Global Edition

Dollar sinks on yen intervention talk, gold breaks $5,000

  • "In thin early Asian liquidity, the yen jumped, and that was enough to knock the broader dollar back into the Asia open."
  • The dollar fell in Asian trade Monday amid speculation US officials could join their Japanese counterparts to help support the yen after a recent sell-off, while equities started the week on a tepid note.
  • "In thin early Asian liquidity, the yen jumped, and that was enough to knock the broader dollar back into the Asia open."
The dollar fell in Asian trade Monday amid speculation US officials could join their Japanese counterparts to help support the yen after a recent sell-off, while equities started the week on a tepid note.
Reports that the Federal Reserve Bank of New York had checked in with traders about the yen's exchange rate sparked a surge in the Japanese currency, according to Bloomberg, pushing it up more than one percent to 153.89 per dollar -- its strongest level since November.
The yen has been sliding amid worries about Japan's fiscal position, the central bank's decision not to hike interest rates further and expectations that the US Fed will hold off cutting its own borrowing costs this week.
The last time Japanese authorities stepped in to support their unit was in 2024 when it hit 160 to the greenback.
The prospect of authorities stepping into financial markets saw the dollar retreat across the board, with the euro, pound and South Korean won also well up while the Singapore dollar hit an 11-year high. 
That in turn sent gold prices surging almost two percent and past $5,000 for the first time.
Talk of joint intervention was fanned Monday by top currency chief Atsushi Mimura, who said Tokyo "will continue responding appropriately against FX moves, working closely with US authorities as needed, in line with the joint statement issued by the Japanese and US finance ministers last September".
His remarks came a day after Japanese Prime Minister Sanae Takaichi warned: "We will take all necessary measures to address speculative and highly abnormal movements."
Stephen Innes at SPI Asset Management said: "Early Asia saw the dollar pushed lower as rate-check chatter swirled around the Fed, and intervention-tinged language out of Tokyo reminded the market that yen weakness is no longer a free carry.
"In thin early Asian liquidity, the yen jumped, and that was enough to knock the broader dollar back into the Asia open."

Eyes on Fed meeting

Lloyd Chan, at MUFG, added: "The balance of risks may point toward dollar vulnerability and heightened two-way volatility in USD/JPY as markets navigate intervention uncertainty and evolving policy expectations around BoJ policy stance and Japan Prime Minister Takaichi's fiscal policy."
The weakening dollar helped send gold to a peak of $5,088.52 per ounce. Silver broke $100 Friday and spiked above $108 this week.
The precious metals have been hitting multiple records of late owing to a rush into safe havens by traders spooked by rising geopolitical concerns, including Donald Trump's intervention in Venezuela and a recent warning to Iran.
Strong central bank demand and elevated inflation have added to the mix, along with fresh worries of another US government shutdown.
"Over the past few days, gold's price action has been textbook safe-haven behaviour," said Fawad Razaqzada, market analyst at Forex.com.
"Underlying demand for protection is still there. Confidence in the dollar and bonds look a bit shaky."
The latest developments come ahead of the Fed's next policy meeting this week, which is expected to see officials stand pat on rates, having cut in the past three.
"We don't expect to learn a lot at the January FOMC meeting. The Fed is on hold but remains data dependent. The balance of risks around the two mandates hasn't changed much since December," wrote Bank of America economists, referring to the bank's goal of keeping a cap on inflation and supporting the jobs market. 
"Chair Powell's press conference might be dominated by questions about politics rather than policy. On the latter, however, market pricing creates risks of a dovish surprise."
Trump has made no secret of his disdain for Powell, claiming there is "no inflation" and repeatedly questioning the Fed chair's competence and integrity.
Equity markets were mixed after a soft lead from Wall Street on Friday.
Tokyo sank almost two percent owing to the stronger yen, which weighs on Japanese exporters, while Singapore, Seoul and Wellington also retreated.
Hong Kong, Shanghai, Taipei and Manila rose.
Oil prices extended Friday gains of almost three percent that came after Trump said a US "armada" was heading toward the Gulf and that Washington was watching Iran closely.
The president has repeatedly left open the option of new military action against Tehran after Washington backed and joined Israel's 12-day war in June aimed at degrading Iranian nuclear and ballistic missile programmes.

Key figures at around 0230 GMT

Dollar/yen: DOWN at 154.36 yen from 157.00 yen on Friday
Euro/dollar: UP at $1.1867 from $1.1823
Pound/dollar: UP at $1.3671 from $1.3636
Euro/pound: UP at 86.81 pence from 86.70 pence
Tokyo - Nikkei 225: DOWN 1.9 percent at 52,812.45 (break)
Hong Kong - Hang Seng Index: UP 0.5 percent at 26,868.64
Shanghai - Composite: UP 0.4 percent at 4,151.35
West Texas Intermediate: UP 0.1 percent at $61.15 per barrel
Brent North Sea Crude: UP 0.1 percent at $65.91 per barrel
New York - Dow: DOWN 0.6 percent at 49,098.71 (close)
London - FTSE 100: DOWN 0.1 percent at 10,143.44 (close)
dan/lb

Fed

Financial trading master Rick Rieder emerges as possible Fed chief

BY JOHN BIERS

  • - Independent streak - Ironically, the Fed chair from recent years whose profile most closely resembles Rieder's is probably Jerome Powell, the current central bank head, whom Trump has criticized relentlessly.
  • The emergence of BlackRock's Rick Rieder as a Federal Reserve frontrunner means the US central bank could be led by a financial markets master less academically credentialed than other recent chairs.
  • - Independent streak - Ironically, the Fed chair from recent years whose profile most closely resembles Rieder's is probably Jerome Powell, the current central bank head, whom Trump has criticized relentlessly.
The emergence of BlackRock's Rick Rieder as a Federal Reserve frontrunner means the US central bank could be led by a financial markets master less academically credentialed than other recent chairs.
Rieder vaulted to the top of betting markets this week after President Donald Trump spoke effusively of the bond market expert, who makes frequent appearances as a commentator on CNBC and other business news broadcasts.
Rieder, whom Trump described as "very impressive," manages some $2.4 trillion as BlackRock's chief investment officer of global fixed income. The post demands deep understanding of myriad securities and digitalized investment platforms.
Rieder studied business as an undergraduate at Emory University and earned a Master of Business Administration at the Wharton School of the University of Pennsylvania.
But unlike past Fed chairs Alan Greenspan, Janet Yellen and Ben Bernanke -- who won a Nobel prize after his Fed service -- Rieder has no PhD. He has served on government panels, but never worked for the US central bank. 
That lack of government experience was viewed as a "big positive," according to a Fox Business report on Rieder's January 15 interview at the Oval Office.
Besides Trump, the interview included Treasury Secretary Scott Bessent, who in July likened the Fed's personnel management to "universal basic income for academic economists." 
In a 2023 interview with the Goldman Sachs podcast "Exchanges," Rieder described trading as a thrilling challenge of navigating constantly changing dynamics and discovering when you need to pivot.
"I always say this in managing money, we're not in the business of being right," said Rieder, who famously begins his daily research ritual at 3:30 am. "We're in the business of generating return for our clients."
Trading is about "risk management and your perception of where the world is and how people think the world is," he said. 
Rieder worked at Lehman Brothers from 1987 to 2008 before starting R3 Capital Partners in 2008, months before the Lehman bankruptcy. In 2009, BlackRock acquired R3. 
BlackRock declined to comment. 

