Aurelia Butler

ROME (Reuters) -Italy’s government said on Friday it had taken steps to limit the influence of China’s Sinochem on tyremaker Pirelli, including a mandatory qualified majority for strategic decisions made by the company’s board.Rome’s decision comes after Sinochem, Pirelli’s largest shareholder with a 37% stake, notified the Italian government in March of plans to update an existing shareholder pact with Camfin, the vehicle of Pirelli CEO Marco Tronchetti Provera.Prime Minister Giorgia Meloni’s administration scrutinised the pact under “Golden Power” rules aimed at protecting assets deemed strategic for the country, at a time when relations between China and Western countries have entered a tenser phase.Sinochem was not immediately available for comment, while Pirelli declined to comment.Sources had previously told Reuters that the government was concerned about Sinochem’s growing influence on Pirelli, as the proposed pact would have allowed the Chinese group to appoint more board members and potentially choose Pirelli’s future CEOs.On Friday, Rome said it had imposed prescriptions aimed at shielding “the autonomy of Pirelli”, including a requirement that “some” strategic decisions by its board of directors should require approval by at least 80% of directors.The government, saying it had accepted some proposals made by Sinochem to address its concerns, also mentioned specific measures to protect cyber sensor technology that can be incorporated into Pirelli tyres.”The relevance of such a technology can be identified in a variety of sectors: industrial automation, machine-to-machine communication, machine learning, advanced manufacturing, artificial intelligence, critical sensor and actuator technologies, Big Data and Analytics,” the government said.Founded in 1872, Pirelli is one of Italy’s most storied companies. It specialises in high-end tyres for premium carmakers like Ferrari (NYSE:RACE), Porsche and BMW and is the sole supplier for Formula One cars.CHANGES NEEDEDMeloni’s government refrained from imposing even tougher conditions on Sinochem, including blocking its voting rights in Pirelli. Its requirements will nevertheless force Sinochem and Camfin to amend their shareholders’ pact.The Chinese group earlier this year confirmed its plans to remain a long-term investor in Pirelli.The Italian company is due to appoint a new board at a shareholders meeting on July 31, with current Deputy CEO Giorgio Bruno set to become the new CEO and Tronchetti Provera staying as executive vice chairman.Tronchetti Provera has been in charge of Pirelli since 1992. The Italian government’s move to limit Sinochem’s grip on the tyremaker comes ahead of another key decision on whether to renew Rome’s partnership with Beijing on the Belt and Road Initiative (BRI).Italy in 2019 became the first and so far only G7 nation to join China’s hugely ambitious BRI initiative, which critics said could enable Beijing to gain get control of sensitive technologies and vital infrastructure.The BRI envisions rebuilding the old Silk Road to connect China with Europe with large infrastructure spending. More

LONDON (Reuters) – The U.S. affiliate of crypto giant Binance has carried out a round of layoffs since regulators last week charged it with violating securities laws and sought to freeze its assets, said two people with knowledge of the dismissals and employees’ social media posts.One of the sources said around 50 people were laid off. Reuters was unable to independently verify the number or seniority of employees affected. A Binance.US spokesperson did not respond to emails and calls seeking comment.Employees in Binance.US’ legal, compliance and risk departments were among those dismissed, the people told Reuters, requesting anonymity because the matter is private.The SEC on June 5 accused Binance and its founder and CEO Changpeng Zhao of creating Binance.US as part of a “web of deception” to evade securities laws aimed at protecting U.S. investors. Binance said it would defend itself “vigorously.”The SEC also sued Binance.US’ operating company, BAM Trading, alleging that it misled investors about “non-existent trading” controls over its platform. A day later, the SEC asked a federal court to freeze Binance.US’ assets, including more than $2.2 billion held in crypto and some $377 million in U.S. dollar bank accounts. The SEC expressed concern that the exchange could move those funds offshore.Binance.US called the request “unwarranted” and said the SEC’s allegations were “unjustified.””Because of our preparation for a prolonged and very costly legal battle, the Board asked Management to right-size our organization and reduce our burn rate to ensure long-term viability,” Binance.US CEO Brian Shroder wrote to employees in a message seen by Reuters.’ROUND OF LAYOFFS’Two Binance.US employees said on LinkedIn on Wednesday they were leaving the company, with one citing a “round of layoffs.” In a June 9 tweet, Binance.US its banking partners were preparing to stop dollar withdrawals as early as June 13 after the SEC’s “increasingly aggressive tactics.” It gave customers until then to withdraw their funds, saying it planned to become a “crypto-only exchange.”Binance.US had avoided layoffs over the past year, Shroder wrote in the message. “However, the SEC and the response by our banking partners has now forced us to change our approach.” In a court filing on Monday, Binance.US’ operator, BAM Trading, said the SEC’s asset freeze request would “effectively put BAM out of business.” “Without the ability to pay its employees, vendors, suppliers, and professionals in the ordinary course of business and to maintain its technology platform, operations would quickly grind to a halt,” it wrote. More

