Aurelia Butler

WASHINGTON (Reuters) -Billions of dollars in foreign aid for Ukraine, Israel and Taiwan advanced in the U.S. Senate on Tuesday, heading for a final vote after the House of Representatives abruptly ended a months-long stalemate and approved the assistance last week.The Senate voted by an overwhelming 80 to 19 to advance the package of four bills passed by the House, far more than the 60 needed to pave the way for a vote on final passage as soon as Tuesday or Wednesday.One of the bills provides $61 billion for Ukraine, a second provides $26 billion for Israel and humanitarian aid for civilians in conflict zones around the world, and a third mandates $8.12 billion “to counter communist China” in the Indo-Pacific. A fourth includes a potential ban on the social media app TikTok, measures for the transfer of seized Russian assets to Ukraine and new sanctions on Iran.President Joe Biden has promised to sign the measure into law as soon as it reaches his desk, and his administration is already preparing a $1 billion military aid package for Ukraine, the first to be sourced from the bill, two U.S. officials told Reuters.After the procedural vote, the Senate’s Democratic and Republican leaders predicted that Congress had turned the corner in putting Russian President Vladimir Putin and other foreign adversaries on notice that Washington will continue supporting Ukraine and other foreign partners.”This is an inflection point in history. Western democracy perhaps faced its greatest threat since the end of the Cold War,” Senate Democratic Majority Leader Chuck Schumer said in the Senate.The aid package could be the last approved for Ukraine until after elections in November when the White House, House of Representatives and one-third of the Senate are up for grabs.Almost all the “no” votes – 17 of the 19 – came from Republicans, many of them close allies of former U.S. President Donald Trump, a Ukraine aid skeptic who has stressed “America First” policies as he seeks a second term in November.Senate Republican Leader Mitch McConnell said his party has tended to be isolationist when a Democrat is in the White House, but he noted that well over half the Republican conference had voted to advance the bill.When asked about complaints that his party’s objections meant it took six months for the aid to pass, McConnell told a news conference, “I would say better late than never.”Some of the Ukraine money – $10 billion in economic support – comes in the form of a loan, which Trump had suggested. But the bill lets the president forgive the loan starting in 2026.HUMANITARIAN CONCERNSThe influx of weapons should improve Kyiv’s chances of averting a major breakthrough in the east by Russian invaders, analysts said, although it would have been more helpful if the aid had come closer to when Biden requested it last year.It was not immediately clear how the money for Israel would affect the conflict in Gaza. Israel already receives billions of dollars in annual U.S. security assistance.Supporters of the new aid package hope the humanitarian assistance will help Palestinians in Gaza, which has been devastated by Israel’s campaign against Hamas to retaliate for Oct. 7 attacks that killed 1,200 people.Gaza health authorities say the campaign has led to the deaths of more than 34,000 civilians in the Palestinian enclave.It was the second time this year that the Senate passed security aid for Ukraine, Israel and the Indo-Pacific. The last bill, more than two months ago, garnered 70% support in the 100-member chamber from Republicans and Democrats. But the House’s Republican leaders, who are more closely aligned with Trump, would not allow a vote on the foreign aid until last week.The legislation’s progress has been closely watched by industry, with U.S. defense firms up for major contracts to supply equipment for Ukraine and other U.S. partners.Experts expect the supplemental spending to boost the order backlog of RTX Corp along with other major companies that receive government contracts, such as Lockheed Martin (NYSE:LMT), General Dynamics (NYSE:GD) and Northrop Grumman (NYSE:NOC). The House passed the Ukraine funding by 311-112, with all “no” votes coming from Republicans, many of whom were bitterly opposed to further assistance for Kyiv. Only 101 Republicans voted for it, forcing Speaker Mike Johnson to rely on Democratic support and prompting calls for his ouster as House leader.However, the House left Washington for a week-long recess, without triggering a vote to remove Johnson. More

