Aurelia Butler

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COPENHAGEN (Reuters) – Greenland’s leader was expected to hold talks on Wednesday with the Danish king in Copenhagen, after U.S. President-elect Donald Trump said he wanted to take control of the vast Arctic island, an autonomous territory of Denmark.Trump, who takes office on Jan. 20, said on Tuesday he would not rule out using military or economic action to make Greenland part of the United States. The same day, Trump’s eldest son, Donald Trump Jr., made a private visit to Greenland.Trump’s comments prompted France’s foreign minister, Jean-Noel Barrot, to say on Wednesday that the European Union would not let other nations attack its sovereign borders. Barrot added he did not believe the U.S. would invade Greenland, which has been part of Denmark for over 600 years.A German government spokesman said Germany stands by the international principle that borders not be changed by force.NATO did not respond on Wednesday to a request for comments on Trump’s remarks. Denmark is a member of the U.S.-led military alliance and also of the EU. Greenland, which has just 57,000 people but is more than 2 million square km in size, is not part of the EU but it is of NATO through its links with Denmark.Greenland’s Prime Minister Mute Egede, leader of a left-wing political party that supports future independence from Denmark, was due to meet King Frederik in Copenhagen later on Wednesday. The royal court gave no details on their planned meeting.While many Greenlanders dream of independence from their former colonial ruler, the king still enjoys a large measure of popularity, having spent extended periods of time in Greenland, including a four-month expedition on the ice sheet. “I’m sure the king is really the person best placed in Denmark to deal with this issue right now because he has a long history with Greenland,” Damien Degeorges, a Reykjavik-based consultant specialising in Greenland, told Reuters.”He’s popular in Greenland. So he can clearly be helpful to the Danish-Greenlandic relationship.”The royal court recently tweaked the coat of arms to more prominently display symbols of Greenland and the Faroe Islands, a move widely interpreted as underlining the royal family’s relationship with Greenland. SEMI-SOVEREIGNGreenland now controls most of its own domestic affairs as a semi-sovereign territory under the Danish realm. Its relations with Denmark have lately been strained by allegations of colonial-era mistreatment of Greenlanders.Danish Prime Minister Mette Frederiksen said on Tuesday she could not imagine Trump’s ambitions would lead to U.S. military intervention in Greenland.Denmark is responsible for the security and defence of Greenland, but its military capabilities there are limited to four inspection vessels, a Challenger surveillance plane, and dog sled patrols. Responding to Trump’s threat of tariffs against Denmark, Frederiksen said she did not think a trade war with the United States was a good way forward. Denmark is home to Novo Nordisk (NYSE:NVO), Europe’s most valuable company, which makes weight-loss drug Wegovy that has become hugely popular in the United States.Still, Trump’s openly stated ambition to expand U.S. control of territory has jolted allies less than two weeks before he takes power.Greenland’s Egede has said the island is not for sale, while in his New Year speech he stepped up his push for independence. Denmark also says the territory is not for sale, and that its fate can be decided only by Greenlanders. Trump already raised the issue of the U.S. taking over Greenland in 2019 during his first presidency, but his latest remarks still left many Danes baffled.”I find it extremely ridiculous,” said Jeppe Finne Sorenson, a data engineer in the Danish capital. “We have an alliance, we’re allies. So this doesn’t really respect that.” More

WASHINGTON (Reuters) – Inflation should continue falling in 2025 and allow the U.S. Federal Reserve to further reduce interest rates, though at an uncertain pace, Federal Reserve governor Christopher Waller said on Wednesday.Waller said that while it was true inflation “appears to have stalled” above the Fed’s 2% target in the waning months of 2024, market-based inflation estimates, as well as one month and shorter-term inflation readings, have left him confident that inflation is continuing to ease in the U.S. even if the pace of improvement is less certain.”This minimal further progress has led to calls to slow or stop reducing the policy rate,” Waller said in remarks to an Organization for Economic Cooperation and Development event in Paris. “However, I believe that inflation will continue to make progress toward our 2% goal over the medium term and that further reductions will be appropriate.””The pace of those cuts,” he said, “will depend on how much progress we make on inflation, while keeping the labor market from weakening.”The Fed reduced its policy rate of interest a full percentage point in the final three meetings of 2024, but is expected to leave the rate steady in the current 4.25% to 4.5% range at the upcoming Jan. 28-29 policy meeting.Waller did not say how many rate cuts he thought would be appropriate this year, but noted that among Fed officials “the range of views is quite large, from no cuts to as many as five cuts” that would reduce the Fed’s policy rate by another 1.25 percentage points.Along with slower progress on inflation, Fed officials have been reluctant to commit to further rate cuts because the economy itself is performing well, with growth above estimates of long-run potential and continued hiring and wage growth that, in turn, has supported consumer spending.”I continue to believe that the U.S. economy is on a solid footing,” Waller said, with “nothing in the data or forecasts that suggests the labor market will dramatically weaken over coming months.”The Fed gets new jobs data on Friday for the month of December.Fed policymakers are also trying to sort how the policies of the incoming Trump administration may change the course of the economy, with the possible impact of tariffs one front-of-mind concern.Waller said that while increased tariffs “raise the possibility that a new source of upward pressure on inflation could emerge in the coming year,” he said it would probably not cause a persistent increase in prices pressures and thus “are unlikely to affect my view of appropriate monetary policy.” More