Independent streak

Ironically, the Fed chair from recent years whose profile most closely resembles Rieder's is probably Jerome Powell, the current central bank head, whom Trump has criticized relentlessly.
Trump in 2017 named as chairman Powell, an attorney who had worked in private equity in between stints at the US Treasury Department and the Fed. 
Trump's interest in Rieder reflects "MAGA's critique of the Fed as being excessively technocratic," said Mark Blyth, a professor in international economics professor at Brown University.
Blyth also called Rieder a bit of a "dark horse" on whether his decisions would shift from Powell's.
"It's not automatically clear that Rieder is a very low-interest rates guy," Blyth said.
Rieder's political donations suggest an independent streak. In the 2024 cycle, he backed Trump's Republican primary challenger Nikki Haley over Trump and some Democrats.
In a January 2 BlackRock column, Rieder said the inflation "storm has passed," characterizing labor market weakness as the bigger priority.
That position is in line with pronouncements by Powell at recent meetings. The Fed is expected to leave rates unchanged this week at between 3.50 percent and 3.75 percent after three straight cuts.
Rieder told CNBC on January 12 that the "Fed's got to get the rate down" to about three percent.
His appearance on CNBC came the day after Powell hit out at a criminal probe of the Fed launched by Trump's Justice Department as a "pretext" for the president's opposition to the Fed's cautious approach to cutting rates.
Rieder declined to comment directly on Powell's remarks, but backed Fed independence, insisting that whomever leads the Fed is "going to make the right decisions... for maximum employment and price stability," he told CNBC.
Besides Rieder, the other leading candidates are White House National Economic Council director Kevin Hassett; former Fed official Kevin Warsh; and Fed governor Christopher Waller.
jmb/iv

conflict

What is Russia's 'shadow fleet' and how does it work?

  • The French navy on Thursday boarded an oil tanker in the Mediterranean suspected of belonging to Russia's shadow fleet. 
  • France's interception of an oil tanker suspected of being part of Russia's "shadow fleet" draws attention to how the vessels allegedly operate in order to escape Western sanctions.
  • The French navy on Thursday boarded an oil tanker in the Mediterranean suspected of belonging to Russia's shadow fleet. 
France's interception of an oil tanker suspected of being part of Russia's "shadow fleet" draws attention to how the vessels allegedly operate in order to escape Western sanctions.

What is the 'shadow fleet'?

Russia has reportedly built up a flotilla of old oil tankers of opaque ownership to get around sanctions imposed by the European Union, United States and the G7 group of nations over Moscow's all-out invasion of Ukraine that started in 2022.
The sanctions, based on a price-cap on Russian crude to limit Moscow's revenues used to pursue its war, have shut out many tankers carrying Russian oil from Western insurance and shipping systems.
The EU lists 598 vessels that are banned from European ports and maritime services.
The US -- which seized a Russian-flagged tanker in the north Atlantic early in January -- lists 183 vessels and asserts an extraterritorial right to act against them.

How does it operate?

According to experts, and a briefing paper by the European Parliament, the "shadow fleet" obscures the ownership of vessels, and ensures the companies managing them are outside Russia and fly flags of convenience -- or even sometimes falsely claimed flags.
In addition, the vessels have been observed turning off their Automatic Identification System, to go "dark" at sea, where ship-to-ship transfers of Russian oil occur. 
Many of the vessels are old, meaning they can be more easily written off if seized, or forfeited if they cause oil spills.
The Kyiv School of Economics, which runs a "Russian Oil Tracker", said in its latest report, in December, that 78 percent of the shadow-fleet tankers it monitored in November were older than 15 years.
"The top three flags used by Russian shadow-fleet vessels transporting crude oil are false/unknown flag, Sierra Leone, and Cameroon," it said. 
It said management companies for the vessels were located in the United Arab Emirates, the Seychelles, Mauritius, the Marshall Islands and elsewhere.
The Kyiv School of Economics also said that "India remains the biggest Russian seaborne crude importer with 40 percent share in total Russian exports".

What is being done against it?

The United States, which is leading efforts to try to broker an end to the conflict in Ukraine, in early January stepped up its sanctions against Russia's oil industry, including the shadow fleet. 
When its forces seized the tanker in the Atlantic on January 7, the White House said the vessel was "deemed stateless after flying a false flag". 
Russia said on Tuesday that the US still had not released two Russian crew members from the tanker.
The European Union is considering expanding its powers to board Russia's shadow-fleet vessels, according to a document by its foreign-policy service viewed by Politico in October.
The French navy on Thursday boarded an oil tanker in the Mediterranean suspected of belonging to Russia's shadow fleet. 
President Emmanuel Macron said on X the vessel, "coming from Russia, was subject to international sanctions and suspected of flying a false flag".
Britain said it provided tracking and monitoring support for the French interception.

How is Russia reacting?

