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    U.S. fintech Plaid taps Booking.com veteran to lead its European expansion

    Fintech firm Plaid has hired Ripsy Bandourian, formerly a vice president at Booking.com, as its head of Europe.
    Plaid’s former head of international, Keith Grose, now focuses largely on running the U.K. business.
    The company says it’s planning an “aggressive” expansion in Europe this year.

    Ripsy Bandourian, head of Europe at Plaid.

    LONDON — Financial technology firm Plaid has hired Ripsy Bandourian, a long-time Booking.com executive, to head up its European operations.
    Bandourian joined Plaid last week and is working out of its Dutch offices in Amsterdam. She’ll be tasked with leading the San Francisco-based start-up’s expansion in continental Europe. Keith Grose, formerly Plaid’s head of international, now focuses largely on running the U.K. business.

    The Armenian-born businesswoman brings a mix of experience to the world of fintech. She originally studied molecular biology at Brigham Young University in Provo, Utah, before moving to New York to take on a quantitative analyst job at Goldman Sachs. After a consulting stint with McKinsey, she moved to London to work at Apple’s European division.
    Bandourian joined Booking.com in 2014, working for the online travel platform for more than eight years in a variety of roles focusing on product and marketing. She was most recently vice president of global accommodation partnerships, overseeing Booking.com’s relationships with hotel partners.
    Bandourian told CNBC her reasons for joining Plaid were “personal” just as much as they were professional.
    “I’ve lived my life on three different continents,” Bandourian said. “And there is absolutely no way for me to take my financial history with me. There are no tools, there are no ways to make it easier. And this is a use case.”
    Plaid’s technology allows fintech companies like Venmo and Robinhood to connect to customers’ bank accounts so that users can log in and share their financial data securely. It’s part of a fast-growing trend known as “open banking.”

    The company, which also offers payment tools in some markets, says it’s planning an “aggressive” expansion in Europe this year. Its services are currently available in seven European countries, including the U.K., Germany and France. Plaid also plans to roll out to other markets including Poland, Belgium and the Nordics soon.
    “The plans are quite aggressive,” Bandourian said. “The investment that Plaid is making in Europe speaks to the opportunity that the company sees itself, and how deeply and how fast we’re evolving.”
    Among Plaid’s plans for Europe is growing its headcount — the firm currently employs around 80 people in the region — and hiring individual country managers for France and Germany. Plaid’s clients in Europe include crypto exchange Kraken and dating app Bumble.
    The open banking trend has gained significant traction in Europe over the years. That’s thanks in part to fintech-friendly regulations introduced in 2018 requiring banks to share user data with third parties at the request of consumers.
    The number of open banking users in the continent reached 12.2 million in 2020, according to Statista data, a number that’s expected to rise to 63.8 million by 2024.
    Big businesses and investors are taking note. Apple last month acquired Credit Kudos, a London-based fintech that uses consumers’ banking data to make more informed credit checks. Meanwhile, Visa bought Tink, a European competitor to Plaid, for over $2 billion.
    Plaid was last privately valued at $13.4 billion after a $5.3 billion deal to be taken over by Visa fell apart.

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    In the U.S., consumers are paying more for everything. In China, the inflation problem is very different

    Official measures of producer and consumer prices in China rose in March by more than analysts expected, according to data released Monday.
    “Rising food and energy price inflation limits the space for the PBoC to cut interest rates, despite the rapidly worsening economy,” Nomura’s chief China economist Ting Lu and a team said in a note.
    The yield on China’s 10-year government bond fell below that of the U.S. for the first time in 12 years on Monday, according to Reuters.

    Transportation fuel prices rose by 24.1% in China in March 2022 from a year ago, the largest increase within the country’s consumer price index.
    Vcg | Visual China Group | Getty Images

    BEIJING — Persistent inflation in China narrows the window for when the People’s Bank of China can cut interest rates and support growth, economists said.
    Official measures of producer and consumer prices in China rose in March by more than analysts expected, according to data released Monday.