Investors are having to adjust to the prospect of interest rates across major economies staying higher for longer than expected, after central banks warned the battle against inflation is still not yet won. In a pivotal week in the monetary calendar, the US Federal Reserve surprised markets when it signalled support for two additional interest rate increases in 2023, even as it skipped a rise in June and kept its target range of between 5 per cent and 5.25 per cent. In the press conference following the meeting on Wednesday, chair Jay Powell said inflation “has not so far reacted much to our existing rate hikes, so we’re going to have to keep at it”.The news prompted traders in Treasury futures markets, who have long been expecting the Fed to have to make cuts later this year, to remove those bets.The European Central Bank announced the following day a widely anticipated 0.25 percentage point increase in rates, taking its deposit rate to 3.5 per cent. But ECB president Christine Lagarde delivered a more hawkish message than expected, stating that inflation in the eurozone is set to stay “too high for too long”.Futures traders are now betting on the probability of two more rises instead of one, with major investment banks including Goldman Sachs and BNP Paribas expecting the benchmark deposit rate to reach 4 per cent by September. The shift has helped extend a months-long surge in short-dated bond yields, which closely follow interest rate expectations, in the US and Europe. Yields rise as prices fall.Yields on two-year Treasuries, which tumbled in the wake of the collapse of Silicon Valley Bank in March, have surged more than a percentage point since early May, to 4.74 per cent. In the eurozone, yields on two-year Bunds have risen more than 0.8 percentage points since March, to 3.18 per cent.Azad Zangana, a senior European economist at Schroders, said: “It’s pretty clear that rates have to be higher for longer, not only has demand turned out to be stronger than expected but supply issues push costs up — especially the shortage of workers in the labour market.”The moves in the UK have been even more extreme, with yields on two-year gilts soaring more than 1.7 percentage points since March to above 4.9 per cent, with futures traders pricing in at least four more rate rises to a peak as high as 5.75 per cent. “In the UK there is a real underlying inflation issue and it’s much more severe than in the euro area and the US,” said Christian Kopf, head of fixed income at Union Investment. The upward moves in yields come after a number of fund managers had bet that central banks were close to the end of their rate tightening cycles and that yields were on their way down. A Bank of America survey of global fund managers this week showed they had an overweight allocation to bonds for six of the past seven months, having previously been underweight for 14 years. Asset managers are holding the biggest long position in two-year Treasury futures — a bet on falling interest rates — since September 2019, according to CFTC data. Mark Dowding, chief investment officer at RBC BlueBay, said he has moved to a “tactical long” position in US bonds, noting that “we are at a moment when the cycle is starting to turn and rates could look more attractive”. He was sceptical the Fed will deliver two more rate rises, particularly if data comes in softer than expected, but added the central bank’s message was designed to quash the idea that it would quickly move to cut rates. Expectations of higher rates come with mixed economic signals across the US and Europe. Investors are increasingly skittish about rates after unexpected pivots by the Reserve Bank of Australia and the Bank of Canada in recent weeks, both of which resumed raising rates after a pause, citing “upside risks” and “concern” about higher inflation, respectively. The eurozone is in a technical recession, but Lagarde said the “incredible” strength of the labour market was the main reason for raising its forecast for core inflation to 5.1 per cent for this year, 3 per cent next year and 2.3 per cent in 2025. The core rate was 5.3 per cent in May.Dario Messi, a fixed-income analyst at Julius Baer, said: “It will be difficult to justify a tightening pause as long as the inflation forecast on the longer-term horizon does not converge towards the 2 per cent target.”This has increased nerves that central banks will be unable to bring down inflation without triggering deep recessions, particularly in Europe.The rally in short-dated bond yields this week has not been matched by yields on longer-dated peers, with 10-year bonds trading well below the rate on two-year securities, bringing the depth of the inversion — a closely watched recession indicator — near to levels seen in the spring, when banking crisis fears sparked panic across global markets.

