Global Edition

Dollar rebounds while gold climbs again before Fed update

  • Investors also took a cautious approach ahead of the Fed's latest policy meeting, hoping for guidance on its plans for interest rates amid uncertainty over Trump's latest tariff threats.
  • The dollar recovered slightly on Wednesday as traders awaited the US Federal Reserve's outlook on interest rates, while gold reached another record high as investors seek safety amid an uncertain economic outlook on several fronts.
  • Investors also took a cautious approach ahead of the Fed's latest policy meeting, hoping for guidance on its plans for interest rates amid uncertainty over Trump's latest tariff threats.
The dollar recovered slightly on Wednesday as traders awaited the US Federal Reserve's outlook on interest rates, while gold reached another record high as investors seek safety amid an uncertain economic outlook on several fronts.
European stocks were mainly lower ahead of the New York open, with Amazon saying it planned to cut a further 16,000 jobs worldwide -- having already announced 14,000 cuts last October.
The dollar had seen a sell-off Tuesday fuelled by US President Donald Trump's suggestion that he was happy with the currency's recent decline, which saw it fall to a four-year low of $1.20 against the euro.
The greenback has retreated across the board following reports that the New York Federal Reserve had checked in with traders about the yen's exchange rate, fuelling talk of a joint US and Japanese intervention to prop up the yen. 
That led to speculation the White House was prepared to let the dollar weaken, and Trump did little to dismiss that when asked Tuesday if he was worried about the decline.
"No, I think it's great," he told reporters as the currency fell to a two-and-half-month low against the yen. 
"Look at the business we're doing. The dollar's doing great," he said.
Win Thin, at Bank of Nassau 1982 Ltd, said: "Foreign exchange typically is the leader in terms of showing market discomfort with a country's policies and economic outlook."
Elsewhere, the price of gold struck a new peak at $5,278.30 a troy ounce (31.1 grams) as the dollar's drop continued to support demand for the save-haven investment.
Investors also took a cautious approach ahead of the Fed's latest policy meeting, hoping for guidance on its plans for interest rates amid uncertainty over Trump's latest tariff threats.
The US central bank is widely expected to freeze rates for the coming months, but a weakening dollar could fan inflation in the world's largest economy, clouding the possibility of lower rates later this year. 
US consumer confidence has plunged to its lowest level since 2014, a survey showed, as households fret about sticky inflation.
In Europe, the CAC 40 in Paris was dragged down by renewed concerns for the luxury sector after market heavyweight LVMH posted a 13 percent slide in annual profit, to 10.9 billion euros ($13.1 billion).
LVMH shares tumbled 6.5 percent, while in London the British fashion label Burberry lost 2.6 percent.
On the upside, shares in Dutch tech giant ASML, which makes machines for semiconductors, jumped six percent after announcing a strong rise in annual profits and a buoyant outlook, while also saying it would cut hundreds of management jobs.
"ASML's latest results suggest the AI boom is still in full swing, with strong orders and a bullish outlook," said Russ Mould, investment director at traders AJ Bell. 
"However, job cuts in the business would suggest it is not getting carried away with the strength of current trading."

Key figures at around 1130 GMT

London - FTSE 100: DOWN 0.5 percent at 10,160.61 points
Paris - CAC 40: DOWN 0.9 percent at 8,083.14
Frankfurt - DAX: DOWN 0.2 percent at 24,852.64
Tokyo - Nikkei 225: UP 0.1 percent at 53,358.71 (close)
Hong Kong - Hang Seng Index: UP 2.6 percent at 27,826.91 (close)
Shanghai - Composite: UP 0.3 percent at 4,151.24 (close)
New York - Dow: DOWN 0.8 percent at 49,003.41 (close)
Euro/dollar: DOWN at $1.1973 from $1.2035
Pound/dollar: DOWN at $1.3774 from $1.3833
Dollar/yen: UP at 152.67 yen from 152.32 yen on Tuesday
Euro/pound: DOWN at 86.90 pence from 86.98 pence
Brent North Sea Crude: DOWN 0.2 percent at $67.42 per barrel
West Texas Intermediate: DOWN 0.1 percent at $62.35 per barrel
burs-bcp/ajb/js

results

Dutch tech giant ASML posts bumper profits, cuts jobs

  • In a case unrelated to ASML, the Dutch government briefly seized control of Nexperia, a Chinese-owned company that makes low-tech semiconductors.
  • Dutch tech giant ASML, which sells cutting-edge machines to make semiconductor chips, reported a significant gain in annual net profit Wednesday but said it would cut hundreds of management jobs to improve internal organisation.
  • In a case unrelated to ASML, the Dutch government briefly seized control of Nexperia, a Chinese-owned company that makes low-tech semiconductors.
Dutch tech giant ASML, which sells cutting-edge machines to make semiconductor chips, reported a significant gain in annual net profit Wednesday but said it would cut hundreds of management jobs to improve internal organisation.
Shares in the firm soared more than seven percent at the opening bell as it forecast another record sales year in 2026 driven by insatiable demand for artificial intelligence.
ASML is a critical cog in the global economy, as the semiconductors crafted with its tools power everything from smartphones to missiles.
The company, Europe's biggest tech firm by market value, posted after-tax profit of 9.6 billion euros ($11.5 billion) for last year, up from 7.6 billion euros in 2024.
CEO Christophe Fouquet said ASML customers were bullish on the medium-term outlook "primarily based on more robust expectations of the sustainability of AI-related demand".
Fourth-quarter net bookings, the figure traders track most closely, came in at 13.2 billion euros, a sharp rise from the 5.4 billion euros in orders booked in the previous quarter.
Total 2025 net sales were a record 32.7 billion euros. The firm had previously said it did not expect sales to be below the 28.3 billion euros banked last year.
"ASML just delivered a thumping set of numbers, with new orders blowing past expectations and pointing to a market gearing up for the next leg of growth," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
The company expects net sales this year to reach 34 billion to 39 billion euros, it announced in new forecasts, with first-quarter sales hitting 8.2 billion to 8.9 billion euros.
"We expect 2026 to be another growth year for ASML's business," Fouquet said.
Separately, ASML announced an organisational shake-up aimed at speeding up working methods that Fouquet said had become "less agile".
The firm expects to cut around 1,700 jobs in the Netherlands and the United States, mostly from leadership roles, Fouquet said.
"As with any company that grows rapidly, however, we need to be mindful that the way we have grown does not slow us down," he said.
ASML employs around 44,000 staff worldwide.
Fouquet told reporters it was "probably the most difficult decision the management team ever had to make."
But given the firm's positive financial outlook, he added: "We are not doing that... because we are in trouble or because we need to save money."

US-China tech war

ASML is caught in the middle of a US-led effort to curb high-tech exports to China over fears they could be used to bolster the country's military.
Beijing has been infuriated by the export curbs, calling them "technological terrorism".
In a case unrelated to ASML, the Dutch government briefly seized control of Nexperia, a Chinese-owned company that makes low-tech semiconductors.
That move sparked a major row between Beijing and the West that threatened to cripple car manufacturers that rely on Nexperia chips.
In late October, following trade talks between China's President Xi Jinping and his US counterpart Donald Trump, Beijing agreed to resume exports of some Nexperia chips halted over the row.
ASML had already warned when presenting third-quarter results that China sales would "decline significantly" this year compared with "very strong business" in 2024 and 2025.
A breakdown of sales showed 33 percent of sales going to China last year, compared to 41 percent in 2024. China was ASML's top customer in both years.
Chief Financial Officer Roger Dassen said "we expect that decline to continue", predicting a share of 20 percent from China this year.
"It's not falling off a cliff, it's more of a normalisation than anything else," Dassen told reporters.
Longer-term, ASML believes that the rapidly expanding AI market will push up its annual sales to between 44 billion and 60 billion euros by 2030. 
ric/jh

