2024-04-29 15:41

LONDON, April 29 (Reuters) - Japan would face "a fairly strong" recession if it were to raise interest rates, Olivier Blanchard, former chief economist at the International Monetary Fund, said on Monday. Blanchard delivered his remarks on the same day the Bank of Japan was widely suspected of having intervened in the currency markets to boost the yen, which has fallen sharply this year to 34-year lows against the dollar. Part of the decline in the currency has been blamed on Japan's ultra-loose monetary policy, as interest rates are far lower than in other major economies, even though the central bank ended negative rates in March. "They're economically stuck," said Blanchard who cited the drop in workers' real wages and the country's growing deficit. Blanchard, who is now a professor emeritus at Massachusetts Institute of Technology (MIT), was addressing attendees at the AIM Summit in London. Japanese workers wages adjusted for inflation fell in February for a 23rd consecutive month, data showed earlier this month, suggesting higher prices kept up pressure on consumers' spending appetite. The wage trend is among the key data the Bank of Japan examines for pay and inflation outlooks, crucial factors for the central bank to consider in deciding whether to unwind its stimulus policy further. Furthermore, Japan's government debt-to-GDP ratio is also one of the highest in the world, having more than trebled to close to 260% from 85% back in 1994. Looking at the bigger macro picture, Blanchard said a second term for former President Donald Trump was his biggest fear for the global economy. A second term posed more risk than his first because during the first term he was prevented from making policy decisions that would have adversely affected the U.S. economy, Blanchard said. This time, Blanchard said he believes Trump would staff his cabinet, and make key political appointments, with people he was more "comfortable with". "When he replaces the Chairman of the Fed with someone who allows him to lower rates because then he can spend more, it'll be catastrophic for the whole world," Blanchard said. The current chair, Jerome Powell, is serving a second four-year term as head of the U.S. Federal Reserve that is due to end in 2026. Sign up here. https://www.reuters.com/markets/asia/higher-rates-could-knock-japan-into-recession-says-former-imf-economist-2024-04-29/

2024-04-29 13:17

DHAKA, April 29 (Reuters) - Bangladesh again closed all primary schools across the country and educational institutions in almost half of districts including the capital as a severe heatwave saw temperatures climb to 43 degrees Celsius (109 Fahrenheit) on Monday. Schools across the country that closed last week due to the heatwave reopened on Sunday despite persistent high temperatures across the South Asian nation, which resulted in lower attendance. Classes of all government primary schools will remain closed till Thursday and educational institutions in 27 districts out of 64, including the capital Dhaka, will remain closed on Tuesday, the education ministry said on Monday. Education Minister Mohibul Hasan Chowdhury Nowfel said on Sunday that if the temperature in any district exceeds 42 degrees, the educational institutions in those districts will be closed. Separately, the High Court on Monday ordered countrywide shutdown of primary and secondary schools until Thursday due to extreme heat. The order came after a lawyer alerted the court about reports of deaths and illnesses, including those of teachers and students, in the past few days. Scientists have said climate change is contributing to more frequent, severe, and lengthy heatwaves during summer months. This month, Bangladesh has recorded extreme temperatures every day except April 9 and 10. Authorities have encouraged citizens to stay indoors during the day. But for those who work outdoors, like rickshaw driver Mohammed Shameem, there is not much respite. "There are not many people who are coming out which means getting passengers is tough. But we have no option but to come out and work," Shameem said. Like Shameem, tens of thousands of rickshaw operators in Dhaka are suffering in the scorching sun, waiting for customers while most people choose to stay inside. "I have never experienced such heat in my life. Yes, summer should be hot, but there would have been gusts of wind and rain. But it's not happening this time. People are suffering a lot," said rickshaw operator Shaheb Ali. Sign up here. https://www.reuters.com/world/asia-pacific/bangladesh-again-shuts-schools-due-heatwave-2024-04-29/

2024-04-29 13:13

SAO PAULO, April 29 (Reuters) - Vale (VALE3.SA) New Tab, opens new tab, BHP (BHP.AX) New Tab, opens new tab and their joint venture Samarco have presented Brazilian authorities with a settlement proposal related to reparations for the 2015 Mariana tailings dam burst, which killed 19 people and left hundreds homeless. The proposal foresees a total payment of 127 billion reais ($24.88 billion), including 37 billion reais already disbursed, the Brazilian mining giant said in a securities filing on Monday. The dam collapse at the Samarco iron ore mine near the town of Mariana in Brazil's southeastern state of Minas Gerais caused a vast flow of mud and mining waste that buried a nearby village and polluted a major river in November 2015. Of the remaining amount the companies proposed to disburse, 72 billion reais would be paid to the federal and local governments over an undisclosed period, Vale said. Some 18 billion reais would be used to settle future obligations. Vale had previously said that it expected to reach a final agreement regarding the collapse of the dam by the end of the first half of 2024. "The companies and authorities remain committed to advancing negotiations and approving a definitive agreement," Vale said. "The proposal is intended to provide a mutually beneficial resolution for all parties." Vale and BHP struck an initial deal over the disaster in 2016 which created a foundation to implement reparations but had a complicated chronology for payments and left space for a final definitive agreement. Vale said that as of March 2024, 17 billion reais had been paid to more than 430,000 people and about 85% of the resettlement cases for the communities affected had been completed. ($1 = 5.1037 reais) Sign up here. https://www.reuters.com/world/americas/vale-bhp-propose-25-billion-deal-settle-reparations-mariana-disaster-2024-04-29/

