The Federal Reserve is in “no rush to make a judgment” about further changes to interest rates, Fed Chairman Jerome Powell told U.S. lawmakers on Tuesday as he spelled out the central bank’s approach to an economy that is likely slowing.

In two hours of testimony to the Senate Banking Committee, Powell elaborated on the “conflicting signals” the Fed has tried to decipher in recent weeks, including disappointing data on retail sales and other aspects of the economy that contrast with steady hiring, wage growth, and ongoing low unemployment.

“The baseline outlook is a good one,” Powell said, but slower growth overseas is a drag on the U.S. economy that “we may feel more of” in the coming months.

“We have the makings of a good outlook and our (rate-setting) committee is really monitoring the crosscurrents, the risks, and for now we are going to be patient with our policy and allow things to take time to clarify.”

If anything, Powell’s comments solidified a Fed policy shift last month in which it indicated it would pause a three-year cycle of rate hikes, which had been projected to run well into 2020, until the inflation or growth dynamics change.

The flow of new workers into the labor force, for example, has surprised the central bank and means “there is more room to grow,” Powell said.

Powell, who has led the Fed for just over a year, faced virtually no pushback from Republicans on the Senate panel, as former Fed chief Janet Yellen had in the past, that the central bank was courting inflation or financial risks by leaving rates too low.

After raising rates four times in 2018, and anticipating further hikes in 2019, the Fed in January switched to a “patient” stance as concerns about the global economy took root, and markets voiced doubts about the U.S. economic recovery.

The Fed’s benchmark overnight lending rate currently is within a range of 2.25 percent to 2.50 percent.

There was also little said by lawmakers about the Fed’s evolving plan to maintain a balance sheet of perhaps $3.5 trillion, which would be lower than the current $4 trillion but still massive by historical standards. Republican lawmakers generally have pushed the central bank to reduce a financial footprint inflated by crisis-era programs many in the party considered risky.

Financial markets were largely unmoved by Powell’s testimony, which was the first of his two hearings this week in Congress. He is due to appear before the House of Representatives Financial Services Committee on Wednesday.

U.S. Treasury yields were lower in afternoon trading while major U.S. stock indexes were slightly higher. The dollar was weaker against a basket of currencies.

Political Shift

Powell told lawmakers that the Fed expected the U.S. economy to grow solidly but at a slower pace this year than the estimated 3 percent growth for 2018, an outlook that was built into the central bank’s policy statement in January.

The “patient” approach to rate hikes has been a staple of Fed commentary since early last month.

“As long as we have steady growth with no inflation, that should keep the Fed at bay,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors in Chicago.

But Tuesday’s hearing did offer a preview of issues the central bank may confront as the 2020 presidential campaign takes shape, and Democrats use their recently-won control of the House to press new economic and political ideas.

Amid a growing debate over whether the U.S. government may have far more room to expand its debt than conventional economics might recommend, or whether the Fed’s own balance sheet might help finance a “Green New Deal” of economic and environmental programs, Powell made clear he was among the traditionalists.

“The idea that deficits don’t matter for countries that can borrow in their own currency I think is just wrong. I think that U.S. debt is fairly high as a level of (gross domestic product) and, much more importantly than that, it’s growing faster than GDP,” Powell said. “To the extent that people are talking about the Fed – our role is not to provide support for particular policies” on environmental, social or other related issues.

Indeed, asked about the upcoming need to boost the U.S. debt ceiling, he said he considered the prospect of a U.S. government default on its obligations “a bright line, and I hope we never do pass it.”

Powell’s appearances on Capitol Hill this week, part of his semi-annual testimony to Congress, are his first since Democrats won control of the House in the November elections. They also follow the kickoff of a number of 2020 presidential campaigns.

Along with questions that ranged from the sources of rural poverty to the impact of climate change on banks, Senate committee members pressed points likely to figure into the Democratic primary battle.

“The Fed works for big rich banks that want to get bigger and richer,” said Senator Elizabeth Warren, a Massachusetts Democrat running for president. She questioned whether Powell would be adequately aggressive in reviewing a proposed megamerger between U.S. regional lender BB&T and rival SunTrust Banks.

Powell pledged an “open and transparent” review of the deal.

When asked whether there had been any “direct or indirect” communication from the White House about interest rates, Powell deferred, saying he would not comment on private conversations with other officials.

President Donald Trump has castigated the Fed for raising rates, arguing that the monetary tightening was undercutting his administration’s efforts to boost economic growth.

On Tuesday, Powell repeated his oft-heard pledge that the Fed will make policy decisions “in a way that is not political.”
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Cameroonian police officers, assisted by members of the country’s elite corps, seized hundreds of containers of fuel illegally transported from Nigeria by suspected Central African Republic rebels in the northern town of Mbe, Cameroon.

Rigobert Ojong, a member of a task force of military, police and civil society members created three weeks ago to stop the illegal fuel trade, said the group received a tip that the fuel was on its way to the C.A.R., where it would be used by rebels fighting the central African state’s government. 

“We have put aside personnel dedicated to this fight, within the framework of this task force, and we have been able to intercept about 1,500 drums of fraudulently imported fuel. If we go by the price in the black market, we are talking about more than 3 billion CFA francs [$5 million] a year,” Ojong said.

Cameroon’s government says an unknown quantity of oil is smuggled from Nigeria through its territory because the border is so porous. The military says it has opened an investigation to track dealers who might be collaborating with rebel groups in the C.A.R.

Alleged corruption

Businessman Patrice Essola, who supplies fuel to the C.A.R. from Cameroon, says illegal trade with C.A.R. rebels is facilitated by corrupt government officials in both countries.

He said the rebels and traffickers work in collaboration with corrupt Cameroonian military officials and C.A.R. border immigration staff to import the fuel from Nigeria. Some of the tankers and trucks that smuggle the fuel are even protected by corrupt officials while in Cameroon and in the C.A.R., Essola added.

Kildadi Taguieke Boukar, governor of the Adamawa region that shares a border with the C.A.R., denies corrupt military officials assist rebels and smugglers, but said investigations had been opened.

Each time the traffickers are arrested, they answer charges in courts of law, Boukar said, but added the task is very, very difficult because Cameroon’s borders with Nigeria and the C.A.R. are very porous. All of the fuel will be taken to C.A.R. authorities, he said.

C.A.R. violence, peace deal

In January, Cameroon said 300 of its citizens had been abducted by suspected C.A.R. rebels within the past two years, along with at least 5,000 cattle. Local border communities asked the government to authorize self-defense groups to be equipped with guns to face rebels who they said continued to cross to their villages for supplies.

The C.A.R. was plunged into turmoil in 2013 when Muslim rebels known as the Seleka seized power in the majority-Christian country. A band of mostly Christian militias, called the anti-Balaka, rose up to counter the Seleka. Thousands of people have been killed in the violence and more than one million are internally displaced. An estimated 570,000 people have fled to neighboring countries, with about 350,000 in Cameroon.

