Aurelia Butler

PARIS (Reuters) – President Emmanuel Macron, a former investment banker who was elected in 2017 on a promise to be neither of the left nor the right, is projected in voter surveys to win a second term against a resurgent far-right Marine Le Pen, although with a smaller margin of victory.Here are his main policy proposals:ECONOMY* Raise the minimum pension age to 65 from 62 and increase the minimum monthly pension to 1,100 euros ($1,187).* Require 15-20 hours a week of training for welfare benefit recipients* Cut taxes by 15 billion euros with half for households and the rest for businesses.* Further loosen labour market rules and reform unemployment insurance to make payments vary according to the state of the economy* Raise the threshold over which inheritance tax kicks in from 100,000 euros to 150,000 eurosEUROPE, INTERNATIONAL AFFAIRS* Make the European Union more self-sufficient in defence, agriculture, energy and strategic economic sectors* Strengthen the capacities of national European armies, increase co-ordination between them and create a “common military doctrine”* Create European industrial champions including a “European metaverse”* Reform the European electricity marketIMMIGRATION & SECURITY* Make long-term residence permits conditional on a French exam and employment* Expel foreigners deemed to be trouble-makers* Create a rapid-action force to restore order in troubled “banlieues”, economically deprived suburbs.* Broader scope for on-the-spot-fines for petty crime ENERGY* Build six new nuclear reactors and launch studies for another eight, increase solar energy capacity tenfold, build 50 wind farms at sea by mid-century* Take control of certain energy companies, suggesting that the government would revive stalled plans to buy out minority shareholders in nuclear utility EDF (EPA:EDF)* Renovate 700,000 homes a year* Leasing scheme to make electric vehicles more accessible* Put the next prime minister directly in charge of “green planning” to make France the “first great nation”. Stop using oil, coal and gas($1 = 0.9264 euros) More

“We are not going to change the goals of the program with the IMF,” Guzman told local media. The South American country’s center-left Peronist government led by President Alberto Fernandez struck a staff-level agreement with the international lender at the beginning of March to avoid a default. The deal lays out a fresh schedule of financing over a 30-month period to replace a failed $57 billion program from 2018 that the grains-producing country was unable to pay back after years of recession, spiraling inflation and capital flightHowever, Guzman cautioned without giving more details that there will be a change in emphasis to focus on the social safety net due to the fallout from the Russian invasion of Ukraine which has triggered worldwide inflation. Argentina has long suffered from extremely high inflation. However, the war has increased price surges in Argentina as well as much of Latin America. Argentina’s 2021 inflation hit above 50%. More

The EU is preparing to announce the creation of a new trade and technology council with India as part of efforts to deepen their relationship and respond to the rising economic power of China. The new forum could be unveiled during meetings between Ursula von der Leyen and Narendra Modi, India’s prime minister, during a visit by the European Commission president to New Delhi on Monday, according to a senior EU official. Von der Leyen’s discussions with the Indian government will include sales of European military equipment to India and potential joint ventures as the EU seeks ways of reducing India’s longstanding reliance on Russian defence technology. They will also cover plans to relaunch negotiations this summer aimed at striking a comprehensive trade deal between the EU and India. The meetings will be overshadowed by the war in Ukraine, and India’s refusal to openly condemn President Vladimir Putin’s invasion. Western governments are hoping to find ways of wooing New Delhi away from its longstanding relationship with Moscow, pointing in part to the threat posed by Vladimir Putin’s “no limits” partnership with China’s Xi Jinping. Von der Leyen’s goal is to find ways of offering India alternatives to its “dependencies” on Russia, in areas such as military equipment as well as fertilisers, said the EU official. “We want to offer an even broader relationship with India. My sense is they are interested in ideas [for] co-operation with us.”A trade and technology council would build on an existing model involving the US and EU which was launched in Pittsburgh last year. However the transatlantic format has yet to prove itself, given deep divergences between the US and EU on questions such as digital privacy and how hard-hitting regulation of tech giants should be. New Delhi declined to comment on the proposal for a TTC with the EU. The EU official said potential topics on its agenda would include 5G and 6G technologies, privacy regulation, and how to supervise social media platforms. There was also scope to deepen co-operation on digital skills. Von der Leyen’s visit to New Delhi will be watched closely given divisions over how to respond to Russia’s war on Ukraine. Boris Johnson, the UK prime minister, declined to openly criticise Modi during a visit this week, focusing instead on areas of co-operation including the UK’s ambitions for a trade agreement with India. For his part, Modi repeated his call for an immediate ceasefire in Ukraine during Johnson’s visit and said diplomacy and dialogue were needed. The EU will try to push ways for India to loosen its reliance on key Russian exports, while reminding New Delhi that it expects its partners either to match EU sanctions or at least not circumvent them. The topic of Indian purchases of Russian oil is also likely to feature in discussions, given the EU’s attempts to wean itself off Russian fossil fuels and drive down the revenues Putin gets from its exports of oil, coal and gas. The UK plans to accelerate the licensing process by which India procures weapons from Britain, as well as more joint military exercises and officer exchanges. More

