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March 25, 2019

ECB says nowhere near withdrawing stimulus 

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President of the European Central Bank Mario Draghi speaks during a news conference after a meeting of the governing council in Frankfurt, Germany, Thursday, Jan. 19, 2017. | AP

FRANKFURT: The head of the ECB says the central bank is not anywhere near withdrawing its stimulus programs aimed at supporting the economy.

Draghi said that bank officials “didn’t discuss tapering” the stimulus program at Thursday’s meeting. When the time comes, there will need to be “a very deep and careful analysis,” he said, “but we are not there yet.

Draghi spoke after the bank kept its key interest benchmark at a record low of zero, and left untouched its December decision to keep purchasing government and corporate bonds until the end of the year. The bond purchases pump newly created money into the economy.

Inflation has recently jumped to 1.1 percent in the 19 countries that use the euro, closer to the bank’s goal of just under 2 percent. But core inflation — which excludes volatile fuel and food prices — has been stuck at 0.8 percent-0.9 percent, and higher prices are not being reflected in wages.

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3:00 p.m.

ECB President Mario Draghi said it’s “early” to comment on Donald Trump’s remark that the dollar is “too strong” — but recalled the commitments countries made as part of the G-20 group of nations not to devalue their currencies to get trade advantage.

Draghi said there was “a strong international consensus in the G-7 and the G-20 to refrain from competitive currency devaluations.”

A weaker currency can help a country’s exporters in the international marketplace. The dollar’s recent rise has raised concerns it may hurt U.S. exports.

Draghi said it was “very early” to comment on any statements by President-elect Trump.

Trump made the remark earlier this week in an interview with the Wall Street Journal.

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2:40 p.m.

European Central Bank President Mario Draghi says inflation pressures in the 19-country eurozone “remain subdued.”

Thursday’s remark is a sign that the bank is determined to maintain its monetary stimulus programs at least through the end of the year.

Inflation has jumped to 1.1 percent in December in the eurozone, but that was mainly due to an increase in fuel prices, not underlying demand for goods.

Draghi said there was “no sign yet” of a convincing upturn in inflation. Excluding fuel and other volatile items, inflation remains stuck around 0.8 percent-0.9 percent. That’s still far below the ECB’s goal of just under 2 percent.

The ECB earlier decided to keep its interest rates and stimulus programs on hold.

Britain warns EU: We'll find ways to compete if no trade deal

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Britain’s Chancellor of the Exchequer Philip Hammond walks through Downing Street in London, Britain January 18, 2017. REUTERS

DAVOS: British finance minister Philip Hammond warned the European Union on Thursday that Britain would find other ways to remain competitive after Brexit if it did not strike a comprehensive trading deal with the bloc.

At the World Economic Forum in Davos, Switzerland, he stuck closely to the government’s message that it wants to explore ways with the EU to ensure that decades of close ties are not broken – saying with goodwill, anything was possible.

But Hammond, who is keen to show Davos that Britain is “open for business”, said while the government did not want to leave the economic mainstream and trigger a race to the bottom on tax, the decision was “not entirely in our gift”.

“We have to remain competitive. The best way to do that is to have a comprehensive trading relationship with the European Union, our closest neighbours,” the finance minister, known as the Chancellor, told Reuters.

“But if we can’t achieve that then we will have to find other ways to maintain our competitiveness, because our first obligation of government is to make sure that our people are able to maintain their standard of living.”

Hammond later said that this was not a threat, but German Finance Minister Wolfgang Schaeuble said Britain should not try to gain competitive advantage by cutting corporate tax rates after the G20 leading economies agreed not to do so in 2015.

Recalling a pledge by Prime Minister Theresa May to make Britain a global player post-Brexit, Schaeuble said: “A truly global economy has to stick to what’s been agreed globally.”

FAR APART

Britain and the EU have stuck fast to their opening gambits as May prepares to trigger some of the most complicated talks since World War Two by the end of March.

The prime minister said in a speech this week that Britain would quit the EU single market when it leaves the European Union.

She threatened to withdraw the bloc without any agreement with Brussels in place, unless she failed to win a good deal, in what aides say was a speech aimed at a domestic audience.

British officials however now hope to reassure businesses in Davos that there will be prospect of falling off a “cliff edge” into uncertain trading conditions.

On Wednesday, two of the world’s biggest banks, UBS and HSBC, said they could each move about 1,000 jobs out of London to prepare for Brexit disruption.

In her speech on Tuesday, May did offer some comfort to those who want to see Britain retain close ties with the EU, saying that she is aiming to secure an agreement that “may take in elements of current single market arrangements in certain areas” and to have a customs agreement with the EU.

‘WELCOMING SOCIETY’

Asked how such an arrangement could work, Hammond said Britain wanted to explore options to find ways in which businesses – including the financial industry, which fears losing the right to sell their services in the bloc – could trade freely.