On Feb. 2, the U.N. mission in the C.A.R., known as MINUSCA, and the African Union announced that a peace deal between the C.A.R. government and 14 rebel groups had been reached after sponsored talks in Sudan. They called on the C.A.R.’s neighbors to help bring peace by not allowing their borders to be used for supplies or as a hiding ground for fighters who refuse to respect the deal.
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U.S. aerospace manufacturer Boeing said on Tuesday it has nominated Nikki Haley, former U.S. ambassador to the United Nations and a close ally of President Donald Trump, to join its board of directors at the company’s annual shareholders meeting on April 29.

If elected by Boeing shareholders, she would help guide the future of America’s largest exporter, with a network of suppliers across the United States and the world, as Washington and Beijing have been locked in intense negotiations to end a trade war.

Haley’s nomination comes as Boeing grapples with a major decision: whether to launch an all-new jetliner known as NMA, a midsize plane that would serve a niche market falling between narrow- and wide-body aircraft.

The world’s largest planemaker has said it would make a final launch decision in 2020 on the new program, which is expected to define competition with archrival Airbus SE.

Viewed as a rising Republican Party star, Haley has often been mentioned as a future presidential candidate. Her counterparts at the United Nations saw her as a voice of clarity in the Trump administration.

Haley, 47, is the first female governor of South Carolina and a three-term legislator in the South Carolina House of Representatives. As governor in 2015, Haley was a key opponent of a campaign by Boeing’s largest labor union to form a collective bargaining unit at its 787 Dreamliner factory in South Carolina – though the machinists were later successful in forming a small bargaining unit there.

Boeing has faced growing scrutiny over its links to the Trump administration after a former senior planemaking executive, Pat Shanahan, was named deputy defense secretary and later acting defense secretary. The 31-year Boeing veteran has recused himself, however, from matters relating to the aerospace company.

The U.S. government has been weighing the purchase of an advanced version of the F-15 Boeing fighter. Last year, Boeing’s defense side had a series of wins, including the U.S. Air Force’s next training jet, which could be worth up to $9.2 billion, as well as a contract to replace UH-1N Huey helicopters worth $2.4 billion over the life of the programs.

In a press release, Muilenburg praised Haley’s record in government and industry partnership.

“Boeing will benefit greatly from her broad perspectives and combined diplomatic, government and business experience to help achieve our aspiration to be the best in aerospace and a global industrial champion,” Muilenburg said.

Based on total compensation for Boeing’s other 13 board members, Haley can expect to earn more than $300,000, well above her salary as U.N. ambassador.

Separately on Tuesday, the shareholders of Brazilian planemaker Embraer SA approved a deal to sell 80 percent of the Sao Paulo-based company’s commercial jet division to Boeing, a move that could reshape the global market for aircraft of up to 150 seats.

Boeing shares were flat at $427.88 a share in afternoon trading on the New York Stock Exchange.
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Turkish President Recep Tayyip Erdogan has declared war on food inflation. With food prices rising nearly 30 percent and looming critical local elections next month Erdogan is turning to unconventional methods to rein in costs.

Subsidized food is being sold at distribution centers in Istanbul and the capital, Ankara, along with several provincial cities. The centers are part of Erdogan’s war on inflation.

In the pouring rain in Istanbul’s Kadikoy district people patiently line up to take advantage of reduced prices. With staples like onions and potatoes tripling in price, the distribution centers appear welcome by people seeking relief from soaring price tags.

“The food prices are high. Sometimes you go to the street market and go back home without buying anything,” said Sule who works at a nearby university. “Why? Because the produce is so expensive. You go near the leeks, and you see it is 6, 7 lira. Spinach prices rose up to 10 liras. Ok, I can afford some, but larger families cannot buy at these prices.”

Last year’s currency collapse unleashed an inflationary wave, driving up costs of food production.

The inflation surge comes at an inopportune time for Erdogan’s AKP, with critical local elections for control of Turkey’s main cities scheduled in March.

Erdogan, already campaigning hard, is seeking to blame food wholesalers and supermarkets, accusing them of price gouging and even labeling them food terrorists.

“In recent days they began playing a game on Turkey. Prices of eggplants, tomatoes, potatoes, and cucumbers began to escalate. It was a terrorist attack,” said Erdogan.

“We will not allow those to launch this terror” he added. “I promise you we will deal with these terrorists who are behind these rising prices like we have dealt with other terrorists that threaten our country.”

Police are raiding supermarkets and wholesalers suspected of price gouging and hoarding. The Turkish Trade Ministry has created a computer app allowing customers to compare prices in shops and report those suspected of overcharging.

Major supermarkets, seeking to avoid Erdogan’s wrath, are slashing prices. Shop signs claim products are now being sold below cost, along with rationing on what can be bought.

“This has nothing to do with economics,” said economist Cengiz Aktar. “Turkey will dearly pay for these mistakes because these are gross economic mistakes. There will be huge price increases. People will have difficulties to buy food and the public finances will collapse one day.”

Rising costs and mounting state pressure on producers and retailers, has led to a new phenomenon in Turkey, “shrinkflation.”

“Shrinkflation has started, which is instead of rising prices, companies selling in smaller formats,” explains Atilla Yesilada, analysts for Global Source Partners.

“So a 100-gram chocolate bar is now being sold for the same price but it’s only 80 grams and it’s the same for toothpaste, etc. The plates are getting smaller in cheap restaurants, as people can’t afford full portions,” added Yesilada.

Istanbul’s “Sali Pazar,” is a traditional marketplace for bargains, drawing people from across the city.

However, the combination of subsidies and the state crackdown on prices is taking its toll on small traders. “It affected our sales by 50 percent. The customers come here and see the prices and don’t buy anything. They just walk off,” said Ali, looking at his unsold potatoes, which are selling at more than twice the price as at state distribution centers.

“Prices are very high (from wholesalers), he added. “You cannot compete with the state. How can we compete with the state? The state buys it for 3.5 liras and sells it to 2 liras.”

“My sales are not falling because I have not sold anything,” said tomato seller Hulusi, waving his hands in exasperation.

“How can sales go down when you don’t have any sales in the first place,” he added. “I have been screaming my heart out since morning and sold just 2 kilos to 2 customers.”

However, for Sali Markets customers eager for bargains, Erdogan’s price war is welcome.

 

“With the intervention of the president there has been some drop in the prices,” said Sule. “In the previous weeks they were quite high, and this makes the people content. Hopefully, this will keep going well.”

Driving down food prices and with it, public discontent, will be critical to Erdogan’s AKP maintaining control of key cities like Istanbul in next month’s local elections, analysts say.

“All the polls show the main concern for the voter will be the economy, and they will be going to vote to register their protests,” said Yesilada. “Nationwide, I expect AKP to suffer very large losses. I would not be too surprised if they lose Istanbul or Ankara.”
…

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Turkish President Recep Tayyip Erdogan has declared war on food inflation. With food prices rising nearly 30 percent and looming critical local elections next month Erdogan is turning to unconventional methods to rein in costs.