The data underscores the Bank of Japan’s view that rising service prices will replace cost-push inflation as a key driver of price gains, and help sustain inflation around its 2% target.The year-on-year rise in the services producer price index, which measures what companies charge each other for services, followed a 2.2% gain in February.Service price moves are closely watched by the BOJ as a key indicator of whether wages and inflation are rising in tandem, which it set as one of the prerequisites for raising interest rates.The BOJ ended eight years of negative interest rates and other remnants of its unorthodox policy last month, making a historic shift away from decades of massive monetary stimulus that was aimed at reviving the economy and quashing deflation. More

(Reuters) – Fintech lender Affirm has started quietly offering “buy now, pay later” (BNPL) loans for elective medical procedures, in a major push beyond its core e-commerce market, the company told Reuters. Over the past year, Affirm has more than doubled the number of elective medical merchants on its network, reaching around 130 at of the end of 2023. The San Francisco-based company is hoping to tap growing consumer demand for financing for cosmetic treatments, dental services, medical devices and veterinary procedures. “A lot of these price points are about $2,000 and above, so that suits our installment product… really well,” Pat Suh, Affirm’s senior vice president of revenue, said in an interview.While Affirm has been adding elective medical providers since the middle of last year, it has not previously discussed or publicized its push into the sector, the first by a major BNPL provider in the U.S. market, the company said. Affirm’s installment product charges between 0% and 36%, depending on the purchase price and a borrower’s credit profile.”It’s a smart growth strategy,” said Ted Rossman, senior industry analyst at Bankrate, a consumer finance publisher. “They’re already doing a lot with e-commerce, and that’ll continue to grow, but it’s always about the next big thing.”In 2022, the global market for cosmetic procedures and dental services combined was worth more than half a trillion dollars, market research firm Grand View Research estimated.Global veterinary services were worth $124.37 billion in 2023, according to Precedence Research.Buy now, pay later exploded in popularity as the COVID-19 pandemic forced more shoppers online.The move into medical highlights how lenders in the space are trying to expand beyond what Affirm Chief Executive Max Levchin described to analysts in November as the “e-commerce cage.” It could also fuel concerns among regulators and advocacy groups that BNPL lending, which has grown rapidly, is leading consumers to borrow more than they can afford.As part of the expansion, Affirm has partnered with Weave, a customer relationship management platform for small and medium-sized healthcare businesses, as a distribution partner. BNPL providers partner with retailers like Amazon.com (NASDAQ:AMZN) and Walmart (NYSE:WMT) to finance customer purchases, earning a commission on the sale and interest on the loan, which shoppers repay in a handful of installments. BNPL loans drove $75 billion in online spending in 2023, up 14.3% from 2022, according to Adobe (NASDAQ:ADBE) Analytics. Despite that growth, some fintech lenders have been pressured by high interest rates and inflation, which have driven up their borrowing costs and customer delinquencies, though Affirm’s 30-day delinquencies are currently steady compared to the year prior. The company’s shares are down more than 30% from its initial public offering price in January 2021.While most BNPL purchases are for discretionary consumer goods like clothes and beauty, spending on services, travel, healthcare and even education has been growing since 2019, according to a 2022 U.S. Consumer Financial Protection Bureau (CFPB) report. Affirm is marketing elective medical procedure loans as an alternative to medical credit cards, like Synchrony Financial (NYSE:SYF)’s CareCredit, and installment loans. Those products typically waive interest payments for a promotional period after which annual interest is on average 27%, according to the CFPB. “Being able to shift consumers away from paying these types of high interest and deferred rates into a product like ours, we think there’s a lot of value to that,” Suh said. Affirm declined to disclose the average interest rate it charges customers for elective medical purchases, but said that nearly half of its transactions in the category are at 0% APR – a higher proportion compared to other categories. The company has been tightening credit standards and said in a Feb. 8 earnings report that 30-day delinquencies on monthly loans were flat from a year earlier at 2.4%. ‘FINANCIAL