semiconductors

SKorean chip giant SK hynix posts record operating profit for 2025

  • South Korea has said it will triple spending on artificial intelligence this year, aiming to join the United States and China as one of the top three AI powers.  cdl/pbt
  • South Korean chip giant SK hynix said on Wednesday its operating profit doubled last year to a record high after a surge in global demand for technology powering artificial intelligence.
  • South Korea has said it will triple spending on artificial intelligence this year, aiming to join the United States and China as one of the top three AI powers.  cdl/pbt
South Korean chip giant SK hynix said on Wednesday its operating profit doubled last year to a record high after a surge in global demand for technology powering artificial intelligence.
SK hynix and rival Samsung are among the world's leading producers of memory chips, supplying high‑performance components that are essential for AI products and the data centres powering the fast‑evolving sector.
It said in a statement that "2025 marked a year in which the company once again demonstrated its world-class technological leadership".
The firm said its operating profit soared 101 percent to 47.2 trillion won ($33 billion) last year.
Net profit came to 42.9 trillion won last year, up 117 percent from 2024. Sales for 2025 stood at 97.1 trillion won, up 47 percent from the previous year.
The AI boom has pushed up prices and shipments of conventional NAND and DRAM memory semiconductors, while demand for high‑bandwidth memory (HBM) chips, used in AI servers, has soared.
That has helped SK hynix's shares surge around 220 percent over the past six months.
Fourth-quarter net profit came to 15.24 trillion won, a 90.4 percent year-on-year increase.
SK hynix "plans to further strengthen its proven quality, technological leadership and mass-production capabilities", by "stably supplying both HBM3E and HBM4" chips.
The company also said it plans to set up an "AI solutions firm" in the United States, committing $10 billion, and is weighing investments in innovative US companies.

AI power

TrendForce memory analyst Ellie Wang said HBM chips were essential for advanced processors used in AI systems.
"For Samsung and SK hynix, while AI has driven a meaningful increase in memory demand, the technical barriers for HBM have also risen," she told AFP. 
"How capacity is allocated across different products has become an increasingly critical issue" for the companies, she said, adding that current memory chip "supply tightness is partly due to suppliers concentrating production lines on HBM".
The huge demand for memory chips in AI systems has caused a shortage for those used in consumer electronics -- threatening higher prices for phones, laptops and other devices. 
"As HBM's share of total production continues to rise, supply shortages are difficult to alleviate," Wang said. 
TrendForce predicts that memory chip industry revenue will surge to a global peak of more than $840 billion in 2027.
South Korea has said it will triple spending on artificial intelligence this year, aiming to join the United States and China as one of the top three AI powers. 
cdl/pbt

politics

Japan PM's tax giveaway roils markets and worries voters

BY JULIEN GIRAULT AND HIROSHI HIYAMA

  • That evoked fears of a repeat of the turmoil seen in Britain in 2022 when Prime Minister Liz Truss unveiled massive unfunded tax cuts that triggered a sharp spike in bond yields -- eventually leading to her resignation. 
  • Ahead of a snap election in Japan, Prime Minister Sanae Takaichi has pledged to scrap a tax on food, but a lack of clear funding is unnerving markets and voters. 
  • That evoked fears of a repeat of the turmoil seen in Britain in 2022 when Prime Minister Liz Truss unveiled massive unfunded tax cuts that triggered a sharp spike in bond yields -- eventually leading to her resignation. 
Ahead of a snap election in Japan, Prime Minister Sanae Takaichi has pledged to scrap a tax on food, but a lack of clear funding is unnerving markets and voters. 
As she announced the dissolution of parliament last week ahead of a February 8 vote, the ultra-conservative leader promised to exempt food products from an eight percent consumption tax for two years in response to soaring living costs. 
It's a measure also strongly supported by opposition parties.
But her comments immediately rattled the bond market, worried by the prospect of fiscal slippage, with yields on 30- and 40-year Japanese bonds jumping to record highs. 
That evoked fears of a repeat of the turmoil seen in Britain in 2022 when Prime Minister Liz Truss unveiled massive unfunded tax cuts that triggered a sharp spike in bond yields -- eventually leading to her resignation. 
Takaichi is far from that point: markets calmed in the following days, and Japan's modest budget deficit allows it to absorb shocks. 
"Japan is able to secure financing without relying on foreign money" thanks to its vast domestic savings, said Hideo Kumano, an economist at Dai-ichi Life. And unlike the UK at the time, it posts a sizeable current account surplus, he told AFP. 
Takaichi has repeatedly said Japan will post a primary budget surplus, which excludes the cost of servicing debts, for the first time in 28 years. 
A "Truss shock" is only one risk scenario, Kumano said, although the underlying danger "has been rising".

'Fiscal sustainability'

The tax break is expected to cost around 5 trillion yen ($32.8 billion) per year, but Takaichi has outlined no funding source or offsetting measures. 
Markets were already anxious over a colossal $135 billion stimulus package adopted at the end of 2025.
That aims to support households through energy subsidies, even at the risk of inflating Japan's gargantuan national debt, which is expected to exceed 230 percent of GDP in the fiscal year 2025-26.
Under pressure, Takaichi defended her measure on Monday, saying she wanted to set up a public committee to discuss the issue, insisting she was paying "considerable attention to fiscal sustainability".
But a bigger majority in parliament could give her coalition free rein for expansionary fiscal policy. 
In the event of a landslide victory, UBS experts warned that Takaichi's policies could even exceed market expectations and that renewed anxiety could push bond yields back up.  
In that case, "Takaichi may be forced to offset some of the expansionary fiscal measures announced recently with tightening elsewhere", noted Marcel Thieliant, an economist at Capital Economics. 
The government could also opt to issue shorter-maturity debt, and, as a last resort, the Bank of Japan (BoJ) "could step up its bond purchases yet again", he added. 
But it's complicated. Any intervention in the bond market risks triggering a depreciation of the yen, making imports more expensive and putting further upward pressure on inflation.
The foreign exchange market is already jittery. The yen has come under pressure amid renewed concerns over fiscal discipline, before it rebounded amid rumours of a possible joint Japan–US monetary intervention to boost its value. 

'Election tactic'?

It's unclear whether the tax break is even a vote-winner, although inflation is a top concern among voters.
Consumer prices, excluding fresh food, rose 2.4 percent year-on-year in December.
According to a poll published Monday by the Nikkei newspaper, 56 percent of those surveyed believe the promised tax exemption would not be effective against rising prices. 
"You can't help wondering whether it's just an election tactic," Kanamu Kashima, a 23-year-old student, told AFP. 
The BoJ itself has slightly raised its inflation forecasts through 2027, pointing to pressure from labour shortages in the ageing country. That might lead to an increase in long-term yields, which adjust to these expectations. 
In the short term, Dai-ichi Life's Kumano warned that structural reforms are being sidestepped. 
"A question must be asked about the real nature of the tax cut and... if it alone would do the job (of restoring the economy)," he said.
"These policies are rather short-sighted."
hih-jug/aph/dan

trade

Greenland blues to Delhi red carpet: EU finds solace in India

BY UMBERTO BACCHI

  • In spite of its eye-tickling pollution, the Indian capital must have felt like a breath of fresh air for von der Leyen and European Council president Antonio Costa, who co-led the EU delegation.
  • Presiding over the signing of a major trade deal alongside Indian Prime Minister Narendra Modi on Tuesday, EU chief Ursula von der Leyen broke into a large smile.
  • In spite of its eye-tickling pollution, the Indian capital must have felt like a breath of fresh air for von der Leyen and European Council president Antonio Costa, who co-led the EU delegation.
Presiding over the signing of a major trade deal alongside Indian Prime Minister Narendra Modi on Tuesday, EU chief Ursula von der Leyen broke into a large smile.
A diplomatic and economic coup, the EU-India pact comes as a welcome piece of good news for Brussels after a tumultuous few weeks dominated by US threats over Greenland.
Addressing a press conference in New Delhi, von der Leyen described it as a tale of "two giants who choose partnership" and "the best answer to global challenges".
In spite of its eye-tickling pollution, the Indian capital must have felt like a breath of fresh air for von der Leyen and European Council president Antonio Costa, who co-led the EU delegation.
As they flew away from Brussels over the weekend, the pair left behind a just-defused crisis in transatlantic relations and internal squabbling over another trade deal with South American nations.
In New Delhi, authorities rolled out the red carpet for the pair, who were feted as guests of honour at India's Republic Day parade.
Posters emblazoned with their faces adorned lampposts across the city.
Costa, whose family hails from Goa, proudly flashed his Indian identity card at a press conference where Modi celebrated him as "the Gandhi of Lisbon".
Meanwhile local media praised von der Leyen's burgundy and gold brocade outfit -- a nod to Indian fashion.
It was a far cry from the scorn and threats reserved for Europe by its traditional ally the United States at the World Economic Forum in Davos last week.
European officials had been hoping to make progress on Ukraine at the Swiss ski resort -- a goal drowned out by US President Donald Trump's push to wrest control of Greenland from EU member Denmark.

