Demonstrators called for the revocation of controversial extradition proposals, the release of student demonstrators and the resignation of Chief Executive Carrie Lam
North Korea has sentenced an American student to 15 years’ hard labour for trying to steal a propaganda banner from his hotel. Otto Warmbier was convicted on charges of subversion, in a move which has showcased the secretive and unforgiving North Korean regime and futher deteriorated relations with Washington.
(Reuters) – A senior U.S. Treasury official said on Friday that China has been intervening to keep its yuan currency from falling more than it otherwise would and that the sooner Beijing lets the market work, the better for China.
The official, who spoke to a group of reporters but asked not to be named, urged Beijing to allow the currency to rise and fall freely.
The comments preceded a state visit to Washington by Chinese President Xi Jinping on Sept. 25, in which Xi and President Barack Obama will discuss economic ties between the two countries as well as their increasingly testy relationship over security matters.
Washington has long urged Beijing to let the yuan appreciate, arguing that China was using a weak currency to make its goods cheaper in America.
But China these days is facing doubts in financial markets over the strength of its economy. The Treasury official said China’s decision to loosen restrictions on currency trading last month, which prompted a sharp fall in the yuan’s value, appeared to be perceived in markets as having the intention to prop up China’s economy, sowing further doubts among investors.
The official said China should not feel like it needs to step in and stop declines in financial markets every time investors send it signals about the economy.
He said China’s commitment to letting market forces play a bigger role in the value of the yuanwill earn more credibility when it allows market forces to push its value up. (Reporting byJason Lange; Editing by James Dalgleish, Andrew Hay and Leslie Adler)
- The building was part residential and part commercial
- A tenant was keeping licensed explosives there
- The exact cause of the blast is under investigation
New Delhi (CNN)At least 89 people were killed and scores injured when a building that housed mining explosives blew up in central India on Saturday, a state office reported.
Some of the injured are in critical condition, according to the chief minister’s office in the state of Madhya Pradesh.
The building in Madhya Pradesh’s Jhabua district was part commercial and part residential, police superintendent G.G. Pandey said.
A tenant was storing licensed mining explosives, police said. A fire may have triggered the blast, but an inquiry has been ordered to determine the exact cause, Pandey said.
Some of the dead included customers at an adjacent restaurant. The impact of the blast was also felt across the road, where a few other houses also suffered damage, police said.
About 100 people were injured, said Arun Sharma, Jhabua’s chief medical officer.
There were no immediate reports of damage or injuries.
The magnitude-5.2 earthquake was 35 miles deep and was centered in Tokyo Bay, near Haneda Airport, the Japan Meteorological Agency said. It struck at 5:49 a.m.
Subway and train service was briefly interrupted for safety checks.
The agency warned that the quake could cause landslides following recent heavy rains
New York (CNN Money) — It’s no secret that China is the largest holder of U.S. debt.
So should Americans be concerned that China has started dumping some of its Treasury holdings?
After all, it raises serious questions about whether China will keep lending Washington money to help finance the federal deficit in the future.
But right now, China is selling because it’s in dire need of cash. Recently, it unleashed multiple moves to support its markets and prevent its currency from a freefall, while at the same time trying to stimulate the economy.
China yanks record sum from war chest
China owned $1.3 trillion of U.S. Treasuries as of June, making it the biggest holder of U.S. debt.
But China’s foreign-exchange reserves plunged by a record $94 billion in August, according to the country’s central bank, leaving it with a war chest of $3.6 trillion. Analysts say it’s very safe to believe a big chunk of that decline occurred due to a reduction in U.S. Treasury holdings.
The selling and the potential that China will not be buying U.S. debt in the near future raises questions on its potential to increase America’s borrowing costs.
Some of this might already be happening, at least at a small scale. When stock markets are turbulent, investors usually rush to the safety of U.S. Treasurys and yields fall. However, despite August’s extreme stock volatility, rates on Treasurys actually rose slightly in late August.
Part of that move is likely due to Wall Street betting the Federal Reserve may raise interest rates next week. But market participants also suspect the unusual action in the bond market was driven by China dumping Treasuries.
China is raising lots of cash
This time, Beijing is cutting its Treasury holdings out of a weakened position as it tries to stave off more declines in its currency. China is also propping up its stock market, which lost half its value in the span of just a few months this summer.
“Capital outflows have skyrocketed in China and the yuan is under intense selling pressure. The only thing they could do is sell Treasuries to buy their own currency,” said Walter Zimmerman, chief technical analyst at United-ICAP.
China isn’t trying to sink the U.S. economy
There have long been concerns that China could sink the American economy by unloading its gigantic holdings of Treasuries, sending borrowing costs skyrocketing.
Thankfully, those doomsday fears don’t appear to be at play here yet.
“If China’s U.S. Treasury stock is a nuclear bomb, moderate sales to offset selling pressure on the yuan are unlikely to set off an explosion,” Michael McDonough, chief economist at Bloomberg Intelligence, wrote in a recent report.
But moves could raise borrowing costs here
Still, China’s sales could make Treasury yields higher than they would normally be. That’s of concern because Treasury rates are used as a benchmark that set the cost of borrowing for items like credit cards and mortgages.
