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Under pressure, Fed faces an outlook clouded by trade wars and signs of weakness

WASHINGTON ( ) – U.S. President Donald Trump’s attacks on the Federal Reserve have broken one set of precedents, his talk of stacking the central bank with political allies has strained another, and his on-again off-again tariff threats have made the economic outlook harder than ever to predict.

While the Fed may well find reason to cut interest rates in recent weak job and inflation readings, doing so could also put a safety net under Trump policies that, to the eyes of many policymakers, have to date done more harm than good.

“There is a kind of feed the beast aspect to it,” said former Fed vice chair Alan Blinder. “Among the many things the Fed has to take as given is trade policy. And if in fact trade policy is going to push the economy into a slump, that is a reason to cut interest rates … If the Fed comes in to bail him out you encourage bad behavior.”

Fed Chair Jerome Powell and other officials insist they can only consider what is happening in the economy and the appropriate policy response, and not try to second guess what the administration does or might do.

Trump on Monday renewed his attacks on the Fed, claiming that central bank policy put him at a disadvantage in his trade negotiations with China because that country, with closer political control of its central bank, could devalue its currency or use other tools to offset the tariffs Trump has imposed on Chinese imports.

“Our Fed is very destructive to us… They haven’t listened to me,” Trump said in a CNBC interview. “They’re not my people.”

In fact, Trump elevated Powell to the Fed leadership and appointed three of the other four sitting Fed governors.

Trump has for a year berated the Fed for raising rates and other policy steps that Fed officials say are the best way for keeping the recovery under way. That broke a roughly 30-year run of presidents largely staying away from specific policy recommendations for the Fed, even if they were sometimes generically critical of the central bank.

Earlier this year, Trump threatened a fuller assault by considering the appointment of two highly partisan political allies to the central bank, straying from a tradition of more technocratic appointments.

The surprise announcement in early May of higher tariffs on China and a threatened imposition of levies on Mexican imports added to the minefield the Fed must now navigate.

Though Trump in the end chose not to impose the tariffs on Mexico, the prospect of using an economic lever for the non-economic end of border control showed how in the Trump era policy could shift abruptly for central bankers who try to keep their focus on medium- and longer-term outcomes.

“We take all kinds of things…into account,” St. Louis Fed President James Bullard said last week before Trump called off the Mexican tariffs. “There are some good policies in there. There may be some bad policies in there. But we have to take everything into account.”

NOT IN A BOX

Recent economic data are already complicating the Fed’s job. Policymakers have expected the economy to slow, but also regarded the likely slowing as modest, and not enough to warrant a rate cut.

The story shifted after Trump’s latest trade war salvo.

“I don’t feel backed into a box,” to cut rates, Dallas Federal Reserve bank president Robert Kaplan said last week. But “in the month of April I might have said … I was a little more optimistic that the outlook was firming, and today I will tell you I am more cognizant of risks to the downside. That is a pretty big change in a relatively short amount of time.”

Whether it is enough for the Fed to put a rate cut squarely on the table will become clearer next week. Fed officials will hold their policy meeting on Tuesday and Wednesday, and issue updated rate projections. They will also have to decide whether to maintain their “patient” approach to changing rates from the current range of between 2.25% and 2.5%, or drop that description in a sign that they are open to a move sooner rather than later.

Weak inflation readings like those in a New York Fed report on Monday have already led Bullard to say that a rate reduction was “warranted.” [nL2N23H0PS]

Analysts and markets, though, are split.

Bond markets have been aggressive in pricing in lower rates later this year, and U.S. stocks have rallied hard in the past week on optimism that a rate cut looked more likely, especially after last week’s weak jobs report. Economists at Goldman Sachs and elsewhere, meanwhile, have discounted any pressure from Trump and argue the economic outlook does not yet warrant a rate cut.

Rolling with the punches from political Washington is nothing new. Former Fed chair Ben Bernanke complained when congressional spending caps reduced economic growth just as the U.S. recovery was getting traction and the eurozone was threatening to crack apart.

This problem here is different, though, with the Fed both under political pressure and less certain, week to week, what actions of the White House they may have to take into account.

After years in which U.S. central bankers bemoaned being “th上海夜生活e only game in town” influencing the economy, they may now be nostalgic for those simpler times.

“The Fed has had too much on its plate for a long time,” said Boston College economics professor Peter Ireland. “Powell was taking pains to say ‘trade is trade’ and that is not our business. But he has gotten sucked into it.”

U.S. House Speaker Ryan running for re-election: spokeswoman

WASHINGTON ( ) – U.S. House of Representatives Speaker Paul Ryan is running again for the job in the next Congress, a spokeswoman said on Thursday after a media report quoted several unidentified House Republicans as saying they expected him to step down next week.

“He is running,” Ryan spokeswoman AshLee Strong said.

The Hill cited four House Republicans as saying that they expected Ryan to step aside as Speaker after next Tuesday’s general election.

“Speculation is growing that Paul will not return,” the Hill quoted a “senior GOP lawmaker close to leadership” as saying.

It quoted a member of the Freedom Caucus, a group of conservative Republicans, as saying that if Democratic presidential candidate Hillary Clinton wins, Ryan will get “a good share of the blame” among House members who support Republican candidate Donald Trump.

Ryan last month told fellow Republicans that he would not defend or campaign for Trump and would instead focus on re-electing Republicans to keep the majority in the House.

This angered some Trump supporters in the House, who felt the Wisconsin co上海夜生活论坛ngressman should stand by Trump. One of them, Representative Jim Bridenstine of Oklahoma, tweeted: “if Paul Ryan isn’t for Trump, then I’m not for Paul Ryan.”