The survey’s findings align with previous indicators, including the Purchasing Managers Index (PMI), which also signaled no significant change in the final quarter of the year.The survey’s Economic Sentiment Indicator (ESI) fell from a revised 95.6 in November to 93.7 in December, a drop that was steeper than both consensus and our own forecasts, which predicted 95.6 and 95.3 respectively. This decline is in line with the stagnation of the GDP in the fourth quarter.The survey also indicates a loosening labor market, with the employment expectations index dropping from 98.9 to 97.3. This decrease is consistent with the further weakening of employment growth from 0.2% quarter-on-quarter in the third quarter to just above zero.Inflationary pressures remain persistent according to the survey data. Selling price expectations for firms in the industrial and construction sectors have risen slightly. The services selling price expectations index also increased, reaching a 10-month high and remaining above pre-Covid norms. Despite the economic activity’s weakness, these findings from the survey may increase concerns among ECB policymakers about the strength of domestic price pressures.This article was generated with the support of AI and reviewed by an editor. For more information see our T&C. More

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WASHINGTON (Reuters) – Federal Reserve officials have been signaling that further interest rate cuts are on hold for now given slowed progress on inflation and a still-strong U.S. economy, but minutes from the central bank’s December meeting may show just how deeply that sentiment is shared among policymakers facing a newly uncertain economic environment under the incoming Trump administration.After cutting rates by a quarter of a percentage point at the Dec. 17-18 meeting, Fed Chair Jerome Powell said policymakers could now be “cautious” about further reductions, and noted that some officials had begun approaching upcoming decisions as if they were “driving on a foggy night or walking into a dark room full of furniture” because of uncertainty around the impact of President-elect Donald Trump’s tariff, tax and other proposals. The minutes, to be released at 2 p.m. EST (1900 GMT) on Wednesday, may help clarify how policymakers will approach further rate reductions. Projections issued after the December meeting showed officials anticipating just a half percentage point worth of rate cuts this year, compared to a full percentage point as of September.The minutes “are likely to fully reflect this relatively hawkish viewpoint,” analysts from Citi wrote. “This would include discussion of concerns that inflation could remain persistently elevated if policy rates do not remain suitably restrictive,” and perhaps discussion as well that the rate of interest needed to fully return inflation to the Fed’s 2% target has moved higher.”That would be part of the rationale for the committee now planning to slow the pace of rate cuts,” the Citi team wrote.The Fed reduced the policy rate by a full percentage point over its last three meetings of 2024, with the benchmark rate now set in a range of 4.25% to 4.5%.Economic data since then has remained steady across several important fronts, with growth still seen at well above 2%, the unemployment rate staying in the low 4% range, and the Fed’s preferred measure of inflation, known as the personal consumption expenditures price index, most recently measured at 2.4%.Fed officials who have spoken publicly since the last meeting have said there is no reason to rush further cuts until it is clear something has changed in the data – a clear drop in hiring and rise in unemployment, for example, or a renewed decline in inflation toward the 2% target.Richmond Fed President Thomas Barkin, for example, said last week that he felt the Fed should keep credit conditions tight until there was “real confidence that inflation has stably gotten down to the 2% target … The second would be a significant weakening on the demand side of the economy.”New jobs data on Friday will show how employment and wages changed in December. A separate labor market survey for November, released on Tuesday, painted an overall picture of stability – or at least only slow change. There was a small uptick in job openings, considered a sign of continued economic strength, but a small drop in hiring and in the number of workers who voluntarily quit, considered signs of a weaker hiring environment.The meeting minutes may also show Fed officials discussing in more detail when to halt their current effort to reduce the size of the central bank balance sheet. Having shaved about $2 trillion off their bond holdings since the summer of 2022, officials are widely expected to end the effort at some point in 2025.Some Fed watchers expect the minutes to provide new information about the end of so-called quantitative tightening. More

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