Subsidized food is being sold at distribution centers in Istanbul and the capital, Ankara, along with several provincial cities. The centers are part of Erdogan’s war on inflation.

In the pouring rain in Istanbul’s Kadikoy district people patiently line up to take advantage of reduced prices. With staples like onions and potatoes tripling in price, the distribution centers appear welcome by people seeking relief from soaring price tags.

“The food prices are high. Sometimes you go to the street market and go back home without buying anything,” said Sule who works at a nearby university. “Why? Because the produce is so expensive. You go near the leeks, and you see it is 6, 7 lira. Spinach prices rose up to 10 liras. Ok, I can afford some, but larger families cannot buy at these prices.”

Last year’s currency collapse unleashed an inflationary wave, driving up costs of food production.

The inflation surge comes at an inopportune time for Erdogan’s AKP, with critical local elections for control of Turkey’s main cities scheduled in March.

Erdogan, already campaigning hard, is seeking to blame food wholesalers and supermarkets, accusing them of price gouging and even labeling them food terrorists.

“In recent days they began playing a game on Turkey. Prices of eggplants, tomatoes, potatoes, and cucumbers began to escalate. It was a terrorist attack,” said Erdogan.

“We will not allow those to launch this terror” he added. “I promise you we will deal with these terrorists who are behind these rising prices like we have dealt with other terrorists that threaten our country.”

Police are raiding supermarkets and wholesalers suspected of price gouging and hoarding. The Turkish Trade Ministry has created a computer app allowing customers to compare prices in shops and report those suspected of overcharging.

Major supermarkets, seeking to avoid Erdogan’s wrath, are slashing prices. Shop signs claim products are now being sold below cost, along with rationing on what can be bought.

“This has nothing to do with economics,” said economist Cengiz Aktar. “Turkey will dearly pay for these mistakes because these are gross economic mistakes. There will be huge price increases. People will have difficulties to buy food and the public finances will collapse one day.”

Rising costs and mounting state pressure on producers and retailers, has led to a new phenomenon in Turkey, “shrinkflation.”

“Shrinkflation has started, which is instead of rising prices, companies selling in smaller formats,” explains Atilla Yesilada, analysts for Global Source Partners.

“So a 100-gram chocolate bar is now being sold for the same price but it’s only 80 grams and it’s the same for toothpaste, etc. The plates are getting smaller in cheap restaurants, as people can’t afford full portions,” added Yesilada.

Istanbul’s “Sali Pazar,” is a traditional marketplace for bargains, drawing people from across the city.

However, the combination of subsidies and the state crackdown on prices is taking its toll on small traders. “It affected our sales by 50 percent. The customers come here and see the prices and don’t buy anything. They just walk off,” said Ali, looking at his unsold potatoes, which are selling at more than twice the price as at state distribution centers.

“Prices are very high (from wholesalers), he added. “You cannot compete with the state. How can we compete with the state? The state buys it for 3.5 liras and sells it to 2 liras.”

“My sales are not falling because I have not sold anything,” said tomato seller Hulusi, waving his hands in exasperation.

“How can sales go down when you don’t have any sales in the first place,” he added. “I have been screaming my heart out since morning and sold just 2 kilos to 2 customers.”

However, for Sali Markets customers eager for bargains, Erdogan’s price war is welcome.

 

“With the intervention of the president there has been some drop in the prices,” said Sule. “In the previous weeks they were quite high, and this makes the people content. Hopefully, this will keep going well.”

Driving down food prices and with it, public discontent, will be critical to Erdogan’s AKP maintaining control of key cities like Istanbul in next month’s local elections, analysts say.

“All the polls show the main concern for the voter will be the economy, and they will be going to vote to register their protests,” said Yesilada. “Nationwide, I expect AKP to suffer very large losses. I would not be too surprised if they lose Istanbul or Ankara.”
…

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Kenya’s ride-hailing company ‘Little Cab’ is expanding to Tanzania and Ghana. The company will start offering rides in Tanzania’s commercial capital Dar es Salaam next week and plans to launch in Accra by May. VOA’s Mariama Diallo reports.
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Kenya’s ride-hailing company ‘Little Cab’ is expanding to Tanzania and Ghana. The company will start offering rides in Tanzania’s commercial capital Dar es Salaam next week and plans to launch in Accra by May. VOA’s Mariama Diallo reports.
…

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Turkish President Recep Tayyip Erdogan has declared war on inflation after food prices in the country soared by 30 percent after last year’s collapse of the Turkish currency. In a bid aimed at securing his political future, Erdogan is taking radical measures to curb price increases after accusing food sellers of excessively hiking food prices. Dorian Jones reports from Istanbul.
…

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Turkish President Recep Tayyip Erdogan has declared war on inflation after food prices in the country soared by 30 percent after last year’s collapse of the Turkish currency. In a bid aimed at securing his political future, Erdogan is taking radical measures to curb price increases after accusing food sellers of excessively hiking food prices. Dorian Jones reports from Istanbul.
…

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A slowing economy is unlikely to crimp China’s 2019 defense budget rise, as Beijing earmarks more spending for modernization and big-ticket items like stealth jets, and focuses on Taiwan after a stern new year’s speech from President Xi Jinping.

The defense spending figure is closely watched worldwide for clues to China’s strategic intentions as it develops new military capabilities, including aircraft carriers and anti-satellite missiles.

In 2018, China unveiled its largest defense spending increase in three years, setting an 8.1 percent growth target for the year, fueling an ambitious military upgrade program and making its neighbors nervous.

The 2019 number should be revealed at the March 5 opening of the annual session of China’s largely rubber-stamp parliament, although in 2017 it was initially not announced, prompting renewed concerns about transparency.

China plans to set a lower economic growth target of 6-6.5 percent in 2019 compared with last year’s target of around 6.5 percent, policy sources have told Reuters. The government will also announced the economic growth target on March 5. 

However, the defense budget increase could well surpass that.

Influential state-run tabloid the Global Times, which takes a strongly nationalistic line, this month cited an unidentified military expert as saying “a stable 8-9 percent increase from 2018 would be a reasonable prediction.”

China still has a long way to go to catch Western forces because the number of advanced weapons now in its arsenal, such as the J-20 stealth fighter, remain limited, the paper said.

Xie Yue, a professor of political science at Tongji University in Shanghai and a security expert, said with a weakening economy there would naturally be an expectation for a slower increase in military spending.

“It should go down, as the defense budget is connected to economic growth, but certainly factors will probably mean it will still go up, like the South China Sea and Taiwan issues,” Xie said.

Xi’s January speech threatening to attack Taiwan should it not accept Chinese rule has shot the issue back up the agenda for China’s military thinkers, especially as the island gears up for presidential elections next year.

