2024-03-04 19:05

March 4 (Reuters) - A federal judge in Virginia on Monday dismissed a lawsuit accusing Capital One (COF.N) , opens new tab of overcharging credit and debit card customers on transactions made in foreign currencies. U.S. District Judge Patricia Tolliver Giles in Alexandria said cardholders in the proposed class action did not identify language in their card agreements that was "clear and unambiguous" about what rates and fees Capital One would impose. Four plaintiffs said Capital One sought to maximize profit by charging "fictional" rates when it converted foreign currency transactions into dollars. They said the McLean, Virginia-based bank ignored rules set by card processors Visa (V.N) , opens new tab and Mastercard (MA.N) , opens new tab that it use wholesale market rates or government-mandated rates. The plaintiffs said this also boosted profit on transactions in which cardholders pay a percentage of the transaction, typically 3%, as a fee. The judge said the plaintiffs failed to show that their card agreements incorporated the processors' rules, or created an "objectively justified expectation" that their exchange rates would resemble those incurred by Capital One or the processors. "Plaintiffs have failed to plausibly allege facts sufficient to state that defendants breached a contractual duty owed to plaintiffs through defendants' own conduct or the processors' conduct," Giles wrote. Lawyers for the plaintiffs did not immediately respond to requests for comment. Capital One did not immediately respond to similar requests. Capital One's credit card business accounted for $25.7 billion , opens new tab, or 70%, of the bank's net revenue in 2023. The plaintiffs' lawyers filed a similar lawsuit against Bank of America (BAC.N) , opens new tab in the Charlotte, North Carolina federal court. On Dec. 6, a federal magistrate judge recommended rejecting Bank of America's motion to dismiss that case. A district judge will decide whether to accept that recommendation. Capital One said on Feb. 19 that it plans to buy Discover Financial Services (DFS.N) , opens new tab, whose card network rivals Visa's and Mastercard's, for $35.3 billion in stock. The case is Wright et al v Capital One Bank (USA) NA et al, U.S. District Court, Eastern District of Virginia, No. 21-00803. https://www.reuters.com/legal/capital-one-defeats-cardholders-lawsuit-over-foreign-exchange-charges-2024-03-04/

2024-03-04 17:53

WASHINGTON, March 4 (Reuters) - The U.S. Federal Reserve is under no urgent pressure to cut interest rates given a "prospering" economy and job market, Atlanta Fed President Raphael Bostic said in remarks that highlighted the risk inflation may get stuck above the central bank's 2% target or be sent even higher by "pent-up exuberance." Bostic said he still thinks it will likely be appropriate for the Fed to approve two quarter-point rate cuts by the end of this year. But he also said the Fed was walking a "fine line" to be sure that current economic strength does not evolve into "froth" and a new round of inflation. Before rate cuts "I need to see more progress to feel fully confident that inflation is on a sure path to averaging 2% over time." "Only when I gain that confidence will I feel the time is right to begin lowering the federal funds rate," said Bostic, a voter this year on interest rate policy. "The good news is the labor market and economy are prospering, furnishing the (Federal Open Market) Committee the luxury of making policy without the pressure of urgency." Bostic aired his views in a new essay , opens new taband in separate comments to reporters that acknowledged both growing stress among some consumers, particularly those with lower incomes after a period of high inflation and tight credit, but also his concern that a new surge of demand could counter the Fed's progress on prices. Given that there was no sign yet of "degradation" to the job market, Bostic said he and his colleagues debating the path of interest rates "have some time to make sure that we get to 2%" inflation. Bostic said that once rate cuts start, he does not envision them being "back to back," with the pace depending on "how participants in the markets, business leaders and families respond." The Fed at its upcoming March 19-20 meeting is expected to maintain the benchmark interest rate in the 5.25% to 5.5% range, where it has been since July, and will also issue updated projections for how far rates may fall this year given recent declines in inflation. Investors currently expect an initial rate cut in June, but that could slip if inflation stalls or the job market and wages continue to beat expectations. As a baseline, Bostic said he felt inflation was in line to "slowly" return to the Fed's target without major damage to the job market or growth, what he called a "resounding success." But that outcome, was "hardly assured...it is premature to claim victory in the fight against inflation," he said. In particular, Bostic said he was concerned that prices for a larger-than-usual share of items are still increasing at a more than 5% annual rate, while a Dallas Fed measure of underlying inflation, at 2.6%, has been stuck "just outside the neighborhood" of the central bank's target. Bostic said recent talks with business executives made him feel both confident the economy was strong, but concerned about a new surge of demand. "Many executives tell us they are on pause, ready to deploy assets and ramp up hiring when the time is right," Bostic said. "If that scenario were to unfold on a large scale, it holds the potential to unleash a burst of new demand...This threat of what I’ll call pent-up exuberance is a new upside risk that I think bears scrutiny in coming months." https://www.reuters.com/markets/us/feds-bostic-no-urgency-cut-interest-rates-given-us-economys-strength-2024-03-04/

2024-03-04 17:52

PARIS, March 4 (Reuters) - French state-owned utility EDF has raised its cost estimate for the construction of six new nuclear reactors to 67.4 billion euros ($73.18 billion), Les Echos newspaper reported on Monday, citing unidentified sources. The utility had first estimated their cost at 51.7 billion euros, though it acknowledged that figure could rise in later estimates. The French government last year bought the stake in EDF it did not already own and delisted its shares from the stock market as it launched a major new investment programme to add more nuclear power plants in a country that mainly depends on nuclear energy. A spokesperson for EDF did not comment on the reported sum. "We are currently in a phase of cost and schedule optimisation," EDF said in a emailed statement. ($1 = 0.9211 euros) https://www.reuters.com/business/energy/french-utility-edf-lifts-cost-estimate-new-reactors-67-bln-euros-les-echos-2024-03-04/

