Latest news with #JanStrupczewski
Yahoo
7 days ago
- Business
- Yahoo
EU gains leverage in trade talks as US court casts doubt on tariffs, EU officials say
By Jan Strupczewski BRUSSELS (Reuters) - The European Union has gained leverage in trade talks with the United States after a U.S. court cast doubt on the legality of Washington's "reciprocal" tariffs, EU officials said on Friday. The European Commission said trade talks between Brussels and Washington would continue, with Europe sticking to its offer of mutual zero tariffs on industrial goods. "There's no change in our approach, we proceed as planned with both technical and political meetings next week," a Commission spokesperson said. A U.S. federal appeals court temporarily reinstated President Donald Trump's tariffs on Thursday, a day after a U.S. trade court ruled that Trump had exceeded his authority in imposing the duties and ordered an immediate block on them. "The uncertainty as to the legality of the 'reciprocal' tariffs certainly gives us extra leverage," one EU official close to the talks said. "The talks will continue, as formally we still look for zero-for-zero tariffs," the official said. The EU was also willing to discuss some non-trade barriers with the U.S., officials said, but would not touch the EU's taxation system -- such as the value added tax or digital tax -- or food safety standards. The Commission, which conducts all trade negotiations on behalf of the 27-nation bloc, would not comment on the rulings because they were internal U.S. procedures. EU Trade Commissioner Maros Sefcovic in a post on the X social media platform said he held a phone call with U.S. Commerce Secretary Howard Lutnick on Friday. "Our time and effort fully invested, as delivering forward-looking solutions remains a top EU priority. Staying in permanent contact," Sefcovic said on X. More trade talks between the U.S. and the EU are scheduled for next week, on the sidelines of the OECD Ministerial Council Meeting in Paris on June 3-4. EU officials said the U.S. courts' rulings validated the EU view that the sweeping "reciprocal" tariffs, imposed on all goods from the EU and many other countries around the world on April 2, were unjustified. The officials also said that while U.S. courts did not question Washington's 25% tariffs imposed on European steel, aluminium and cars, the rulings could also play a role in the EU's efforts to get those tariffs lowered or removed. They also said the uncertainty created by the court rulings and the Trump administration's tariff policy also had a positive aspect for Europe, which was seen by markets as an oasis of stability in comparison. "This is the watchword: uncertainty. It is impossible to know what the status of the tariffs will be next week, not to mention next month!" the EU official said. "If you want sane, stable, even boring, rules-based order and predictable business environment, Europe is the place for you!" the official said. (Additional reporting by Julia Payne; Reporting by Jan Strupczewski. Editing by Jane Merriman) Sign in to access your portfolio
Yahoo
22-05-2025
- Business
- Yahoo
Exclusive-EU to delay bank rules as it waits for Trump's deregulation moves, sources say
By Francesco Canepa, Jan Strupczewski and Giuseppe Fonte FRANKFURT(Reuters) -The European Union is set to delay new, global rules governing banks' trading again as it waits for more clarity about the U.S. administration's plans to deregulate its financial sector, sources told Reuters. The Fundamental Review of the Trading Book (FRTB) is a key part the Basel III package devised in the wake of the global financial crisis but not yet implemented by Britain or the United States, two of the world's key financial centres. Its adoption in the EU was already pushed back by a year to 2026 last year, when it became clear that the United States would not be able to adopt the rules by its original deadline. The latest, one-year postponement to January 1, 2027 reflects pressure from European banks fearing they will find themselves at a disadvantage to their U.S. and UK rivals, five senior officials at European and national institutions said. A senior EU source said European Commissioner Maria Luís Albuquerque informed the bloc's finance ministers about the delay at a meeting on May 13. The European Commission had said it would make a decision on whether or not to postpone the FRTB by the end of June after consulting with the industry and its supervisors. The FRTB governs capital and reporting requirements relating to banks' trading assets, crucially including how risk should be measured using a standard method or banks' own calculations. The United States has stalled the introduction of the entire Basel III package and U.S. President Donald Trump's administration signalled it might even relax some of the existing rules, in what would mark a U-turn from the push for more controls that followed the 2007-2009 financial crisis. European banks have urged the EU to refrain from imposing new burdens that their competitors