NEWS,05 AND 06.04.2013

Obama to offer entitlement cuts in budget

President Barack Obama will make key concessions to Republican foes next week when he unveils his US budget that proposes cuts to cherished entitlement programs, the White House said on Friday.
Obama's fiscal blueprint slashes the deficit by $1.8 trillion over 10 years, in what a senior administration official described as a "compromise offer" that cuts federal spending, finds savings in Social Security, and raises tax revenue from the wealthy.
Republicans led by House Speaker John Boehner are widely opposed to any new tax hikes, after the president secured $600bn in increased tax revenue in a year-end deal.
But Obama's concession to conservatives in the form of reduced cost-of-living payouts for Social Security benefits could revive consideration of a deficit-reducing "grand bargain" that has proved elusive in recent years.
Such cuts to public pension programmes and public health insurance for the elderly - seen as sacred cows for Obama's Democrats  have been longstanding demands of Republicans.
"While this is not the president's ideal deficit reduction plan, and there are particular proposals in this plan like the CPI (consumer price index) change that were key Republican requests and not the president's preferred approach, this is a compromise proposal built on common ground," the administration official said.
The president is willing to "do tough things to reduce the deficit," but only in the context of a package that includes new revenues from the wealthy, the official added.
"This isn't about political horse trading; it's about reducing the deficit in a balanced way that economists say is best for the economy and job creation."
Obama's new revenues will draw in part from capping retirement savings plans for millionaires, and closing some loopholes that benefit the rich.
The annual budget deficit is projected at 5.5% of gross domestic product for the fiscal year ending in September. Under the Obama budget, that would decline to 1.7% of GDP by 2023.
Combined with the $2.5 trillion in savings already achieved since negotiations in 2010, the Obama budget would bring total deficit reduction to $4.3 trillion over 10 years, slightly higher than the overall goal agreed to by both parties for stabilizing the national debt.
Boehner offered a lukewarm reaction to the plan.
"One of the best things President Obama can do is follow the House and outline a balanced budget next week  one that includes entitlement reforms that are not conditional on enactment of more tax increases, which will suppress growth instead of encourage it," Boehner said in a statement.

Petrol price fixing probe ends - report

Prosecutors in Italy have wrapped up a probe triggered by suspicions that the country's steep petrol prices were the result of manipulation by several large oil firms, media reported Friday.
The results of the investigation into seven companies - ENI, Shell, Esso, Total ERG, Tamoil, Q8 and API - have been sent to legal authorities in Rome and Milan for possible further action.
Italian motorists pay the highest prices at the pump in the European Union, according to the European Commission's directorate general for energy.
The newspaper La Stampa said the Varese prosecutor's office in northern Italy, which conducted the probe at the urging of a consumer group, suspected the oil companies of "carrying out speculative moves to boost the price of fuel at the pump".
But the head of Italy's biggest oil company ENI, Paolo Scaroni, told reporters on Friday the probe was just the latest official scrutiny of what he described as unavoidably high petrol prices.
"There are several reasons fuel prices in Italy are higher than elsewhere in Europe. To name just one, there are 24 000 service stations in Italy compared with 9 000 in Britain with a total equivalent consumption, so these service stations, in Italy, need a bigger margin" to achieve profitability, he said.
He also cited reduced station opening hours, and noted that Italian service stations cannot sell other items, such as newspapers or cigarettes, to augment revenues.
"There is nothing underhanded," he said.
The average price for unleaded petrol in Italy at the end of 2012 was €1.75 per litre ($8.60 per gallon), according to the European Commission's directorate general for energy.
That compared with €1.50 per litre in France, €1.56 per litre in Germany, and €1.63 per litre in Britain, the data showed, according to the Commission's Eurostat statistics office.