But Ryan, who as Speaker is the country’s highest-ranking Republican, has a great deal of support in the Republican caucus, and it is far from clear that his critics would be able to oust him if they tried.

House Republicans, who currently number 246, plan to have closed-door leadership elections in mid-November. Ryan is expected to win their nomination for Speaker at that gathering, but the actual election to the Speaker’s post would not be held until the new Congress convenes in January.

All members of the House, both Republican and Democrat, will vote in the Speaker election and Ryan will need 218 votes – a majority of the House’s 435 members – to win. This could be a challenge if Republicans lose a substantial number of seats in next week’s elections, and if some of those who remain decide to oppose Ryan.

UPDATE 4-ANC set to retain power in South Africa but support slips

* Results in from 64 percent of voting districts

* ANC share of vote could fall to 55-59 percent -analysts

* President Ramaphosa trying to halt slide in ANC support

* Jobs, land and corruption were key issues for voters

* For more stories on the elections: (Adds DA, EFF, analyst comment, updates results)

By Alexander Winning and Onke Ngcuka

PRETORIA, May 9 ( ) – Results from nearly two-thirds of voting districts in South Africa’s election put the African National Congress on course to retain power but heading for its worst performance in a national poll in its 25 years in government.

The former liberation party of Nelson Mandela has not won less than a 60 percent vote share since it swept to power in South Africa’s first all-race election in 1994, marking the end of white minority rule.

As of 1840 GMT on Thursday, ballots in 64 percent of 22,925 voting districts had been counted. The early tallies put the ANC on 57 percent in the parliamentary race, with the main opposition Democratic Alliance (DA) on nearly 23 percent and the leftist Economic Freedom Fighters (EFF) on nearly 10 percent.

Based on those results, analysts predicted the ANC was set for a vote share of between 55 and 59 percent.

“The ANC result is going to be lower because of voter turnout, which could be the lowest at any parliamentary election since 1994,” political analyst Melanie Verwoerd said. “Turnout has been lower in areas where more black voters live, while the turnout has been higher in the white areas.”

She projected a vote share of 56-57 percent for the ANC.

South Africans voting on Wednesday for a new parliament and nine provincial legislatures had expressed frustration at rampant corruption, high unemployment and racial inequalities that remain deeply entrenched.

“The ANC have taken a hit in the polls — with an estimated near 5 percent loss on 2014 results — due to their failure to address key challenges affecting the South African population,” said Indigo Ellis, Verisk Maplecroft’s Africa analyst.

He cited youth unemployment of 53 percent, among the highest rates in the world.

Analysts have said that a poor showing for the ANC would embolden opponents of President Cyril Ramaphosa and risk a potential challenge to his leadership. The elections are the first test of national sentiment since Ramaphosa replaced scandal-plagued Jacob Zuma as head of state in February 2018.

“As long as the ANC gets more than 55 percent, things will be okay for Ramaphosa inside the ANC,” Verwoerd said.

The Council for Scientific and Industrial Research, a government agency, also forecast a decline in support, predicting the ANC would get just over 57 percent of the parliamentary vote and about 50 percent in the provincial polls.

Turnout on Wednesday was just over 65 percent, according to the votes processed so far, the Electoral Commission said.

ANC Deputy Secretary General Jessie Duarte said she expected the party’s vote share to grow as results from larger voting districts filtered through.

Mmusi Maimane, the DA leader, said he was content with his party’s performance so far, while EFF’s chairman Dali Mpofu said the results showed the party to be “the only growing big party”.

At the last election in 2014, the ANC won 62 percent of votes, the DA 22 percent and the EFF 6 percent.

Chief Electoral Officer Sy Mamabolo said the Electoral Commission hoped that results from around 90 percent of voting districts would be declared by 10:00 p.m. local time (2000 GMT), with the remaining results to be released on Friday morning.

RAMAPHOSA BAROMETER

Ramaphosa is trying to arrest a slide in support for the ANC, whose image has been tarnished in the last decade by corruption scandals and a weak economy.

Ramaphosa, who became ANC leader in December 2017 after narrowly defeating a faction allied with Zuma, has promised to improve poor public services, create jobs and fight corruption.

But he has been constrained by divisions within his own party, where some Zuma supporters still retain influence and oppose his agenda.

The ANC achi上海夜生活网eved its best parliamentary election result in 2004 under former president Thabo Mbeki, when it won 69 percent of the vote. But its support fell under Zuma, and it lost control of big cities like the commercial capital Johannesburg in local government elections in 2016.

The party now controls eight of the country’s nine provinces, with the DA in power in the Western Cape. Early results showed ANC ahead in Gauteng province, where Johannesburg and the administrative capital Pretoria are located, while the DA led in the Western Cape, home to Cape Town.

Election officials said voting had in general progressed smoothly but that there had been isolated disruptions caused by bad weather, unscheduled power outages or community protests.

Japan’s coincident index suggests economy may be in recession

TOKYO ( ) – Japan’s coincident indicator index declined in March and the government cut its assessment of the economy, a sign it may already be in recession as the U.S.-China trade war and weak external demand hurt activity.

Worries about the economy have grown as Japan’s exports and factory output were hit by China’s economic slowdown and the escalating U.S.-China trade friction, which had disrupted global supply chains.

The index of coincident economic indicators, which consists of a range of data including factory output, employment and retail sales, fell a preliminary 0.9 of a point in March from the previous month, the Cabinet Office said on Monday.

In its view on the index, the government described the economy as “worsening”. That compared with its previous assessment for February when it described the economy at “a turning point towards a downgrade”.

The index for leading economic indicators is compiled using data such as job offers and consumer sentiment and is seen as a forward-looking gauge of the economy. It slipped 0.8 of a point from February.