'Difficult job'

Trump made an about-turn after talks with NATO chief Mark Rutte -- a change of heart EU officials were keen to credit to Europe's firm response -- and the climbdown took the sting out of an emergency summit called on the Greenland issue.
One year into Trump's second term, Costa said the European Union has "learned how to manage" the ups and downs, and not to "react to each message".
"We need to keep calm and continue to have a polite, respectful relationship," the council chief told AFP. "At the same time, we need to diversify our relationships".
But few in Europe believe the Greenland crisis was a one-off bump in the road, with the unpredictable US leader at the helm.
Maros Sefcovic, the EU's trade chief, told AFP he scours through newspaper headlines each morning in anticipation of "what else might happen".
"It's indeed a difficult job," he quipped.
Yet he said the same was true for most other countries, which in turn found renewed appeal in what Europe has to offer: partnership, predictability and stability.
India, for one, was left bruised by tariffs slapped on it by the White House over its purchase of Russian oil as New Delhi and Washington were negotiating a -- so-far-elusive -- trade deal.
"The last year has turbocharged the European trade policy," Sefcovic said.
Pushing to reduce its dependencies on the United States and China and lower the cost of US tariffs, the EU was negotiating or looking to open talks with an array of nations including the Philippines, Malaysia, the United Arab Emirates and Australia, he said.

'New opportunities'

By cutting or eliminating tariffs on almost 97 percent of European exports, the deal struck in New Delhi will help ease access to India's 1.4-billion-people-strong market for cars, wine, pasta and other EU products.
But the signing also allowed Brussels to turn the page after a just-sealed pact with South American bloc Mercosur was cast into limbo by a legal challenge in the European parliament.
That setback added to rancorous divisions among member states over the deal's impact on European farmers, who remained deaf to the EU's arguments and staged months of tractor-mounted protests against the accord.
European officials hope the new India deal will also help bring the South Asian giant diplomatically closer to Europe.
Neutral on Ukraine, New Delhi has relied on Moscow for key military hardware for decades, but has tried to cut its dependence by diversifying imports and pushing its own domestic manufacturing base.
Modi said a security partnership struck alongside the trade deal would provide "new opportunities" for defence companies.
While denying a pivot away from Russia, foreign secretary Vikram Misri said India was interested in hosting the joint production of European military kit.
Monday's Republic Day parade featured Russian helicopters and planes, alongside dancers and motorcycle daredevils.
But, in perhaps a hint of things to come, it ended with a squad of French-made Rafale fighter jets zooming overhead.
ub/ec/jhb/ceg

rate

US Fed set to pause rate cuts as it defies Trump pressure

BY BEIYI SEOW

  • Yet, "while the Fed has been politically pressured to cut rates, it is not pressed by the data," said EY-Parthenon chief economist Gregory Daco.
  • The US Federal Reserve is broadly expected to pause its series of interest rate cuts Wednesday, resisting mounting attacks from President Donald Trump, while policymakers await more data on the world's biggest economy.
  • Yet, "while the Fed has been politically pressured to cut rates, it is not pressed by the data," said EY-Parthenon chief economist Gregory Daco.
The US Federal Reserve is broadly expected to pause its series of interest rate cuts Wednesday, resisting mounting attacks from President Donald Trump, while policymakers await more data on the world's biggest economy.
The US central bank lowered rates in each of its last three policy meetings -- bringing them to a range between 3.50 percent and 3.75 percent -- as officials fretted about the cooling jobs market.
But solid GDP growth, relatively low unemployment and stubborn inflation have given them reason to shift into wait-and-see mode.
The lack of urgency, however, could put the central bank again at odds with Trump, who has repeatedly called for large rate reductions.
Trump has sharply escalated pressure on the Fed since returning to the White House a year ago, seeking to oust Fed Governor Lisa Cook over mortgage fraud allegations while his administration launched an investigation into chairman Jerome Powell.
In a rare rebuke this month, Powell slammed the threat of criminal charges against him -- over the Fed's headquarters renovation -- as a threat to central bank independence.
Yet, "while the Fed has been politically pressured to cut rates, it is not pressed by the data," said EY-Parthenon chief economist Gregory Daco.
Officials appear to have converged on a near-term halt in rate reductions, with their debate now centering around what conditions justify further rate cuts -- and how quickly these should take place.
"The hurdle for additional near-term cuts has risen," Daco said.
Officials will be looking for "clearer, more durable evidence of disinflation" or renewed deterioration in the labor market before lowering rates again, he added.

'Less dissent'

While the Fed has seen deepening divides over interest rates, Dan North of Allianz Trade North America told AFP that he expects "less dissent" in Wednesday's decision.
Fed Governor Stephen Miran, appointed by Trump last year to fill a term lasting until late January, is likely to again push for lower rates, North said.
But it is unclear if others on the board of governors like Michelle Bowman and Christopher Waller would join him.
Financial markets generally expect the Fed to continue keeping rates unchanged until its June meeting, according to CME FedWatch.
Looking ahead, all eyes are on how Trump's nominee to succeed Powell -- whose chairmanship of the bank ends in May -- shapes Fed policy.
"We think inflation peaks and starts to turn lower (this year) but also importantly, we think a new Fed chair would be more open to helping to navigate lower interest rates," said Nationwide chief economist Kathy Bostjancic.

Credibility issues

One issue is whether the new chairman can corral the rest of the rate-setting Federal Open Market Committee into more rate cuts, ING analysts said in a note.
Outside the Fed, it could be harder for the next chairman to convince investors that the bank will continue pursuing its mandate of low and stable inflation and maximum employment, independent of political influence, said Michael Strain of the conservative American Enterprise Institute.
"I think the stakes are higher," he said.
Given the way the Trump administration has targeted Powell, Strain added that "establishing credibility will be much more challenging” for Powell's successor than it has been for previous Fed chiefs over the last few decades.
Strain, who is AEI's director of economic policy studies, also cautioned that the Fed may have gone too far in lowering rates last year.
He warned that the labor market might be stronger than officials think, while there remains a risk that inflation accelerates again.
"Certainly, the Fed should not continue to cut," he said. "I'm worried the Fed's going to have to hike in 2026."
myl-bys/ksb

