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Bank of Japan keeps monetary policy, tweaks view on global economy

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The Bank of Japan kept monetary policy steady on Friday but tempered its optimism that robust exports and factory output will underpin growth, a nod to heightened overseas risks that threaten to derail a fragile economic recovery.

Factories across the globe slammed on the brakes last month as demand was hit by the U.S.China trade war, slowing global growth and political uncertainty in Europe ahead of Britain’s departure from the European Union.

In a nod to the increased risks, the BOJ cut its assessment on overseas economies to say they are showing signs of slowdown. It also revised down its view on exports and output.

“Exports have shown some weaknesses recently,” the central bank said in a statement on its policy decision, offering a bleaker view than in January when it said they were increasing as a trend.

At a two-day rate review ending on Friday, the BOJ maintained a pledge to guide short-term interest rates at minus 0.1 percent and 10-year government bond yields around zero percent. The widely expected decision was made by a 7-2 vote.

The central bank also stuck to its view Japan’s economy is expanding moderately, but added a phrase that “exports and output have been affected by slowing overseas growth.” In January, it said only that the economy was expanding moderately.

“The sharp deterioration in exports and industrial production should be a serious source of concern for the BOJ. I think the BOJ is doing some thought experiments about what they can do,” said Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management.

“For now you can still make the argument that current economic weakness is temporary, but this is becoming an increasingly closer call. The next three months are critical.”

Japan’s exports posted their biggest decline in more than two years in January as China-bound shipments tumbled. Factory output also posted the biggest decline in a year in that month, a sign slowing global demand was taking a toll on Japan Inc.

Many in the BOJ expect Japan’s economy to emerge from the current soft patch in the second half of this year, when Beijing’s stimulus plans could lift Chinese demand and underpin global growth, sources have told Reuters.

But there is uncertainty on how quickly global demand could rebound, adding to woes for Japanese companies already feeling the pinch from slowing Chinese demand, analysts say.

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Trump says he does not see white nationalism rising after New Zealand mosque shooting

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President Donald Trump speaks to members of the media on the South Lawn of the White House in Washington, D.C.

Olivier Douliery | Bloomberg | Getty Images

President Donald Trump speaks to members of the media on the South Lawn of the White House in Washington, D.C.

President Donald Trump said on Friday he does not see a rise in white nationalism but it may be an issue in New Zealand, where a gunman who is believed to espouse those views killed 49 people at two mosques.

Asked by a reporter if he sees an increase in white nationalism, Trump said: “I don’t really. I think its a small group of people.”

Trump also said he had not seen a manifesto in which the suspected gunman denounced immigrants and praised Trump as “a symbol of renewed white identity and common purpose.”

Trump’s comment come after news that at least 49 people were killed and more than 40 people are being treated for injuries after at least one shooter opened fire at two mosques in Christchurch, New Zealand on Friday, according to New Zealand police.

A 28-year-old man was charged with murder and is set to appear in Christchurch District Court, while two others remain in police custody.

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Trump vetoes bill that would block border wall national emergency

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President Donald Trump speaks about border security in the Oval Office of the White House, Friday, March 15, 2019, in Washington. Trump issued the first veto of his presidency, overruling Congress to protect his emergency declaration for border wall funding.

Evan Vucci | AP

President Donald Trump speaks about border security in the Oval Office of the White House, Friday, March 15, 2019, in Washington. Trump issued the first veto of his presidency, overruling Congress to protect his emergency declaration for border wall funding.

President Donald Trump rejected a bill Friday that would end the national emergency he declared at the southern U.S. border.

The president’s veto, signed in front of reporters in the Oval Office, is his first since he entered the White House. While the Democratic-held House will likely try to override his opposition, neither chamber of Congress appears to have enough support to reach the two-thirds majority needed.

The GOP-controlled Senate dealt a blow to Trump on Thursday, when 12 Republicans joined with Democrats in voting to terminate his emergency declaration. He publicly pushed Senate Republicans to vote against the House-passed resolution even as he shot down one plan that could have limited the number of GOP senators voting to block his flex of executive power.

In a tweet before he vetoed the bill, Trump thanked the GOP senators who he said “bravely voted for Strong Border Security and the WALL.”

“Watch, when you get back to your State, they will LOVE you more than ever before!” he wrote.

Though Trump has pushed back congressional efforts to check his declaration for now, his administration still has to fight court challenges. More than a dozen states and several outside groups have filed lawsuits challenging his executive action.

Democrats plan to vote to override Trump’s veto on March 26, NBC News reported, citing two sources. Rep. Joaquin Castro, a Texas Democrat who introduced the measure to block the declaration in the House, said Thursday that he will try to gather support for another vote even though it will be “very tough” to reach a two-thirds majority.

Trump declared a national emergency at the U.S.-Mexico border last month to divert already approved Defense Department money to build his proposed border wall. He demanded $5.7 billion for border barriers as part of a spending plan to fund the government through September, but Congress denied him. Lawmakers passed only $1.4 billion for structures on the border.

Democrats said Trump created a sham emergency in order to circumvent Congress’ appropriations power. Republicans also worried the president setting a dangerous precedent that Democrats could use to declare emergencies related to other topics such as climate change and gun violence.

Trump hopes to put $8 billion total toward the border wall, including the money allocated by Congress. Using emergency powers, he would divert $3.6 billion from military construction funds. With other executive actions, he hopes to pull the remainder from other Pentagon and Treasury Department funds.

The wall will not go away as a political issue. Trump set up another fight with Democrats when he asked for an additional $8.6 billion for border barriers in his recently released fiscal 2020 budget.

Democrats could also vote on whether to block the national emergency declaration every six months.

This story is developing. Please check back for updates.

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American Airlines suspends flights to Venezuela amid unrest

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American Airlines on Friday suspended flights to and from Venezuela amid unrest, further isolating the South American country.

American’s pilot union earlier on Friday said it told its members to refuse any trips to the country after the State Department told U.S. citizens to leave the country. It also pulled its diplomats from Venezuela.

Most U.S. airlines already halted service to Venezuela amid political and economic turmoil there. American was the last major U.S. airline to fly to Venezuela and sells flights from Miami to Caracas and to Maracaibo. The move threatens to further isolate the South American nation that is mired in a humanitarian crisis.

“The safety and security of our team members and customers is always number one and American will not operate to countries we don’t consider safe,” American said in a statement.

Venezuelan President Nicolas Maduro cut ties with the U.S. in January after Washington recognized opposition leader Juan Guaido as the country’s president. More than 50 other countries have recognized Guaido as the country’s president.

“Do not travel to Venezuela due to crime, civil unrest, poor health infrastructure, and arbitrary arrest and detention of U.S. citizens,” the State Department said in its warning on Tuesday.

“Until further notice, if you are scheduled, assigned, or reassigned a pairing into Venezuela, refuse the assignment” and call chief pilots, the Allied Pilots Association, which represents about 15,000 American Airlines pilots, said in a note to its members late Thursday.

American Airlines did not immediately respond to request for comment. The airline’s two flights from Miami to Caracas were canceled on Friday, the airline’s website showed, but flights scheduled for Saturday appeared as scheduled.

The Association of Professional Flight Attendants that represents American’s 25,000 flight attendants said it supported the pilot union’s decision “100%.”

“Of course without the pilots, the flight’s not operating,” said Lori Bassani, APFA’s president.

United Airlines and Delta Air Lines ceased service to Venezuela in 2017.

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