“The Taiwan question can’t keep being put off, passed down through the generations,” retired Chinese Major General Luo Yuan, one of the country’s most prominent and widely read military commentators, wrote on his blog last month. “Our generation must complete our historic mission.”

‘Itching for a fight’

One source with ties to China’s military said the armed forces were itching for a fight over self-ruled Taiwan, claimed by China as its sacred territory, especially after Xi’s speech.

“Every day, they’re like ‘fight, fight, fight,'” said the source, who regularly meets senior officers.

Taiwan President Tsai Ing-wen has repeatedly warned of the threat from China, and vowed to defend the island and its democratic way of life. The United States has said it is closely watching Chinese intentions towards Taiwan.

“Even with just a broom, I would fight against China,” Taiwan Premier Su Tseng-chang told parliament last week. “You would pay a price if you want to annex Taiwan.”

The United States again sent two Navy ships through the Taiwan Strait on Monday as the U.S. military increased the frequency of movement through the strategic waterway despite opposition from China.

China’s Defense Ministry did not respond to a request for comment on this year’s military budget. China routinely says spending is for defensive purposes only, comparatively small and that critics just want to keep the country down.

“What people are scared of is China getting strong,” said Xu Guangyu, a senior consultant at the China Arm Control and Disarmament Association and another former senior Chinese officer, dismissing concerns about defense spending.

U.S. President Donald Trump has backed plans to request $750 billion from Congress for defense spending in 2019. That compares with the 1.11 trillion yuan ($165.40 billion) China set for its military budget in 2018.

China provides no breakdown of its defense budget, leading neighbors and other military powers to complain that Beijing’s lack of transparency has added to regional tension. China says it is fully transparent and no threat.

Diplomats and many foreign experts say China’s defense numbers probably underestimate true military spending for the People’s Liberation Army, the world’s largest armed forces, which also runs the country’s space program.
…

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A slowing economy is unlikely to crimp China’s 2019 defense budget rise, as Beijing earmarks more spending for modernization and big-ticket items like stealth jets, and focuses on Taiwan after a stern new year’s speech from President Xi Jinping.

The defense spending figure is closely watched worldwide for clues to China’s strategic intentions as it develops new military capabilities, including aircraft carriers and anti-satellite missiles.

In 2018, China unveiled its largest defense spending increase in three years, setting an 8.1 percent growth target for the year, fueling an ambitious military upgrade program and making its neighbors nervous.

The 2019 number should be revealed at the March 5 opening of the annual session of China’s largely rubber-stamp parliament, although in 2017 it was initially not announced, prompting renewed concerns about transparency.

China plans to set a lower economic growth target of 6-6.5 percent in 2019 compared with last year’s target of around 6.5 percent, policy sources have told Reuters. The government will also announced the economic growth target on March 5. 

However, the defense budget increase could well surpass that.

Influential state-run tabloid the Global Times, which takes a strongly nationalistic line, this month cited an unidentified military expert as saying “a stable 8-9 percent increase from 2018 would be a reasonable prediction.”

China still has a long way to go to catch Western forces because the number of advanced weapons now in its arsenal, such as the J-20 stealth fighter, remain limited, the paper said.

Xie Yue, a professor of political science at Tongji University in Shanghai and a security expert, said with a weakening economy there would naturally be an expectation for a slower increase in military spending.

“It should go down, as the defense budget is connected to economic growth, but certainly factors will probably mean it will still go up, like the South China Sea and Taiwan issues,” Xie said.

Xi’s January speech threatening to attack Taiwan should it not accept Chinese rule has shot the issue back up the agenda for China’s military thinkers, especially as the island gears up for presidential elections next year.

“The Taiwan question can’t keep being put off, passed down through the generations,” retired Chinese Major General Luo Yuan, one of the country’s most prominent and widely read military commentators, wrote on his blog last month. “Our generation must complete our historic mission.”

‘Itching for a fight’

One source with ties to China’s military said the armed forces were itching for a fight over self-ruled Taiwan, claimed by China as its sacred territory, especially after Xi’s speech.

“Every day, they’re like ‘fight, fight, fight,'” said the source, who regularly meets senior officers.

Taiwan President Tsai Ing-wen has repeatedly warned of the threat from China, and vowed to defend the island and its democratic way of life. The United States has said it is closely watching Chinese intentions towards Taiwan.

“Even with just a broom, I would fight against China,” Taiwan Premier Su Tseng-chang told parliament last week. “You would pay a price if you want to annex Taiwan.”

The United States again sent two Navy ships through the Taiwan Strait on Monday as the U.S. military increased the frequency of movement through the strategic waterway despite opposition from China.

China’s Defense Ministry did not respond to a request for comment on this year’s military budget. China routinely says spending is for defensive purposes only, comparatively small and that critics just want to keep the country down.

“What people are scared of is China getting strong,” said Xu Guangyu, a senior consultant at the China Arm Control and Disarmament Association and another former senior Chinese officer, dismissing concerns about defense spending.

U.S. President Donald Trump has backed plans to request $750 billion from Congress for defense spending in 2019. That compares with the 1.11 trillion yuan ($165.40 billion) China set for its military budget in 2018.

China provides no breakdown of its defense budget, leading neighbors and other military powers to complain that Beijing’s lack of transparency has added to regional tension. China says it is fully transparent and no threat.

Diplomats and many foreign experts say China’s defense numbers probably underestimate true military spending for the People’s Liberation Army, the world’s largest armed forces, which also runs the country’s space program.
…

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Relief swept across world financial markets Monday after President Donald Trump pushed back a March 2 deadline in a trade dispute with China.

 

But the respite might not last.

 

The world’s two biggest economies have squared off over Beijing’s aggressive campaign to turn Chinese companies into world leaders in advanced industries such as robotics and electric vehicles. Both sides have said they’ve made progress but haven’t provided much detail.

 

“Popping the champagne today would be premature,” Gregory Daco, chief U.S. economist at Oxford Economics, wrote in a research note.

 

Daco added that vast differences between the two countries “will prevent a significant de-escalation of trade tensions between the two giants.”

 

In the United States, business groups and lawmakers fear that Trump will settle for a deal that doesn’t require China to change its sharp-elbowed business practices.

 

A look at the dispute:

 

What Are the U.S. and CHINA Fighting About?

 

The United States accuses China of deploying predatory tactics in a headlong push to challenge American technological dominance. These, the U.S. says, include: outright theft of trade secrets, forcing foreign companies to hand over technology as the price of access to the Chinese market, and unfairly subsidizing Chinese tech companies and using regulations to hobble their foreign competitors.

 

The accusations elevate the standoff from a typical trade dispute to a battle over whether the United States or China dominates the industries of the future, the outcome of which has implications for national security.

 

Trump is also obsessed with America’s massive trade deficit with China, $336 billion in 2017 and likely higher last year.