economy

Trump warns of 'bad things' if Republicans lose midterms

BY BRENDAN SMIALOWSKI WITH DANNY KEMP IN WASHINGTON

  • "If we lose the midterms, you'll lose so many of the things that we're talking about, so many of the assets that we're talking about, so many of the tax cuts that we're talking about -- and it would lead to very bad things."
  • Donald Trump warned Tuesday of "very bad things" if Republicans lose the US midterm elections, as the US president kicked off a travel blitz under the shadow of unrest in Minneapolis and voter worries about the economy.
  • "If we lose the midterms, you'll lose so many of the things that we're talking about, so many of the assets that we're talking about, so many of the tax cuts that we're talking about -- and it would lead to very bad things."
Donald Trump warned Tuesday of "very bad things" if Republicans lose the US midterm elections, as the US president kicked off a travel blitz under the shadow of unrest in Minneapolis and voter worries about the economy.
At a rally in Iowa -- one of the first stops for primary campaigns in US presidential elections -- Trump said his party must win both the Senate and the House in November despite his own poor approval ratings.
"I'm here because I love Iowa, but I'm here because we're starting the campaign to win the midterms. Got to win the midterms," second-term president Trump said in his speech.
"If we lose the midterms, you'll lose so many of the things that we're talking about, so many of the assets that we're talking about, so many of the tax cuts that we're talking about -- and it would lead to very bad things."
But Trump's economy-focused speech was largely overshadowed by events in the neighboring state of Minnesota, where two people have died this month in a deadly immigration crackdown.
Trump told Fox News earlier he would "de-escalate a little bit" after federal agents shot 37-year-old nurse Alex Pretti in Minneapolis at the weekend, but he largely avoided talking about it in his speech.
The White House says Trump will be making weekly trips across the country ahead of the midterms, in which voters have historically punished US presidents.
Trump's team has increasingly focused on the economy after polls showed mounting voter anger over the issue of affordability one year since the billionaire's return to power.
In his Iowa speech, the 79-year-old president repeated his claims about a "Golden Age" in the United States and insisted prices were falling for most goods.
But he admitted that it may be hard to convince voters in November's midterms, saying that in past elections "if something happens, the screw turns with the voters" no matter how good the president.

'Sickos'

Trump has raged at what he calls unfair opinion polls, but numerous surveys have showed him with low approval ratings. A New York Times/Siena poll last week put the figure at 40 percent.
With supporters cheering him along in Iowa, Trump, however, returned to a familiar theme of talking about running for a constitutionally barred third term as president. 
"Should we do it a fourth time?" he said, referring to his false claim to have won the 2020 election that he lost to Democrat Joe Biden, along with winning in 2016 and 2024.
Protesters disrupted Trump's speech on at least two occasions, with the Republican dismissing them as "sickos" and "paid insurrectionists."
Trump, who was accompanied by US Treasury chief Scott Bessent, earlier visited a local diner and talked to patrons.
Also accompanying Trump to Iowa was deputy chief of staff Stephen Miller, the architect of his immigration policy, who described Pretti without evidence as a "would-be assassin." 
The political row over immigration sees Trump in an unusually tight spot of one of his core campaign issues.
While polls show most voters approve of his policy of mass deportations, many recent surveys show they are uncomfortable with the harsh tactics of Trump's immigration agents.
During his Iowa speech Trump veered off as he often does into talking about immigration, including renewed attacks on Ilhan Omar, a Democrat who is the first Somali-American elected to Congress.
Meanwhile Trump faced a fresh blow on the economy too Tuesday as data showed US consumer confidence plunged in January to its lowest level since 2014.
dk/md

retail

Amazon closing Fresh and Go stores in Whole Foods push

  • "The bet is that mass-market groceries sell more efficiently through same-day delivery, with Whole Foods as its primary physical retail brand.
  • Amazon on Tuesday said it is closing its Go and Fresh real-world stores to focus on its Whole Foods markets and online grocery delivery.
  • "The bet is that mass-market groceries sell more efficiently through same-day delivery, with Whole Foods as its primary physical retail brand.
Amazon on Tuesday said it is closing its Go and Fresh real-world stores to focus on its Whole Foods markets and online grocery delivery.
Go and Fresh shops doubled as innovation centers for Amazon, which tested systems such as eliminating checkout stations and automatically billing customers for the items they have with them as they leave the store.
"Go and Fresh showed what was technologically possible, but not what was viable economically," said Emarketer senior analyst Zak Stambor.
"The bet is that mass-market groceries sell more efficiently through same-day delivery, with Whole Foods as its primary physical retail brand.
Grocery sales at Amazon's same-day delivery service grew 40-fold in the past year and an option for ultra-fast delivery of fresh food and other items in 30 minutes or less is being tested, according to the company.
Amazon will "continue inventing on behalf of customers to develop a mass physical store format that brings customers distinctive selection, value, and convenience," the e-commerce giant founded by Jeff Bezos said in a blog post.
Ideas being explored include a new retail supercenter where people can shop for groceries, household essentials and general merchandise, according to Amazon.
Amazon aims to open more than 100 new Whole Foods stores in coming years, with some Go and Fresh shops being converted into Whole Foods outlets.
Whole Foods sales have grown 40 percent, and the number of stores has increased to more than 550 locations, since the chain was bought by Amazon in 2017, the retail titan said.
The deal was valued at $13.7 billion.
Amazon ranked itself as one of the top three grocers in the United States.
"We believe Amazon's reallocation of resources towards the Whole Foods and fast delivery experience likely benefits the logistics flywheel," Baird Equity senior research analyst Colin Sebastian said in a note to investors, reasoning that the grocery business is a large growth opportunity for the company.
gc/dw

earnings

GM reports quarterly loss but boosts shareholder returns

BY JOHN BIERS

  • On Tuesday, GM raised its dividend by 20 percent and announced it had authorized $6 billion in new share repurchases.
  • General Motors announced Tuesday fresh actions to return funds to investors, lifting shares despite reporting a quarterly loss on costs connected to its electric vehicle retreat.
  • On Tuesday, GM raised its dividend by 20 percent and announced it had authorized $6 billion in new share repurchases.
General Motors announced Tuesday fresh actions to return funds to investors, lifting shares despite reporting a quarterly loss on costs connected to its electric vehicle retreat.
The results were dented by a previously-announced hit of $7.1 billion, mostly due to write-down on EV investments following an about-face in US environmental policy enacted by President Donald Trump's administration.
That resulted in a fourth-quarter loss of $3.3 billion, compared with a loss of $3.0 billion in the year-ago period.
Annual profits fell 55 percent to $2.7 billion.
But the big US automaker, which has undertaken significant strategic pivots in light of Trump's aggressive policy changes on trade and fuel economy rules, projected higher profits in 2026.
GM described its performance in 2025 as "resilient," with 2026 "positioned to be stronger than 2025," according to a company presentation.
GM expects solid vehicle pricing to continue amid relatively tight vehicle inventories that stand "slightly" below the company's target of having 50-60 days of supply on hand. 
GM also plans launches of key vehicles, including its popular Chevrolet Silverado pickup.
"We grew the business and adapted to significant changes in tax and trade policy, to deliver full year (earnings) at the high end of guidance range," said Chief Executive Mary Barra
Revenues dipped 5.1 percent to $45.3 billion on lower vehicle sales compared with the year-ago period.
GM has significantly scaled back its EV investments while redirecting billions of dollars in capital towards boosting production of gasoline-fired vehicles.
However, Barra has said the company continues to believe in an EV future, in part because "we know once somebody drives an EV, they rarely go back to internal combustion engine," she said on Tuesday's analyst call.

Lower auto inventories

GM expects 2026 tariff costs of $3.0-$4.0 billion after incurring $3.1 billion in 2025, a bit below the $3.5 to $4.5 billion previously forecast.
The latest wildcard in White House trade policy came Monday night when Trump said he would raise tariffs on South Korean goods to 25 percent, accusing the Asian country's legislature of not enacting policy to cement a US-South Korea deal setting a 15 percent tariff.
GM has a significant operation in South Korea, including production of the Chevrolet Trax, a moderately-priced compact sport utility vehicle.
GM's forecasts still include the 15 percent levy. Barra said she was "hopeful" about the lower rate but would offset the hit if there is a period with a higher levy.
GM's North American inventories have gradually edged lower over the last year, standing at 486,000 vehicles at the end of the year, down 18.6 percent from the end of 2024.
Pricing will be "flat to up 0.5 percent," according to a GM slide.
The company does not anticipate a "big buildup" in vehicle supply, Chief Financial Officer Paul Jacobson said on the conference call.
Jacobson emphasized GM's ongoing commitment to shareholder returns, noting the company has repurchased $23 billion in stock since November 2023, reducing its outstanding share count by nearly 35 percent.
On Tuesday, GM raised its dividend by 20 percent and announced it had authorized $6 billion in new share repurchases.
Shares surged 8.6 percent shortly after midday.
jmb/des/msp