When France in late September detained a Russian-linked ship called the Boracay, a vessel claiming to be flagged in Benin, Russian President Vladimir Putin condemned the move as "piracy".
After the US seizure of the tanker in early January, the Russian foreign ministry warned the move could "result in further military and political tensions", and said it was worried by "Washington's willingness to generate acute international crisis situations".
rmb/gv

fashion

Men's fashion goes low-risk in uncertain world

BY MARINE DO-VALE

  • According to him, both the public and designers are no longer looking for one-season pieces which are quickly out-of-date, instead opting for styling that will stand the test of time. 
  • Paris Men’s Fashion Week, which wrapped up Sunday, saw designers opt for often pragmatic and timeless styling, reflecting a low-risk approach at an uncertain time for the industry, experts said. 
  • According to him, both the public and designers are no longer looking for one-season pieces which are quickly out-of-date, instead opting for styling that will stand the test of time. 
Paris Men’s Fashion Week, which wrapped up Sunday, saw designers opt for often pragmatic and timeless styling, reflecting a low-risk approach at an uncertain time for the industry, experts said. 
After a 2025 marked by sweeping turnover among creative directors and numerous debuts, this Fall/Winter 2026 edition was more measured, in substance as well as in style. 
"It’s been a fairly conservative season, without any incredible propositions," Matthieu Morge Zucconi, head of men’s fashion at France's Le Figaro newspaper, told AFP. 
"We’re in a period where we zero in on what's essential. You can feel it in the shows," added Astrid Faguer, fashion journalist at Les Echos newspaper. 
Against a backdrop of worrying international news and economic turbulence in the luxury sector, brands are looking to reassure customers rather than risk unsettling them, experts agree. 

Suits in force

The classic suit-and-tie duo stood out as one of the strongest markers on the runways.
The overall colour palette was fairly classic: black, gray, beige and brown, with a few brighter touches, like the purple seen from Dior to Vuitton, via Issey Miyake and Etudes Studio. 
The extravagant over-sized jackets with large shoulder pads of previous seasons have become more fitted -- still loosely tailored, but more traditional.
"I think that with age and the way my view of the world is evolving now, I wanted to create a silhouette that's ... a bit more fitted," head of Paris-based 3.Paradis, Emeric Tchatchoua, told AFP.
Louis Vuitton chief designer Pharrell Williams wrote that his fairly conventional collection was "designed to endure rather than expire, it is a timeless expression."
For Adrien Communier, head of fashion at GQ magazine in France, the restraint signals a return to basics. 
"There’s really a phenomenon of creating clothes for the now, that will be able to last and take on everyday life," he observes. 
According to him, both the public and designers are no longer looking for one-season pieces which are quickly out-of-date, instead opting for styling that will stand the test of time. 
"It’s impossible not to see a reference to the international context. I think there’s something very responsive and pragmatic in relation to that," he told AFP. 
The unstable state of the world has weighed on luxury sales over the last few years, crimping profits at luxury groups which had enjoyed a post-Covid sales bonanza.  
- 'Normality' - 
It was not all sensible shapes and tasteful tailoring.
Dior designer Jonathan Anderson appeared keener than most to take some risks.
He said he didn't want "normality" as he reimagined modern-day aristocrats for his second men's collection, adding that his designs included some "angst and a kind of wrongness, engulfing wrong taste".
He sent out shirts with checks adorned with rhinestone-fringed epaulettes, while models wore yellow or spiked wigs.
The Bar jacket, a Dior signature item, was redesigned in a shrunken format
A grey cape-coat from Dries van Noten had tiny embedded jewels embedded in a gray cape-coat, while there were faux-fur coats for men at KidSuper and Willy Chavarria. 
Embroidery showed up in several shows, while floral prints and patchwork bomber jackets also featured.
Simon Longland, chief fashion buyer for London luxury store Harrod's, also said that the past week had been about designers "offering flexibility, comfort and longevity."
"Broadly, collections felt less driven by trend and more focused on creating pieces with purpose -- clothing intended to be worn, lived in and valued over multiple seasons rather than defined by the moment alone," he said.
mdr-adp/gv

trade

EU council president arrives in India to seal trade pact

  • Costa and European Commission president Ursula von der Leyen are chief guests for this year's Republic Day celebrations in New Delhi on Monday, before an EU-India summit the next day where they hope to shake hands on an accord described as the "mother of all deals".
  • European Council president Antonio Costa arrived in India on Sunday as the EU and New Delhi seek to seal a free trade pact, capping nearly two decades of negotiations between the economic behemoths.
  • Costa and European Commission president Ursula von der Leyen are chief guests for this year's Republic Day celebrations in New Delhi on Monday, before an EU-India summit the next day where they hope to shake hands on an accord described as the "mother of all deals".
European Council president Antonio Costa arrived in India on Sunday as the EU and New Delhi seek to seal a free trade pact, capping nearly two decades of negotiations between the economic behemoths.
Costa and European Commission president Ursula von der Leyen are chief guests for this year's Republic Day celebrations in New Delhi on Monday, before an EU-India summit the next day where they hope to shake hands on an accord described as the "mother of all deals".
"The summit will be an opportunity to build on the EU-India strategic partnership and further strengthen collaboration across key policy areas," the EU Council said on X.
India, the world's most populous nation, is on track to become its fourth-largest economy this year, according to International Monetary Fund projections.
The EU eyes India as an important market for the future, while 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.
"The EU stands to gain the highest level of access ever granted to a trade partner in the traditionally protected Indian market," von der Leyen said on Sunday, adding that she expected exports to India to double.
"We will gain a significant competitive advantage in key industrial and agri-good sectors."
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.
The pact would be a major win for Brussels and New Delhi as both seek to open up new markets in the face of US tariffs and Chinese export controls.
"The EU and India are moving closer together at the time when the rules-based international order is under unprecedented pressure through wars, coercion and economic fragmentation," Kaja Kallas, the EU's top diplomat, said on Wednesday. 
However, ongoing negotiations are focusing on a few sticking points, including the impact of the EU's carbon border tax on steel exports, according to people familiar with the discussions.
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.
sai-ub/pbt

politics

India's solar-panel boom: full throttle today, uncertain tomorrow

BY PHILIPPE ALFROY

  • "The quality of the product is very, very critical," said Ashish Khanna, CEO Adani Green Energy.
  • The race for green energy is on.
  • "The quality of the product is very, very critical," said Ashish Khanna, CEO Adani Green Energy.
The race for green energy is on. India, driven by soaring electricity demand and a push to reduce reliance on China, is rapidly producing solar panels, fuelling a booming yet uncertain market.
At the Adani Group's factory in Mundra, in India's western state of Gujarat, assembly lines churn out photovoltaic panels around the clock.
Up to 10,000 a day come off the line, with most sent straight to Khavda, further north, where the Indian conglomerate is finishing what will be the world's largest solar park.
But Adani Solar's CEO, Muralee Krishnan, says operations are "actually lagging".
"Our capacity needs to be fully used -- we should work 48 hours a day."
The intensity is matched by other major producers in the world's most populous nation.
At the Tata conglomerate factory in Tirunelveli, in the southern state of Tamil Nadu, 4,000 mostly women employees also work non-stop shifts.
"They operate 24/7, so you get better yield, better efficiency, better productivity," said Praveer Sinha, CEO of Tata Power.
"You cannot stop the production line... there is a rush to produce to maximise the output."
With the twin imperatives of development and lower carbon emissions, India has set itself ambitious renewable energy targets.
Last year, it said half its electricity-generation capacity was now "green", five years ahead of the timeline set in the Paris Agreement on lowering emissions.
But 75 percent of electricity is still generated by coal-fired power plants, with inflexible operations and long-term coal power purchase agreements hampering renewable uptake.