Panicked Cypriots queue at banks

Panicked Cypriots queued outside banks on Friday on rumours that a new levy would be imposed on deposits as part of a bailout, but the authorities moved quickly to assure them this was not the case.
Cyprus wrapped up talks this week paving the way for the €10bn ($13bn) bailout from EU-led lenders, but fears swirled that it was still well short of the €5.8bn to fund its end of the deal.
As the speculation spread on Friday morning, customers formed long queues outside some of the larger branches of the Co-op bank, prompting the government to issue a denial of the reports as "unjustified" and "groundless".
"Such an issue was never tabled or discussed, therefore we categorically state that no such issue exists, not even as an intention," said the finance ministry.
"The memorandum has been agreed with the troika and it does not include any additional measure that leads to the need to implement any new haircut on deposits," it said, referring to the EU, European Central Bank and IMF.
The ministry said the measures agreed by the Eurogroup on March 25 for restructuring the Cypriot banking sector were being implemented and the system was "on track towards stabilisation and consolidation".
The central bank also denied reports of any plans to introduce a "general" haircut of deposits to pay for the conversion of uninsured deposits above €100 000 into shares in the island's biggest lender, the Bank of Cyprus (BoC).
"We refute this because such an action is not provided for in the policy decisions taken by the Eurogroup," it said in a statement.
The supervisory authority for the Co-op societies also warned anxious customers to ignore "slanderous rumours" being spread by text messages that a haircut on deposits was imminent.
Under the deal to downsize the banking sector, large BoC depositors could lose all of the remaining 60% of their balances over 100,000 euros depending on the costs of winding up and merging second-largest lender Laiki.
Savers in that bank will have to wait for years to see any of their cash over €100 000.
Banks have been operating under stringent capital controls since they reopened last week, after a near two-week lockdown prompted by fears of a run on deposits.

Global miners to hire more staff

Despite the unpredictability of the global mining industry, the prospect of hiring more staff is on the cards, according to a survey by Pedersen & Partners.

From the 160 companies surveyed across the sector, 33% indicated that they will be hiring more staff, while 50% said they will maintain their work force.

The results show that:

• 28% indicate they will be hiring new employees,
• 5% indicate they will be bringing back staff that were laid off,
• 50% will maintain their current staffing levels, and
• 15% suggest they will be restructuring.

The survey noted that the overall perception is that miners appear to be cautiously optimistic with most firms predicting that 2013 will be very similar to last year or improving somewhat.

However, it was not all good news, several small mining firms with market caps below $10m will not survive through the next year, the survey stated.

"Those with proven projects and strong management reputations may be subject to acquisitions or find more fluid funding through private equity, streaming, flow through shares and eventually, some institutional financing."

According to respondents 47% expect mergers and acquisitions to be a part of their growth strategy this year, while 31% said it will be considered for the right opportunity and 22% ruled it out altogether.

The last five years have been a turbulent time for mines with the global recession, operational restructurings, production cuts as well as expenditure reduction. This resulted in flagging confidence in the mining sector.

Mining in SA

The mining sector in South Africa, which is the backbone of the economy, has faced several challenges in recent months, including proposed job cuts, a series of wildcat strikes and the Marikana massacre in which more than 44 people died.

Data released by Statistics South Africa in March showed that total mining production was 3.1% lower in 2012 compared with 2011.

Finance Minister Pravin Gordhan stated in his National Budget speech in February that mine strife resulted in a revenue shortfall of R16.3bn, estimated to be 5.2% of the 2012/13 gross domestic product.

However, Mines Minister Susan Shabangu said in February that the country is committed to a strong mining industry, adding that the industry had grown from 993 mines in 2004 to almost 1 600 mines.

"We will continue to ensure that an enabling environment is created, while at the same time developing an environment that is responsive to the changing global economic environment and the dynamism of the contemporary mining industry," she said.

US trade deficit shrinks to $43bn

The US trade deficit edged lower in February after a big jump in January, government data released Friday showed.
The commerce department reported the trade gap shrank to $43bn, down from the revised $44.7bn in January.
The decline, which came after a large 16.7% deficit increase in January, surprised analysts who had projected a deficit of $44.7bn.
US exports grew 0.8 percent to $186bn, strengthened by the exports of industrial goods (up 4.5%) and automobiles (up 1.6%).
Meanwhile, US imports held steady at $228.9bn.
US imports of crude oil, which represent more than 10% of imported goods by the US, dropped 5.6% to $23.6bn.
But US imports of foreign automobiles rose 4.6% between January and February to reach $24.8bn.
On a 12-month basis, the US trade deficit has dropped by 3.5%.