    “Rising food and energy price inflation limits the space for the PBoC to cut interest rates, despite the rapidly worsening economy,” Nomura’s chief China economist Ting Lu and a team said in a note Monday.
    Lu referred to his team’s report earlier this month that noted how China’s 1-year benchmark deposit rate is only slightly above the rate of consumer price increases. That reduces the relative value of Chinese bank deposits.
    On an international level, higher U.S. interest rates narrows the gap between the benchmark U.S. 10-year Treasury yield and its Chinese counterpart, reducing the relative attractiveness of Chinese bonds. Cutting rates in China would reduce that gap further.
    The yield on China’s 10-year government bond fell below that of the U.S. for the first time in 12 years on Monday, according to Reuters. Previously the Chinese bond yield tended to trade at a 100 to 200 basis point premium to the U.S.

    “We think April could be the last chance for China to have a rate cut in the near term before [the] Fed’s potential balance sheet shrink,” said Bruce Pang, head of macro and strategy research at China Renaissance.

    Fed meeting minutes released last week showed how policymakers generally agreed to reduce the central bank’s holdings of bonds, likely starting in May, at about double the rate prior to the pandemic. U.S. consumer price data is due out overnight.
    “Rising inflation, if [it] continues, could further limit China’s room for policy maneuvers,” Pang said.
    He noted how Chinese investors increasingly expect the PBOC to act after high-level government comments this month.
    China will adjust monetary policy “when appropriate” to support growth, Premier Li Keqiang said at a meeting last week of the State Council, the top executive body.

    Profit margin squeeze

    The producer price index rose by 8.3% in March, slower than the 8.8% increase in February and the lowest since April 2021, according to Wind data. Coal and petroleum products contributed some of the largest gains.
    Within the consumer price index, the largest increase was in transportation fuel, up by 24.1% year-on-year in March. The global price of oil has surged since the Russia-Ukraine war began in late February.
    China’s consumer price index rose by 1.5% in March, up from 0.9% in February and the fastest since consumer prices rose by the same pace in December, Wind data showed. A sharp, 41.4% year-on-year decline in pork prices continued to drag down food inflation. Vegetable prices rose by 17.2%.
    “China’s inflation dynamics implied a continued margin pressure on Chinese corporates,” said Bruce Liu, Beijing-based CEO of Esoterica Capital, an asset manager.
    “March inflation was not the only force that brought down Chinese equity markets [on Monday], and the rising-real-yield-induced equity sell-off last Friday in the U.S. spilled over,” Liu said. “More Covid worries in multiple places outside Shanghai (Guangzhou, Beijing, etc.) also weighed on market sentiment, and investors got their hands full at the moment.”
    The U.S. 10-year Treasury yield climbed to a three-year high Friday and rose further overnight on Monday to 2.793%, its highest since January 2019. China’s 10-year government bond yield held around 2.8075% Tuesday, according to Wind Information.

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    Citi analysts expect the PBOC could, as soon as this month, cut at least a policy rate or the reserve requirement ratio — a measure of how much cash banks need to have on hand. They said the prolonged omicron wave requires more monetary easing.
    “Inflation won’t constrain monetary policy for now, in our view,” the analysts said, “but could become more a source of concern in H2.”
    They expect the producer price index to moderate due to last year’s high base — for a 5.6% annual increase — while the consumer price index will likely rise slightly — rising 2.3% for the year— as food prices remain elevated.
    — CNBC’s Chris Hayes contributed to this report.

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    New omicron XE Covid variant first detected in the UK spreads to Japan as cases rise

    Japan’s health ministry said Monday that the new XE variant, first detected in the U.K., was found in a woman in her 30s who arrived at Narita Airport.
    The XE subvariant is a so-called recombinant, or mix, of two earlier omicron strains, BA.1 and BA.2.
    1,125 cases of XE have so far been detected in the U.K. almost double the previous count, according to the latest statistics from the U.K. Health Security Agency.