Clouding the outlook are government plans to raise a sales tax to 10 percent from the current 8 percent in October unless a big shock on the scale of Lehman Brothers’ collapse in 2008 hits the economy.

There is also speculation Prime Minister Shinzo Abe may postpone the sales tax hike as risks to demand grow, having already twice delayed it.

There are concerns the sales tax increase will damage private consumption as it did so when Japan raised the tax to 8 percent from 5 percent in 2014.

Japan releases gross domestic product (GDP) data on May 20, which will give a clearer read on the state of the economy and whether the government will proceed with the tax hike as sc上海夜生活论坛heduled.

The economy likely contracted at an annualized 0.2 percent in January-March as corporate and consumer spending weakened, a poll showed.

GRAPHIC-Take Five: Trade winds – World markets themes for the week ahead

May 10 ( ) – Following are five big themes likely to dominate thinking of investors and traders in the coming week and the stories related to them. 1/WATCH THOSE CURVES Moody’s warned this week that a trade war could tip the U.S. economy into recession next year. And U.S. President Donald Trump’s latest decision to hike tariff rates on Chinese goods has possibly brought that risk a bit closer. At least the bond market seems to think so — the yield on three-month U.S. Treasury bills is on the cusp of rising above 10-year yields.

A sustained curve inversion, as such a shift is called, would be seen as a sure-fire recession signal; in a normally growing economy, longer-dated borrowing costs are higher than short-term rates.

But the curve has sent a false alarm at least once before and some believe it is doing so again, above all because huge Fed purchases have depressed longer yields. Huge issuance of short-term debt is also likely to have contributed to the flattening.

Which brings us to another question. Given 2019 net borrowing will top $1 trillion, might Washington find itself scrambling to find buyers? Some dismal bond auctions recently have raised the question whether China is paring Treasury purchases — due to the escalating trade spat. Simmering tensions will keep the issue alive.

-EXPLAINER-What is an inverted yield curve -Flattened yield curve reason to be nervous, but US economy solid – Fed’s Evans -U.S. yields spike after dismal 10-year note sale

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2/ TALK, TWEET, REPEAT Industrial output, retail sales, house prices: a batch of data due in coming days was supposed to give investors an idea about how China’s economy was faring against a backdrop of 10% U.S. tariffs and authorities’ stimulus policies.

Fast forward and the stakes have been raised — quite a lot. On Friday, Washington hiked tariffs on $200 billion worth of Chinese goods to 25% and Trump, reverting to Twitter, has threatened more. Beijing warned it would retaliate, though it didn’t say how.

Negotiations to try to end a 10-month-old trade war between the world’s biggest economies are continuing, and markets have taken heart from China’s decision to stick with the talks. Another factor is China’s central bank, which assured markets it had “rich” policy tools to cope with external uncertainties. Weak economic data can only cement that resolve. -Trump’s tariff hike on $200 bln of Chinese goods takes effect -More China policy easing seen as lending slows, trade risks rise -Counting the cost of the U.S.-China trad上海夜生活论坛e war so far tmsnrt.rs/2Lzed8e

3/OIL SLICK The world economy seems to be shifting into a lower gear but Brent crude futures are holding above $70 a barrel, up 30% this year. Barclays sees a climb to $74-$75 in the coming year.

In the short-term too, oil looks well-supported. On the demand side, Chinese imports hit a record in April, possibly due to economic stimulus measures taking effect. And supply has been curtailed by a pipeline contamination issue in Russia and U.S. sanctions that have cut shipments from Venezuela and Iran.

Venezuelan exports have dropped 40% since January and Iran’s exports have more than halved, to one million barrels per day or less. They are expected to slide further in May.

None of these issues will be resolved anytime soon. Iran for one is threatening to retaliate against U.S. sanctions by breaching a nuclear pact signed in 2015. Sanctions have failed to dislodge Venezuelan President Nicolas Maduro but they are likely to cut oil exports further in May, after the expiry of an April 28 deadline for U.S. firms to complete existing deals.

-U.S. sanctions and Venezuela’s exports and imports -OPEC supply squeeze seen supporting higher oil prices -Sinopec, CNPC skip Iran oil purchases for May to avoid U.S. sanctions tmsnrt.rs/2VThqU1

4/NO STICKER SHOCK Few U.S. data series have been as choppy in recent months as retail sales. December’s drop in core sales was the largest in nearly two decades — only to be followed by an equally large swing to the upside in January. Demand for big-ticket items like cars then pushed the March total to the highest in 18 months.

Consumer resilience, emboldened by a strong job market, was a key pillar of support for the U.S. economy in the first quarter. So the April reading will show if that willingness to spend continues into Q2.

estimates point to the first back-to-back rise in retail sales since November. Headline sales are seen up 0.2%.

The report comes soon after Trump imposed new tariffs on $200 billion of Chinese imports, but it is far too soon to see a meaningful impact from the trade war between the world’s two largest economies. Shoppers will probably not start reacting to sticker shock until the third quarter. -U.S. retail sales post biggest gain in 1-1/2 years in March -Fed rate cut likely if U.S. manufacturing continues to slow: Kemp tmsnrt.rs/2VVixm4 5/ITALIA DEJA VU Once again it seems there’s good reason to fret over Italy, the euro zone’s third-biggest economy — and one of its most indebted.

Tensions have flared within the ruling coalition over a corruption scandal that cost a junior minister his job. Rome may find itself footing the bill for a bank bailout after BlackRock ditched a proposed rescue of Carige. And finally, the European Commission has warned that Italian finances may deteriorate further. So another showdown with the EU might be looming.

How talks on deficit targets may pan out could become clearer at the May 16 Eurogroup meeting of finance ministers.