Ireland slowly recovering

Ireland's central bank said on Friday the country's gradual economic recovery was broadly on track, barely changing its growth forecasts but warning the government it could not afford to ease back on its austerity programme.
It predicted gross domestic product would expand by 1.2%, a touch below the 1.3% foreseen three months ago, and kept its 2014 growth forecast at 2.5%.
Bailed out in late 2010, Ireland has been one of the few eurozone economies to grow over the past two years and closed in on weaning itself off emergency assistance last month by raising €5bn ($6.42bn) in a landmark 10-year bond sale.
The International Monetary Fund (IMF), one of Ireland's bailout lenders, struck a similar note on Wednesday when it said the economy would grow by 1.1% this year, the first time in six quarterly reviews it has not marked down its view for 2013.
However like the IMF, which cautioned that Ireland's gradual recovery remained highly uncertain, the central bank said its medium-term assessment for the export-focused economy relied on a pick-up in external demand from the second half of 2013.
"The gradual recovery of the Irish economy is continuing," the central bank said in its latest quarterly review.
"The prospects for such a recovery must be treated with some caution, however, given the high degree of uncertainty regarding the near-term outlook for world demand."
The bank said that while recent surveys, particularly in consumer sentiment, pointed to an easing in the rate of decline in the eurozone, the bloc was facing a delayed emergence from recession, and that would have knock-on effects for Ireland.
Export growth - driven completely by the booming services industry - would fall to 2.5% this year as a result, down on the 3% expected in January, while expansion in 2014 was marked down by just under the same amount to 5%.
That should be mostly offset by a lower than previously expected drop of 0.2% in consumer spending this year and slightly quicker rise of 0.4% in 2014. The fall in domestic demand may, finally, be nearing an end, the bank said.
With any growth in the domestic economy slight at best, unemployment is still forecast to fall only slightly, to 13.9% next year even though the estimated rate fell to 14% over the last two months.
The bank added that while unemployment rates for those with the lowest levels of education were around four times higher than those with third-level qualifications, in absolute terms the majority of the unemployed come from higher education.
It gave a cool reception to the government's promise to voters of a 20% reduction in the €5.1bn of austerity measures planned by 2015, following a deal struck with the European Central Bank to ease its the burden of its bank-assumed debt.
"Full implementation of the announced budget measures remains essential to preserve market confidence and to keep a buffer against negative shocks," the bank said.

Germans back Merkel's crisis management

A new poll shows Germans widely approve of Chancellor Angela Merkel's crisis management following a bailout deal for Cyprus, suggesting it remains a key asset for the leader as she prepares to seek a third term in elections in September.

The poll for ARD television published on Friday also showed Merkel's popularity riding high and that of centre-left challenger Peer Steinbrueck, who had a gaffe-strewn start to his campaign, sinking further.
But, although Merkel's conservative bloc is easily the biggest single party, it gave neither Merkel's current centre-right coalition nor the combination of Steinbrueck's Social Democrats and the Greens a parliamentary majority.
Merkel's hard-nosed handling of the debt crisis has long been popular at home, though many in the nations that have been bailed out resent the austerity and reform policies attached to the deals.
The poll of 1 002 people, conducted on Tuesday and Wednesday, found 65% agreed that Merkel has "acted correctly and decisively in the euro crisis”.
Only 33% thought that the German government thinks too little about the well-being of people in crisis-hit countries as it works to rescue the euro.
Fifty percent said it was right that investors and bank depositors in Cyprus had to contribute to the bailout for the small island nation.
Merkel's government was insistent that large depositors should help pay, but was criticised by Germany's opposition for initially accepting a short-lived plan that would have involved a levy on small deposits as well.
The survey found that 68% were satisfied with Merkel's work, unchanged from last month, and that Finance Minister Wolfgang Schaeuble was close behind, with 63%. But Steinbrueck's rating was down four points to 32%.
Still, the survey pointed to one risk for Merkel: It found that 75% of respondents believed the worst of the euro crisis is still to come.
Germany's economy so far has been relatively unscathed by the crisis, even as several countries suffer recessions.
A new group calling itself Alternative for Germany, which advocates scrapping the euro in its current form, plans to launch itself as a party on 14 April and run in the 22 September elections.
It's unclear whether it will be able to make any impact; another party, the Free Voters, has failed to make any inroads with a more moderate platform of opposition to the current bailout policies.
The ARD poll gave a margin of error of plus or minus up to 3.1 points.