DISTRESS’Still, some consumer advocates worry the growth of BNPL may contribute to a consumer debt crisis. BNPL borrowers are more likely to have lower credit scores and lower savings on average, according to the CFPB. U.S. borrowers on lower incomes are increasingly struggling to keep up with their loan payments, Reuters reported on Monday. Because many BNPL lenders do not provide comprehensive data to credit reporting agencies, consumer advocates have warned that the firms have little insight into borrowers’ indebtedness.”One of our long standing concerns is a cumulative impact of multiple buy now, pay later loans on top of other expenses and debt obligations, which could really push the consumer over into over-indebtedness and financial distress,” said Delicia Hand, a senior director at Consumer Reports. Affirm mostly lends to near-prime and prime — credit scores between about 620 and 719 — borrowers. The company says it only lends what customers are able to repay, total charges are disclosed upfront, and there are no late or hidden fees. Affirm looks at every customer’s financial position, Suh said, “in order to offer them an appropriate amount of credit.” More

Median basic pay settlements in the first quarter of 2024 were 4.8% higher than a year earlier, the smallest rise since the third quarter of 2022 and down from 5.0% in the three months to February, human resources data provider Brightmine said.Brightmine is a new name for XpertHR, which has pay settlement data going back more than 30 years.The Bank of England is closely watching pay data. Before they cut interest rates, most BoE policymakers want to see signs that annual wage growth is heading back to the 3-4% range from the most recent rate of 6%.However settlements so far in April – usually the busiest month for pay deals – suggest annual growth had returned to 5%.”This cements our view that pay awards will centre on the 5% mark over at least the first half of 2024,” Brightmine senior content manager Sheila Attwood said.Employers surveyed by Brightmine last month expected the median pay award for 2024 to be 4%, while a BoE survey showed employers anticipate pay growth of 4.9% over the coming year.Separate figures from the British Chambers of Commerce, also released on Wednesday, showed 66% of businesses reported recruitment difficulties, the lowest percentage in three years.A tight labour market since the COVID-19 pandemic boosted wages, although they did not keep up with inflation.The BCC data was based on responses from a survey of 4,600 firms between Feb. 12 and March 12, while the first-quarter data from Brightmine was based on 142 pay settlements covering just under 400,000 employees. More

(Reuters) -The United States has preliminarily discussed sanctions on some Chinese banks but does not yet have a plan to implement such measures, a U.S. official told Reuters on Tuesday, as Washington seeks ways to curb Beijing’s support for Russia.The official, speaking on condition of anonymity, said there was no plan to roll out sanctions on China’s banks in the near-term, and said officials hope that diplomacy will avert the need for such action. Secretary of State Antony Blinken is due to visit China this week.The Wall Street Journal reported on Monday, citing people familiar with the matter, that the U.S. was drafting sanctions against some Chinese banks in the hopes of stopping Beijing’s commercial support of Russia’s military production.The White House and Treasury Department did not immediately respond to requests for comment.In recent weeks, U.S. officials have intensified pressure on China, warning that Washington was ready to take action against Chinese financial institutions facilitating trade in goods with dual civilian and military applications.Blinken on Friday criticized Chinese support for Russia’s defense industry, saying Beijing was the key contributor to Moscow’s war in Ukraine through its provision of critical components for weaponry.Cutting banks off from access to the dollar – used in much of global trade – is often reserved as a last resort, as such sanctions often force banks into failure. It would also represent a particular risk for China, amid a sputtering economic recovery and growing debt.The Wall Street Journal report did not describe which types of banks might be targeted, a key distinction for how large an impact any such measure would have on China’s economy or its ability to support Russia economically.The U.S. has sanctioned smaller Chinese banks in the past, such as the Bank of Kunlun, over various issues, including working with Iranian institutions. But Washington has so far been reluctant to implement sanctions on major Chinese banks – long deemed by analysts as a “nuclear” option – because of the huge ripple effects it could have on the global economy and U.S.