    As of April 5 2022, 1,125 cases of XE — a new scombinant subvariant — have been identified in the U.K., up from 637 on March 25.
    Dominic Lipinski | Pa Images | Getty Images

    Japan has reported its first case of omicron XE — a new Covid-19 strain first detected in the U.K. — just as British cases of the subvariant rise.
    The XE variant was found in a woman in her 30s who arrived at Narita International Airport from the U.S. on March 26. The woman, whose nationality was not immediately disclosed, was asymptomatic, Japan’s health ministry said Monday.

    It comes as cases of the new strain have almost doubled in Britain, according to the latest statistics from the U.K. Health Security Agency.
    As of April 5, 1,125 cases of XE had been identified in the U.K., up from 637 on March 25. The earliest confirmed case has a specimen date of Jan. 19 of this year, suggesting it could have been in circulation in the population for several months.
    XE has since been detected in Thailand, India and Israel. It is suspected that the latter Israeli cases may have developed independently. The U.S. has not yet reported any XE cases.

    What is omicron XE?

    XE is what’s known as a “recombinant,” a type of variant that can occur when an individual becomes infected with two or more variants at the same time, resulting in a mixing of their genetic material within a patient’s body.
    In the case of XE, it contains a mix of the previously highly infectious omicron BA.1 strain, which emerged in late 2021, and the newer “stealth” BA.2 variant, currently the U.K.’s dominant variant.

    Such recombinants are not uncommon, having occurred several times during the course of the coronavirus pandemic. However, health experts say it is too soon to draw conclusions on the new subvariant’s severity or ability to evade vaccines.

    “We continue to monitor cases of the recombinant XE variant in the U.K., which currently represents a very small proportion of cases,” Meera Chand, director of clinical and emerging infections at UKHSA, said in a statement.
    On Sunday, the U.K. reported 41,469 new Covid cases, with a seven-day average of 59,578 cases. As such, XE likely accounts for only a small percentage of total Covid cases currently.

    How worried should we be?

    Early estimates suggest XE may be more transmissible than earlier strains, having so far demonstrated a slightly higher growth rate than its predecessor.
    UKHSA data shows XE has a growth rate of 9.8% above that of BA.2, while the World Health Organization has so far put that figure at 10%.
    However, experts say they expect it to wane in severity even as it spreads more easily. XE has so far not been declared a variant of concern.
    “XE seems to be moving in the same direction as BA.2, having an increased transmissibility to BA.1 but being less severe,” Jennifer Horney, professor of epidemiology at the University of Delaware, told CNBC.
    “It is the devil we know, so to speak. [It is] essentially a reshuffling of the same deck of cards,” added Mark Cameron, associate professor in the School of Medicine at Case Western Reserve University.

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    XE contains spike and structural proteins from the same virus family, i.e. omicron, meaning that it should, theoretically at least, behave as omicron has done before. Existing vaccines and immunity should, therefore, provide some level of protection against infection.
    “Recombinants that contain the spike and structural proteins from a single virus (like XE or XF) are fairly likely to act similarly to [their] parental virus,” Tom Peacock, virologist at Imperial College London’s Department of Infectious Disease, wrote in a thread of tweets in mid-March. XF refers to another recombinant previously detected in the U.K. in February.
    However, other recombinants containing spike and structural proteins from different virus families continue to emerge. That includes the XD subvariant, recently discovered in Germany, the Netherlands and Denmark, which contains delta structural proteins and omicron spike proteins and which Peacock described as “a little more concerning.”
    As such, all new emergences need to be closely monitored, especially in their early phases, to ensure they don’t evolve into something more serious.
    “The virus is still capable of evolving, recombining and developing a new branch of its family tree,” Cameron said.
    “The key takeaway is that for each of these variants and subvariants, risk of hospitalization and death appears to be, on average, lower where vaccination rates are higher, indicating that vaccination, including a third dose, should be effective in reducing risk for severe disease,” added Stephanie Silvera, professor of public health at Montclair State University.