Signs of compromise will bring relief to Italian bond markets, where yields have seen their biggest weekly jump in three months with a rise of over 10 basis points. Contrast that to Spain and Portugal, often lumped in with Italy as the euro zone “periphery” — 10-year Spanish yields are at 2-1/2 year troughs while Portuguese yields have touched record lows.

The latest bond sell-off, which took Italian yields to 2.7%, is small compared to the rout a year ago when yields spiked to 3.4%. But who could be blamed for a sense of deja vu? -Rome scrambles to swerve Carige bank bailout after BlackRock pulls out -Italy coalition patches up rift after PM ousts junior minister

-Italy accuses EU of prejudice after grim economic forecasts

tmsnrt.rs/2LzsCkO

At Ethiopia flight memorial, white roses mark passing of lives

ADDIS ABABA ( ) – Bouquets of white roses surrounded aviation staff as they gathered at Bole International Airport on Sunday to remember the two pilots and six crew, who perished along with 149 passengers in the Ethiopia Airlines crash a week ago.

Weeping women held slender single stems in their shaking hands. Banks of the white flowers, the traditional color of mourning, were placed in front of a row of empty coffins at the ceremony.

A band – some of the musicians in tears – temporarily stopped playing as band members ran to comfort bereaved relatives who lunged forward, wailing in grief over the coffins.

“Our deep sorrow cannot bring them back,” an Orthodox priest in a traditional black turban and black robes told the crowd gathered outside an airport hangar.

“This is the grief of the world,” he said, as Ethiopian Airlines staff sobbed in each other’s arms.

Related CoverageFactbox: What we know about Boeing 737 MAX crash and what comes nextFrance’s BEA says Ethiopian jet’s flight data successfully recovered

At least the crash had taken place in Ethiopia – the holy land – he said, prompting “amens” from the crowd.

In Paris, investigators examined black box recorders to determine why the aircraft plunged into a field shortly after take off from Addis Ababa, searching for similarities to an October Lion Air crash that killed 189 people.

Both crashes involved the same model of plane – a Boeing 737 MAX 8 – causing aviation authorities to ground the model around the world after last week’s accident.

Data from the Ethiopian Airlines flight recorder had been successfully downloaded, France’s BEA air accident investigation agency said on Sunday. That information had been transferred to Ethiopian investigators, the agency said, adding that its technical work on the flight data recorder and cockpit voice recorder was now done.

PRAYERS PAUSED

In the Ethiopian capital, families and airline staff were focused on honoring their dead.

At the airport memorial, a banner offered “deepest condolences and comfort” to the families of the deceased crew.

A female flight attendant spoke warmly of the deceased captain, Yared Getachew.

“He was a really nice person, a good person, all the words you can find to talk about a good person apply. He was a very kind human being,” she said, before dissolving in tears.

A service for the families of passengers – more than 30 nationalities were onboard – was also held beneath the pink stone spires of Addis Ababa’s Holy Trinity Cathedral.

Families and relatives of the victims threw themselves on the coffins as they arrived and kissed pictures of loved ones.

Incense was waved over the coffins, but there was so much weeping that prayers had to be paused. Afterwards, some said the service meant they could now shift focus from grieving for the dead to caring for the living.

“Her husband is now left with an 上海夜网infant, he has to shift his attention to his life and raising his baby,” said Getachew Negatu, a friend of one of the stewardesses onboard the flight.

“Her father and mother, including her sisters, are devastated by this grief. Everyone has got to come back to life as we … cannot live like this forever.”

The families were offered charred earth from the crash site to bury, because most of the bodies were destroyed by the impact and fire. Identifying the small remains that have been collected may take up to six months.

U.S. judge orders Arkansas to pay Planned Parenthood in narrow ruling

LITTLE ROCK, Ark. ( ) – A U.S. district judge on Friday ordered Arkansas to continue payments to Planned Parenthood for its treatment of three women who challenged Governor Asa Hutchinson’s directive cutting off Medicaid reimbursements to the organization.

The order applied only to the cases of the three plaintiffs, although the judge suggested that Planned Parenthood as an organization might successfully challenge the cutoff.

Judge Kristine Baker held that the three women, identified in court papers as “Jane Does,” had demonstrated they would incur irreparable harm should they not be able to access contraceptive care and other services through Planned Parenthood. 

Arkansas is one of several Republican-controlled states that have cut funds for the organization after the release of videos by an anti-abortion activist group, the Center for Medical Progress, in which Planned Parenthood officials are seen discussing transactions involving fetal tissue.

Planned Parenthood has denied any wrongdoing.

The preliminary injunction the judge issued on Friday follows a temporary restraining order she put in place two weeks ago.

The judge declined to bar the introduction of the videos in further proceedings, but dismissed them from immediate consideration as “inadmissible hearsay.”

Hutchinson, a Republican, said in a statement the ruling was limited to the three women and that he would direct the state health department to “prohibit funding to Planned Parenthood consistent with the Court’s ruling.”

In Washin上海夜生活gton, U.S. congressional Republicans this week challenged Planned Parenthood’s eligibility for federal funds, while the health organization’s president said defunding it would restrict women’s access to care and disproportionately hurt low-income patients.

Planned Parenthood gets about $500 million annually in federal funds, largely in reimbursements under Medicaid, the government’s healthcare program for the poor.

In Arkansas, reaction from social conservatives to the judge’s move was swift.

“Arkansans have made it clear time and again they do not want public dollars subsidizing abortions,” said Jerry Cox, president of the Family Council of Arkansas. 

Planned Parenthood has said almost all of its work in the state covered services other than abortions.

The Arkansas contracts with Planned Parenthood involved services including nurse practitioners, pharmacy and family planning and were delivered through the Arkansas Medicaid program. No state funds were used for abortions, except in the case of incest, rape or when the life of the mother was at stake, state health officials said.