regulation

US banks fight crypto's push into Main Street

BY ALEX PIGMAN

  • The White House remains confident the bill can get back on track, and warns of the consequences if the opportunity is missed and the Democratic party wins midterm elections in November.
  • The banking industry is pushing back against White House-aligned crypto companies seeking to expand their business to Main Street customers in the United States.
  • The White House remains confident the bill can get back on track, and warns of the consequences if the opportunity is missed and the Democratic party wins midterm elections in November.
The banking industry is pushing back against White House-aligned crypto companies seeking to expand their business to Main Street customers in the United States.
At the heart of the battle being waged by some of Washington's most powerful lobbies is control over several trillions of dollars in banking deposits and a debate over whether crypto companies can offer an alternative place to stash cash.
The crypto industry has long had a complicated and adversarial relationship with traditional banks, a distrust dating back to the birth of the crypto movement in the wake of the 2008 financial crisis. Crypto believers fear that banks are trying to derail their rise.
The current battle centers on draft legislation -- the Clarity Act -- that would allow crypto players to offer cash rewards to stablecoin holders, boosting their ability to lure customers away from traditional banks.
According to the American Banking Association, these incentives would endanger the $6.6 trillion in deposits parked in traditional banks, especially lenders smaller than the national giants JPMorgan Chase or Bank of America.
These deposits are the lifeblood of the economy, especially in areas outside major cities, where local banks use them to finance loans to individuals, small businesses and farmers.
"Community banks make 60 percent of all the small business loans in this country," Independent Community Bankers of America CEO Rebeca Romero Rainey told AFP. "They make 80 percent of all agriculture loans. If they don't have those deposits, where are the funds coming from to fund those loans?"
Stablecoins are cryptocurrencies designed to maintain steady value by being pegged to traditional assets like cash or US government bonds -- meaning they can be used reliably for transactions and transfers while bypassing banks.
The crypto industry touts them as proof that crypto businesses can be trusted and aren't necessarily high-risk or vulnerable to scams.
For Bhau Kotecha, CEO and co-founder of platform Paxos Labs, banning stablecoins from offering interest "would narrow the use cases that make stablecoins compelling for mainstream adoption."
The key player in the battle is Coinbase and its CEO Brian Armstrong, who has led efforts to rehabilitate crypto's reputation after years of scandals and a Biden administration notably skeptical of crypto's benefits.
In the runup to the 2024 election, Armstrong and Silicon Valley venture capital firm Andreessen Horowitz helped raise tens of millions of dollars for the Trump campaign and lawmakers on both sides of the aisle to change Washington's stance on crypto.
The gamble paid off with the Republican sweep in November 2024.
Since Donald Trump's victory, crypto companies have seen their power and influence surge. Trump and his wife Melania each have their crypto coins, and his sons are heavily invested in the industry. One bill -- the GENIUS Act -- has already been signed into law, giving stablecoins long-sought legal recognition.
But with the Clarity Act -- a broader proposal setting the rules of the road for digital assets -- the crypto industry is moving onto the banking industry's turf.

Beware of the midterms

For banks, the risk of customers diverting deposits to stablecoins and potentially gutting their core business was too grave a threat.
After their concerns were heard, the Senate Banking Committee was poised last month to pass a version of the bill that would ban stablecoins from paying interest.
An irate Armstrong maneuvered to have the bill pulled, and the Clarity Act is now stuck in limbo.
"We'd rather have no bill than a bad bill," Armstrong wrote on X.
The banks counter that if the crypto industry wants to operate as banks, they should apply for banking licenses and be regulated like any other lender.
The White House remains confident the bill can get back on track, and warns of the consequences if the opportunity is missed and the Democratic party wins midterm elections in November.
"You might not love every part of the CLARITY Act, but I can guarantee you'll hate a future Dem version even more," said Patrick Witt, who coordinates crypto policy at the White House.
arp-tu/ksb

addiction

TikTok settles hours before landmark social media addiction trial

BY GLENN CHAPMAN

  • TikTok's settlement joins Snapchat, which last week confirmed that it made a deal to avoid the trial brought by K.G.M. The terms were not disclosed.
  • Video sharing app TikTok has made an eleventh-hour deal to avoid a landmark US trial accusing it, along with Meta and YouTube, of addicting young people to social media, lawyers said on Tuesday.
  • TikTok's settlement joins Snapchat, which last week confirmed that it made a deal to avoid the trial brought by K.G.M. The terms were not disclosed.
Video sharing app TikTok has made an eleventh-hour deal to avoid a landmark US trial accusing it, along with Meta and YouTube, of addicting young people to social media, lawyers said on Tuesday.
The deal was made as jury selection was to begin in a Los Angeles court that could establish a legal precedent on whether social media companies deliberately designed their platforms to addict children.
The case being heard in the California state court is being called a "bellwether" proceeding because its outcome could set the tone for a tidal wave of similar litigation across the United States.
The remaining defendants in the suit are Alphabet and Meta, the tech titans behind YouTube and Instagram.
Meta co-founder and Chief Executive Mark Zuckerberg is slated to be called as a witness during the trial.
"The parties are pleased to have reached an amicable resolution of this dispute," the Social Media Victims Law Center said, noting that the terms of the settlement with TikTok are confidential.
The case focuses on allegations that a 19-year-old woman identified by the initials K.G.M. suffered severe mental harm because she was addicted to social media.
After joining YouTube at age six, Instagram at 11, Snapchat at 13, and TikTok at 14, the Californian claims to have developed an addiction to the sites that contributed to her depression, anxiety, body image issues and that stoked suicidal thoughts.
Social media firms are accused in hundreds of lawsuits of addicting young users to content that has led to depression, eating disorders, psychiatric hospitalization and even suicide.
Lawyers for the plaintiffs are explicitly borrowing strategies used in the 1990s and 2000s against the tobacco industry, which faced a similar onslaught of lawsuits arguing that companies sold a harmful product.
The trial before Judge Carolyn Kuhl is expected to start next week after a jury is selected.

'Significant victory'

"This is the first time that a social media company has ever had to face a jury for harming kids," Social Media Victims Law Center founder Matthew Bergman, whose team is involved in more than 1,000 such cases, told AFP.
The center is a legal organization dedicated to holding social media companies accountable for harms allegedly caused to young people online.
"The fact that now K.G.M. and her family get to stand in a courtroom equal to the largest, most powerful and wealthy companies in the world is, in and of itself, a very significant victory," Bergman said.
Internet titans have argued that they are shielded by Section 230 of the US Communications Decency Act, which frees them of responsibility for what social media users post.
However, this case argues those firms are culpable for business models designed to hold people's attention and to promote content that winds up harming their mental health.
"The allegations in these complaints are simply not true," said Jose Castaneda, a YouTube spokesperson.
"Providing young people with a safer, healthier experience has always been core to our work," he added.
Meta has also rejected the allegations.
TikTok's settlement joins Snapchat, which last week confirmed that it made a deal to avoid the trial brought by K.G.M. The terms were not disclosed.
The companies face two other similar trials in the same court scheduled for later this year.
Lawsuits, including some brought by school districts, accusing social media platforms of practices endangering young users are also making their way through federal court in Northern California and state courts across the country.
gc-arp/msp