North Korea advises diplomats to leave

Foreign diplomats in Pyongyang huddled on Saturday to discuss a North Korean evacuation advisory as concerns grew that the isolated state was preparing a missile launch at a time of soaring nuclear tensions.
The heads of all EU missions had agreed to meet to hammer out a common position after Pyongyang warned embassies it would be unable to guarantee their safety if a conflict broke out and that they should consider leaving.
Most of their governments made it clear they had no plans to withdraw any personnel, and some suggested the advisory was a ruse to fuel growing global anxiety over the current crisis on the Korean peninsula.
"We believe they have taken this step as part of their country's rhetoric that the US poses a threat to them," a British Foreign Office spokesperson said in London.
Missiles
The embassy warning coincided with reports that North Korea had loaded two intermediate-range missiles on mobile launchers and hidden them in underground facilities near its east coast.
"The North is apparently intent on firing the missiles without prior warning," the South's Yonhap news agency quoted a senior government official as saying.
They were reported to be Musudan missiles, which have never been tested, but are believed to have a range of around 3 000km, which could theoretically be pushed to 4 000km with a light payload.
That would cover any target in South Korea and Japan, and possibly even reach US military bases located on the Pacific island of Guam.
The White House said on Friday it "would not be surprised" by a missile test.
"We have seen them launch missiles in the past.... And it would fit their current pattern of bellicose, unhelpful and unconstructive rhetoric and actions," White House spokesperson Jay Carney said.
'Provocative act'
The Pentagon warned any such test would be "a provocative act", with spokesperson George Little urging Pyongyang to "follow international norms and abide by their commitments".
North Korea, incensed by UN sanctions and South Korea-US military drills, has issued a series of apocalyptic threats of nuclear war in recent weeks.
The North has no proven inter-continental ballistic missile capability that would enable it to strike more distant US targets, and many experts say it is unlikely it can even mount a nuclear warhead on a mid-range missile.
Nevertheless, the international community is becoming increasingly skittish that, with tensions showing no sign of de-escalating, there is a real risk of the situation spiralling out of control.
The latest expression of concern came from Communist icon Fidel Castro, who warned the danger of a nuclear conflict erupting was higher than it had been at any time since the 1962 Cuban missile crisis.
If war broke out on the Korean peninsula, "there would be a terrible slaughter of people", Castro wrote in a front-page article in Granma, the Cuban Communist Party's newspaper.
UN won't withdraw
The United Nations said it had no plans to pull staff out after the North Korean warning message to embassies and NGOs in Pyongyang.
Spokesperson Martin Nesirky said UN chief Ban Ki-moon was "studying the message," and added that UN staff "remain engaged in their humanitarian and developmental work" throughout North Korea.
According to the British Foreign office, embassies and organisations were told to inform the Pyongyang authorities by 10 April what assistance they would require should they wish to evacuate.
"Our understanding is that the North Koreans were asking whether embassies are intending to leave, rather than advising them to leave," the spokesperson said.
Russian Foreign Minister Sergei Lavrov said Moscow was consulting with China over the warning, as well as the United States and other members of the stalled six-party talks on North Korea.
In South Korea, a Navy official told Yonhap that two Aegis destroyers with advance radar systems had been deployed - one off the east coast and one off the west coast - to track any missile launch.
North Korea refused on Saturday to lift a ban on South Koreans accessing their companies in a joint industrial zone on the North side of the border.
Entry to the Seoul-funded Kaesong complex has been barred since Wednesday.

Castro urges calm in North Korean crisis

Communist icon Fidel Castro on Friday called on North Korea and the United States to avoid confrontation and reminded both sides of their "duties" towards peace.