A spokesman for the state attorney general said no decision had been made regarding an appeal of the ruling.

Russia’s top banks plot temporary sanctions workaround: sources

MOSCOW ( ) – Leading Russian banks are working on plans to help each other retain at least short-term access to the global financial system in the event that they are hit by fresh U.S. sanctions, sources familiar with the matter told .

Sberbank, VTB, Gazprombank and others are examining how they can provide each other with access to U.S. dollars or other major foreign currencies by using so-called correspondent accounts, the sources said.

Banks access financial services in different jurisdictions and provide cross-border payment services to customers in various currencies through correspondent banking relationships.

The new scheme, which banks started to draft with Russia’s finance ministry and the central bank last year, would be unlikely to work indefinitely but could help avoid a panic if one or several big banks are cut off from dollar transactions.

U.S. lawmakers last year drafted a sanctions bill which proposed cutting off some of Russia’s top banks from the U.S. dollar system, mentioning Sberbank, VTB, Gazprombank, Russian Agriculture Bank, Promsvyazbank, VEB and Bank of Moscow.

This did not come into force and recently another was proposed, without mentioning any specific banks.

But Russian banks still fear they could come under sanctions and so have begun to draft a contingency plan.

“Each important bank has a step-by step plan on what should be done in a given situation. The first month is set out day by day, if not hour by hour,” a senior financial official said.

The central bank and Gazprombank declined to comment. The finance ministry, Sberbank, VTB, Promsvyazbank, VEB and Russian Agriculture Bank did not reply to requests for comment.

The two biggest threats to the banking sector in Russia are being cut off from the SWIFT banking messaging system and losing access to foreign currency, which they usually get from U.S. banks via correspondent accounts.

In the event of being shut out of SWIFT, Russia already has its own system, which it is upgrading.

And for foreign currencies there are a number of options, said the sources, who include a high-ranking state banker, a well-placed industry official, an executive with a large bank and an individual in a foreign bank.

TEMPORARY FIX

The main option relies on at least one major Russian bank avoiding sanctions and being able to retain access to foreign currencies via correspondent accounts with major overseas banks.

Other Russian banks would then set up or upgrade existing correspondent accounts with that bank to shift currency around.

Publicly available documents show VTB has correspondent accounts with Sberbank and VEB, while Russian Agriculture Bank has accounts with VEB, VTB, Gazprombank, Sberbank and a number of other Russian banks.

VEB has such accounts with Sberbank and Gazprombank.

Sberbank, VTB, VEB, Gazprombank and Russian Agriculture Bank have correspondent accounts with the central bank as well.

However the bulk of these accounts are denominated in rubles, with only a handful in U.S. dollars and euros.

“This would (them) allow to move the dollars between themselves bypassing a correspondent account,” the source at a foreign bank said, adding that in order for the back-up to work one bank in the chain would need to have a U.S. dollar correspondent account with a U.S. bank as there would still be a need to make external settlements, necessitating a bridge.

Correspondent accounts would complicate tracking currency transfers between the banks, making them harder for overseas authorities to spot, a former central bank official said.

Such an arrangement would represent a “temporary solution” which might last for three or four months and buy the banks time to find an alternative, while also reassuring customers.

And a spike in currency transactions by the banks which had not been sanctioned and were dealing with the foreign correspondent bank would likely arous上海夜生活e suspicions.

Other options include the central bank providing forex currency to a ‘clean bank’ which in turn would then distribute it to peers via correspondent accounts, sources said.

Alternatively a sanctioned bank could use correspondent accounts directly with the central bank although that would raise the risk of the central bank itself being hit with sanctions and therefore, is unlikely, the sources said.

French growth seen firming as impact of protests wanes: INSEE

PARIS ( ) – French quarterly growth will firm in the first half the year as consumer spending benefits from improving household incomes and recovering business confidence after protests at the end of last year, the INSEE statistics agency said on Tuesday.

The euro zone’s second-biggest economy is set to post growth of 0.4 percent in both the first and second quarters, up from 0.3 percent in the final three months of last year, INSEE forecast in its quarterly economic outlook.

The economy would have grown 0.4 percent at the end of last year as well if it were not for the impact of the yellow vest anti-government unrest, which INSEE estimated at 0.1 percentage point.

Protests in December saw some of the worst street violence in Paris in decades with rioters rampaging through upmarket neighborhoods, smashing store windows and burning cars.

With the exception of a flare-up last weekend, the violence has largely subsided since President Emmanuel Macron offered concessions in December worth more than 10 billion euros ($11.3 billion) in a package intended to boost the incomes of the poorest workers and pensioners.

INSEE said higher incomes would help consumer spending rebound 0.5 percent in the first quarter after flatlining at the end of last year in the face of the unrest, which forced many stores in central Paris to be boarded up during the peak holiday shopping period.

Business investment was also expected to recover in the first half of the year as confidence firmed albeit not to rates seen before a slowdown at the end of last year.

INSEE saw a limited impact to the French economy from Britain’s departure from the European Union, in theory still planned for the end of the month.

It estimated an orderly Brexit would knock a cumulative 0.3 percent off French growth over several quarters, while the impact could be as much as 0.6 perce上海夜生活论坛nt if London failed to reach a Brexit deal with the EU and tariffs were raised.

That was much less than impact INSEE estimated for Ireland (-1.4 to -4.1 percent) and Germany (-0.5 percent to -0.9 percent), as both countries are closer trade partners with Britain that France.