 

Critics complain that the administration has been inconsistent about what it wants — sometimes demanding sweeping changes in Chinese economic policy, sometimes seeming willing to settle for China just buying more American stuff to narrow the trade deficit.

 

Robert Daly, director of the Kissinger Institute on China and the United States at the Wilson Center think tank, said he would be disappointed if the Trump administration settles only for more exports to China and vague promises to make structural reforms. “The Trump administration could have had that in week one,” Daly said.

 

What’s Happened So Far?

 

In July, the Trump administration gradually began slapping import taxes on Chinese goods to pressure Beijing into changing its policies. It now has imposed 10 percent tariffs on $200 billion in Chinese imports and 25 percent tariffs on another $50 billion.

 

Twice, Trump has pushed back plans to raise the tariffs on the $200 billion to 25 percent. He extended a Jan. 1 deadline by three months after meeting Chinese President Xi Jinping in Buenos Aires Dec. 1. And on Sunday, following meetings last week between U.S. and Chinese negotiators, he delayed indefinitely the tariff hike that was scheduled to kick in at 12:01 EST March 2.

 

The U.S. is also restricting Chinese investment in high-tech American industries and U.S. exports of sensitive technology to China.

 

Meanwhile, the Chinese have punched back by slapping import taxes on $110 billion in U.S. goods, focusing on soybeans and agricultural products in a direct shot at Trump supporters in the American farm belt.

 

Forecasters at the World Bank, the International Monetary Fund and the Organization for Economic Cooperation and Development have all downgraded their forecasts for the global economy, citing the heightened trade tensions.

 

Are U.S. and Chinese Negotiators Making Headway?

 

They say they are but haven’t provided many particulars. Trump tweeted Sunday that negotiators had made “substantial progress” on issues including protection of intellectual property, coerced tech transfer, currency manipulation and U.S. access to the Chinese farm and services markets among “many other issues.” China’s official Xinhua news agency echoed that assessment.

 

Trump has said he would likely have to meet one-on-one with Xi — probably late next month at Trump’s Mar-a-Lago resort in Florida — to resolve the thorniest issues.

 

What Happens Next?

 

Trump sees the stock market as a measure of the success of his economic policies. Investors’ view is clear: When U.S.-China negotiations go well, American stocks rise. When talks falter, they drop.

 

So the question is whether Trump, having taken U.S.-China economic relations to the brink, has the patience to hold out in the face of likely stock-market volatility for an enforceable deal that requires China to change its behavior. Or whether he’ll agree to more exports and promises of change.

 

“If the U.S. has already achieved quite a bit, and we are just clarifying the details of substantial Chinese concessions, then that’s not a huge concern,” said Scott Kennedy, a China expert at the Center for Strategic and International Studies. “But if the U.S. has come away with very little in terms of binding commitments (after dropping the tariff deadline), then the chance of getting more in the coming weeks could be quite low.”

 

Daly at the Wilson Center faulted the administration for not imposing a new deadline. “They are expert at the use of time and delay until conditions have changed and leverage has been lost, to get a better outcome,” he said.

 

Trump has also alarmed Canada and critics by suggesting the U.S. might drop criminal charges against Chinese telecommunications giant Huawei and its chief financial officer, Meng Wanzhou, in a quest to cut a deal. The U.S. has charged Huawei with lying about violating sanctions against Iran and with stealing trade secrets. Canada arrested Meng Dec. 1 at America’s request and is weighing whether to extradite her to the United States. China arrested two Canadians in apparent retaliation.

 

Former Canadian Ambassador to China David Mulroney tweeted Monday that “it’s now the US that has to hang tough, and not sell out its integrity in Huawei case for a trade deal with China.”
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Relief swept across world financial markets Monday after President Donald Trump pushed back a March 2 deadline in a trade dispute with China.

 

But the respite might not last.

 

The world’s two biggest economies have squared off over Beijing’s aggressive campaign to turn Chinese companies into world leaders in advanced industries such as robotics and electric vehicles. Both sides have said they’ve made progress but haven’t provided much detail.

 

“Popping the champagne today would be premature,” Gregory Daco, chief U.S. economist at Oxford Economics, wrote in a research note.

 

Daco added that vast differences between the two countries “will prevent a significant de-escalation of trade tensions between the two giants.”

 

In the United States, business groups and lawmakers fear that Trump will settle for a deal that doesn’t require China to change its sharp-elbowed business practices.

 

A look at the dispute:

 

What Are the U.S. and CHINA Fighting About?

 

The United States accuses China of deploying predatory tactics in a headlong push to challenge American technological dominance. These, the U.S. says, include: outright theft of trade secrets, forcing foreign companies to hand over technology as the price of access to the Chinese market, and unfairly subsidizing Chinese tech companies and using regulations to hobble their foreign competitors.

 

The accusations elevate the standoff from a typical trade dispute to a battle over whether the United States or China dominates the industries of the future, the outcome of which has implications for national security.

 

Trump is also obsessed with America’s massive trade deficit with China, $336 billion in 2017 and likely higher last year.

 

Critics complain that the administration has been inconsistent about what it wants — sometimes demanding sweeping changes in Chinese economic policy, sometimes seeming willing to settle for China just buying more American stuff to narrow the trade deficit.

 

Robert Daly, director of the Kissinger Institute on China and the United States at the Wilson Center think tank, said he would be disappointed if the Trump administration settles only for more exports to China and vague promises to make structural reforms. “The Trump administration could have had that in week one,” Daly said.

 

What’s Happened So Far?

 

In July, the Trump administration gradually began slapping import taxes on Chinese goods to pressure Beijing into changing its policies. It now has imposed 10 percent tariffs on $200 billion in Chinese imports and 25 percent tariffs on another $50 billion.

 

Twice, Trump has pushed back plans to raise the tariffs on the $200 billion to 25 percent. He extended a Jan. 1 deadline by three months after meeting Chinese President Xi Jinping in Buenos Aires Dec. 1. And on Sunday, following meetings last week between U.S. and Chinese negotiators, he delayed indefinitely the tariff hike that was scheduled to kick in at 12:01 EST March 2.

 

The U.S. is also restricting Chinese investment in high-tech American industries and U.S. exports of sensitive technology to China.

 

Meanwhile, the Chinese have punched back by slapping import taxes on $110 billion in U.S. goods, focusing on soybeans and agricultural products in a direct shot at Trump supporters in the American farm belt.

 

Forecasters at the World Bank, the International Monetary Fund and the Organization for Economic Cooperation and Development have all downgraded their forecasts for the global economy, citing the heightened trade tensions.

 

Are U.S. and Chinese Negotiators Making Headway?

 

They say they are but haven’t provided many particulars. Trump tweeted Sunday that negotiators had made “substantial progress” on issues including protection of intellectual property, coerced tech transfer, currency manipulation and U.S. access to the Chinese farm and services markets among “many other issues.” China’s official Xinhua news agency echoed that assessment.