While it’s “not the end of the world,” SkyBridge Capital senior portfolio manager Troy Gayeski said higher yields could lead to a “slowdown in the housing recovery.”
What’s key is how much cash China ultimately needs to raise to defend its currency and stock market. No one, not even China, knows that figure.
China may go on a U.S. debt diet
So far, the American bond market seems to be taking the China move in stride.
The yield on the 10-year Treasury note is currently sitting at 2.22%, about unchanged from a month ago.
Demand for U.S. debt is healthy now especially when compared to the ultra-low, or even negative rates in other economic powerhouses like Germany and Japan.
Policymakers in Washington should hope that trend continues. Now that China’s economy is in disarray, America might not be able to count on its No. 1 lender to gobble up U.S. debt like in the past.
“China’s surplus is slowing. That gives them less firepower to accumulate Treasuries,” said Thomas Urano, managing director at Sage Advisory.
If you export to China, the latest headlines are not good news.
After a decade of rapid growth, China’s appetite for goods and raw materials from the rest of the world appears to be slowing. And that’s left companies and countries that sell to China wondering just how badly their orders may shrink.
On Tuesday, Beijing reported that China’s giant manufacturing sector contracted at the fastest pace in three years. A separate private survey of smaller firms showed the factories slowing to the weakest pace in more than six years.
The slowdown is hitting China’s biggest suppliers and major trade partners hardest. In August, exports from South Korea tumbled by nearly 15 percent—the most in six years.
For U.S. exporters, China represents the third-largest market—behind Canada and Mexico—accounting for $120 billion worth of goods last year. But that trade represents only 7 percent of U.S. exports—or less than 1 percent of total gross domestic product, according to economists at Wells Fargo Securities.
“Even when indirect effects are considered, the United States simply does not seem to have significant economic and financial exposure to China,” they wrote in a recent note to clients.
But that impact varies widely from one U.S. state to another, with West Coast states more heavily reliant on Chinese markets.
Among the most dependent states: Washington, which sold roughly 20 percent of its exports to China last year, or nearly $10 billion worth of goods. Airplanes, the state’s largest export by far, made up the bulk of the state’s sales to China.
California exported some $16 billion to mainland China last year, with computers and electronics accounting for nearly 28 percent of the total. Texas was the third-largest exporter to China, with nearly $11 billion worth of products that included chemicals, computers and machinery.
Alaska, which exports a smaller volume of goods, last year sent a bigger share—some 28 percent—to China. Roughly half of Alaska’s $1.5 billion in exports to China last year consisted of seafood.
U.S. farm states are also big exporters to China, which is the biggest for American agricultural products. Some 20 percent of all U.S. farm exports are sold to China, which bought $30 billion worth of foods products in fiscal year 2014, including soybeans, distillers’ grains, hides and skins, tree nuts, coarse grains, cotton and beef, according to the U.S. Department of Agriculture.
While the total impact of Chinese exports is a relatively small share of U.S. GDP, sales have grown faster than any other trading partner on the last decade—nearly tripling between 2005 and 2014. U.S. exports Canada rose 47 percent growth and exports to Mexico roughly doubled.
By Jonathan Saul
(Reuters) – An Iranian supertanker with two million barrels of oil is heading to Asia after sitting in Iranian waters for months, the first vessel storing crude offshore to sail after a nuclear deal this week, data showed on Thursday.Iran and six major world powers reached a landmark nuclear deal on Tuesday, clearing the way for an easing of international sanctions on Tehran and higher oil exports.While oil analysts do not expect Iran to make a major return to the market until next year, it has been parking millions of barrels of oil on tankers for months.The fully laden Starla, operated by Iran’s top tanker group NITC, had been used for floating storage since Dec. 12, 2014, a tanker tracking source said.”This is the first tanker to come off floating storage,” the source said. “One of the scenarios is it could do an STS operation, although nothing is known at the moment,” the source said, referring to ship-to-ship transfers of oil between two vessels, usually at sea.Reuters Eikon data showed the vessel was sailing from the Middle East Gulf with a Singapore destination.Iran’s Oil Minister Bijan Zanganeh said last month the country was aiming to add 500,000 barrels per day (bpd) to production within two months of Western sanctions being eased, and as much as 1 million bpd in six to seven months.The sanctions have halved Iran’s shipments to as little as 1 million bpd. Years of under investment mean Iran may struggle to get its oil industry anywhere near full potential, analysts say. It will also take time to raise output while nuclear inspectors verify Iran’s compliance with the terms of the deal, and sanctions are slowly removed.Last month, tanker tracking sources said Iran was storing as much as 40 million barrels of oil, mostly crude, on board tankers at its anchorages, which could flood the oil market.Windward, a Tel Aviv operated maritime data and analytics company, estimated this week that Iran was storing 51.4 million barrels of crude and condensate on 28 vessels at sea.Condensate is a type of very light oil and can be used as a diluent for extra heavy crude and as a feedstock for petrochemical plants and refineries. (editing by David Clarke)