BRUSSELS (Reuters) -EU companies may be able to work around Russia’s demand to receive gas payments in roubles without breaching sanctions if they pay in euros or dollars which are then converted into the Russian currency, the European Commission said on Friday.The companies would also need to seek additional conditions on the transactions, such as a statement that they consider their contractual obligations complete once they have deposited the non-Russian currencies.Moscow has warned Europe it risks having gas supplies cut unless it pays in roubles. In March it issued a decree proposing that energy buyers open accounts at Gazprombank to make payments in euros or dollars, which would then be converted to roubles.The Commission said companies should continue to pay the currency agreed in their contracts with Gazprom (MCX:GAZP) – 97% of which are in euros or dollars.”Companies with contracts stipulating payments in euros or dollars should not accede to Russian demands. This would be contrary to the sanctions in place,” a Commission spokesperson said.In an advisory document sent to member states on Thursday, the Commission said Russia’s proposal risked breaching EU sanctions since it would put the effective completion of the purchase – once the payments are converted to roubles – into the hands of the Russian authorities.However, Moscow’s decree does not necessarily prevent a payment process that would comply with EU sanctions against Russia over the Ukraine conflict, the Commission said.Brussels said in the document that there were options that could allow companies to continue lawfully paying for gas.”EU companies can ask their Russian counterparts to fulfil their contractual obligations in the same manner as before the adoption of the decree, i.e. by depositing the due amount in euros or dollars,” the document said.However, the procedure for securing exemptions from the requirements of the decree is not yet clear, it said.Before making payments, EU operators could also make a clear statement that they consider their contractual obligations to be completed when they deposit euros or dollars with Gazprombank – as opposed to later, after the payment is converted into roubles, the document said.”It would be advisable to seek confirmation from the Russian side that this procedure is possible under the rules of the decree,” the document said.The Commission’s advice is not legally binding, but is an attempt to steer the discussion while member states work out how they can continue to pay for Russian gas.The EU’s sanctions regime does not prohibit companies from opening accounts with Gazprombank, or engaging with the bank to attempt to seek a solution, the document said. More

India procures most of its military hardware from Russia and in recent weeks has rejected appeals from Western nations to limit bilateral relations with Moscow in response to the Russian invasion of Ukraine. Prime Minister Narendra Modi’s government has faced criticism from Western allies with regard to its refusal to outright condemn Russian President Vladimir Putin over the devastating conflict in Ukraine.Sitharaman said India, which has long-standing border disputes with neighbouring Pakistan and China and in the past has gone to war with both, was focused on protecting its own regional interests.Alluding to Pakistan and China, Sitharaman told Bloomberg: “You have a neighbour who joins hands with another neighbour, both of whom are against me. In the context of the Russia-Ukraine war, God forbid, if there are alliances created, India has to be strong enough to protect itself.”India wants to be friends with the European Union and the Western, free, liberal world,” she added, “but not as a weak friend that needs desperate help here and there.” Sitharaman made the remarks on Friday in the United States where she attended the annual spring meetings of the International Monetary Fund and the World Bank. While the United States has traditionally sought to balance relations between arch regional rivals India and Pakistan, in recent years it has also improved strategic ties with New Delhi to counter China.British Prime Minister Boris Johnson, who was in India this week to ramp up security and trade relations, said that it was unlikely India would end its long-standing ties with Russia. More