"If a war breaks out there, there would be a terrible slaughter of people" in both North and South Korea "with no benefit for either of them”, Castro wrote in a front-page article in Granma, the Communist Party's newspaper.
Now that the North Korean government "has demonstrated its technical and scientific advances, we remind them of their duties with those countries that have been their great friends."
Castro urged North Korea to remember that "such a war would affect... more than 70% of the planet's population”, and decried "the gravity of such an incredible and absurd event" in such a densely populated region.
Castro said the present crisis presents the most serious risk of a nuclear war since the 1962 Cuban missile crisis, a two-week standoff between the United States and the Soviet Union over placing nuclear missiles in Cuba.
The "duty" to avoid the conflict is also in the hands of Washington "and of the people of the United States”, Castro said.
If a war breaks out, President Barack Obama's second term "would be buried in a deluge of images that would portray him as the most sinister personality in the history of the United States."
Castro, 86, handed over power to his brother Raul in 2006 but remains influential in Cuba and among leftists worldwide.
Meeting Kim Il-Sung
In his article, the Cuban leader recalled "the honour" of meeting Kim Il-Sung, the founder of the North Korean regime and grandfather to current leader Kim Jong-un.
The late North Korean leader, who died in 1994, was a "historic figure, notably brave and revolutionary," Castro wrote.
Castro also wrote that North Korea "has always been friendly with Cuba, as Cuba has been always and will continue to be" friendly with North Korea.
Castro writes an occasional column titled "Reflections of Comrade Fidel" that runs in state media. This is his first column since June 2012.
North Korea, incensed by UN sanctions and South Korea-US military drills, has issued a series of apocalyptic threats of nuclear war in recent weeks.
On Thursday the North Korean army said it had received final approval for military action, possibly involving nuclear weapons, against the threat posed by US B-52 and B-2 stealth bombers taking part in the joint drills.

NEWS,14.,15.,16. AND 17.03.2013

1.7 m applications for 1 500 jobs

India's largest state-run bank has received 1.7 million applications for just 1 500 entry-level clerk jobs and has promised to examine all of them, a report said this week.State Bank of India chairperson Pratip Chaudhuri attributed the huge interest to good arketing and attractive employment terms, with the number of applications  underlining the appeal of "jobs for life" in the Indian public sector. "This time, we had given the advertisement a good profile, highlighting the position of SBI and describing the compensation package in detail, which attracted a lot of attention," Chaudhuri told The Times of India.For positions in Mumbai, the bank offered a starting package of 69 000 rupees ($1 270) a month for the "probationary officers" including a housing allowance - an attractive perk in the expensive local real estate market.Job opportunities in the Indian private sector have fallen in the last 18 months as economic growth has dropped to its lowest level in a decade due to declining business confidence and high interest rates.The government forecasts that India's once-booming economy will grow by just 5% in the current financial year to March 31.Last year, it grew by 6.2% but even that rate - while enviable by anaemic Western standards is insufficient to create the jobs India needs for its fast-growing young population.India's Prime Minister Manmohan Singh, a former economist, believes that India requires at least 8% growth to create enough jobs for its expanding population, with the government keen to promote the industrial sector.Chaudhuri said all 1.7 million applicants more than 1 100 per position available - would be assessed."We have conducted such examinations in the past by hiring schools across the country. This time, we may have to do two shifts," he told the newspaper. Nine out of ten Indians are currently employed in the "informal" sector in jobs that offer no security, few perks and often illegal working conditions, government data shows.

London's gold, silver in price fix probe

 

London's gold and silver markets face the possibility of a probe alongside other benchmarks into price setting, putting a century-old practice under the spotlight after the Libor rigging scandal that exposed widespread interest rate manipulation by banks.The US Commodity Futures Trading Commission has engaged in "a couple" of conversations about whether the daily setting of gold and silver prices in London is open to manipulation, Commissioner Scott O'Malia said on Thursday, although he said the situation is "fairly immature in its development."The Wall Street Journal, citing unnamed sources, reported on Wednesday that the CFTC was examining various aspects of gold and silver price-setting, including whether it is sufficiently transparent "What was stated in that story was more than I think we're doing," O'Malia told reporters at the annual Futures Industry Association conference in Florida on Thursday."I think we've had a couple of conversations. We're looking at energy, indexes, prices, how they're set. We'll look at all of the range of index-setting," O'Malia said.The CFTC declined to provide an official comment, while the chairs of the London Gold Fixing Company and London Silver Fixing Company were not available for comment.Another CFTC Commissioner Bart Chilton, known as an outspoken proponent of regulation to protect investors and consumers, declined to specifically address the report, saying: "Given the clubby manipulation efforts we saw in Libor benchmarks, I assume other benchmarks - many other benchmarks are legit areas of inquiry."Britain's Financial Services Authority (FSA) also declined to comment on whether it was looking into gold and silver price setting, but said on Thursday it is feeding into a wider review of price benchmarks run by the International Organisation of Securities Commissions (Iosco) a global umbrella group for markets regulators.Iosco is set to publish a report in May with principles on how to compile important benchmarks to avoid rigging.The setting, or "fix", of the gold price in London dates back to 1919, originally involving NM Rothschild & Sons, Mocatta & Goldsmid, Samuel Montagu & Co, Pixley & Abell and Sharps & Wilkins. Silver price setting started in 1897.Currently, gold fixing happens twice a day by teleconference with five banks: Bank of Nova Scotia-ScotiaMocatta, Barclays Bank Plc, Deutsche Bank AG, HSBC Bank USA, NA and Société Générale. The fixings are used to determine prices globally.Chairmanship of the Gold Fixing rotates annually among the member banks.At the start of each gold price-fixing, the chairperson announces an opening price to the other four members who relay that to their customers, and based on orders received from them, instruct their representatives to declare themselves as buyers or sellers at that price.The gold price is adjusted up and down until demand and supply is matched at which point the price is declared "Fixed".The fixings are used to determine spot prices for the billions of dollars of the two precious metals traded each day.Buyers and sellers can get insight on price changes and the level of interest during the fixing process. They can cancel, increase or decrease their interest based on that information.Gold and silver price setting has long been the subject of debate, and the CFTC looked at complaints about the silver market in 2008.But most believe that the process is transparent."The fix is open, consequential, transparent and has stood the test of time. It's not open to manipulation in the same way as Libor," said Ross Norman, chief executive of bullion broker Sharps Pixley.