“The market will have to account for the increasing probability that this narrow focus on current inflation to determine the ECB’s success results in a policy error further down the road,” wrote analysts at ING. “Hence the reluctance in longer rates to follow the front end higher”. More

LONDON/NEW YORK (Reuters) – The yen plunged to a 15-year low against the euro on Friday after the Bank of Japan (BOJ) kept its ultra-low interest rate policy and forecast that inflation will slow later this year, in contrast with the European Central Bank’s (ECB) rate hike on Thursday.The Japanese unit also fell against the greenback, dropping to a six-month trough.As widely expected, the BOJ maintained its -0.1% short-term rate target and a 0% cap on the 10-year bond yield set under its yield curve control (YCC) policy.BOJ Governor Kazuo Ueda said he expects inflation to moderate, but the “pace of decline is somewhat slow.” The yen fell broadly following the decision and hit a fresh 15-year low of 155.22 per euro. It was poised for its biggest weekly decline against the euro in three years. The euro was last up 1.1 at 155.16 yen.The dollar rose 1.1% against the Japanese currency to 141.795, after earlier touching its highest since November. It was on pace for its largest daily percentage gain since late April.”The Bank of Japan added fuel to that dollar fire today by being on hold again,” said Erik Bregar, director, FX & precious metals risk management at Silver Gold Bull in Toronto.Elsewhere, the euro was poised for its best week against the dollar since June after the ECB raised borrowing costs to a 22-year high and hinted at further tightening.That and some soft U.S. data saw the dollar fall as traders scaled back bets on how high U.S. rates would need to rise.The euro was flat against the greenback at $1.0940 after earlier touching a five-week high, having surged over 1% on Thursday following the rate hike and forward ECB guidance.ECB President Christine Lagarde told a news conference another rate hike in July was highly likely and the central bank still has “ground to cover” to stave off high inflation.Sterling rose 0.4% to $1.2831 after earlier rising to its highest since April 2022, as traders ramped up bets the Bank of England will raise rates for the 13th straight meeting next week.FED FACES GRIM DATAThe ECB’s policy decision came a day after the Federal Reserve left rates unchanged, snapping a string of 10 consecutive hikes. However, the Fed also signalled that rates may still need to rise by as much as 50 basis points by the end of this year.However, recent data showed U.S. economic activity is slowing and inflation is cooling, challenging the Fed’s still-hawkish stance.On Friday, data showed ebbing inflation expectations that lifted U.S. consumer sentiment to a four-month high in June. The survey’s reading of one-year inflation expectations dropped to 3.3% this month from 4.2% in May. In afternoon trading, the dollar index edged up 0.1% to 102.24, after falling to a five-week low on Thursday. It was on track for its weakest weekly performance since January.”Beyond July, we don’t think there’s going to be another hike, but the first cut would be in December,” said Vassili Serebriakov, FX strategist at UBS in New York. “We think the economy is going to slow meaningfully in the second half, with inflation coming in below what the Fed is expecting.”Also on Friday, the U.S. Treasury said it found that no major U.S. trading partners had manipulated their currencies for an export advantage, adding it ended “enhanced analysis” for Switzerland after the country met only one of three manipulation criteria.The FX market showed little reaction to the news.========================================================Currency bid prices at 3:45PM (1945 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Dollar index 102.2600 102.1400 +0.13% -1.189% +102.4200 +102.0000 Euro/Dollar $1.0941 $1.0946 -0.03% +2.12% +$1.0971 +$1.0918 Dollar/Yen 141.7650 140.3000 +1.05% +8.13% +141.8800 +139.8500 Euro/Yen 155.12 153.52 +1.04% +10.56% +155.2200 +153.1000 Dollar/Swiss 0.8939 0.8920 +0.23% -3.31% +0.8949 +0.8902 Sterling/Dollar $1.2831 $1.2783 +0.39% +6.11% +$1.2848 +$1.2771 Dollar/Canadian 1.3192 1.3222 -0.22% -2.63% +1.3239 +1.3178 Aussie/Dollar $0.6875 $0.6883 -0.11% +0.87% +$0.6900 +$0.6856 Euro/Swiss 0.9778 0.9758 +0.20% -1.18% +0.9782 +0.9747 Euro/Sterling 0.8526 0.8561 -0.41% -3.60% +0.8565 +0.8522 NZ $0.6232 $0.6235 -0.03% -1.83% +$0.6247 +$0.6211 Dollar/Dollar Dollar/Norway 10.5430 10.4910 +0.54% +7.48% +10.6070 +10.4810 Euro/Norway 11.5415 11.4805 +0.53% +9.99% +11.5975 +11.4708 Dollar/Sweden 10.6478 10.5974 +0.59% +2.31% +10.6588 +10.5609 Euro/Sweden 11.6514 11.5825 +0.59% +4.50% +11.6585 +11.5828 More