Sterling regains poise as fresh Brexit developments eyed

* Graphic: World FX rates in 2019 tmsnrt.rs/2egbfVh

* Graphic: Trade-weighted sterling since Brexit vote tmsnrt.rs/2hwV9Hv

LONDON, March 19 ( ) – The pound edged higher on Tuesday thanks to broad dollar weakness against its rivals as investors waited cautiously for developments on Brexit negotiations with less than two weeks before the United Kingdom is due to leave the European Union.

The British currency got off to a volatile start to the week, shedding half a percent in late London trading on Monday, after John Bercow, the speaker of Britain’s parliament, said Prime Minister Theresa May’s Brexit deal could not be voted on again unless a different proposal was submitted.

While traders have steadily reduced their fears that Britain will crash out of the EU without a deal in recent weeks, Bercow’s move means more uncertainty in the short term as the government 上海夜网races to convince opposing lawmakers to back May’s deal or request for an extension.

“The predominant notion adopted by the market is that as long as the worst case scenario of hard Brexit is avoided by delaying Brexit, the pound is a buy on dips,” Rabobank strategists said in a note.

That view was shared by Morgan Stanley strategists who said the pound remained a buy on dips. The U.S. bank’s positioning tracker showed broader market positions on the pound was broadly neutral.

Against the dollar, the pound firmed 0.1 percent higher at $1.3267. It rallied to a 9-month high against the greenback to nearly $1.34 last week and is down less than a percent from those highs.

Against the euro, the pound was broadly steady at 85.55 pence.

Despite the latest political developments, various gauges of volatility indicators for the pound ticked lower on Tuesday, reflecting a broader drop in currency market volatility.

Pogba: We need to win

Paul Pogba tried to motivate his fellow Manchester United players ahead of their derby against local rivals and league leaders Manchester City

The France international will not play in the Red Devils’ important match due to the suspension he picked up against Arsenal. However, Pogba has urged Jose Mourinho’s side to take the game to Pep Guardiola’s men on Sunday, when they meet in the English top-flight.

The United playmaker encouraged his club to throw bodies forward, as they need a win to get closer to their rivals in the league table. He said United must attack during the whole game.

“We need to. To win those games you need to give everything. You need to be there offensively, defensively. Kill the game when you have one chance because they are City and they have quality as well in front and they can kill the game at any time,” Pogba explained.Solskjaer “very pleased” after another failure to win George Patchias – Ole Gunnar Solskjaer said he was “very pleased,” even though United failed to win yet again.It is now ten games on the road since…

“They are first for good reason because they have been doing great at the start of the season. They keep winning and they didn’t lose one game and obviously mentally they are very strong.”

“I have complete trus上海夜生活t in the team. Even if I am not there, I will be there watching the game giving positive energy and hopefully we are going to win,” he added when asked about United’s chances to win the game.

“I’m very disappointed because I really want to help the team and wanted to be there for this derby because obviously we are playing City and in this moment, we need points and we need to win. It’s an important moment, an important game so, like I say, disappointed.”

“It’s a big derby and the atmosphere is going to be big. We want to win, we need to win as well,” the Frenchman praised the derby.

Preview: Barcelona – Sporting

Sporting’s only chance to qualify from Group D is a win in Barcelona today, coupled with a favorable result in the other match of the group between Olympiakos and Juventus (1x).

Flashscore presents the key facts before the match:

Sporting Lisbon face a 1,250km trip to Barcelona and face a mammoth task in their final group game in this Champions League (CL) campaign. Sporting must win here to stand any chance of qualification from the group. But for them to beat a Barcelona side away from home, who are unbeaten domestically and in the CL so far, whilst also relying on Olympiakos to do a job on Juventus – may be too big of an ask.

Barcelona have already qualified from the group having gained 11 points from their first five fixtures, but do not be mistaken in thinking that they’ll take their foot off of the gas for this one. Ernesto Valverde’s Barcelona have won nine of their last ten at the Nou Camp, and their last defeat in any competition, home or away, was against their rivals Real Madrid in the Spanish Super Cup.

To add more misery to Sporting’s chances, Barcelona have scored three goals in each of their home group games so far (3-0 vs Juventus, 3-1 vs Olympiakos). Furthermore, they remain unbeaten here in the CL since all the way back in September 2013 – a remarkable 23 CL home games.

Jorge Jesus’ Sporting side have not won in Spain in 11 attempts, drawing three and losing the remaining eight games, and m上海夜网ost recently to Real Madrid last season. Meanwhile, Barcelona are unbeaten vs Portuguese teams in their last 15 games, winning 12 and drawing three – with their last defeat to a Portuguese side being back in ‘87/’88!Niko Kovac urges Bayern Munich to remain ‘humble’ Andrew Smyth – Niko Kovac has called on Bayern Munich to stay focused and humble after thrashing Tottenham 7-2 in the Champions League.

Barcelona have managed five clean sheets in their last six CL outings, yet Sporting have scored 27 goals in their last ten away games, which is just short of three goals per game. The last meeting between the two at the Camp Nou ended with a Barca win and both teams finding the net (3-1).

Lionel Messi is on the brink of making history, he is now just three goals away from his century of CL goals, and he will surely be looking to take the match ball home after the game.

Missing players

Barcelona: O. Dembele (muscle injury), J. Mascherano (muscle injury), Rafinha (knee injury), S. Umtiti (muscle injury), A. Iniesta (doubtful), A. Turan (doubtful)

Sporting: J. Silva (knee injury), S. Doumbia (doubtful).

Bonucci expecting a Milan victory in Serie A derby

The Italian is grateful for his time with the Nerazzurri, but hopes to come out as a victor after the clash between Inter and AC Milan.

Leonardo Bonucci has looked back on his spell with Inter Milan ahead of the Serie A derby on Sunday. The Italy international completed a shocking move during the summer as he swapped the Nerezzurri with the Rossoneri in a record €40m deal.