Japan's PM set to push trade pact

Japan's hard-charging prime minister on Friday said he wanted in on talks to forge a huge trade pact, the latest bold move from a man who says he is determined to lick the frail economy into shape.With caveats aimed squarely at reassuring the cosseted farming industry, Shinzo Abe said Japan could not afford to miss negotiations on thrashing out the Trans Pacific Partnership (TPP).The announcement came just hours after his pick for central bank chief was approved by parliament, boosting the likelihood of more of the aggressive monetary easing he has been calling for to counter chronic deflation."A huge economic bloc that would account for roughly a third of the world economy is about to begin," Abe told a news conference."What the TPP is aiming to achieve is to make the Pacific Ocean a sea where goods, services and investment are freely exchanged."Supporters of the TPP say participation would give Japan's flagging economy a boost the government estimates by as much as $33bn over a decade and increase consumer choice.They say opening up Japan's cosseted markets is vital if its stumbling economy is going to pick up speed, a key campaign promise from Abe.But opponents claim it could be a body blow to the country's ageing farmers, removing the sky-high tariffs that have sheltered them and sending many to the wall, changing the face of the countryside in the process.Japan's rural heartland is a crucial source of support for Abe's brand of conservative nationalism and any suggestion that farmers will lose their unparalleled protection could be politically costly for him.But, said the premier, the agricultural sector could not stand still. He said it was already facing challenges and participation in the TPP presented an opportunity."I am sure that Japan's delicious and safe farm products will become popular all over the world," he said."The TPP is not a crisis but, rather, a huge chance. I have heard many who worry that Japan's agriculture would be devastated if we join."I promise that I will protect Japan's farm industry and Japan's food industry by any means."The TPP forms a vital plank in US President Barack Obama's vaunted "pivot" to Asia, and is seen by some as part of a US bid to contain China's rising economic might.Washington has been keen to get Japan on board because of the economic heft its participation lends to the project and Acting US Trade Representative Demetrios Marantis said the US welcomed Abe's "important announcement".But the US Alliance for American Manufacturing, which is backed by the US auto industry and is nervous of allowing Japanese rivals unfettered access to the huge auto market, was critical of the idea of Japan joining the talks."Japan's closed market, currency manipulation, and many other concerns stand in the way. It's not worth sacrificing American jobs and American manufacturing to secure a TPP agreement at any cost," said AAM president Scott Paul.The TPP has been on the global agenda for years, but a succession of politically weak leaders have been unable to commit Japan to involvement.The fact that Abe appears ready to take the plunge is a sign, say observers, of the momentum he has gathered in the less than three months since he came to power in landslide elections.He hit the ground running on taking office on December 26 and his calls for more monetary easing, coupled with threats to change the law governing the independence of the Bank of Japan, succeeded in driving down the painfully strong yen.Helped by the slide in the currency, which helps the country's many exporters, the stock market is at more than four-year highsFriday's upper house approval for Abe's slate of central bank chiefs Haruhiko Kuroda was confirmed as governor, while Kikuo Iwata and Hiroshi Nakaso got the nod as his deputies - boosts his efforts to pull Japan out of more than a decade of deflation.The BoJ's new management team, which was approved by the lower house on Thursday, is set to take up their positions next week with the focus now squarely on their first policy meeting next month."High hopes are resting on the ability of the Bank of Japan's new leadership to revitalise the economy," London-based Capital Economics said in a note.Kuroda, 68, is thought likely to back the premier's prescription of big spending and aggressive monetary easing, vowing during confirmation hearings to do "everything possible" to reverse years of falling prices.