The average consumer will spend $196.23 for Father’s Day, according to the National Retail Federation. In 2021, they spent $174.10. Adjusted for inflation, they are spending roughly the same. Shoppers are still buying despite the higher prices. Consumer spending, adjusted for inflation, rose 0.5% in May, the highest since the start of 2023, according to data from the US Commerce Department. The difference may be in what consumers are buying. Retail sales for May show moderating consumer demand from the past year. Still, recreation spending habits have continued to increase for categories like games, toys and hobbies, up 48.3%, and watches, up 31.7%.There are still some deals to be had. Prices for jackets and outerwear have fallen 0.6% from last year, and the cost of watches has risen just 2.1%, less than the overall rate of inflation, Labor Department data show. Look for bargains for dad online, where prices for computers, electronics and home and garden items have fallen, according to Adobe’s digital price index.Read More: The Best Luxury Father’s Day Gifts for the Dad Who Loves Design©2023 Bloomberg L.P. More

At least four people were killed in twisters that touched down on Thursday in the panhandles of Texas and Florida, where flooding also forced almost 150 people out of their homes, officials said. Power was out to nearly 500,000 customers in Texas, Louisiana and Mississippi on Friday, according to Poweroutage.us.A mix of high humidity and temperatures above 90 degrees Fahrenheit (32 degrees Celsius)could push heat index values above 115 in some parts of the South this weekend, National Weather Service meteorologist Matt Mosier said. The combination could cause atmospheric instability and create conditions ripe for more destructive storms.”It’s just been very humid and muggy out,” Mosier said. “You’ll end up getting strong gusts and large hail, and even with a few of these storms, you can get tornadoes as well.”The agency issued excessive heat warnings affecting millions of people in parts of southern Louisiana and Texas, saying the heat index could reach 110 degrees. South Florida and Mississippi were under heat advisories for Friday.It recommended that people drink fluids to keep hydrated, stay in air-conditioned rooms and limit time in the sun.President Joe Biden was briefed on the weather conditions on Friday morning, White House spokesperson Olivia Dalton told reporters aboard Air Force One while Biden traveled to an event in Connecticut. Afterwards, the president committed to offering federal assistance, she said.While southern states are accustomed to high heat during the summer, extreme weather conditions have become more frequent and intense across the country in recent years. Climate change is driving the trend, scientists say.The tornado that struck in the Texas Panhandle town of Perryton killed at least three people and injured dozens of others. Hundreds of homes, many of them in a trailer park, were damaged or destroyed.In Pensacola, on Florida’s Panhandle, a tornado downed power lines and toppled a tree onto a home, killing one person inside, Escambia County spokesperson Davis Wood said. Heavy rainfall also forced 146 residents to evacuate an apartment complex in the city of Warrington, he said. More