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    Russia's war in Ukraine means there'll be no return to normality for Europe's economy

    In light of Russia’s unprovoked invasion of Ukraine, European leaders have been forced to rapidly accelerate plans to reduce their outsized dependence on Russian energy.
    “For the continent, the war is much more of a game-changer than the pandemic ever was. I’m not talking just in terms of security and defense policies but notably about the entire economy,” said ING Head of Global Macro Research, Carsten Brzeski.

    German Chancellor Olaf Scholz, French President Emmanuel Macron and Polish President Andrzej Duda attend a news conference ahead of a Weimar Triangle meeting to discuss the ongoing Ukraine crisis, in Berlin, Germany, February 8, 2022.
    Hannibal Hanschke | Reuters

    The war in Ukraine and the ensuing economic sanctions imposed on Russia will cause far bigger shifts for Europe’s economy and markets than previous crises like the coronavirus pandemic, economists have said.
    In light of Russia’s unprovoked invasion of Ukraine, European leaders have been forced to rapidly accelerate plans to reduce their outsized dependence on Russian energy. The European Parliament on Thursday called for an immediate and total embargo of Russian oil, coal, nuclear fuel and gas.

    However, this aggressive decoupling comes at a price for the European economy, driving up already high inflation to record levels and threatening to undermine the manufacturing recovery that began last year as economies attempted to re-emerge from the Covid-19 pandemic.
    ING Head of Global Macro Research Carsten Brzeski noted last week that Europe is particularly at the risk of losing international competitiveness as a result of the war.
    “For the continent, the war is much more of a game-changer than the pandemic ever was. I’m not talking just in terms of security and defense policies but notably about the entire economy,” Brzeski said.

    “The eurozone is now experiencing the downside of its fundamental economic model, that of an export-oriented economy with a large industrial backbone and a higher dependency on energy imports.”
    Having benefited from globalization and the division of labor in recent decades, the euro zone is now having to ramp up its green transition and pursuit of energy autonomy, while at the same time boosting spending on defense, digitization and education. Brzeski characterized this as a challenge that “can and actually must succeed.”

    “If and when it does, Europe should be well-positioned. But the pressure on household finances and incomes will remain huge until it gets there. Corporate profits, meanwhile, will remain high,” he said.
    “Europe is facing a humanitarian crisis and significant economic transition. The war is taking place in the ‘breadbasket’ of Europe, a key production area for grain and corn. Food prices will rise to unprecedented levels. Higher inflation in developed economies could be a matter of life and death in developing economies.”
    Brzeski concluded that financial markets were “misguided” as European stocks attempt to grind higher, adding that “there’s no return to any sort of normality of any kind right now.”
    Debt sustainability concerns
    This tectonic shift for the European, and indeed global, economy will place additional pressure on central banks and governments caught between a rock and a hard place in juggling inflation against fiscal sustainability, economists acknowledge.
    In a note Thursday, BNP Paribas predicted that a faster drive to decarbonize, higher government spending and debt, more intense headwinds to globalization and higher inflationary pressures would be an enduring theme.
    “This backdrop presents central banks with a more challenging environment in which to conduct policy and keep inflation on target, not only diminishing their ability to commit to a certain policy path but making policy mistakes more likely,” BNP Paribas Senior European Economist Spyros Andreopoulos said.
    He also noted that raising interest rates to rein in inflation will eventually make life difficult for fiscal authorities.

    “While this is not an immediate concern, not least because governments have generally lengthened the average maturity of their debt in the low interest rate years, a higher interest rate environment may change the fiscal calculus as well. Eventually, debt sustainability concerns could resurface,” Andreopoulos said.
    Low inflation throughout the euro zone’s recent history meant the European Central Bank was never forced to choose between fiscal sustainability and pursuing its inflation targets, since low inflation necessitated the accommodative monetary policy that aided fiscal sustainability.
    “Politically, the ECB was able to – convincingly, in our view – deflect accusations that it was helping governments by pointing to low inflation outcomes,” Andreopoulos said.
    “This time around, the ECB is having to tighten policy to rein in inflation against the backdrop of even higher public debt, a legacy of the pandemic, and continued pressures on the public purse.”