IMF urges EU to clean up banks

The International Monetary Fund said on Friday that the European economy and financial system remained weak and urged the region to quickly clean up its banks in order to advance toward a banking union.In a first-ever assessment of the stability of the European Union financial system, the IMF said banks in the region were still weak and needed more capital strengthening."Much has been achieved to address the recent financial crisis in Europe, but vulnerabilities remain, and intensified efforts are needed across a wide front," the IMF report said."Financial stability has not been assured," it said, pointing to continued falls in asset prices, distrust of sovereign debt and the overall weak economy, which remains in recession.The first priority, the IMF said, is to shore up banks by cleaning up their balance sheets, weighed down by large but still-unclear levels of bad assets, and put them through more stress tests.Secondly, the EU must complete the establishment of a region-wide financial oversight mechanism, necessary to strengthen the eurozone currency union and the single market for banking, and then a regional resolution mechanism for winding up failed financial institutions.All that needs to be done this year, the IMF emphasized, stressing that market and economic threats continued to hang over the European economy.With those jobs tackled, it said, the region can move toward a banking union with, ideally, a road map laid down by the middle of this year."The crisis has shown that national decisions, even well-intended ones, have union-wide repercussions on financial stability, and that there is a need for single frameworks for crisis management, deposit insurance, supervision and resolution, with a common backstop for the banking system."The IMF acknowledged some significant progress toward a single supervisory mechanism and a banking union.However, it said, as long as EU members failed to unite on an EU-wide approach to financial stability, the system remains "vulnerable to shocks, and generates incentives for national ring-fencing and fragmentation."

IMF calls for Palestine breather

The International Monetary Fund (IMF) on Thursday called for "urgent action" to help revive the Palestinian economy, saying it had been choked by Israeli restrictions and political uncertainty."Urgent actions are needed by the Palestinian Authority (PA), by the government of Israel, and by donors to stabilsze the fiscal position and rekindle economic growth over time," the IMF said in a statement.The fund said the situation in the West Bank and the Gaza Strip had deteriorated in recent months, pointing to rising unemployment which had claimed nearly a quarter of the labour market in late 2012."Israeli restrictions on movement and access are virtually unchanged and continue to hamper growth prospects," the IMF said, noting that gross domestic product had risen by only 6% last year compared to an average of around 11% in 2010 and 2011.Further slippage in GDP to around 5% was possible this year, the IMF said, citing "increasing political uncertainty" in the region."The military confrontation between Hamas and Israel last November, continued settlement expansion, and recent outbreaks of unrest in the West Bank underline the common view that prospects for peace remain dim," the IMF said.The fund's analysis also said the Palestinian Authority faced a "liquidity crisis" with public spending on an "unsustainable" trajectory."If left unchecked, these trends will ultimately lead some to question the legitimacy of the PA and undermine its ability to govern effectively," the IMF remarked.The fund called on the international community to increase financial support to the Palestinian Authority while urging "enhanced economic cooperation with Israel".The IMF analysis echoed a report by the World Bank on Tuesday ahead of a meeting of international donors on March 19, which warned of "lasting damage" to the Palestinian Authority's economy wreaked by Israeli restrictions and the worsening fiscal situation.