In a statement shared with Reuters, the ABL called the plan “disastrous” and said it would leave banks and depositors shouldering the “major portion” of losses.The government estimates that the financial sector’s losses amount to $72 billion.“ABL has assigned its legal advisers to examine and present a range of judicial measures that will allow the preservation and recovery of the rights of the banks and the depositors,” the association said. Lebanon’s banks have been a major lender to the government for decades, helping to finance a wasteful and corrupt state that went into financial meltdown in 2019.The collapse has resulted in depositors being shut out of their savings and the local currency losing more than 90% of its value. The banking association rejected an earlier draft of the plan in February, saying it would cause a loss of confidence in the financial sector.The ABL’s approval is not required for the government to begin implementing a plan, but experts say support from the banking sector could contribute to solving the crisis.The current draft lays out a series of financial reforms, including an overhaul of the banking sector and caps on how much depositors would be able to recover from their accounts. Earlier this month, Lebanon signed a staff-level agreement with the International Monetary Fund for a 46-month extended fund facility, under which Lebanon has requested access to the equivalent of around $3 billion. But access to those funds is contingent on enacting a slew of economic reforms and financial sector restructuring. More

For more than five years after launching the personal finance app Truebill with his two brothers, Yahya Mokhtarzada watched the subscription economy grow.But now that trend has gone into reverse as rising inflation causes consumers to rethink their discretionary spending — a development that Mokhtarzada, like investors and analysts, believes will spread far beyond their Netflix accounts.“As long as there is this much uncertainty in the economy, people are going to be increasingly cautious with their money,” said Maryland-based Mokhtarzada, whose app manages subscriptions, bills and other payments.Last year Mokhtarzada noticed that the app’s 2.5mn users were scrapping more subscriptions, ranging from streaming services to meal kits. By March the cancellations were outnumbering new sign-ups.This week Netflix’s share price dropped more than 35 per cent after it reported a fall in subscriber numbers for the first time in a decade. While Netflix suffered from increased competition, Steve Wreford, a portfolio manager at Lazard Asset Management, says the squeeze on disposable incomes acted as a catalyst.“What’s happening with the streaming services is the canary in the coal mine,” he said. “Inflation puts pressure on the consumer, you think about which is your least valued purchase, and you then find out which businesses are really going to struggle in that inflationary environment.”Inflation has gathered pace just as consumers were resuming aspects of their pre-pandemic lives — eating out, working from the office and booking vacations. It also comes after Covid-19 restrictions pushed up savings rates: Americans had built up an extra $4.2tn of cash by the end of 2021, according to the Federal Reserve.

You are seeing a snapshot of an interactive graphic. This is most likely due to being offline or JavaScript being disabled in your browser.

Yet price rises and worries over the war in Ukraine, which has worsened inflation, have led to a marked decline in consumer sentiment, said Jessica Moulton, a senior partner at McKinsey.“Consumers’ levels of optimism are back to mid-2020 levels. That’s a big drop from the autumn,” she said, citing McKinsey surveys carried out in five European countries and the US.UK retail sales fell 1.4 per cent in March, the second consecutive monthly decline, as surging inflation began to bite. Inflation of 7 per cent — the rate in Germany in March — effectively cuts household discretionary spending there by 13 per cent, according to a McKinsey analysis.The gloomier climate has cast a shadow over sectors like clothing and restaurants, said Wreford. Investors are taking note: global consumer discretionary stocks have fallen 14 per cent since the start of the year, against 8 per cent for the broader MSCI World index, according to Bloomberg data. Apparel groups’ shares have been particularly hit.The London-based online clothing retailer Asos this month reported a sharp fall in sales growth and profits, and warned that pressure on incomes might outweigh the boost expected to accompany the loosening of Covid restrictions. Its shares are down almost 40 per cent since the start of the year.

