’s second-biggest economy, with policymakers walking a fine line between preserving stability and hurting market sentiment.

Renewed tensions between China and the United States over trade have also added pressure on Chinese policymakers to keep the domestic economy on a stable footing, while continuing to fend off risks such as housing bubbles.

Average new home prices in China’s 70 major cities rose 0.6% in April, unchanged from the pace of growth in March, according to a monthly official survey.

Most of the 70 cities surveyed by the National Bureau of Statistics still reported monthly price gains for new homes. The number increased to 67 in April from 65 in March, signaling a slight strengthening in the market.

The housing ministry reiterated that “houses are for living in, not for speculation”, according to the Xinhua news agency on Saturday.

Even before the ministry’s latest warning, the prosperous city of Suzhou, just northwest of Shanghai, had already rolled out new property curbs.

On May 11, Suzhou said it would restrict buyers of new homes in some districts from selling their property within three years.

(Reporting by Ryan Woo; Editing by Kenneth Maxwell)

Source: OANN

FILE PHOTO: Iranian Material Display at a Military Base in Washington
FILE PHOTO: Brian Hook, U.S. special representative for Iran, in Washington, U.S., November 29, 2018. REUTERS/Al Drago/File Photo

May 8, 2019

WASHINGTON (Reuters) – The United States will not grant any more waivers to any countries that would allow them to buy Iranian oil without facing U.S. sanctions, a senior U.S. diplomat said on Wednesday.

Brian Hook, Iran Special Envoy, also said in a briefing the global oil market had already factored in Iranian oil exports falling to zero under the Trump administration’s economic pressure campaign against Tehran.

(Reporting by Jonathan Landay and Humeyra Pamuk; Editing by Chizu Nomiyama)

Source: OANN


[There are no radio stations in the database]