2024-04-29 13:10

FRANKFURT, April 29 (Reuters) - Thyssenkrupp on Monday rejected allegations by labour representatives that it failed to adequately inform workers about its plans to sell a stake in its steel unit to Czech energy firm EPCG, adding to growing tension between the two sides. The comments underline the fragile relationship between management and unions in Thyssenkrupp's long-running effort to divest its steel business, a part of the group where workers have been particularly influential. Unions on Friday said they had only been informed of the plan a few hours before it was announced. Thyssenkrupp, meanwhile, said it had been clear for months that the group was in talks with EPCG, which is controlled by Czech billionaire Daniel Kretinsky. Thyssenkrupp plans to sell 20% of Thyssenkrupp Steel Europe to EPCG. Responding to claims that worker representatives and unions had been "passed over" in the talks, Thyssenkrupp said that at no point had this had been the case and that there were no plans to do so in the future. Labour representatives command great clout at the German conglomerate and fill half the seats on its supervisory board. While they cannot block major strategic decisions, their buy-in as a key stakeholder group is seen as critical. The company also said it had informed employee representatives, who have called for major protests at Thyssenkrupp Steel Europe's headquarters on April 30, last week that it was in advanced negotiations with EPCG about the stake sale. "The element of surprise regarding actual results, which were achieved this last Friday, should therefore have been limited," the company said. Sign up here. https://www.reuters.com/markets/deals/thyssenkrupp-rebuffs-union-claims-regarding-steel-stake-sale-2024-04-29/

2024-04-29 12:42

April 29 (Reuters) - Southern Co's (SO.N) New Tab, opens new tab Vogtle unit 4 nuclear reactor has entered commercial operation after years of running behind schedule, the utility firm's Georgia unit said on Monday. The Vogtle two-unit expansion project near Waynesboro, Georgia has been hailed as a major milestone for the U.S. nuclear power industry as they are the nation's first large-scale nuclear reactors in decades. Vogtle unit 3 had entered commercial operation in July 2023. WHY IT'S IMPORTANT U.S. power consumption is expected to rise to record highs in 2024 and 2025, according to U.S. Energy Information Administration, driven by rising demand from artificial intelligence data centers and electric vehicle usage. U.S. President Joe Biden has a goal to achieve net-zero emissions by 2035 in the power sector, the source of a quarter of the nation's emissions. CONTEXT The COP28 environmental conference at the end of last year aimed to triple nuclear power generation by 2050 compared to the present capacity as it is viewed as a key tool to reach net-zero goals. With all four units now in operation, Vogtle plant is the largest generator of clean energy in the U.S., according to the company. BY THE NUMBERS When Georgia approved the Vogtle expansion in 2009, the two reactors were expected to cost about $14 billion and enter service in 2016 and 2017. However, along with the delays, the costs have ballooned to $30 billion. The unit 4 can produce enough electricity to power an estimated 500,000 homes and businesses and will provide emissions-free energy to customers for at least 60 to 80 years, the company said. KEY QUOTE "The new Vogtle units are a key piece of our strategy to meet the energy needs of our customers not only tomorrow, but 20 years from now," said Georgia Power CEO Kim Greene. Sign up here. https://www.reuters.com/business/energy/southern-cos-long-delayed-vogtle-unit-4-nuclear-reactor-enters-commercial-2024-04-29/

2024-04-29 12:30

JOHANNESBURG, April 29 (Reuters) - South Africa views BHP Group's (BHP.AX) New Tab, opens new tab proposed bid for Anglo American (AAL.L) New Tab, opens new tab as "normal market activity" and is following the process as it unfolds, President Cyril Ramaphosa's spokesperson said on Monday. BHP is considering making an improved offer for Anglo American after its $39 billion initial proposal was rejected by the London-listed miner, a source told Reuters last week. "It is still early days in terms of the proposal that BHP has submitted to Anglo," spokesperson Vincent Magwenya told a media briefing. "We will follow like everybody else the process as it unfolds. We don't as a country go out of our way to block market activity," Magwenya added. BHP has until May 22 to make a binding bid. A deal, if successful, would create the world's biggest miner of copper, a metal central to the clean energy shift. A condition of the miner's proposal is that Anglo first distributes to shareholders its stakes in Anglo American Platinum (Amplats) (AMSJ.J) New Tab, opens new tab and Kumba Iron Ore (KIOJ.J) New Tab, opens new tab, both of which operate in South Africa. Any exit by Anglo - founded in South Africa in 1917 - would be an economic blow to the country, whose miners have been cutting jobs and investment in response to weakening metals prices and a slew of local challenges exacerbated by the state port and freight rail company. BHP's bid comes weeks before a general election in which voter anger about a stagnant economy and high unemployment could cost the long-governing African National Congress its majority. Sign up here. https://www.reuters.com/markets/commodities/south-africa-views-bhp-bid-anglo-normal-market-activity-2024-04-29/