'Make in India'

There are signs of change.
Last year, coal-fired power generation fell three percent, only the second full-year drop recorded in half a decade, according to the Centre for Research on Energy and Clean Air.
Renewable capacity of 230 gigawatts (GW) is set to rise to 500 GW by 2030, including 280 GW of solar.
But Prime Minister Narendra Modi has placed another constraint on the industry: "Make in India."
That means there is no question of importing solar panels from China, which supplies 90 percent of the world's market.
All public tenders require "local" production, which India supports with substantial subsidies that have attracted big businesses.
Tata, a pioneer in solar panels since the 1990s, has been joined by Adani and Reliance, which have built state-of-the-art, highly automated factories.
"The quality of the product is very, very critical," said Ashish Khanna, CEO Adani Green Energy.
"When you are building a project of this size, you also need to be very reassured of the supply chain. We cannot have a disruption or interruption in that particular process." 
But for now, the technology and raw materials still come from China.
And Beijing has complained to the World Trade Organization over the subsidies and restrictions on its solar panels.
The solar push is so intense that Adani is considering silicon mining to secure a key raw material, company insiders say, and there are suggestions Tata Power is eyeing in-house silicon-wafer production.

'A huge market'

Growth in the sector is already staggering, with solar manufacturing capacity expected to soon exceed 125 GW, according to consultancy Wood Mackenzie said.
But that is triple current domestic demand, according to Wood Mackenzie analyst Yana Hryshko.
Government incentives have "been highly effective in spurring factory announcements, but the industry is now seeing warning signs of rapid overcapacity", Hryshko said in a report last year.
The sector's long-term sustainability may therefore depend on exports, with some companies already targeting global markets.
"Solar is a huge market: the world will see it doubling, from 2,000 GW to 4,000 GW in four years," said Ashish Khanna, head of the International Solar Alliance. 
"The question is now -- will Indian manufacturers be globally competitive compared to China?" 
Tejpreet Chopra, from the private power company Bharat Light and Power, points out that "the problem is that it's cheaper to import from China than to buy local".
And the level of manufacturing in China "is so much higher that it's very difficult to match", he added.
The sector also faces "geopolitical" headwinds from US President Donald Trump's tariffs, with Chopra adding that they make it "very difficult to sell to the United States".
Despite these challenges, the head of Tata Power, which does not yet export, remains convinced his business has a bright future.
"We strongly believe," said Praveer Sinha, "that solar will play a very important role in the renewable space of India."
pa/pjm/dan

bank

US Fed set to keep rates steady as officials defend independence

BY BEIYI SEOW

  • - External pressure - The Fed meets eight times a year to consider interest rate levels, and Michael Pearce of Oxford Economics said the dilemma it faces has eased.
  • The US Federal Reserve is widely expected to keep interest rates unchanged when it meets in the coming week, holding firm despite President Donald Trump's pressure to slash levels as it guards against threats to its independence.
  • - External pressure - The Fed meets eight times a year to consider interest rate levels, and Michael Pearce of Oxford Economics said the dilemma it faces has eased.
The US Federal Reserve is widely expected to keep interest rates unchanged when it meets in the coming week, holding firm despite President Donald Trump's pressure to slash levels as it guards against threats to its independence.
The central bank has cut rates three consecutive times since September as the jobs market weakened, bringing them to a range between 3.50 percent and 3.75 percent.
But Fed Chair Jerome Powell has signaled the bar would be higher for a further reduction in January. They meet on Tuesday and Wednesday.
"The fact that growth is strong, unemployment is low, equity markets are close to all-time highs and inflation is above target all argue for a pause," said analysts at ING bank.
Powell's robust defense of Fed independence in response to ongoing pressure from Trump to lower rates confirms this, ING added.
On January 11, Powell released a rare, solemn statement revealing that the Department of Justice was investigating him over a $2.5 billion renovation of the bank's headquarters.
He slammed the threat of criminal charges as the result of policymakers setting rates in the public's best interests -- rather than bowing to the president's wishes.
Trump has made no secret of his disdain for Powell, claiming there is "no inflation" and repeatedly questioning the Fed chair's competence and integrity.
Yet, US inflation has been well above the bank's two-percent target for over five years, said former Cleveland Fed president Loretta Mester.
"I think the Fed needs to keep a pretty tight eye on where the inflation is going," she told AFP.
Price increases could cool after Trump's trade tariffs filter through the world's biggest economy, but Mester flagged the need for "more convincing evidence."
Meanwhile, existing cost hikes have brought about a "large wedge" between how affluent and lower-income households view the economy, said KPMG chief economist Diane Swonk.
Even if the gap could temporarily narrow as fiscal stimulus hits in early 2026 -- with a rise in tax refunds incoming due to tax cut expansions -- this could "cause a more entrenched bout of inflation," she warned.
Another complication is stagnating employment, forcing policymakers to walk a tightrope between lowering rates to boost the economy and keeping them higher to curb inflation.