Asos chief executive Mat Dunn said that “rising energy prices and food inflation will weigh on discretionary spend. The next three months will be telling as we see how these factors play out on consumer discretionary income.”Swedish rival H&M last month also reported a sudden slowdown in sales growth. Spending on apparel has dropped below 2019 levels in the UK, according to data provider Fable.This year’s inflationary squeeze differs from past periods of rising prices, in following on the heels of the pandemic. Consumers’ lifestyles are already in flux as they emerge from Covid-19 restrictions. Now inflation has added to pressure on companies that gained from lockdowns, like Netflix and Peloton, which have also had to raise their own prices.The inflationary environment has damped post-Covid optimism at groups like Asos that still hope to benefit from a “summer of events, parties and weddings”, in the words of Dunn.Restaurants hoping for a recovery are wrestling with demands for higher wages from their own staff, while the chief executive of a London-based casual dining chain said that average spend per customer had already declined in the past month.But the same does not so far appear true of the travel industry, where consumers with accumulated savings look determined to spend them on trips they missed during the height of the pandemic. “Normally [in an inflationary environment] we would see an impact on travel, but there is a lot of pent-up demand,” said Moulton.

You are seeing a snapshot of an interactive graphic. This is most likely due to being offline or JavaScript being disabled in your browser.

American Airlines and Delta Air Lines, the US’s largest and third-largest carriers by fleet size, reported record ticket sales in March, while United Airlines, the second largest, predicted that the second quarter would be its most profitable ever.“We’re seeing no signs of any customer reticence around inflation,” Ed Bastian, Delta chief executive told the Financial Times, while Robert Isom, American chief executive, told employees this week that “demand is as strong as we’ve ever seen it”.Will Hayllar, managing partner at strategy consultants OC&C, said that the impact of the income squeeze was not entirely predictable. “Consumers want some things that they feel good about. It doesn’t work out as completely utilitarian,” he said.Food delivery services, another beneficiary of the pandemic, so far maintain they are not suffering from the pressure on consumer spending.

$4.2tn

Extra savings built up by Americans by the end of 2021

Deliveroo maintained its annual guidance for order volume growth in a trading update this month, saying it would be slower than 2021’s 70 per cent but still growing by 15-25 per cent on a constant currency basis.Jitse Groen, chief executive of Just Eat Takeaway, insisted this week that food price inflation could be a net benefit: when restaurants’ prices go up, so too does Just Eat’s commission.But David Reynolds, analyst at Irish investment bank Davy, said: “We are moving into uncharted territory. Ordinarily online takeaway food proves to be fairly resilient in the face of inflationary pressures and dining out bears the brunt.“But with double-digit inflation not impossible, there must be risks that consumers drop some or all takeaway food orders.”Analysts agree that inflation has not yet peaked, and that its full impact is only just starting to be felt. While pandemic savings will cushion some wealthier consumers for a time, those on lower incomes will be the first to feel the squeeze as staples account for a higher proportion of their disposable incomes, said Wreford.

You are seeing a snapshot of an interactive graphic. This is most likely due to being offline or JavaScript being disabled in your browser.

Makers of branded consumer staples have so far succeeded in passing price rises on to consumers: Nestlé, Heineken, Danone and Procter & Gamble all said this week they had increased prices by about 5 per cent in the three months to March, without pushing down sales.But as the pressure grows, households may switch to private-label products. “Consumer down-trading is looking increasingly likely as discretionary spend gets squeezed . . . Premium brands will likely hold up, as will value, but ‘me too’ mass brands are at risk,” said Warren Ackerman, analyst at Barclays.Some businesses hope to benefit from consumers seeking cheap alternatives.Mooky Greidinger, chief executive of Cineworld, the world’s second largest cinema chain, is betting that cinemas, unlike Netflix, will benefit from lower discretionary spend: “In view of recession [consumers] cannot afford the same trips abroad or a £100 ticket musical but they can afford a £10 ticket to the cinema. I’m not worried at all,” he told the FT last month.At the opposite end of the scale, fund managers expect luxury goods makers to weather the storm, as their margins are high and wealthy buyers cushioned from inflation’s worst effects.Groups such as France-based LVMH “have consistently been able to raise prices to more than offset the inflationary pressures”, said Marcus Morris-Eyton, fund manager at Allianz.Yet Mokhtarzada said Truebill’s customer base, which slants towards younger users, has already shown a marked cut in spending: on both petrol and groceries, the rise in total spending has lagged behind the rises in prices, indicating a more prudent approach. “That has to indicate a change in consumer behaviour,” he said.Reporting by Tim Bradshaw, Steff Chávez, Alice Hancock, Patrick Mathurin and Patricia Nilsson More