-China relations. ‘GROUNDLESS ACCUSATIONS’A spokesperson for China’s foreign ministry said on Tuesday that China was “firmly opposed” to the U.S. making “groundless accusations” about normal trade exchanges with Russia. “We are firmly opposed to the hypocritical practice of the U.S. side itself pouring fuel but blaming the Chinese side,” Wang Wenbin said at a regular news briefing when questioned on the possible sanctions. “China’s right to conduct normal economic and trade exchanges with other countries, including Russia, is inviolable,” said Wang.The People’s Bank of China and the National Financial Regulatory Administration, China’s top banking regulator, did not immediately respond to Reuters’ requests for comments. China and Russia have fostered more trade in yuan instead of the dollar in the wake of the Ukraine war, potentially shielding their economies from possible U.S. sanctions. The United States and other Western nations imposed sweeping sanctions on Russia’s financial system after Moscow invaded Ukraine in February 2022.Several banks in China, the United Arab Emirates and Turkey have boosted their sanctions-compliance requirements, resulting in delays or the rejection of money transfers to Moscow, Reuters reported in March. The delays show how U.S. restrictions can have a strong knock-on effect.Banks, cautious of sanctions, have started to ask their clients to provide written guarantees that no person or entity from the U.S. SDN (Special Designated Nationals) list is involved in a deal or is a beneficiary of a payment. More

(Reuters) – A look at the day ahead in Asian markets.Investors continue to breathe life back into risky assets, paving the way for a positive market open in Asia on Wednesday as attention in the region turns to the latest interest rate decision and guidance from Indonesia.Trade figures from Thailand and New Zealand, service sector producer inflation data from Japan and consumer price inflation from Australia are the other main highlights from a packed calendar on Wednesday.Yen-buying intervention from Japanese authorities still hasn’t materialized, and with the Bank of Japan opening its two-day policy meeting on Thursday, it may be that Tokyo stays out of the currency market at least until next week.That is by no means certain, and the closer the dollar gets towards 155.00 yen, the more vigilant traders will be.China’s yuan, meanwhile, continues to weaken too. It slid to a new five-month low against the dollar in spot trading on Tuesday and the central bank set its official guidance rate at a seven-week low also.Indonesia’s central bank is expected to leave its seven-day repo rate on hold at 6.00%, with an outside chance of a quarter point hike, according to a Reuters poll. The bank’s first rate cut has been pushed out to the third quarter and the rupiah’s slide has also reduced the amount of easing expected this year.The general tone across Asian markets on Wednesday should be positive, at least initially, after the S&P 500 and MSCI World index on Tuesday put in their best performances in two months, Britain’s FTSE 100 hit a record high, and the MSCI Asia ex-Japan index registered its biggest rise in a month. Strong demand for a $69 billion sale of two-year U.S. Treasuries on Tuesday, lower bonds yields across the curve, and a weaker dollar all helped fuel the positive sentiment, a confluence of events that loosens financial conditions.  The U.S. earnings season delivered encouraging news as well, with Spotify (NYSE:SPOT) and General Motors (NYSE:GM) among those reporting strong results. Tesla (NASDAQ:TSLA)’s revenue fell and earnings fell short of forecasts, but shares jumped in after hours trade after the firm said it had pulled forward the launch of new models.Could it be that the recent equity market wobble that saw major indices pull back 5% and some of the world’s biggest single stocks like Nvidia (NASDAQ:NVDA) tumble 10%, is now over? Perhaps, although there are good reasons to be cautious.Meanwhile, Sino-U.S. tensions may be bubbling up again ahead of U.S. Secretary of State Antony Blinken’s visit to China later this week. According to a U.S. official, the U.S. has preliminarily discussed sanctions on some Chinese banks as a way to curb Beijing’s support for Russia.Here are key developments that could provide more direction to markets on Wednesday:- Indonesia interest rate decision- Australia consumer inflation (March, Q1)- Japan services producer price inflation (March) (Reporting and Writing by Jamie McGeever; Editing by Bill Berkrot) More