 

Trump has said he would likely have to meet one-on-one with Xi — probably late next month at Trump’s Mar-a-Lago resort in Florida — to resolve the thorniest issues.

 

What Happens Next?

 

Trump sees the stock market as a measure of the success of his economic policies. Investors’ view is clear: When U.S.-China negotiations go well, American stocks rise. When talks falter, they drop.

 

So the question is whether Trump, having taken U.S.-China economic relations to the brink, has the patience to hold out in the face of likely stock-market volatility for an enforceable deal that requires China to change its behavior. Or whether he’ll agree to more exports and promises of change.

 

“If the U.S. has already achieved quite a bit, and we are just clarifying the details of substantial Chinese concessions, then that’s not a huge concern,” said Scott Kennedy, a China expert at the Center for Strategic and International Studies. “But if the U.S. has come away with very little in terms of binding commitments (after dropping the tariff deadline), then the chance of getting more in the coming weeks could be quite low.”

 

Daly at the Wilson Center faulted the administration for not imposing a new deadline. “They are expert at the use of time and delay until conditions have changed and leverage has been lost, to get a better outcome,” he said.

 

Trump has also alarmed Canada and critics by suggesting the U.S. might drop criminal charges against Chinese telecommunications giant Huawei and its chief financial officer, Meng Wanzhou, in a quest to cut a deal. The U.S. has charged Huawei with lying about violating sanctions against Iran and with stealing trade secrets. Canada arrested Meng Dec. 1 at America’s request and is weighing whether to extradite her to the United States. China arrested two Canadians in apparent retaliation.

 

Former Canadian Ambassador to China David Mulroney tweeted Monday that “it’s now the US that has to hang tough, and not sell out its integrity in Huawei case for a trade deal with China.”
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The old center of Benghazi lies in ruins but one shopping street has sprung up in the war-ravaged Libyan city, with sportswear and fashion stores that would not be out of place in Dubai or Istanbul.

Foreign brands are tapping into residents’ desire to enjoy shopping again after a three-year city war when their minds were concentrated on getting fuel or moving to safer areas.

Imports were limited as fighting between Khalifa Haftar’s Libyan National Army and his mostly Islamist opponents forced Benghazi’s port to close.

But with the end of conflict in 2017, shops have returned and Venice Street, with its trendy new stores and elegant cafes, has brought back a level of wealthy consumerism.

That contrasts with much of the city where some buildings still show bullet holes from World War II, when Benghazi changed hands between British and German troops.

Former leader Moammar Gadhafi neglected eastern Libya, where Benghazi is located, during his 42 years in power in punishment for political opposition there, and what is now Venice Street was mostly wasteland until his overthrow in 2011.

Residents have money in their bank accounts, as most work for the state, but not necessarily cash as there is a shortage of bank notes.

“It’s good that some traders started accepting checks,” said Mustafa Bazara, shopping with his sister for shirts. Checks are accepted in some shops at a premium as they can usually only be cashed on the black market for a fee.

Ahmed al-Orfy, who runs a new fashion store, said he had high hopes for Venice street: “We have security and the ambition to be on same level as the Champs-Elysees.”

($1 = 1.3849 Libyan dinars)
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Reserve Chairman Jerome Powell worked hard to strengthen ties with Congress during his first year as head of the U.S. central bank, doubling the pace of meetings with lawmakers over his predecessors and courting Democrats and Republicans alike.

The value of that effort will get a very public test this week when Powell heads to Capitol Hill for hearings in a political and economic environment that has shifted dramatically since he last appeared before Congress in July 2018.

Democrats won control of the U.S. House of Representatives in the November elections, and some new lawmakers are pushing programs like a “Green New Deal” that could have long-term implications for the Fed; two members of the Senate Banking Committee and at least one member of the House Financial Services Committee may run for president in 2020; and President Donald Trump’s public criticism of the Fed has raised questions about whether its independence has been compromised.

On top of that, what appeared to be a blue-sky economy in July has become clouded by a global growth slowdown, weak inflation, and bouts of volatility in U.S. bond and stock markets that some have blamed on policy and communications missteps by Powell himself.

In that context, Powell will have to explain the Fed’s recent decision to pause further interest rate increases even though Fed officials feel the U.S. economy remains strong, and convince lawmakers, particularly Democrats, that the decision was not the result of White House pressure for lower rates, said Peter Ireland, an economics professor at Boston College.

The Fed raised rates four times in 2018, but in a sharp pivot last month said it would be patient in deciding when to tighten policy again, if at all. Investors interpreted the move as indicating that the tightening cycle had ended.

After appearances in February and July in which the mood was largely congenial and the economy on an even keel, “all of these things are coming together to make Powell’s testimony particularly challenging,” he said.

The Fed chief by law appears before separate Senate and House committees twice a year.

Points of friction

In a companion report issued last week, the Fed described a U.S. economy that was doing well on many fronts, but facing weaker growth in the year to come and a number of intensifying risks.

Powell will elaborate on that document in written testimony and in answers to lawmakers’ questions, first before the Senate committee on Tuesday and on the following day before the House panel. The Senate hearing is scheduled to start at 10 a.m. EST (1500 GMT).

The Fed chairman is no stranger to the key players: Over the last year he has had one-on-one meetings with a majority of the members of the Senate Banking Committee and about a third of the House Financial Services Committee, including sessions with Sherrod Brown of Ohio, who is the ranking Democrat on the Senate panel, and Maxine Waters, a Democrat from California who chairs the House panel.

Brown is exploring a possible run for president, as is his Democratic colleague on the Senate Banking Committee, Elizabeth Warren of Massachusetts.

Last week, Warren teed up one point of pressure for Powell, repeating her call that the Fed use its regulatory powers to force out Wells Fargo & Co Chief Executive Officer Tim Sloan over the bank’s prior misconduct.

Tougher oversight of major banks and Wall Street is among the top issues of Warren’s presidential campaign. Aside from questions about Trump, there could be other points of friction.

The newest members of the House committee include first-year lawmakers like Alexandria Ocasio-Cortez, a Democrat from New York, who have proposed in broad outline a “Green New Deal” encompassing major changes in national environmental and economic policy. Some versions of that idea involve relying on the Fed to create the credit needed to pay for the program — a controversial proposition to mainstream central bankers.
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Afghanistan has started shipping goods to India for the first time through a newly developed Iranian seaport in a bid to improve exports and reduce reliance on routes through its uneasy neighbor, Pakistan.

Afghan President Ashraf Ghani traveled Sunday to the western border city of Zaranj to see off the inaugural convoy of 23 trucks loaded with 570 tons of cargo to the Chabahar port in neighboring Iran. The consignment is destined for the Indian port city of Mumbai. 

For decades, landlocked Afghanistan has mostly relied on Pakistani land and seaports for international trade. But mutual tensions have in recent years significantly reduced Afghan trade and transit activities through Pakistan. 