External pressure

The Fed meets eight times a year to consider interest rate levels, and Michael Pearce of Oxford Economics said the dilemma it faces has eased.
Figures suggest that risks to the labor market appear less pressing than a few months ago, while the likelihood of rising inflation also seems to have moderated, he said in a note.
Nonetheless, events outside of the rate-setting committee "have the potential to shake up the path of monetary policy," Pearce added.
Besides the probe into Powell, Trump has sought to fire Fed Governor Lisa Cook, sparking a legal battle crucial to shaping how much discretion the president has in changing the Fed's leadership.
A president can only fire Fed board members "for cause," traditionally understood to mean malfeasance or dereliction of duty.
But the Trump administration appears to be pushing a broader interpretation, as Trump moved to fire Cook over mortgage fraud allegations she denies.
The Supreme Court heard arguments on the issue on Wednesday, and Cook stressed in a statement afterwards the importance of insulating the Fed from political threats.
She said her case is about whether the Fed will set rates "guided by evidence and independent judgment or will succumb to political pressure."
Pearce flagged a "small risk" that the government succeeds in ousting Cook, saying this could "pave the way for a substantial dovish transformation on the committee over time."
Policymakers seen as "hawkish" favor higher rates to fight inflation, while a "dovish" Fed tends towards lower levels.
Analysts expect Powell to avoid discussing political issues at his press briefing after the two-day Fed meeting on Wednesday, while divisions remain over the path of future policy.
myl-bys/msp

diplomacy

Trump threatens Canada with 100% tariff if it completes China trade deal

BY SUSAN STUMME

  • "If Canada makes a deal with China, it will immediately be hit with a 100% Tariff against all Canadian goods and products coming into the USA." Trump insulted Carney by calling him "Governor" -- a swipe referring to the US president's repeated insistence that Canada should be the 51st US state.
  • US President Donald Trump on Saturday warned Canada that if it concludes a trade deal with China, he will impose a 100 percent tariff on all goods coming over the border.
  • "If Canada makes a deal with China, it will immediately be hit with a 100% Tariff against all Canadian goods and products coming into the USA." Trump insulted Carney by calling him "Governor" -- a swipe referring to the US president's repeated insistence that Canada should be the 51st US state.
US President Donald Trump on Saturday warned Canada that if it concludes a trade deal with China, he will impose a 100 percent tariff on all goods coming over the border.
Relations between the United States and its northern neighbor have been rocky since Trump returned to the White House a year ago, with spats over trade and Canadian Prime Minister Mark Carney decrying a "rupture" in the US-led global order.
During a visit to Beijing last week, Carney hailed a "new strategic partnership" with China that resulted in a "preliminary but landmark trade agreement" to reduce tariffs -- but Trump warned of serious consequences should that deal be realized.
If Carney "thinks he is going to make Canada a 'Drop Off Port' for China to send goods and products into the United States, he is sorely mistaken," Trump wrote on his Truth Social platform.
"China will eat Canada alive, completely devour it, including the destruction of their businesses, social fabric, and general way of life," he said.
"If Canada makes a deal with China, it will immediately be hit with a 100% Tariff against all Canadian goods and products coming into the USA."
Trump insulted Carney by calling him "Governor" -- a swipe referring to the US president's repeated insistence that Canada should be the 51st US state.
Trump this week posted an image on social media of a map with Canada -- as well as Greenland and Venezuela -- covered by the American flag.
Canada's minister responsible for trade with the United States, Dominic LeBlanc, pushed back against Trump's latest threat.
"There is no pursuit of a free trade deal with China. What was achieved was resolution on several important tariff issues," he wrote on X.

'Canada thrives because we are Canadian'

The two leaders have sharpened their rhetorical knives in recent days, beginning with Carney's speech on Tuesday at the World Economic Forum in Davos, where he earned a standing ovation for his frank assessment of a "rupture" in the US-led global order.
His comment was widely viewed as a reference to Trump's disruptive influence on international affairs, although Carney did not mention the US leader by name. 
Trump fired back at Carney a day later in his own speech, and then withdrew an invitation for the Canadian prime minister to join his "Board of Peace" -- his self-styled body for resolving global conflict.
Initially designed to oversee the situation in postwar Gaza, the body appears now to have a far wider scope, sparking concerns that Trump wants to create a rival to the United Nations.
"Canada lives because of the United States. Remember that, Mark, the next time you make your statements," Trump said.
Carney shot back on Thursday: "Canada doesn't live because of the United States. Canada thrives because we are Canadian." He nevertheless acknowledged the "remarkable partnership" between the two nations.

Trade spats

Canada heavily relies on trade with the United States, the destination for more than three quarters of Canadian exports.
Key Canadian sectors like auto, aluminum and steel have been hit hard by Trump's global sectoral tariffs, but the levies' impacts have been muted by the president's broad adherence to an existing North American free trade agreement.
Negotiations on revising that deal are set for early this year, and Trump has repeatedly insisted the United States doesn't need access to any Canadian products -- which would have sweeping consequences for its northern neighbor.
Matthew Holmes, executive vice president of the Canadian Chamber of Commerce, said in a statement that he hoped the two governments would "come to a better understanding quickly that can alleviate further concerns for businesses."
The two nations, along with Mexico, are set to host the World Cup later this year.
sst/iv

internet

Iranians struggle as internet shutdown hits livelihoods

BY MENNA ZAKI

  • Buses, subway systems, online payment and banking platforms, as well as ride-hailing, navigation and food delivery services, are all functioning on the intranet, along with local news websites.
  • Cut off from the global internet for more than two weeks, online content creator Amir spends his days scanning the few news websites available on Iran's domestic web for signs that connectivity to the world might return.
  • Buses, subway systems, online payment and banking platforms, as well as ride-hailing, navigation and food delivery services, are all functioning on the intranet, along with local news websites.
Cut off from the global internet for more than two weeks, online content creator Amir spends his days scanning the few news websites available on Iran's domestic web for signs that connectivity to the world might return.
Amir, 32, has been unable to produce his reviews of video games and movies since January 8, when authorities imposed an unprecedented communications blackout amid mass anti-government protests that authorities acknowledge left more than 3,000 dead.
The prolonged shutdown has impacted key sectors of the economy from travel to exports, according to Iranians in Tehran who spoke to AFP, while costing the country millions of dollars each day.
"My work entirely depends on the internet... I really cannot see myself surviving without it," said Amir, who works with social media platforms including Instagram and YouTube.
He said the restrictions had left him demotivated and increasingly concerned about his income and future.
Nationwide rallies against the rising cost of living erupted in Tehran on December 28, beginning as peaceful demonstrations before turning into what officials describe as "foreign-instigated riots" that included killings and vandalism.
An official death toll from the unrest stands at 3,117, but international NGOs have provided higher numbers.
The protests have since subsided but remaining in place are the internet restrictions, which Iran's foreign minister has justified as necessary to confront foreign "terrorist operations". Rights groups, however, say the shutdown was imposed to mask a government crackdown on protesters.
Millions of Iranians have been left reliant on the country's intranet, which supports a wide range of domestic apps while keeping users isolated from the outside world.
Buses, subway systems, online payment and banking platforms, as well as ride-hailing, navigation and food delivery services, are all functioning on the intranet, along with local news websites.
Last weekend local media reported that domestic messaging apps including Bale, Eitaa and Rubika would also become functional again.
But Amir told AFP that he had "never used these apps and I will not start now", citing privacy concerns.