earnings

LVMH 2025 net profit drops 13% to 10.9 bn euros

  • But sales at the company, best known for Louis Vuitton handbags, Dior fashion, Moet & Chandon champagne and Tiffany jewellery, also dropped by five percent to 80.8 billion euros as tariffs and geopolitical uncertainty hit consumer sentiment.
  • The world's leading luxury group, LVMH, saw net profit slide 13 percent in 2025 to 10.9 billion euros ($13.1 billion) as an exceptional tax on large French companies weighed on its bottom line. 
  • But sales at the company, best known for Louis Vuitton handbags, Dior fashion, Moet & Chandon champagne and Tiffany jewellery, also dropped by five percent to 80.8 billion euros as tariffs and geopolitical uncertainty hit consumer sentiment.
The world's leading luxury group, LVMH, saw net profit slide 13 percent in 2025 to 10.9 billion euros ($13.1 billion) as an exceptional tax on large French companies weighed on its bottom line. 
But sales at the company, best known for Louis Vuitton handbags, Dior fashion, Moet & Chandon champagne and Tiffany jewellery, also dropped by five percent to 80.8 billion euros as tariffs and geopolitical uncertainty hit consumer sentiment.
The wines and spirits division took the hardest hit with a nine percent drop in sales. 
However the top fashion and leather goods division, which accounts for nearly half of overall sales, also saw an eight percent drop in sales.
LVMH said it "showed good resilience and maintained its innovative momentum despite a disrupted geopolitical and economic environment" last year.
"Despite a geopolitical and macroeconomic environment that remains uncertain, the Group remains confident" for 2026, it added in its earnings statement.
Revenue also dropped by 5.1 percent in the final quarter of 2025 from the same period in 2024.
LVMH said sales in the United States grew in the second half of 2025 thanks to solid demand.
kap/rl/rmb

clothing

China's Anta Sports to become top Puma shareholder

  • Anta said in the statement that the stake would "further enhance its presence and brand recognition in the global sporting goods market", including China.
  • Chinese athletic goods giant Anta Sports will buy a controlling stake in historic German sportswear brand Puma for $1.79 billion, a stock exchange filing showed Tuesday.
  • Anta said in the statement that the stake would "further enhance its presence and brand recognition in the global sporting goods market", including China.
Chinese athletic goods giant Anta Sports will buy a controlling stake in historic German sportswear brand Puma for $1.79 billion, a stock exchange filing showed Tuesday.
As it expands its international presence, Anta will buy 43 million shares for 35 euros apiece from the French billionaire Pinault family's Artemis group, the statement to the Hong Kong exchange said, giving it a 29 percent stake.
The price is a more than 60-percent premium to Puma's last close, according to Bloomberg data, and values the deal at 1.51 billion euros.
Anta said in the statement that the stake would "further enhance its presence and brand recognition in the global sporting goods market", including China.
"We believe Puma's share price over the past few months does not fully reflect the long-term potential of the brand," Anta chairman Ding Shizhong said.
While the statement said Anta had no plans to launch a full takeover of Puma, it will "carefully assess the possibility of further deepening the partnership between the two parties in the future".
Artemis said the sale would allow it to "redeploy its resources to new value-creating sectors".
The deal is expected to close by the end of the year, though it is subject to regulatory approvals, and the company will buy shares with cash.
In a statement sent to AFP, Puma CEO Arthur Hoeld welcomed Anta's move, calling it a "vote of confidence in Puma and its strategic direction".
"Anta aims to empower Puma to fully realise its brand potential and its heritage," Hoeld said.
Anta declined to comment on the deal when contacted by AFP.
The firm, based in China's southeastern Fujian province, is one of the world's largest sportswear companies.
Founded in 1991, it is the parent company of many global brands through its subsidiary Amer Sports, including Wilson, Arc'teryx and Salomon.
Anta closed its acquisition of Finland-based Amer in 2019, leading a consortium in a deal worth about $5.2 billion.
It also controls rights in the vast Chinese market for foreign sportswear firms including Fila and Descente.
Anta has become the world's third-largest sportswear brand following Nike and Adidas, according to data analytics firm Euromonitor International.
The purchase shows Anta "narrowing the gap" to those two giants, according to Marguerite Le Rolland, senior global insight manager for fashion at Euromonitor International.
The Chinese sportswear giant will benefit from Puma's global reputation, its leading position in India's expanding sportswear market, and its partnership with Hyrox, the rapidly growing fitness trend, she said.
"For Puma, this transaction will provide extra financial resources to turn around the business".
The German brand has been struggling with weak demand in recent months and saw sales decrease more than 15 percent in the third quarter of last year.
CEO Hoeld, who was appointed last year, has said the brand had become "too commercial" and was undergoing a "reset" last year to improve on brand heat, distribution quality and product offering.
Hoeld told investors in October that the company's goal was to "become a top three sports brand in the future again".
He deemed 2026 a "year of transition", vowing a return to growth in 2027.
Puma is set to release its 2025 full-year financial results on February 26.
pfc-mya-sam-bur/iv

indicator

US consumer confidence drops to lowest level since 2014

BY BEIYI SEOW

  • She added that all five components of the index worsened, driving the overall level to its lowest since May 2014 -- "surpassing its Covid-19 pandemic depths."
  • Consumer confidence in the United States plunged in January to its lowest level since 2014, survey data showed Tuesday, as American households continue to fret about inflation and elevated costs of living.
  • She added that all five components of the index worsened, driving the overall level to its lowest since May 2014 -- "surpassing its Covid-19 pandemic depths."
Consumer confidence in the United States plunged in January to its lowest level since 2014, survey data showed Tuesday, as American households continue to fret about inflation and elevated costs of living.
The Conference Board's Consumer Confidence Index slumped by 9.7 points from December to 84.5, with consumers growing more cautious about major spending decisions.
A consumption slowdown -- if it took hold -- would hit at the key driver of the world's biggest economy, with consumer spending accounting for more than two-thirds of US GDP.
The new data comes as US President Donald Trump struggles to reverse voters' negative feelings about the economy ahead of the critical midterm elections in November -- in which his Republican Party risks losing control of Congress.
"Confidence collapsed in January, as consumer concerns about both the present situation and expectations for the future deepened," said the research group's chief economist Dana Peterson.
She added that all five components of the index worsened, driving the overall level to its lowest since May 2014 -- "surpassing its Covid-19 pandemic depths."
While the Conference Board survey data on expectations has diverged from spending patterns in the past, economist Oliver Allen of Pantheon Macroeconomics said: "We'd be surprised if its recent deterioration proves to be an entirely false signal."
This is "particularly given the recent stagnation in real incomes and the already rock-bottom personal saving rate," he said in a note.
In January, net views on current business conditions "dwindled to just barely positive," while perceptions of employment conditions also weakened, The Conference Board said.
Meanwhile, consumers tended to be pessimistic about factors influencing the economy.
"The low hiring rate is a problem," said Navy Federal Credit Union chief economist Heather Long.
"Layer on top of that a lot of geopolitical uncertainty over Venezuela, Greenland and the Federal Reserve, and Americans continue to be frustrated with the economy," she added.
Peterson of The Conference Board flagged that "references to prices and inflation, oil and gas prices, and food and grocery prices remained elevated."
"Mentions of tariffs and trade, politics, and the labor market also rose in January, and references to health/insurance and war edged higher," she said.
Consumers increasingly indicated that they were not planning on big-ticket purchases in the next six months as well, suggesting that they are becoming more selective in their spending.
"Used cars, furniture, TVs, and smartphones remained the most popular within their categories for future purchases," according to The Conference Board.
bys/des

trade

Mexico exports jump in 2025 despite US trade tensions

  • While Mexico's manufacturing exports grew 9.8 percent last year, its auto exports were down by 4.2 percent.
  • Mexico's exports climbed 7.6 percent in 2025, despite its auto, steel and aluminum sectors being swept up in US President Donald Trump's tariffs blitz, according to figures released Tuesday.
  • While Mexico's manufacturing exports grew 9.8 percent last year, its auto exports were down by 4.2 percent.
Mexico's exports climbed 7.6 percent in 2025, despite its auto, steel and aluminum sectors being swept up in US President Donald Trump's tariffs blitz, according to figures released Tuesday.
Over 80 percent of Mexico's exports, which totalled $664.8 billion, went to the neighboring United States, according to statistics released by national statistics agency INEGI.
Latin America's second-biggest economy, which is part of a free-trade agreement with the United States and Canada, has so far largely managed to avoid bilateral US tariffs.
But its steel and aluminum have been hit by levies on US imports of the metals of up to 50 percent.
Its key auto and auto parts sectors also face tariffs of 25 percent on goods that do not fall under the USMCA (United States-Mexico-Canada) trade agreement.
While Mexico's manufacturing exports grew 9.8 percent last year, its auto exports were down by 4.2 percent.
The country's imports also rose last year, but at a slower pace -- 4.4 percent -- than exports, resulting in a trade surplus of $771 million.
Under pressure from Trump, Mexico has hiked tariffs on China, its second-largest trading partner after the United States.
Trump accuses Chinese producers of using Mexico as a tariffs-free backdoor into the United States.
Sheinbaum's decision to implement tariffs of up to 50 percent on some Chinese goods from January 1 was widely seen as a concession to her powerful northern counterpart ahead of a review of the USMCA deal set for the fist half of 2026.
Mexico has also increased levies on imports from other countries with which it does not have a trade deal, including South Korea, India, Indonesia, Russia, Thailand, Turkey, Taiwan and Brazil.
jla/ai/cb/des