overseas do not face. "It now looks as if this set of rules will not exist in the U.S. and we know that Brussels is looking at this carefully," Commerzbank's chief executive Bettina Orlopp said at a conference on Monday. "We have to be careful that we maintain the international competitiveness of European banks." The European Central Bank, the EU's top banking watchdog and for a long time a staunch defender of a timely implementation of Basel III, proposed a compromise earlier this month. It envisaged a one-year delay to rules applied to banks' internal risk models, while those concerning the one-size-fits-all, "standardised approach" would be phased in over three years starting in 2026. Some governments have also weighed in, with French President Emmanuel Macron calling for a "synchronisation" on financial rules between the EU, the United States and Britain. Britain earlier this year pushed back its Basel III implementation to 2027 while Washington has yet to unveil a timeline. In contrast, the EU has already implemented most of the Basel III package, which took effect this year. China, Japan and Canada have done so long ago. In March, the European Commission launched a consultation, asking banks and supervisors if they thought the FRTB should go live next year, be delayed by 12 months or tweaked to align it more with draft U.S. and UK rules. The European Banking Federation, an industry body, said member banks that were exposed to U.S. and British competition favoured a one-year delay. The International Swaps and Derivatives Association, a global lobby, said "a clear majority" of its own members also favoured a delay, although a minority preferred that the FRTB took effect next year to avoid running both new and old rules at once. (Additional reporting by Tom Sims in Frankfurt, Leigh Thomas in Paris and Valentina Za in MilanEditing by Tomasz Janowski) Sign in to access your portfolio
Yahoo
22-05-2025
- Business
- Yahoo
Exclusive-EU to delay bank rules as it waits for Trump's deregulation moves, sources say
By Francesco Canepa, Jan Strupczewski and Giuseppe Fonte FRANKFURT(Reuters) -The European Union is set to delay new, global rules governing banks' trading again as it waits for more clarity about the U.S. administration's plans to deregulate its financial sector, sources told Reuters. The Fundamental Review of the Trading Book (FRTB) is a key part the Basel III package devised in the wake of the global financial crisis but not yet implemented by Britain or the United States, two of the world's key financial centres. Its adoption in the EU was already pushed back by a year to 2026 last year, when it became clear that the United States would not be able to adopt the rules by its original deadline. The latest, one-year postponement to January 1, 2027 reflects pressure from European banks fearing they will find themselves at a disadvantage to their U.S. and UK rivals, five senior officials at European and national institutions said. A senior EU source said European Commissioner Maria Luís Albuquerque informed the bloc's finance ministers about the delay at a meeting on May 13. The European Commission had said it would make a decision on whether or not to postpone the FRTB by the end of June after consulting with the industry and its supervisors. The FRTB governs capital and reporting requirements relating to banks' trading assets, crucially including how risk should be measured using a standard method or banks' own calculations. The United States has stalled the introduction of the entire Basel III package and U.S. President Donald Trump's administration signalled it might even relax some of the existing rules, in what would mark a U-turn from the push for more controls that followed the 2007-2009 financial crisis. European banks have urged the EU to refrain from imposing new burdens that their competitors overseas do not face. "It now looks as if this set of rules will not exist in the U.S. and we know that Brussels is looking at this carefully," Commerzbank's chief executive Bettina Orlopp said at a conference on Monday. "We have to be careful that we maintain the international competitiveness of European banks." The European Central Bank, the EU's top banking watchdog and for a long time a staunch defender of a timely implementation of Basel III, proposed a compromise earlier this month. It envisaged a one-year delay to rules applied to banks' internal risk models, while those concerning the one-size-fits-all, "standardised approach" would be phased in over three years starting in 2026. Some governments have also weighed in, with French President Emmanuel Macron calling for a "synchronisation" on financial rules between the EU, the United States and Britain. Britain earlier this year pushed back its Basel III implementation to 2027 while Washington has yet to unveil a timeline. In contrast, the EU has already implemented most of the Basel III package, which took effect this year. China, Japan and Canada have done so long ago. In March, the European Commission