“Obviously we can’t be in the full customs union because the restrictions that implies goes beyond the political imperatives from a UK point of view,” said Hammond, who had campaigned to stay in the EU ahead of the Brexit referendum in June last year.

“But we have a lot of reasons on both sides of this discussion to want to try and maintain the most frictionless border system possible,” he said, pointing to fresh produce imports every day, which neither side would want to disrupt.

And he said Britain would always be an attractive investment destination because of “the high level of confidence in our institutions”.

British economic growth would slow this year, but the government did not expect to have to borrow more to keep the economy afloat, said Hammond, adding that Britain was still a haven for foreign talent and entrepreneurs.

“We want to go on being that kind of open, welcoming society which people choose as a venue to do their business,” he said.

US bombers strike Islamic State camps in Libya 

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WASHINGTON: US Air Force B-2 bombers and drones attacked a pair of Islamic State military camps in Libya, seeking to eliminate extremists who had escaped the former IS stronghold of Sirte, a defense official said Thursday.

The official said the camps were located about 45 kilometers, or 28 miles, southwest of the central coastal city of Sirte. The official was not authorized to speak in advance of an expected Pentagon announcement and confirmed the strikes on condition of anonymity.

The strikes were carried out overnight and were authorized by President Barack Obama, marking perhaps the final use of military force by a wartime president who intervened in Libya in 2011 as part of a coalition that ultimately toppled dictator Moammar Gadhafi.

The Pentagon believes no civilians were killed in the strikes, the official said, while “several dozen” IS militants are thought to have been killed.

The defense official said the latest strikes were aimed at hitting Islamic State militants who left Sirte after U.S. strikes largely eliminated the group’s presence in that coastal city in December. At the time, Pentagon officials said they would further support counter-IS efforts if asked by Libya’s provisional government.

Libya fell into chaos following Gadhafi’s ouster and killing. The country remains divided between east and west, with no effective government and a multitude of rival factions and militias.

Pakistan opposition submits privilege motion against Sharif in parliament

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Pakistan Prime Minister Nawaz Sharif. | (File | AP)

ISLAMABAD: Embattled Pakistan Prime Minister Nawaz Sharif today faced an united Opposition in parliament as they moved a privilege motion against his “untruthful” speech on the floor of the House on the Panamagate case.

The privilege motion, which was submitted by Leader of the Opposition in the National Assembly Syed Khursheed Shah, referred to a plea by the prime minister’s counsel in the Supreme Court in the ongoing Panamagate case. “The plea taken by the prime minister’s lawyer in Supreme Court on January 16, to do away with Prime Minister’s speech delivered in the NA while explaining the trail of funds used to purchase properties in London and elsewhere as mentioned in Panama Papers, using Article 66 as a shield, are an admission that the Prime Minister did not tell the truth to the assembly,” the motion signed by seven other lawmakers said.

The motion has been submitted over discrepancy in the premier’s statement in the lower House of Parliament and his counsel’s statement in the apex court. “The prime minister while speaking on the floor of National Assembly on May 16, 2016 had explained the trail of funds used to purchase property in one of the most expensive areas of London,” it said and added that the details submitted by the prime minister’s counsel in the top court were “in sheer contrast with the ones stated by the Prime Minister.” It further said the discrepancy in the statements suggest that Prime Minister Nawaz willfully deceived the House on the issue which was a “clear case of contempt of the House”. “As per Article 91(6) of the Constitution of Islamic Republic of Pakistan, prime minister and cabinet are collectively responsible to Parliament and have to state the truth, the whole truth and nothing but the truth,” it said.

Claiming that Sharif’s statement was a blatant breach of the privilege of the National Assembly, it demanded the matter to be immediately taken up for discussion and action. It said the assertion made in the speech were different from the case pleaded by Sharif’s lawyer in the Supreme Court, which is hearing petitions by opposition against alleged illegal assets abroad by the prime minister’s family. Sharif’s lawyer has also asked the court not to consider the speech in the case. Shah said that it was an admission that the prime minister did not tell the truth to the National Assembly, which is breach of the privilege of the august house.

Meanwhile, a larger bench of the Supreme Court hearing the Panamagate case today reminded Sharif’s counsel that the case concerns Sharif’s qualification as Prime Minister. During the hearing, Justice Sheikh Azmat Saeed observed that the case challenges Sharif’s claim to the PM office. Justice Asif Saeed Khosa, who heads the five-judge bench, pointed out that the time-frame in which the appointment of the Prime Minister can be challenged following the election through Article 225 is limited. Once this time period expires, however, the court can be asked to review the appointment under Articles 184/3 and Article 199, Justice Khosa said. Justice Khosa also stated that this case concerns the whole nation because the defendant is the prime minister.

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