Flight disruptions

Social media sites such as Instagram have served as a key marketplace for Iranian entrepreneurs, but the impact on the economy from the internet restrictions extends far wider.
On Sunday, local media quoted Iran's deputy telecommunications minister Ehsan Chitsaz as saying the shutdown is estimated to have cost between four and six trillion rials per day -- around $3 to $4 million.
Internet monitoring group NetBlocks has provided a much higher estimate, saying each day costs Iran more than $37 million.
A travel agent, who declined to be named for security concerns, told AFP that booking international flights has been "unstable". Some flights had been cancelled and passengers only informed upon arrival at airports, she said.
"Business has been affected, with the number of customers calling me daily to book flights dropping," she added, noting that "domestic flights remain easier to arrange".
Iraj, a 51-year-old truck driver in western Iran who transports goods across the country's borders, said administrative procedures for loading and unloading export cargo have slowed.
"Drivers have been required to wait hours to complete paperwork," he added.

'It will backfire'

Curbs on the internet have been imposed during previous bouts of unrest in Iran though have generally been shorter and more limited in scope. 
Disruptions took place as far back as 2009 during nationwide demonstrations against the re-election of then president Mahmoud Ahmadinejad. 
Restrictions were also in place during protests sparked by rising fuel prices in 2019, rallies in 2022-2023 after the death in custody of Mahsa Amini, and during the 12-day war with Israel in June last year.
Amin, another content creator who reviews tech devices in videos posted to YouTube and Instagram, said he had anticipated restrictions this time but did not expect the shutdown to be so long or so stringent.
"We used to complain that working under these conditions was difficult, but now it's affecting every aspect of our livelihoods," the 29-year-old told AFP.
It remains unclear how long the blackout will last. In recent days patchy access to some foreign websites and email services such as Google has been available, but has been highly unreliable.
"The only optimistic thing I can say... is that I don't see them keeping the internet shut completely for a long time," Amin said.
"Otherwise, it will backfire."
bur/axn/smw

NewYork

Wall Street intends to stay open around the clock

BY THéO MARIE-COURTOIS

  • The move is pending approval by federal regulators at the US Securities and Exchange Commission (SEC), and would amount to a minor revolution for the way money moves in US stock markets.
  • The closing and opening bells of the New York Stock Exchange (NYSE) may become a ringing ritual of yesteryear, as the market moves toward nonstop trading.
  • The move is pending approval by federal regulators at the US Securities and Exchange Commission (SEC), and would amount to a minor revolution for the way money moves in US stock markets.
The closing and opening bells of the New York Stock Exchange (NYSE) may become a ringing ritual of yesteryear, as the market moves toward nonstop trading.
This week, the Intercontinental Exchange announced it is developing a platform for 24/7 operations that offers "instant settlement."
The around-the-clock operations would rely on digital tokens mirroring the shares of listed companies, the NYSE's parent company said in a statement.
NASDAQ, another New York-based trading exchange, could follow suit as early as this year.
The move is pending approval by federal regulators at the US Securities and Exchange Commission (SEC), and would amount to a minor revolution for the way money moves in US stock markets.

'Waste of time'

In the early days of the exchange, investors had to be physically present in markets on Wall Street to "stand and yell at each other and wave pieces of paper, and then they would have to write down what everybody bought and sold," Sam Burns, chief strategist at Mill Street Research, told AFP.
That meant "having trading go on all day every day would sort of be impossible to keep up with," Burns said. 
Digitized transactions can change all that.
Off-hours trading has already been on the rise since 2019, exploding since 2024 when the daily average topped $61 billion, according to a NYSE report in early 2025.
But the appeal remains limited, according to Steve Hanke, a professor of applied economics at Johns Hopkins University.
"Historically, there is little evidence that supports the idea that the benefits of 24-hour trading outweigh the costs," he said, adding that there "are few market-moving events that occur outside of normal business hours in New York City." 
"Night trading proved to be a waste of time," he said.
Hanke said the real advantage in the NYSE's announcement lies in the time needed to finalize a trade -- a process that usually occurs the next day in most stock markets.
"Narrowing the settlement window may prove to be a significant competitive advantage," Hanke said.

Attracting the young and foreigners

As host to immense market caps, the US market remains the largest in the world, but competition is growing.
Last year, many European indexes generated returns that outpaced their US counterparts.
With extended hours, Wall Street may be able to attract smaller investors and those outside the Americas.
Nearly 18 percent of US shares belonged to non-US holders in 2024, according to the US Treasury's most recent available figures.
And fans of cryptocurrency trading may jump into stocks, said Burns, the Mill Street Research strategist.
"A lot of retail investors nowadays, particularly younger ones, seem to like the idea of being able to trade stocks all the time the way they do cryptocurrencies and other digital assets, whether it's nights or weekends," Burns said.
It is unlikely that the change would move traditional investors from banker's hours because the impacts of any change are likely to be limited," Burns added.
"Most institutional investors that trade the real money aren't really interested in working or trading on the weekends, and the fact (is) that banks are mostly still closed on the weekends," Burns said.
tmc-ni/myl/sla/lga

trade

Europe and India seek closer ties with 'mother of all deals'

BY UMBERTO BACCHI

  • Securing a pact described by India's Commerce Minister Piyush Goyal as "the mother of all deals", would be a major win for Brussels and New Delhi as both seek to open up new markets in the face of US tariffs and Chinese export controls.
  • India and Europe hope to strike the "mother of all deals" when EU chiefs meet Prime Minister Narendra Modi in New Delhi next week, as the two economic behemoths seek to forge closer ties.
  • Securing a pact described by India's Commerce Minister Piyush Goyal as "the mother of all deals", would be a major win for Brussels and New Delhi as both seek to open up new markets in the face of US tariffs and Chinese export controls.
India and Europe hope to strike the "mother of all deals" when EU chiefs meet Prime Minister Narendra Modi in New Delhi next week, as the two economic behemoths seek to forge closer ties.
Facing challenges from China and the United States, India and the European Union have been negotiating a massive free trade pact -- and talks, first launched about two decades ago, are nearing the finishing line.
"We are on the cusp of a historic trade agreement," European Commission President Ursula von der Leyen said this week.
Von der Leyen and European Council president Antonio Costa will attend Republic Day celebrations Monday before an EU-India summit Tuesday, where they hope to shake hands on the accord.
Securing a pact described by India's Commerce Minister Piyush Goyal as "the mother of all deals", would be a major win for Brussels and New Delhi as both seek to open up new markets in the face of US tariffs and Chinese export controls.
But officials have been eager to stress there is more to it than commerce.
"The EU and India are moving closer together at the time when the rules-based international order is under unprecedented pressure through wars, coercion and economic fragmentation," the EU's top diplomat, Kaja Kallas said Wednesday. 