launched a consultation, asking banks and supervisors if they thought the FRTB should go live next year, be delayed by 12 months or tweaked to align it more with draft U.S. and UK rules. The European Banking Federation, an industry body, said member banks that were exposed to U.S. and British competition favoured a one-year delay. The International Swaps and Derivatives Association, a global lobby, said "a clear majority" of its own members also favoured a delay, although a minority preferred that the FRTB took effect next year to avoid running both new and old rules at once. (Additional reporting by Tom Sims in Frankfurt, Leigh Thomas in Paris and Valentina Za in MilanEditing by Tomasz Janowski) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Star
19-05-2025
- Business
- The Star
EU countries agree on big defence fund, diplomat says
BRUSSELS (Reuters) -EU countries have in principle agreed on the proposals for a 150 billion euro ($168.3 billion) fund aimed at boosting Europe's defence, known as Security Action for Europe (SAFE), an EU diplomat said on Monday. The plan, proposed by the European Commission in March, will be financed through joint borrowing and give loans to EU members and certain other countries such as Ukraine for projects that bolster their defences and boost Europe's arms industry. ($1 = 0.8913 euros) (Reporting by Jan Strupczewski and Bart Meijer;Editing by Sudip Kar-Gupta)
Yahoo
15-05-2025
- Business
- Yahoo
Russian economy in worse shape than Moscow says, report for EU shows
By Jan Strupczewski BRUSSELS (Reuters) -The Russian economy is in an increasingly precarious state as a result of a shift to a war mode and of Western sanctions over Moscow's invasion of Ukraine, a report by the Stockholm Institute of Transition Economics (SITE) said on Tuesday. The report, prepared for talks of European Union finance ministers, said that while still relatively stable, the Russian economy was only superficially resilient and that underlying imbalances and structural weaknesses were growing. "The fiscal stimulus of the war economy has kept the economy afloat in the short term, but the reliance on opaque financing, distortionary resource allocation, and shrinking fiscal buffers makes it unsustainable in the long term. Contrary to Kremlin narratives, time is not on Russia's side," it said. The EU has imposed 16 packages of sanctions on Russia since the start of the war in Ukraine in February 2022, targeting Moscow's main sources of revenue - oil, gas and coal exports. Other Western powers, including the United States, Canada, Britain and Japan also imposed sanctions. Keen to show Western sanctions are pointless, Russia says its gross domestic product grew 4.3% in 2024 after 3.6% expansion in 2023. But Torbjorn Becker, who presented the SITE report to EU finance ministers, said Russian GDP numbers could not be trusted because Moscow was most likely strongly understating inflation which affected real GDP calculations. "Russia claims inflation is 9-10%. Why would they then have a policy rate of 21% at the central bank? Which regular central bank would have a policy rate that's basically 11.50 percentage points higher than the inflation rate? If any of our central banks were doing something like that, they would be out of their job the next day," Becker told reporters. "That's a very clear indication that inflation may not actually be the right number. If you understate inflation, you will then overstate real GDP numbers," he said. LIKELY HIGHER BUDGET DEFICIT He also pointed to Russia's budget constraints caused by falling revenues from oil, gas and coal and rising military spending. Since the start of its invasion of Ukraine and despite its massive war effort, Russia has been reporting a budget deficit of 2% of GDP every year. "Fiscal numbers in Russia don't really correspond to what we think that they are putting into the war effort," Becker said. He said much of the financing of the war machine was going through the banking system. "So if you add that to the fiscal numbers, their fiscal deficits would be ballpark twice as high as what they have shown in the official statistics," he said. This, in turn, was building up financial risks in the banking system, Becker said, because banks were reporting high credit growth. "These are all indicators that we usually look at when we want to predict the banking crisis," Becker said. European Economic Commissioner Valdis Dombrovskis said the European Commission agreed with the SITE report. "Their analysis highlights the unreliability of Russian statistics, and how the Russian economy is not performing as well as its official statistics suggest," Dombrovskis told reporters after the EU ministers' meeting. "The Commission broadly agrees with this analysis and the overall increasing fragility of the Russian economy. This underlines the importance of the international community's ongoing efforts to limit the Kremlin's capacity to continue its war of aggression against Ukraine," he said. Sign in to access your portfolio