Global Edition

Hybrid cars top choice for consumers in Europe in 2025: data

  • Despite the only modest overall sales growth, consumers continued to shift towards hybrid and battery-electric vehicles.
  • Hybrid-electric vehicles dethroned purely petrol-powered cars as the top power option among consumers in Europe last year, data showed Tuesday.
  • Despite the only modest overall sales growth, consumers continued to shift towards hybrid and battery-electric vehicles.
Hybrid-electric vehicles dethroned purely petrol-powered cars as the top power option among consumers in Europe last year, data showed Tuesday.
Some 10.8 million new vehicles were registered in 2025 in the European Union, an increase of 1.8 percent from the previous year, according to the European Automobile Manufacturers' Association (ACEA). 
New car sales "remain well below pre-pandemic levels", however, the trade association said in a statement.
Despite the only modest overall sales growth, consumers continued to shift towards hybrid and battery-electric vehicles.
Sales of hybrid-electric vehicles climbed by 13.5 percent last year to account for 34.5 percent of total sales in the EU last year, putting them ahead of petrol cars at 26.6 percent.
Meanwhile, sales of battery-electric vehicles jumped by 30 percent to account for 17.4 percent of overall sales, though the ACEA noted that the gain was from a weak performance in 2024 and needs to rise further to stay on track with the EU's transition goals.
Sales of plug-in hybrids also rose, but sales of petrol and diesel vehicles dropped.
The combined market share of petrol and diesel cars fell to 35.5 percent, down from 45.2 percent in 2024.
Volkswagen Group saw sales rise by 5.5 percent last year to increase its lead as the top-selling carmaker in Europe.
France's Renault saw similar growth, but Stellantis, which owns several European brands such as Peugeot and Fiat, saw sales slide by 4.7 percent.
Chinese carmaker BYD tripled its sales in the EU last year, although from a small base.
China's SAIC Motor, which owns the MG brand, saw sales rise by a third. 
Sales of Teslas fell by nearly 38 percent last year as the electric car brand has suffered reputational damage in Europe from its association with billionaire Elon Musk, who backed US President Donald Trump before a falling-out, and who has endorsed Germany's far-right AfD party. 
leb/rl/

welfare

Germany takes aim at 'bureaucratic jungle' with welfare reforms

  • Bas, of the centre-left SPD party, added the reforms should help those who are entitled to benefits but "are currently unable to claim them due to the bureaucratic jungle".
  • Germany's government unveiled major reforms Tuesday aimed at slashing the "bureaucratic jungle" of its welfare system but insisted that benefits to those in need would not be rolled back.
  • Bas, of the centre-left SPD party, added the reforms should help those who are entitled to benefits but "are currently unable to claim them due to the bureaucratic jungle".
Germany's government unveiled major reforms Tuesday aimed at slashing the "bureaucratic jungle" of its welfare system but insisted that benefits to those in need would not be rolled back.
The EU's most populous country is notorious for its myriad rules and regulations, and conservative Chancellor Friedrich Merz has vowed to slay the "monster" of onerous red tape.
Part of this drive is directed at overhauling a state welfare system where multiple agencies oversee different entitlements, and citizens have to fill out numerous lengthy documents to claim benefits.
A government-appointed commission laid out proposals that include moving more of the system online and reducing the number of agencies involved in overseeing benefits.
"The welfare state of tomorrow will be simpler, fairer and more digital," Labour Minister Baerbel Bas told a press conference, unveiling the commission's report.
"Less paperwork, simpler applications, faster decisions."
Bas, of the centre-left SPD party, added the reforms should help those who are entitled to benefits but "are currently unable to claim them due to the bureaucratic jungle".
Entitlements would not be cut, she said, despite calls from some in her coalition partner, Merz's centre-right CDU party, to do so.
"It was clear from the outset that this was not about cutting benefits," she said, insisting that current levels of protection would be maintained.
Some have called for what they view as generous entitlements to be trimmed back at a time when the German economy is stagnating and the government needs more money for greater defence and infrastructure spending.
Bas said however that savings would still be generated due to greater efficiencies.
Merz praised the reforms, telling a conference organised by the Welt media group in Berlin that they "really involve a fundamental structural reform of the social security systems".
Among the commission's recommendations is that several existing benefits -- including basic unemployment benefits, housing and child support -- be combined to form a single benefit. 
Only two agencies would be responsible for benefits in future, down from four now.
By making the system more digital and bringing together various benefits, different welfare authorities should be able to more easily exchange data, meaning people do not have to repeatedly give the same details to make claims.
The aim is to have the changes passed into law by the end of 2027, although Bas conceded that timeline was "very ambitious".
sr/fz/jh

migration

Spain to regularise 500,000 undocumented migrants

  • The plan will be passed through a decree that will not need approval in parliament, where the Socialist-led coalition lacks a majority.
  • Spain's left-wing government approved Tuesday a plan to regularise around 500,000 undocumented migrants by decree, the country's latest break with harsher policies elsewhere in Europe.
  • The plan will be passed through a decree that will not need approval in parliament, where the Socialist-led coalition lacks a majority.
Spain's left-wing government approved Tuesday a plan to regularise around 500,000 undocumented migrants by decree, the country's latest break with harsher policies elsewhere in Europe.
Migration Minister Elma Saiz the beneficiaries would be able to work "in any sector, in any part of the country", and extolled "the positive impact" of migration.
"We are talking about estimations, probably more or less the figures may be around half a million people," she told public broadcaster RTVE.
Saiz said at a news conference after Tuesday's cabinet meeting that "we are strengthening a migration model based on human rights, integration, coexistence, and compatible with economic growth and social cohesion".
The measure will affect those living in Spain for at least five months and who applied for international protection before December 31, 2025.
Applicants must have a clean criminal record. The regularisation will also apply to their children who already live in Spain.
The application period is expected to open in April and continue until the end of June.
The plan will be passed through a decree that will not need approval in parliament, where the Socialist-led coalition lacks a majority.
The conservative and far-right opposition lashed out at the government, saying the regularisation would encourage more illegal immigration. 
Alberto Nunez Feijoo, head of the Popular Party, the main right-wing opposition group, wrote on X that the "ludicrous" plan would "overwhelm our public services".
"In Socialist Spain, illegality is rewarded," he said, vowing to change migration policy "from top to bottom" if he took power.