'Untapped potential'

Russia's invasion of Ukraine and US President Donald Trump's punitive tariffs have brought momentum to the relationship between India and the EU, said Praveen Donthi, of the International Crisis Group think tank.
"The EU eyes the Indian market and aims to steer a rising power like India away from Russia, while India seeks to diversify its partnerships, doubling down on its strategy of multi-alignment at a time when its relations with the US have taken a downward turn," he said. 
The summit will offer Brussels the chance to turn the page after a bruising transatlantic crisis over Greenland -- now seemingly defused.
Together the EU and India account for about a quarter of the world's population and GDP.
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.
But both parties are eager to do more. 
"India still accounts for around only around 2.5 percent of total EU trade in goods, compared with close to 15 percent for China," an EU official said, adding the figure gave a sense of the "untapped potential" an agreement could unlock.
EU makers of cars, machinery and chemicals have much to gain from India lowering entry barriers, said Ignacio Garcia Bercero, an analyst at Brussels think tank Bruegel, who led EU trade talks with New Delhi over a decade ago.
"India is one of the most heavily protected economies in the world, with very, very high tariffs, including on many products where the European Union has a competitive advantage," he told AFP. 
Its economy in the doldrums, the 27-member EU is also pushing to ease exports of spirits and wines and strengthen intellectual property rules.
India -- the fastest‑growing major economy in the world -- wants easier market access for products such as textiles and pharmaceuticals. 

Defence pact

EU officials were tight-lipped about the deal's contents as negotiations are ongoing.
But agriculture, a sensitive topic in both India and Europe, is likely to play a limited role, with New Delhi eager to protect its dairy and grain sectors.
Talks are focusing on a few sticking points, including the impact of the EU's carbon border tax on steel exports and safety and quality standards in the pharmaceutical and automotive sectors, according to people familiar with the discussions. 
Still EU officials said they were confident negotiations could be concluded in time for the summit. 
An accord on mobility to facilitate movement for seasonal workers, students, researchers and highly skilled professionals, is also on the menu, alongside a security and defence pact.
The latter envisages closer cooperation in areas including maritime security, cybersecurity and counter-terrorism, an EU official said. It is also a "precondition" for the possible joint production of military equipment, said a second EU official. 
New Delhi, which has relied on Moscow for decades for key military hardware, 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 vis-a-vis the US. 
"We're ready to open a new chapter in EU-India relationships, and really to unlock what we think is the transformative potential of this partnership," said another EU official. 
ub-bur/ec/cw/ceg

recall

France probes deaths of two babies after powdered milk recall

  • The potentially contaminated milk has been "withdrawn" from the market, Health Minister Stephanie Rist said.
  • France's health minister on Friday sought to reassure consumers that all suspicious infant formula had been withdrawn, as an investigation began into the deaths of two babies who drank possibly contaminated powdered milk.
  • The potentially contaminated milk has been "withdrawn" from the market, Health Minister Stephanie Rist said.
France's health minister on Friday sought to reassure consumers that all suspicious infant formula had been withdrawn, as an investigation began into the deaths of two babies who drank possibly contaminated powdered milk.
The infant formula industry has been rocked in recent weeks by several firms recalling batches that could be contaminated with cereulide, a toxin that can cause diarrhoea and vomiting.
The potentially contaminated milk has been "withdrawn" from the market, Health Minister Stephanie Rist said.
In particular, Nestle pulled batches of infant milk in several European countries on January 6.
French investigators are looking into the cause of death of two infants who allegedly consumed Nestle milk.
One was a two-week-old who died on January 8 in Bordeaux, southwest France, after drinking milk from the now-recalled batches, a prosecutor in the city said on Thursday.
The second, aged just 27 days, died on December 23 in the western city ofAngers, the local prosecutor said.
The mother contacted the authorities this week, saying her baby had drunk Nestle milk from one of the lots removed from the market.
At this time, there was no established causal link between the formula and their deaths, according to French authorities.
Nestle told AFP on Friday it would cooperate with the probes, adding there was "no evidence" at this stage linking its products to the infant deaths.
In another recall, Danone on Friday said it would "withdraw from targeted markets a very limited number of specific batches of infant formula" to comply with the latest guidance from local food safety authorities.
A source close to the matter said the move followed changes introduced by authorities, notably in Ireland.
Danone later told AFP in a statement it was voluntarily recalling two batches in France as a precaution "in light of new recommendations from a European authority".
It comes after Singapore authorities on Saturday recalled Dumex baby formula, a brand owned by the French food giant.
French group Lactalis on Wednesday also said it was recalling batches in France and other countries over worries they contained cereulide.
Lactalis did not name the supplier behind the tainted ingredient.
Outside France, countries concerned included Australia, Chile, China, Colombia, Congo-Brazzaville, Ecuador, Spain, Madagascar, Mexico, Uzbekistan, Peru, Georgia, Greece, Kuwait, the Czech Republic and Taiwan, a Lactalis spokesperson told AFP.
burs/jxb/jhb

Global Edition

Gold nears $5,000, silver shines as stocks churn to end turbulent week

  • Trump, who on Wednesday backed away from threatened tariffs on Europe over Greenland, told reporters the United States was sending a "massive fleet" toward Iran "just in case."
  • Global stocks were subdued and precious metals hit new highs Friday as US President Donald Trump followed up conciliatory comments on Greenland with a fresh warning on Iran.
  • Trump, who on Wednesday backed away from threatened tariffs on Europe over Greenland, told reporters the United States was sending a "massive fleet" toward Iran "just in case."
Global stocks were subdued and precious metals hit new highs Friday as US President Donald Trump followed up conciliatory comments on Greenland with a fresh warning on Iran.
Trump, who on Wednesday backed away from threatened tariffs on Europe over Greenland, told reporters the United States was sending a "massive fleet" toward Iran "just in case."
Gold -- a safe-haven asset -- pushed closer to a record $5,000 an ounce, while fellow safe haven silver also kept rising, blasting through $102 an ounce amid worries over what Trump may say next, or actually do.
The dollar retreated, falling to a four-month low against the euro.
Sentiment had calmed over the past two days after the US president pulled back from his threat to hit several European nations with levies because of their opposition to Washington taking over the Danish autonomous territory of Greeland.
Trump has repeatedly left open the option of new military action against Iran after Washington backed and joined Israel's 12-day war in June aimed at degrading Iran's nuclear and ballistic missile programs.
The prospect of immediate American action seemed to recede in recent days, with both sides insisting on giving diplomacy a chance.
European markets sought direction in vain, Frankfurt closing just in the green as London and Paris fell on the red side of the line at the end of the week.
Wall Street painted a similar picture, with the Dow retreating while the Nasdaq pushed higher. 
Intel plunged 17 percent after lackluster expectations on the chip maker's earnings.
Asian markets closed higher.