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    Giant undersea cables set to give the UK and Germany their first direct energy link

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    The NeuConnect project is centered around subsea cables that will enable 1.4 gigawatts of electricity to pass in both directions between the U.K. and Germany.
    The interconnector measures 725 kilometers, or just over 450 miles.
    Those behind NeuConnect have dubbed the privately-financed venture an “invisible energy highway.”

    Onshore wind turbines in Germany. The NeuConnect project says the interconnector will enable Britain to “tap into the vast energy infrastructure in Germany, including its significant renewable energy sources.”
    By Thomas E. Gunnarsson | Moment Open | Getty Images

    Key contracts totaling more than £1.5 billion ($1.95 billion) have been awarded for a major interconnector project that will link Germany and the U.K., as countries around the world attempt to shore up their energy supplies amid the ongoing crisis in Ukraine.
    The NeuConnect project is centered around subsea cables that will enable 1.4 gigawatts of electricity to pass in both directions between the U.K. and Germany — Europe’s two largest economies. The interconnector measures 725 kilometers, or just over 450 miles.

    Those behind NeuConnect have dubbed the privately-financed venture an “invisible energy highway” and have described it as “the first direct link between the UK and German energy markets.”
    The contracts that have been awarded relate to cabling works and converter stations. NeuConnect said Siemens Energy had been awarded the contract for the latter, which will involve the design and construction of sites in Germany and the U.K.
    The NeuConnect project has previously said the interconnector will enable Britain to “tap into the vast energy infrastructure in Germany, including its significant renewable energy sources.”
    For Germany, it says “the new link with Britain will help ease current bottlenecks where wind turbines are frequently powered-down due to an excess of renewable energy being created.”
    Monday’s announcement said financial close on NeuConnect was slated for the “coming weeks,” which would allow works to begin at some point in 2022.

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    The project has been in the works for some time now, but its progression comes at a time when Russia’s invasion of Ukraine has highlighted just how reliant some economies are on Russian fossil fuels.
    Indeed, while the war in Ukraine has created geopolitical tension and division, it has also resulted in a number of initiatives defined by cooperation and shared aims. 
    The U.S. and European Commission, for example, recently issued a statement on energy security in which they announced the creation of a joint task force on the subject.
    The parties said the U.S. would “strive to ensure” at least 15 billion cubic meters of extra liquefied natural gas volumes for the EU this year. They added this would be expected to increase in the future.
    President Joe Biden said the U.S. and EU would also “work together to take concrete measures to reduce dependence on natural gas — period — and to maximize … the availability and use of renewable energy.”

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    NeuConnect is not the only project focused on linking the U.K. with other parts of Europe.
    Last year, a 450-mile subsea cable which connects the U.K. and Norway, enabling them to share renewable energy, began commercial operations.
    The idea behind the North Sea Link, as it’s known, is for it to harness Norway’s hydropower and the U.K’s wind energy resources.
    Back in the U.K., 2020 saw plans announced for a multi-billion pound “underwater energy superhighway” that would allow electricity produced in Scotland to be sent to the northeast of England.
    The Eastern Link project, which is currently in the early stages of development, is to focus on the development of a pair of high-voltage direct current cables that will have a total capacity of 4 GW. More

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    U.S. State Department orders all non-emergency government staff in Shanghai to leave as Covid surges

    Chinese and U.S. flags flutter near The Bund, before U.S. trade delegation meet their Chinese counterparts for talks in Shanghai, China July 30, 2019.
    Aly Song | Reuters

    The U.S. State Department has ordered all non-emergency government staff and their family members in Shanghai to leave as Covid surges and told U.S. citizens to reconsider travel to China, according to an announcement dated April 11.
    “Reconsider travel to the People’s Republic of China (PRC) due to arbitrary enforcement of local laws and COVID-19-related restrictions,” the State Department said.

    “Do not travel to the PRC’s Hong Kong Special Administrative Region (SAR), Jilin province, and Shanghai municipality due to COVID-19-related restrictions, including the risk of parents and children being separated,” the statement said. “Reconsider travel to the PRC’s Hong Kong SAR due to arbitrary enforcement of local laws.”
    This is breaking news. Please check back for updates.