US slaps sanctions on covert Iran oil net

The United States on Thursday slapped financial sanctions on a Greek businessman for secretly operating a shipping network on behalf of the Iranian government to get around international sanctions on the country's sale of oil."Today, we are lifting the veil on an intricate Iranian scheme that was designed to evade international oil sanctions," US Treasury undersecretary for terrorism and financial intelligence David Cohen said in a statement. The move named Dimitris Cambis and a number of front companies for buying tankers on behalf of the National Iranian Tanker Company, barring US citizens from doing business with them and freezing any of their assets under US jurisdiction.Cambis was identified in Reuters report last month that said Iran was using old tankers to ship oil to China. He denied that he had been involved.But a senior US administration official dismissed Cambis' denial in a telephone conference call with reporters on Thursday, and said the clandestine operation had been deliberately structured to conceal Iranian involvement.As the sanctions have had increasing impact, so have the efforts to evade them, the official said.Sanctions were introduced last year by the West to choke Tehran's funding of its nuclear program by targeting the country's oil exports.The West believes Iran is developing weapons, a charge Tehran denies.Sanctions halved Iran's oil exports in 2012 by more than 1 million barrels per day, about the amount that oil production grew in the United States during that time, and Washington has been at pains to keep up the pressure."We will continue to expose deceptive Iranian practices, and to sanction those individuals and entities who participate in these schemes," Cohen said.The targeted network bought and operated eight tankers, each able to carry roughly $200m of oil per shipment."These operations are conducted through a series of ship-to-ship transfers in an attempt to mask the fact that the true origin of the oil is from Iran and to introduce it into the global market as if it were non-Iranian oil," Treasury said.US officials stressed that the sanctions were not aimed in any way at the Greek government, other Greek shippers, or the Greek shipping industry in general.

Still hope for fiscal deal: top official

Senior congressional Republicans said on Sunday they see a chance for a broad deal with President Barack Obama on deficit reduction and reining in spending on vast government programs like Medicare and one senator signaled potential flexibility on taxes.Obama, who met with lawmakers of both parties last week, has been calling for more tax increases on the wealthiest taxpayers, coupled with new spending cuts, to help curb budget deficits that have exceeded $1 trillion in each of the past four years.House of Representatives Speaker John Boehner, the top Republican in Congress, and Obama failed to come to terms at the end of last year on an agreement to get America's fiscal house in order.Such a deal could include spending cuts, tax reform and curbing spending on costly entitlement programs like the Social Security retirement program and the Medicare health insurance program for the elderly and disabled.Speaking on the "Fox News Sunday" program, Senator Bob Corker, a Tennessee Republican, said: "There, by the way, is a chance on a deal. I know the president is saying the right things. And we have an opportunity over the next four to five months."Asked on the ABC programme "This Week" if prospects for a "grand bargain" were dead, Boehner said, "I don't know whether we can come to a big agreement. If we do, it'll be between the two parties on Capitol Hill. Hopefully, we can go to conference on these budgets and hope springs eternal in my mind."Boehner said that while the United States does not have "an immediate debt crisis" one is looming because entitlement programs are not sustainable in their current form. "They're going to go bankrupt," he said.Asked how long the country had to solve these problems, Boehner said, "Nobody knows where this is. It could be a year or two years, three years, four years."Obama has engaged in a couple of weeks of outreach to lawmakers - some have called it a "charm offensive" but the prospects of a large deficit reduction deal by midyear remained unclear. Corker underscored the importance of reform in the huge entitlement programs like Medicare."I think Republicans, if they saw true entitlement reform, would be glad to look at tax reform that generates additional revenue. And that doesn't mean increasing rates. That means closing loopholes. It also means arranging our tax system so that we have economic growth."Boehner said he has "a very good relationship" with Obama, they are "trying to bridge some big differences" and that he "absolutely" trusts the president.But Boehner said that if Obama "believes that we have to have more taxes from the American people, we're not going to get very far.""If the president doesn't believe that the goal ought to be to balance the budget over the next 10 years ... (I'm) not sure we're going to get very far," he said. Obama met last Wednesday with House Republicans and made little headway in persuading them to accept his demand for tax hikes as part of any deficit-reduction deal. Republicans and Democrats in Congress last Tuesday offered up vastly different plans to slash long-term deficits. On Thursday, a Senate bill to avert a federal government shutdown stalled under the weight of more than 100 proposed amendments as senators sought to attach pet provisions. Senate Democratic leaders postponed further votes on the government spending legislation until Monday and said they would work over the weekend to try to whittle down the number of amendments. They had hoped to pass the measure on Thursday.Democrat Dick Durbin of Illinois, the No. 2 Senate Democrat, said senators must pass the budget resolution "and then we're going to move to the next stage and that is the grand bargain stage. That's what the president has tried to set up."The added provisions in the Senate budget measure threatened to make the bill unacceptable to the Republican-controlled House, which last week passed a much less complicated version of the extension to government funding through September 30. Government agencies and programs face a broad shutdown if Congress fails to pass an extension by March 27.