2024-03-04 17:09

CAIRO, March 4 (Reuters) - Egypt is studying further expansions of the Suez Canal to extend and complete a second channel of the waterway, the canal's head said on Monday, a move that could allow for higher volumes of shipping and prevent blockages from halting traffic. The comments come as the canal is seeing a sharp fall in revenue due to shipping companies diverting away from the waterway, the shortest route between Europe and Asia, because of attacks by Houthi militants in Yemen against ships in the Red Sea. Any new extension would come on top of current work to extend the second channel by 10 kilometres, and to deepen and widen a section of the canal. That work was expedited after the Ever Given, a giant container ship, ran aground in a single lane section of the canal in March 2021, stopping traffic for six days. The canal is a key source of scarce foreign currency for indebted Egypt, which spent an estimated $8.2 billion on an expansion of the canal that opened in 2015 and included the creation of a 35-km (22-mile) parallel waterway. Canal revenues have increased gradually but by less than officials had forecast, reaching a record $9.4 billion in the financial year ending in June 2023, before dipping by at least 40% at the beginning of this year due to the Houthi attacks. Initial studies on an additional expansion would take about 16 months, and would include feasibility, environmental and engineering studies, as well as soil and dredging research, Suez Canal Authority (SCA) Chairman Osama Rabie said in a statement. The project would need governmental approvals and would be funded through the SCA's investment budget, to avoid "placing any additional burdens on the state's general budget", the statement added. Rabie said it could raise the competitiveness of the canal and allow it to take more and bigger ships. The 2015 canal expansion is one of a number of mega-projects pursued under President Abdel Fattah al-Sisi that critics say have contributed to the foreign currency crunch and rising debt burden. Officials have said spending on non-essential projects would be cut as a shortage of foreign currency worsened over the past two years. https://www.reuters.com/world/africa/suez-canal-head-says-egypt-studying-further-expansion-waterway-2024-03-04/

2024-03-04 17:03

TOKYO, March 5 (Reuters) - A senior Nippon Steel (5401.T) , opens new tab executive told Reuters he is set to meet the United Steelworkers (USW) union chief this month to seek support for acquiring U.S. Steel (X.N) , opens new tab, expressing confidence the deal can be finalised by the end of September. Gaining their backing could help the world's fourth-largest steelmaker carry the $14.9 billion purchase of its U.S. rival over the line. The merger has drawn criticism from some Democratic and Republican lawmakers who worry about the national security implications of the takeover, even though the U.S. and Japan are close allies, and the powerful USW, who worry how their workers could fare under Nippon Steel's management. "I think we've cleared the contractual issues," Executive Vice President Takahiro Mori said in an interview on Feb. 28, emphasizing Nippon Steel's plan to uphold all of the current agreements between the union and U.S. Steel. Mori will meet the USW chief in early March after a non-disclosure agreement it signed with the union on Feb. 26, which he sees as a positive indicator since it signalled their willingness to talk. "We will have heart-to-heart talks" to address concerns including jobs and mills, he said. Nippon Steel thinks it can strengthen U.S. Steel's business without job cuts or plant closures through providing its advanced technologies, including those for high-grade electromagnetic steel sheets that are used in electric vehicles. "The products could be a game changer in the U.S.," Mori said, adding other skills in blast furnace operation and decarbonisation will also help grow the U.S. company. Nippon Steel aims to find common ground with the USW by early April when U.S. Steel is expected to hold a shareholder meeting to vote on approving the deal, which would be delayed from March because of additional paperwork needed with the Securities and Exchange Commission (SEC), Mori said. Mori is optimistic about winning shareholder approval from the shareholders thanks to the hefty 40% premium it is paying. POLITICAL ISSUE Asked about the opposition of former U.S. President Donald Trump and some politicians, Mori said the Japanese company's priority now is to secure support from the union as then it will be "no longer a political issue." "This deal will make U.S. Steel, the steel industry and its customers, such as automakers, get stronger. The entire supply chain will get stronger... and so will national security," Mori said, adding that there have been few objections from people in the U.S. business and economic worlds. Nippon Steel is sticking to its goal to close the deal sometime between June and September, Mori said. For Japan, the biggest foreign investor in the U.S., a collapse of the deal could give companies pause about acquisitions in other strategic sectors and force them to be more risk averse when sizing up deals, say former officials, lawyers, analysts and executives. Mori also said if the U.S. dismisses the deal with "extrajudicial measures," it would cause major damage to the appetite for Japanese companies to invest in the U.S. "It would affect investment behaviour from Japan and make other countries close to the U.S. wary," he said. "It's going to be a huge minus for both of us." https://www.reuters.com/markets/deals/nippon-steel-exec-meet-usw-head-seek-support-us-steel-deal-2024-03-04/

2024-03-04 16:49

TORONTO, March 4 (Reuters) - Canada and Australia have agreed to promote shared priorities related to the extraction, processing, and refining of critical minerals, they said in a joint statement on Monday. The announcement came on the sidelines of the annual Prospectors and Developers Association of Canada (PDAC) conference in Toronto. Demand for critical minerals used in batteries is projected to expand significantly in coming decades as the world transitions to clean energy. Canada and Australia both have large deposits of the minerals. They will explore opportunities for R&D collaboration and support bilateral mining and service sector trade and investment through what they said was a non-legally binding understanding. Canada and Australia will also push for critical minerals supply chain transparency and advocate for strong Environmental, Social and Governance credentials in global supply chains, according to the statement. Canada's Natural Resources Ministry and Australia's Critical Minerals Office will lead the joint work on critical minerals and coordinate on policies and investments. https://www.reuters.com/markets/commodities/canada-australia-boost-collaboration-critical-minerals-2024-03-04/