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    ‘Forget FAANG’ and focus on value stocks in the current inflationary environment, Jim Cramer says

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    CNBC’s Jim Cramer on Monday advised investors to turn away Big Tech and other growth stocks that are likely to be hard hit as the Federal Reserve raises interest rates.
    “For the moment, I do think we have to forget most of FAANG and focus on the money centers. The oils, Retailers with tremendous scale. Health insurers. Big pharma,” the “Mad Money” host said.

    CNBC’s Jim Cramer on Monday advised investors to turn away Big Tech and other growth stocks that are likely to be hard hit as the Federal Reserve raises interest rates.
    “For the moment, I do think we have to forget most of FAANG and focus on the money centers. The oils. Retailers with tremendous scale. Health insurers. Big pharma — and when I say big pharma, I mean only big pharma, absolutely not biotech, because they’re the losers in a high-inflation environment,” the “Mad Money” host said.

    FAANG is Cramer’s acronym for Facebook-parent Meta, Amazon, Apple, Netflix and Google-parent Alphabet.
    The tech-heavy Nasdaq Composite on Monday tumbled 2.18% while the Dow Jones Industrial Average slipped 1.19%. The S&P 500 declined 1.69%.
    Cramer’s comments come after he said last week that investors should be conservative with FAANG stocks as the market pivots to an environment that doesn’t favor high-growth names.

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    He added that investors shouldn’t sell all of their tech growth names, even if the market isn’t favorable for the stocks in the near term. Investors with tech-laden portfolios will need to be strategic moving forward, he cautioned.
    “Those with too much tech need a bounce to reposition. I think you’re going to get that. … You need to be positioned with no overweighting to anything, except maybe oil because of the industry’s newfound discipline on drilling,” he said.

    Disclosure: Cramer’s Charitable Trust owns shares of Alphabet, Apple, Amazon and Meta.

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    Stock futures inch higher ahead of big inflation report

    U.S. stock futures inched higher in overnight trading as investors braced for a key inflation report Tuesday.
    Futures on the Dow Jones Industrial Average gained 40 points or 0.1%, while S&P 500 futures and Nasdaq 100 futures rose marginally higher.

    The overnight moves come as investors await the release of March’s highly anticipated consumer price index on Tuesday. The data is expected to show an 8.4% annual increase in prices — the highest level since December 1981 — according to economists polled by Dow Jones, with rising food costs, rents and energy prices expected as the main contributors to the spike.
    “I think by the summer we’ll probably see the CPI inflation rate peaking and then the consumption deflator is going to peak somewhere between 6 and 7% and then come down to maybe 3 to 4% by the second half of the year going into next year,” Ed Yardeni, president of Yardeni Research told CNBC’s “Closing Bell: Overtime” on Monday.
    During regular trading on Monday, the Dow Jones Industrial Average fell 413.04 points, or 1.19%, to 34,308.08, while the S&P 500 dropped 1.69% to 4,412.53. The tech-heavy Nasdaq Composite sank 2.18% to 13,411.96.
    All 11 sectors ended the day in the red, with technology facing the brunt of the losses as investors continued to search for stability. Microsoft fell nearly 4%, while semiconductor Nvidia dropped more than 5%.

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    Energy companies including ConocoPhillips and Occidental Petroleum also fell as oil prices declined on fears that lockdowns in China could hit demand. Oil prices have fluctuated in recent weeks amid the war in Ukraine, and WTI settled down 4.04% to $94.29 on Monday while Brent fell 4.18% to $98.48.

    Meanwhile, shares of AT&T rose more than 7% after closing its WarnerMedia spinoff. Airline stocks including Delta Air Lines and Southwest also ended the day in the positive.
    The 10-year Treasury yield topped 2.79%, its highest level since January 2019.  
    Along with March CPI, investors are awaiting the start of earnings season set to kick off Wednesday with JPMorgan and Delta Air Lines, followed by several big banks on Thursday.

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