 'Social justice'

The Spanish Catholic Church was among the organisations praising the move, commending "an act of social justice and recognition".
Socialist Prime Minister Pedro Sanchez says Spain needs migration to fill workforce gaps and counteract an ageing population that could imperil pensions and the welfare state.
Sanchez has said migration accounted for 80 percent of Spain's dynamic economic growth in the last six years.
Official data released Tuesday showed that 52,500 of the 76,200 people who pushed up employment numbers in the final quarter of last year were foreigners, contributing to the lowest jobless figure since 2008.
Spain's more open stance contrasts with a trend that has seen governments toughen migration policies under pressure from far-right parties that have gained ground across the European Union.
Around 840,000 undocumented migrants lived in Spain at the beginning of January 2025, most of them Latin American, according to the Funcas think-tank. 
Spain is one of Europe's main gateways for irregular migrants fleeing poverty, conflict and persecution, with tens of thousands of mostly sub-Saharan African arrivals landing in the Canary Islands archipelago off northwestern Africa.
According to the latest figures published by the National Statistics Institute, more than seven million foreigners live in Spain out of a total population of 49.4 million people.
bur-imm/js

trade

EU, India agree 'mother of all' trade deals

BY UMBERTO BACCHI

  • "We have created a free trade zone of two billion people, with both sides set to benefit."
  • India and the European Union announced Tuesday the "mother of all deals", a huge trade pact to create a market of two billion people, reached after two decades of negotiations.
  • "We have created a free trade zone of two billion people, with both sides set to benefit."
India and the European Union announced Tuesday the "mother of all deals", a huge trade pact to create a market of two billion people, reached after two decades of negotiations.
EU chiefs and Prime Minister Narendra Modi hope the pact will help shield against challenges from the world's two leading economies, the United States and China.
The agreement will cut or eliminate tariffs on almost 97 percent of European exports, saving up to 4 billion euros ($4.75 billion) annually in duties, the 27-nation bloc said.
"A mother of all deals," Modi said Tuesday in the capital New Delhi, where he met with European Commission President Ursula von der Leyen and European Council President Antonio Costa.
"This deal will bring many opportunities for India's 1.4 billion and many millions of people of the EU," Modi said, adding the agreement "represents about 25 percent of global GDP, and one-third of global trade".
The EU has eyed India -- the world's most populous nation -- as an important market for the future.
"Europe and India are making history today," von der Leyen said in a statement, a day after she and Costa were feted as guests of honour at India's Republic Day parade.
"We have created a free trade zone of two billion people, with both sides set to benefit."

'Increasingly insecure world'

EU officials said the deal was the most ambitious India had ever agreed, and European companies would benefit from so-called "first mover advantage".
Europe's key agricultural, automotive and service sectors stand to gain.
But sensitive agricultural sectors, such as beef, rice and sugar whose inclusion in an earlier deal struck with South American bloc Mercosur sparked farmers' anger in Europe, were left out of the agreement.
New Delhi sees the European bloc as an important source of much-needed technology and investment to rapidly upscale its infrastructure and create millions of new jobs.
It also includes a security partnership, providing "new opportunities" for defence companies, Modi said.
"We are not only making our economies stronger -- we are also delivering security for our people in an increasingly insecure world," von der Leyen said, speaking alongside Modi after exchanging agreements.
"By combining these strengths, we reduce strategic dependencies, at a time when trade is increasingly weaponised," she added.
Bilateral trade in goods reached 120 billion euros ($139 billion) in 2024, an increase of nearly 90 percent over the past decade, according to EU figures, with a further 60 billion euros ($69 billion) in trade in services.
Under the agreement, India is expected to ease market access, and European firms will get privileged access to the Indian financial services and maritime transport market, the bloc said.

'Highest level of access'

Tariffs on cars will be gradually lowered from a top rate of 110 percent to as low as 10 percent -- with a quota of 250,000 vehicles -- while duties on wines progressively go down from 150 percent to as low as 20 percent.
Currently at 50 percent, tariffs on processed foods -- including pasta and chocolate -- will be eliminated, according to the EU.
Von der Leyen said she expected exports to India to double, and that the EU would "gain the highest level of access ever granted to a trade partner in the traditionally protected Indian market".
For India, it would boost sectors including textiles, gems and jewellery, and leather goods, as well as the service sector, Modi said.
The accord comes as both Brussels and New Delhi seek to open up markets in the face of US tariffs and Chinese export controls.
"The unprecedented preferential access secured for over 99 percent of Indian exports is a game-changer for Indian industry," said Chandrajit Banerjee, director general, Confederation of Indian Industry.
India is on track to become the fourth-largest economy this year, according to International Monetary Fund projections.
New Delhi, which has relied on Moscow for key military hardware for decades, has tried to cut its dependence on Russia in recent years by diversifying imports and pushing its own domestic manufacturing base.
Europe is doing the same with regard to the United States.
ub-pjm/mtp

trade

What we know about the EU-India trade deal

BY RAZIYE AKKOC

  • Brussels says the steel makes up seven percent of total Indian exports to the EU. Under the deal, India will benefit from a duty-free quota of 1.6 million tonnes, and New Delhi will relinquish its retaliation rights under the World Trade Organization, a senior EU official said.
  • The European Union and India announced Tuesday that they had struck a "historic" trade deal that Brussels hopes will see exports double to the Asian powerhouse.
  • Brussels says the steel makes up seven percent of total Indian exports to the EU. Under the deal, India will benefit from a duty-free quota of 1.6 million tonnes, and New Delhi will relinquish its retaliation rights under the World Trade Organization, a senior EU official said.
The European Union and India announced Tuesday that they had struck a "historic" trade deal that Brussels hopes will see exports double to the Asian powerhouse.
They had spent two decades negotiating but the return of US President Donald Trump and his hefty tariffs accelerated the push on both sides to seal a deal.
Here is what Brussels and New Delhi agreed in what India's Prime Minister Narendra Modi called the "mother of all deals":

What benefits for the EU?

Indian tariffs on more than 90 percent of EU goods will be removed or cut.
For example, India will progressively reduce levies to between 20 and 30 percent on European wines, down from 150 percent before the agreement.
Beer tariffs will drop to 50 percent from 110 percent, while spirits will see future levies of 40 percent, down from up to 150 percent.
India will also remove tariffs on EU olive oil -- a major export from Spain, Italy and Greece -- fruit juice, non-alcoholic beer and processed food including bread, pasta, chocolate and pet food. 
In a welcome move for one of the bloc's biggest sectors and especially Germany, tariffs on cars will be gradually lowered from a top rate of 110 percent to as low as 10 percent -- with a quota of 250,000 vehicles.
And India will eliminate tariffs on aircraft -- a potential boon for pan-European aerospace group Airbus -- as well as cutting levies to zero on most machinery, medical equipment, chemicals and pharmaceutical products.

How does India benefit?

According to Brussels, the EU's imports from India comprise mainly machinery and appliances, chemicals, base metals, mineral products and textiles.
India said the EU would immediately eliminate duties on products making up the majority of its exports including textiles, leather and footwear, tea, coffee, spices, sports goods, toys, gems and jewellery, and certain marine products.
And the EU agreed to phase out tariffs for processed food items as well as arms and ammunition, among other goods.
Steel was a thorny issue in negotiations since India is a major exporter. Brussels says the steel makes up seven percent of total Indian exports to the EU.
Under the deal, India will benefit from a duty-free quota of 1.6 million tonnes, and New Delhi will relinquish its retaliation rights under the World Trade Organization, a senior EU official said.
Another sticking point for India was the EU's carbon border tax, which aims to ensure foreign producers pay a carbon cost similar to what European companies already pay under the bloc's internal emissions trading system.
Under the deal, the EU agreed to launch a technical dialogue on the tax if needed, and vowed not to treat any other EU partner better than India.
The EU has also promised to make it easier for skilled Indian workers to work in the 27-country bloc, agreeing to a memorandum of understanding on mobility covering issues related to seasonal workers, researchers and students, the EU official said.

What doesn't the deal include?

Sensitive agricultural products are excluded from the new deal.
The senior EU official said there were no concessions for sugar, ethanol, rice, soft wheat, beef, chicken meat, milk powders, bananas, honey or garlic.
He also said that unlike deals the EU has struck with other partners, there were no chapters on government procurement, on energy and raw materials, or on the liberalisation of investment in manufacturing sectors.
India also opposed any chapter on "sustainable development where we focus on social rights and also environmental issues", the official added.
The two partners are discussing a separate agreement on Geographical Indications, the intellectual property rights that link a product's qualities, reputation or features to its place of origin.
This "will help traditional EU farming products sell more in India, by removing unfair competition in the form of imitations", the EU executive said.
India said the deal safeguarded sensitive sectors including dairy, cereals, poultry, soybean meal and certain fruits and vegetables.
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