Aurelia Butler

(Reuters) – Russia’s central bank said on Thursday banks would be allowed to sell citizens foreign currency without any restrictions from May 20, with the exception of U.S. dollars and euros.Restrictions on dollars and euros, which allow citizens to buy only those dollars and euros that arrived in banks after April 9, will remain in place until Sept. 9, the central bank said. More

Stability in Northern Ireland is at risk. Unionists, the community who want the six counties to remain part of the UK, are wounded. A visitor need not travel far to spot graffiti attacking the “Irish Sea border” and the “protocol” — the part of the UK’s withdrawal agreement with the EU that governs the region’s post-Brexit trade with Great Britain.The protocol was an ineluctable result of the “hard” Brexit Boris Johnson negotiated, something prominent unionists once supported. Checks and regulations on goods entering Northern Ireland were needed to avoid a destabilising land border with the south of the island. Set aside, for now, who is to blame: the fact of unionist discontent matters for maintaining the peace. Even moderate unionists have anxieties about their shared home becoming less British if UK businesses stop serving it fully. But the needs of unionism should be differentiated from those of its political leaders.At this month’s elections, the largest unionist party ran an incendiary campaign. The Democratic Unionist party pledged — irresponsibly — that it would refuse to enter government unless the protocol were dropped. Since forming an executive requires buy-in from the lead unionist party and the lead party of “nationalism”, as those who would prefer Northern Ireland be part of Ireland are known, this means no government. Johnson’s stated slogan for this week, at least, is “We don’t want to nix it, we want to fix it” — an implicit rebuke to the DUP’s demand on the protocol and to its hard Brexiter allies in the Conservative party in London who view Northern Ireland as a place in which to show off their commitment to maximum “sovereignty”. The protocol contains processes for negotiating its own implementation. The UK should stick with them, and focus narrowly on the border. Some of London’s bugbears, like state aid rules, need to be put to one side.There is a landing zone for a deal to make the sea border less visible. For example, the EU last autumn offered “easements” to cut paperwork and checks — a start. Brussels will need to show more flexibility, but there are solutions to many of the other issues that annoy unionists. This will take time — some potential solutions rely on new data-sharing systems, for example. Taking time will also require trust.So it is regrettable that the UK government has threatened (again) to override parts of the agreement it does not like. Doing so could provoke a trade war — one Johnson cannot win and which would further destabilise the island of Ireland. It would be far better for the UK to draw closer to the EU. It is a shame that alignment between the UK and EU on food and agriculture appears out of bounds: that would mean fewer checks were needed.The kind of careful, trust-building approach needed would be a change from Johnson’s normal bluffing. It should be paired, too, with some uncharacteristic truth-telling. The prime minister needs to make clear to the DUP that they have lost. A forced retreat would be humiliating. But the party should be made to understand it has nothing to gain from its continued veto on a government.As some wilier unionists have quietly noted, the protocol could become a selling point for membership of the UK: it gives Northern Ireland privileged access to both British and EU markets. But the DUP’s presentation of it as a disaster contributes to the sense that Northern Ireland is ungovernable and cannot last. So too does its refusal to support a government. Everyone in the region needs a working executive. But no one needs it more than unionists. Nothing will build support for the end of a British-run Northern Ireland faster than yet another spell without leadership. More

JOHANNESBURG (Reuters) – South Africa’s central bank increased its main lending rate by 50 basis points to 4.75% in a decision announced on Thursday.The decision was in line with a Reuters poll published last week. More

Sir Bufton Tufton, the archetypal British Conservative MP, is deeply unhappy. He did not spend decades advocating free market economics to see such a dire situation visited on the country’s economy. Growth is anaemic, inflation rampant, the tax burden at its highest in six decades and every corner of the public realm has an insatiable appetite for money.Were he a real politician, Sir Bufton would be part of the loud chorus of Tories now calling on chancellor Rishi Sunak to slash taxes. Faced with a spiralling cost of living, the party’s natural instinct would be to reduce the state’s demands — perhaps by bringing forward the 1p income tax cut due in 2024.But there is a far more pressing issue for Tories to grapple with: the plight of the poorest. Those who are unemployed or unable to work find themselves at the sharp end of this crisis, with no imminent hope of a rise in income. It is now widely accepted in the Treasury that not enough help was provided in March’s Spring Statement.Take the 5p cut to fuel duty. Its £2.4bn cost has delivered no political dividend. In a surprise to almost no one, prices at the pumps stayed high. Kwasi Kwarteng, business secretary, sighs that the duty cut “does not appear to have been passed through to forecourt prices in any visible or meaningful way”.The Treasury’s default mindset is to do as little as possible until almost too late. So more still has to be done to address the cost of living and help those out of work. Handily, one of the few parts of the British state that functions well is universal credit. Despite cost overruns and all manner of technical glitches, the UK has the most digitalised, advanced benefits system in Europe.For much of the past decade, however, UC has been underfunded. Its budget was slashed by £3.2bn in 2015 — leading Iain Duncan Smith, then work and pensions secretary, to quit and accuse the government of “balancing the books on the backs of the poor and vulnerable”. But in 2018, its work allowances rose, allowing those on benefits to earn more money from part-time work. And the social security system came into its own during the pandemic, when the lockdown-induced economic crisis saw more than one million extra people on benefits. The government duly introduced a temporary uplift of £20-a-week for claimants at a cost of around £6bn. According to the government, the extra spend cut child poverty by 400,000.The uplift ended in October; the Treasury was eager to ensure extra spending did not become permanent. Half a dozen former work and pensions secretaries pleaded against — to no avail. With inflation soaring, Tory calls to reinstate the £20 a week are growing. Sir Bernard Jenkin, an MP on the right of the party, says it “should immediately be restored”.This 13 per cent rise in UC spending would be well above the current nine per cent inflation rate. With fears rife about stimulating more inflation, one compromise endorsed by the Centre for Social Justice, a centre right think-tank, could be an emergency reassessment of universal credit to reflect inflation across the last quarter. As the cost of living crisis unfolds, ministers should consider a quarterly welfare assessment. If the energy price cap is to be updated on this schedule, why not UC?The Labour party supports more welfare spending. But for Tories such as Sir Bufton, the case is just as strong. UC ensures it is always better to be in work (for those who can). The system minimises waste: the Tories should be much louder and prouder of it.Plus the funds are there to make a rise permanent. Sunak has a healthy windfall from higher-than-forecast tax receipts. Spending £3bn-4bn on UC is proportionate — especially when the Treasury had no qualms about writing off £5bn in Covid payment fraud. Politically, Sunak has to act. Economically, a UC rise is plausible. But, crucially, boosting benefits is morally the right thing to do. [email protected] More

WASHINGTON (Reuters) – The Federal Reserve is not targeting equity markets in its battle against inflation but that is “one of the avenues” where the impact of tighter monetary policy will be felt, Kansas City Fed president Esther George said Thursday in comments to CNBC.”What we are looking for is the transmission of our policy through markets understanding that tightening should be expected,” George said a day after weak profits from major retailers contributed to a sell-off of stocks. “It is not aimed at the equity markets in particular but it is one of the avenues through which tighter financial conditions would emerge.” More