Addressing the nationally televised ceremony, Ghani credited a “healthy cooperation between India, Iran and Afghanistan” for achieving the milestone. He said the new export route will help improve economic growth in his war-shattered country, saying “Afghanistan is not landlocked anymore.”

New Delhi has financed and developed Iran’s Chabahar Port to enable Kabul get direct and easy sea trade access.

India took operational control of a portion of the Iranian port late last year for 18 months and plans to send cargo ships from its ports of Mumbai, Kandla and Mundra every two weeks, according Indian media reports. 

The United States last year waived certain anti-Iran sanctions to allow development of Chabahar to support efforts aimed at stabilizing Afghanistan. The waiver has enable India, Iran and Afghanistan to continue their work to establish a new transit and transport corridor linking the three countries to help improve Afghan economy and allow the war-ravaged country to import food and medicines.

India successfully shipped 1.1 million tons of wheat to Afghanistan through Chabahar Port in 2017. That year, New Delhi also launched an air corridor with Kabul for bilateral trade. 

Indian ambassador to Afghanistan, Vinay Kumar, while addressing Sunday’s ceremony in Zaranj said the air corridor has since helped increased Afghan exports to his country by 40 percent. 

China also opened an air corridor with Afghanistan in November and has since imported thousands of tons of Afghan pine nuts, bringing much-need foreign exchange to Kabul. Afghanistan is the largest producer of pine nuts in the world, with an annual output of about 23,000 tons. The increase in exports to China has led to an unusual rise in in prices of pine nuts in Afghanistan, say local traders and consumers.

Pakistan allows Afghanistan to use its seaports for international trade under a bilateral trade and transit agreement. It also allows use of overland routes for Afghan exports to India. However, Islamabad wants improvement in ties with New Delhi before it will allow Indian exports via the same routes back to Afghanistan. 
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Trump Postpones New Trade Tariffs on China
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As Iran marked the 40th anniversary of its Islamic Revolution, a white-turbaned Shiite cleric at one commemoration targeted President Hassan Rouhani, a fellow clergyman, with this sign: “You who are the cause of inflation; we hope you won’t last until spring.”

Already lashed by criticism over his collapsing nuclear deal and renewed tensions with the U.S., the relatively moderate Rouhani faces anger from clerics, hard-line forces and an ever-growing disaffected public that now threatens his position.

Iranian presidents typically see their popularity erode during their second four-year terms, but analysts say Rouhani is particularly vulnerable because of the economic crisis assailing the country’s rial currency, which has hurt ordinary Iranians and emboldened critics to openly call for his ouster.

Though such a move only has happened once in the Islamic Republic’s four-decade history, the popular discontent heard on streets throughout Iran now could make it possible.

“I don’t care who is in the presidential palace: a cleric, a general or anybody else,” said Qassim Abhari, who sells hats and socks on the streets of Tehran. “We need someone who creates jobs and firmly pushes the brake pedal on rising prices.”

It’s been a long fall for Rouhani, who secured the 2015 nuclear deal after two years in office and won the praise of Iranians, who flooded the streets to celebrate it. Under the deal, Iran limited its enrichment of uranium in exchange for the lifting of economic sanctions.

But the benefits of the deal never reached much of the Iranian public. Even before President Donald Trump pulled America from the accord in May, uncertainty over its future caused the rial to crater, fueling sporadic, nationwide protests.

Now the rial is dropping again, down to 133,000 to $1. It had been 32,000 to the dollar at the time of the deal. On social media, hard-liners share price lists showing food staples like beans, rice and tomato paste rising as much as 238 percent.

Hard-liners stopped parliament speaker Ali Larijani, an ally of Rouhani, from addressing a crowd in Karaj, only 40 kilometers (25 miles) west of Tehran. Rouhani’s Foreign Minister Mohammad Javad Zarif, typically collected, appeared visibly frustrated at times during a recent security conference in Munich.

Hassan Abbasi, a retired general in Iran’s hard-line Revolutionary Guard, which answers to Supreme Leader Ayatollah Ali Khamenei, gave a speech after Karaj saying he believed people will spit on Rouhani, Larijani and Zarif in the streets over the nuclear deal after they leave office. He said they are “shivering” over the accord’s collapse.

“Mr. Hassan Rouhani, Mr. Zarif and Mr. Larijani, go to hell,” Abbasi said to applause.

Tension between hard-liners and more-moderate forces within Iran are nothing new. The Islamic Republic’s political structure muddles who wields power between paramilitary forces within the Guard and the country’s civilian government. Reformist President Mohammad Khatami faced similar pressures in his second term, which then gave way to hard-line populist President Mahmoud Ahmadinejad.

But Khatami didn’t face the same grinding economic pressure, or an American president like Donald Trump, whose administration has taken a maximalist approach toward pressuring Tehran. Analysts say that only further weakens Rouhani’s hand.

“You, Mr. President, have only 15 to 20 percent of the power” within Iran’s government, the pro-Rouhani daily newspaper Jomhouri Eslami said in a January editorial. “You cannot run the country with this amount of power and be accountable for all its difficulties and problems.”

Rouhani himself seemed to acknowledge the pressure he faces during a visit to the Iranian port city of Bandar Abbas on Monday.

“Presidential elections happen every four year,” he said. “When people voted for a particular viewpoint, all should go after that and support” it.

Nine hard-line lawmakers have put forward a measure to disqualify Rouhani as president. His dismissal would require two-thirds of parliament’s 290 members, but there is a precedent. In 1981, parliament disqualified the liberal Abolhassan Banisadr as president, and then Supreme Leader Ayatollah Ruhollah Khomeini dismissed him.

Iranian law also allows Rouhani to resign, and criminal charges could push him from his post. His brother, Hossein Fereidoun, is on trial over corruption charges that his supporters call politically motivated.

Mahmoud Vaezi, a spokesman for Rouhani, on Wednesday dismissed those pursuing impeachment as belonging to “a group in parliament that opposes everything.” However, they aren’t the only source of pressure.

Reformists, those who want to change Iran’s political system from the inside, have grown increasingly disenchanted with Rouhani over his inability to end the house arrests of opposition leaders Mir Hossein Mousavi and Mahdi Karroubi. Rouhani ran for election in 2013 and 2017 promising to free the two leaders of the 2009 Green Movement.

Meanwhile, hard-line clerics have opposed his administration’s efforts to join international anti-money-laundering conventions, fearing that could cut off support to Lebanon’s Hezbollah militant group and others. State television, long controlled by hard-liners, has played up speeches by military officials and increasingly airs segments glorifying those who fought in the 1980s war in Iraq.

“When Rouhani will not be in power, people will choose his alternative,” said hard-line lawmaker and cleric Mojtaba Zolnouri, who signed onto the Rouhani impeachment effort. “Whoever people choose, we welcome.”

Rouhani’s four-year term runs until 2021. But Tehran-based political-economic analyst Saeed Leilaz echoed the sentiments of many in saying the next few weeks could prove crucial to the embattled president. Some have suggested even ending the position of president and returning to a parliamentary system.