Even though Bonucci is thankful for his great time at Inter, he is expecting a win for his new club AC Milan despite a rather shaky start of the season.

“I arrived when I was 17 years old and had two splendid years in their youth academy, where I really improved a lot,” Bonucci told Tencent Sports.

“They are a good side with some great individual talents and chose an important coach in Luciano Spalletti.

“We’ll have to be very wary and give our best. I would take Antonio Candreva and Eder off the Inter squad, as they are my Italy team-mates and they’re two really great guys.Ernesto Valverde praises Lionel Messi’s “fantastic” impact Andrew Smyth – Ernesto Valverde praised a not fully-fit Lionel Messi’s impact as Barcelona came from behind to beat Inter Milan 2-1 on Wednesday.

“I predict a Milan victory, but I won’t tell you [by] how much.”

The Italian also shared a few words regarding his choice to join the Rossoneri, stating that the new challenge at San Siro is what brought him to AC Milan.

“This stadium is the history of football, the most important arena in Italy. Stepping into San Siro always has an effect on you,

“The Rossoneri project is what pushed me to choose this great challenge. I knew there would be difficulties, but I accepted it because I wanted to challenge myself again.

“The objective is to set no limitations in Serie A or the Europa League. Qua上海夜生活网lification for the Champions League must be the minimum target, as Milan have to play in that tournament every year.”

Hartson would do anything to coach Wales

As Chris Coleman decided to end his time as the Wales national team manager, the Welsh FA has to look for his replacement – and one of the possibilities could be the former Wales international, John Hartson.

Hartson himself said that he would “walk on broken glass” for the national team of his country but there is another big name in the game – Tony Pulis. As the experienced manager was sacked by West Brom, he seems to be a great option to replace Coleman and even Hartson admitted that Pulis is a perfect candidate for this position.

Hartson was close to getting this job a few years ago as he said, according to BBC: “I was interviewed for the job when Gary Speed, God rest his soul, got it 10 years ago and I’ve been working on every single game (in the media) – I’ve not missed a Welsh game in the last three years. So I know exactly what goes on within the group. I know the system, I know the philosophy and what the boys like working to because I’ve been in there.”Report: Taylor says authorities turn a blind eye to racism George Patchias – Aston Villa and Wales international Neil Taylor believes football authorities are simply turing a blind eye to the racism that is marring football.Taylor s…

He said that he would be willing to take this job but he hasn’t got a big chance of getting it: “They know my passion – they know I’m an extremely proud Welshman and listen, I would walk on broken glass for the job. But at this moment in time, I don’t think I’m coming into their thinking. I think it’s probably a job, at this moment in time, for somebody that they feel with that little bit more experience and the ideal man, in my opinion, would be Tony Pulis.”

But the former attacker insisted that it’s just up to Pulis: “There’ll be several Premier League jobs and whether Tony feels he is capable of continuing at the highest level in the Premier League – whether he feels he has another couple of上海夜生活 jobs in him – before he takes over the national job, I don’t know.”

Silva praises amazing De Bruyne

The Belgium international has enjoyed a tremendous start of the season under Pep Guardiola.

Manchester City’s summer signing Bernardo Silva has lauded his team-mate Kevin De Bruyne as ‘one of the best in the world’. The Citizens’ playmaker is in outstanding form since the start of the season, constantly lifting the assist bar with his performances. De Bruyne has been the most assisting footballer in the Premier League since arriving at the Etihad Stadium in 2015. The 26-year-old’s showing on the pitch has been vital for Guardiola’s men, who keep smashing every team they face in England.

Their latest feature was a 7-2 hammering over Stoke City, with De Bruyne once again under the spotlight as he was involved in the majority of City’s goals. His incredible form has not gone unnoticed as Bernardo Silva could not hide his satisfaction with the Belgium international’s form and contribution to the club: “Kevin, is just an amazing player. It’s a pleasure to play alongside these kind of players and he showed us again that he’s one of the best in the world.” the Portuguese striker stated, according to beIN Sports.Neville: Pep Guardiola knows Ma上海夜生活n City aren’t good enough Andrew Smyth – Gary Neville has quashed Pep Guardiola’s claims that Manchester City won’t buy in January as they can’t challenge for trophies without defensive cover.

“It feels great to be part of this team and score my first goal for Manchester City, I’ve very happy for this.

“The team played an amazing game, three well deserved points and now we have to think about the Champions League, because we want another three points there to help us progress.

“To be here and to be able to learn from all these fantastic players, it’s an amazing opportunity, I’m very happy to be here, and I hope I can help the team to achieve the goals.”

Wenger says that Alexis and Ozil could leave in January

The Gunners manager admitted that two of his best player could leave during the winter transfer window.

Both Alexis Sanchez and Mesut Ozil are in their last year of contract at Emirates. The Chilean already made it clear that he is not interested in signing a new deal with the club, while negotiations with Ozil have been rather slow.

With a number of big clubs chasing them, it was inevitable that Arsenal will have to make a decision whether to cash in on them in January or to use them for the whole season and lose them for free next summer.Strachan: Arsenal’s Kieran Tierney similar to Virgil van Dijk Andrew Smyth – Gordon Strachan believes Arsenal new signing Kieran Tierney is a similar kin上海夜生活论坛d of defender to Liverpool star Virgil van Dijk.

Manchester City and PSG are thought to be fighting over the signature of Alexis Sanchez, while Mesut Ozil is disputed by Manchester United and Barcelona. However, the German’s agent revealed that negotiations over a new deal with the Gunners ‘are heading in a positive direction’.

Speaking ahead of the upcoming Premier League match against Watford, Arsenal’s manager said about the possibility of the two players to leave the club: “In our situation, we have envisaged every solution. It is possible.”