“In the spring, parallel with intensifying pressures and problems, Rouhani may resign or the (government’s) structure may change,” he said.
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The United States and China are discussing a meeting between their two leaders soon to finalize a trade agreement. To move things forward, the latest round of trade talks between senior officials is being extended into the weekend. As Nike Ching reports, experts say world’s two largest economies must bridge wide gaps as they seek common ground before new U.S. tariffs are set to start.
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The United States and China are discussing a meeting between their two leaders soon to finalize a trade agreement. To move things forward, the latest round of trade talks between senior officials is being extended into the weekend. As Nike Ching reports, experts say world’s two largest economies must bridge wide gaps as they seek common ground before new U.S. tariffs are set to start.
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Stocks rose in major markets around the world Friday on bets of progress in trade talks between China and the United States, while crude futures hit their highest level in more than three months supported by ongoing supply cuts. 

U.S. President Donald Trump said Friday that there was a very good chance the United States would strike a deal with China to end their trade war and that he was inclined to extend his March 1 deadline to reach an agreement. 

U.S. and Chinese negotiators meeting in Washington made progress and will extend this week’s round of negotiations by two days, he said.  

Main stock indexes on Wall Street rose as the optimistic trade talk more than offset signs of slower growth in both U.S. earnings and the economy, with the S&P 500 posting a fourth consecutive week of gains. 

The Dow Jones industrial average rose 181.18 points, or 0.7 percent, to 26,031.81; the S&P 500 gained 17.79 points, or 0.64 percent, to 2,792.67; and the Nasdaq Composite added 67.84 points, or 0.91 percent, to 7,527.55. The Dow rose for the ninth consecutive week.

Overnight, shares in Asia were buoyed by a late rally in Chinese shares, with the main blue-chip index rising more than 2 percent to a near seven-month high. 

Emerging market stocks rose 0.73 percent after touching the highest level since August. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.7 percent higher, while Japan’s Nikkei lost 0.18 percent. 

Trade talks and a growing number of policy U-turns by global central banks have propped up equities in recent weeks, although this week saw the first outflows from emerging market debt and equity funds since October 2018, Bank of America Merrill Lynch strategists said, citing EPFR data. 

Crude rising 

Oil prices touched their highest level in more than three months, supported by OPEC supply cuts as well as the trade developments. New record U.S. oil supply, however, limited gains in post-settle trade. 

U.S. crude rose 0.37 percent to $57.17 per barrel and Brent was last at $67.00, down 0.1 percent on the day. 

In currencies, the U.S. dollar was little changed against a basket of peers. The dollar index fell 0.05 percent, with the euro down 0.03 percent to $1.1331. The Japanese yen strengthened 0.03 percent versus the greenback at 110.68 per dollar. Sterling was last trading at $1.3053, up 0.03 percent on the day. 

The Australian dollar recovered a day after falling more than 1 percent after Reuters reported the Chinese port of Dalian had barred imports of Australian coal indefinitely. China said Friday that imports would continue, but customs has stepped up checks on foreign cargoes. 

Separate comments by Reserve Bank of Australia Gov. Philip Lowe that a rate increase may be appropriate next year also helped to boost the Aussie dollar. 

The Aussie dollar recently gained 0.56 percent versus the greenback at 0.7128. 

Despite gains on risky assets, safe-haven U.S. Treasuries also gained in price. Benchmark 10-year notes last rose 10/32 in price to yield 2.6536 percent, from 2.688 percent late on Thursday. 

The 30-year bond last rose 18/32 in price to yield 3.0159 percent, from 3.045 percent late Thursday. 

Spot gold added 0.4 percent to $1,328.20 an ounce. U.S. gold futures gained 0.21 percent to $1,330.60 an ounce. 

Copper rose 1.52 percent to $6,477.00 a metric ton. 
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Stocks rose in major markets around the world Friday on bets of progress in trade talks between China and the United States, while crude futures hit their highest level in more than three months supported by ongoing supply cuts. 

U.S. President Donald Trump said Friday that there was a very good chance the United States would strike a deal with China to end their trade war and that he was inclined to extend his March 1 deadline to reach an agreement. 

U.S. and Chinese negotiators meeting in Washington made progress and will extend this week’s round of negotiations by two days, he said.  

Main stock indexes on Wall Street rose as the optimistic trade talk more than offset signs of slower growth in both U.S. earnings and the economy, with the S&P 500 posting a fourth consecutive week of gains. 

The Dow Jones industrial average rose 181.18 points, or 0.7 percent, to 26,031.81; the S&P 500 gained 17.79 points, or 0.64 percent, to 2,792.67; and the Nasdaq Composite added 67.84 points, or 0.91 percent, to 7,527.55. The Dow rose for the ninth consecutive week.

Overnight, shares in Asia were buoyed by a late rally in Chinese shares, with the main blue-chip index rising more than 2 percent to a near seven-month high. 

Emerging market stocks rose 0.73 percent after touching the highest level since August. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.7 percent higher, while Japan’s Nikkei lost 0.18 percent. 

Trade talks and a growing number of policy U-turns by global central banks have propped up equities in recent weeks, although this week saw the first outflows from emerging market debt and equity funds since October 2018, Bank of America Merrill Lynch strategists said, citing EPFR data. 

Crude rising 

Oil prices touched their highest level in more than three months, supported by OPEC supply cuts as well as the trade developments. New record U.S. oil supply, however, limited gains in post-settle trade. 

U.S. crude rose 0.37 percent to $57.17 per barrel and Brent was last at $67.00, down 0.1 percent on the day. 

In currencies, the U.S. dollar was little changed against a basket of peers. The dollar index fell 0.05 percent, with the euro down 0.03 percent to $1.1331. The Japanese yen strengthened 0.03 percent versus the greenback at 110.68 per dollar. Sterling was last trading at $1.3053, up 0.03 percent on the day. 

The Australian dollar recovered a day after falling more than 1 percent after Reuters reported the Chinese port of Dalian had barred imports of Australian coal indefinitely. China said Friday that imports would continue, but customs has stepped up checks on foreign cargoes. 

Separate comments by Reserve Bank of Australia Gov. Philip Lowe that a rate increase may be appropriate next year also helped to boost the Aussie dollar. 

The Aussie dollar recently gained 0.56 percent versus the greenback at 0.7128. 

Despite gains on risky assets, safe-haven U.S. Treasuries also gained in price. Benchmark 10-year notes last rose 10/32 in price to yield 2.6536 percent, from 2.688 percent late on Thursday. 

The 30-year bond last rose 18/32 in price to yield 3.0159 percent, from 3.045 percent late Thursday. 

Spot gold added 0.4 percent to $1,328.20 an ounce. U.S. gold futures gained 0.21 percent to $1,330.60 an ounce. 

Copper rose 1.52 percent to $6,477.00 a metric ton. 
…

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