Further asked about the Ozil’s willingness to remain at the Emirates, the French manager said: “It is my understanding [that he wants to stay]. I hope the situation can be turned around. At the moment, we are not close enough to announce anything.”

Mbappe chose PSG for first-team opportunities

Kylian Mbappe said that he felt he would have more first-team opportunities at PSG than at Real Madrid.

The young forward was disputed this summer by Real Madrid and PSG, but eventually he chose to remain in France and sign with the Parisians. Now he revealed that the main reason behind his choice was the prospect of playing regularly in the first team: “I felt that at PSG, I would have more opportunities to play than at Real Madrid.”

Speaking to L’Equipe, the 18-year-old also revealed that he held discussions with Manchester City boss, Pep Guardiola, but eventually turned down a move to England: “Guardiola is a coach who breathes football, he won everywhere and he transmits passion and makes you want to play. Drogba tips for Neymar and Mbappe to win Ballon d’Or one day Nedim Maric – One of the best strikers in the Premier League era talked about PSG’s sensational duo and their chances of winning individual awards in the…

When I spoke with him, he explained how he would use me in his tactical system. But I did not say no to Guardiola, I said no to Manchester City.”

Although he eventually switched to Ligue 1 rivals PSG, Mbappe said that he had no intention of leaving Monaco at the end of last season, when they won the title: “I had no intention of leaving Monaco at the end of the season, but things happened and I decided to change my mind and I’ll take the time to explain it later.”

Th上海夜生活论坛e 18-year-old is now looking forward to win trophies with his new team and has set his sights on Champions League: “I dream of winning the Champions League this year, it’s easy to say in September, but what counts is to be able to say it in February. We have a great team on paper, now we’ll have to prove it on the pitch.”

People have already seen the best of Walker thinks Spurs manager

Mauricio Pochettino believes the the full-back’s prime days were at White Hart Lane.

Tottenham manager Mauricio Pochettino believes Kyle Walker will prove he is a quality player at the Etihad stadium, but also claims his best days are in the past.

The England defender completed a record-breaking £50 million switch from Spurs to Manchester City, making him the most expensive defender in English football history.

Kyle Walker spent eight years with Tottenham and became one of the fans’ favourites. Despite the fact Pochettino is sure Walker will succeed under Guardiola, he also thinks that he struck a good bargain for Tottenham.

“He’s one of the best full-backs in England and Manchester City have paid a lot of money – £50 million – just like they have signed different players to try to get success in the future,” the Argentine said, according to Goal.Paiva says Felix would have done better at City or Barca George Patchias – Joao Felix would have become a better player at Manchester City or Barcelona 上海夜生活网according to former coach Renato Paiva.Renato Paiva was the prodigious Portuguese…

“But, for me, I think we have seen the best of Kyle with Tottenham.

“We helped him improve and learn. When you pay this type of amount for a player, it’s because he’s top and because you are at your best. Then it’s normal that he will succeed.

“It’s a big pressure because when you pay for some players, the pressure to perform as well in every game becomes greater.”

Meanwhile the Citizens parted ways with a number of defenders – Clichy, Sagna and Zabaleta all left the club while Monaco’s Benjamin Mendy arrived at Etihad.

Galatasaray keen on signing Fellaini

The Belgium international has grown to be a key figure for the Red Devils following his performance last season.

Galatasaray will make an offer for Manchester United midfielder Marouane Fellaini claims the club director Cenk Ergün. The midfielder signed a 12-month extension to his contract in January keeping him at Old Trafford until 2018.

However, he could be set for departure amid interest from Turkish giants Galatasaray.

Galatasaray’s club director Ergün told Ajansspor.

“Fellaini will leave Manchester United and he is now on our radar.Report: Pallister urges United to sign Maddison. George Patchias – Former Manchester United centre-back Gary Pallister has urged his old club to sign James Maddison from Leicester City.Pallister formed the first great defensive partnership…

“There will be surprises, we are in talks with Fellaini.

“We have made an approach, we are close and if we get Fellaini we will end our pursuit of [Villarreal’s Alfred] N’Diaye.

“We need a player like Fellaini who can move around in midfield.”

F上海夜生活ellaini made 47 appearances for United in all competitions last season – the highest number of games in one campaign ever since he came from Everton in 2013. He helped the team win three trophies including the Europa League with a victory over Ajax.

Juventus sign Uruguayan wonder-kid

Juventus have announced the signing of Uruguayan wonder-kid, Rodrigo Bentancur, from Boca Juniors.Written by Cosmin Mihalescu. April 22, 2017.

After qualifying in the semi-finals of Champions League, Juventus have concluded their first signing for the 2017/2018 season. Rodrigo Bentancur, the highly rated 19-year-old has signed a 5-year deal, until 2022.

Juventus have paid €9,5m to Boca Juniors, who will also be due 50% of his next transfer. The transfer fee could increase, as it includes different bonuses, conditioned by the number of official games the上海夜生活网 Uruguayan will play for the Bianconeri.Inter Milan V Lazio: Players to Watch Taimoor Khan – Inter Milan are set to host Lazio at the San Siro on Thursday and the game is definitely going to be an exciting affair…

Bentancur is a Boca Juniors youth product and made his debut for the first team in the 2014/2015 season. Since then, he has become Argentinian champion with the team and has also won an Argentinian Cup.

The young central midfielder will join his new teammates on the 1st of July, but has already passed all the medical tests: “I am very happy to have arrived at Juventus, for me it’s a huge honour to be here. I am very happy that a team like Juventus was interested in my services. I follow Serie A very often, the game is very different from the one in Argentina. It’s a new challenge for me, I am young and I will give my everything. Tevez has only told me good things about Juventus”, Bentancur said in a statement.