Powell under pressure

Trump's latest salvo against allies revived trade war fears and uncertainty about US investment, putting downward pressure on the dollar this week.
Analysts said there was no guarantee that Europe-US relations had improved durably.
The US president's willingness to threaten tariffs over any issue had rattled confidence on trading floors, boosting safe-haven metals, analysts said.
Investors were also preparing for next week's Federal Reserve meeting following economic data broadly in line with forecasts and after US prosecutors took aim at boss Jerome Powell, which has raised fears over the bank's independence.
The bank is tipped to hold interest rates steady, after cutting them in the previous three meetings.
The meeting also comes as Trump considers candidates to replace Powell when the Fed chair's term comes to an end in May.
The Bank of Japan left its key interest rate unchanged ahead of a snap election next week, which could impact government spending plans.
After sharp volatility in the wake of the announcement, the yen traded slightly higher.
Next week's US earnings calendar is packed with results from Apple, Microsoft, Boeing, Tesla, Meta and other corporate giants.

Key figures at around 2120 GMT

New York - Dow: DOWN 0.6 percent at 49,098.71 (close)
New York - S&P 500: FLAT at 6,915.61 (close)
New York - NASDAQ: UP 0.3 percent at 23,501.24 (close)
London - FTSE 100: DOWN 0.1 percent at 10,143.44 (close)
Paris - CAC 40: DOWN 0.1 percent at 8,143.05 (close)
Frankfurt - DAX: UP 0.2 percent at 24,900.71 (close)
Tokyo - Nikkei 225: UP 0.3 percent at 53,846.87 (close)
Hong Kong - Hang Seng Index: UP 0.5 percent at 26,749.51 (close)
Shanghai - Composite: UP 0.3 percent at 4,136.16 (close)
Euro/dollar: UP at $1.1823 from $1.1755 on Thursday
Pound/dollar: UP at $1.3636 from $1.3501
Dollar/yen: DOWN at 157.00 yen from 158.41 yen
Euro/pound: DOWN at 86.70 pence from 87.07 pence
West Texas Intermediate: UP 2.9 percent at $61.07 per barrel
Brent North Sea Crude: UP 2.8 percent at $65.88 per barrel
bur-jmb/dw

TikTok

TikTok in the US goes American, but questions remain

  • TikTok insists that US users will maintain a "global TikTok experience," meaning US creators can still be discovered internationally and businesses can "operate on a global scale."
  • After a long legal saga, TikTok has established a majority American-owned joint venture to operate its US business, deflecting the threat of a ban over its Chinese ownership.
  • TikTok insists that US users will maintain a "global TikTok experience," meaning US creators can still be discovered internationally and businesses can "operate on a global scale."
After a long legal saga, TikTok has established a majority American-owned joint venture to operate its US business, deflecting the threat of a ban over its Chinese ownership.
Here is a look at the potential consequences of the deal -- if any -- for users and beyond:

What it means for users

Whether the 200 million users in the United States will notice any difference in their online experience remains unclear. After the deal, users don't need to download a new app, though they were prompted to accept new terms of service covering "new types of location information" and data usage.
At the heart of the ownership drama is TikTok's powerful algorithm, which US lawmakers feared could be weaponized for data or propaganda by the Chinese government. The new ownership has promised to "retrain" the app's magic sauce, but how that will affect the user experience is still unknown.
TikTok insists that US users will maintain a "global TikTok experience," meaning US creators can still be discovered internationally and businesses can "operate on a global scale."
However, the US-only algorithm raises questions. 
"There are still questions of how this new entity will interact with other versions of TikTok globally," said Jennifer Huddleston of the CATO Institute in Washington. 
She also wondered about "what influence the US government may have over the algorithm and the free speech concerns that could arise from this new arrangement."
A major investor in the new entity is Larry Ellison, who is also financing his son David's recent takeover of Paramount and bidding war to take over Warner Bros -- potentially giving the family unprecedented power over US media.
Creators are watching especially closely, since their popularity and income depend on the algorithm's mysterious workings. Some have already migrated to other platforms, frustrated or anxious about the political turmoil surrounding the app.

What it means for TikTok

Before President Donald Trump took office, TikTok's fate in the United States looked bleak. The app was even briefly switched off in its biggest market after exhausting all legal options. 
The political chaos has likely taken a toll on TikTok, despite Trump ultimately coming to its rescue.
"TikTok remains incredibly popular in the US, but it's facing more competition than ever, particularly from Instagram Reels," said Emarketer analyst Minda Smiley.
The algorithm that took the world by storm five years ago is no longer unique. Instagram Reels and YouTube Shorts now offer similar experiences, retaining engagement and attracting advertisers at comparable scale.
According to Emarketer, while US TikTok users still spend more time on the app than on other social networks, that time is declining each year, "signaling that the app is struggling to keep users hooked in the way it once did."

What it means for national security

The divestment may have satisfied the Trump administration, but whether it will satisfy the lawmakers who passed the divest-or-ban law remains to be seen, warned University of Florida media professor Andrew Selepak.
"The TikTok deal has improved the privacy of exactly no one and has done nothing to improve national security," said Kate Ruane of the Washington-based Center for Democracy & Technology.
ByteDance now owns just under 20 percent of the company, with the rest spread across several mainly US companies. 
However, John Moolenaar, the Republican chairman of the House Foreign Affairs Committee, has vowed to conduct full oversight of the agreement, signaling potential trouble ahead.
TikTok says key functions like e-commerce and marketing will remain tied to the global entity and that could be problematic.
"I don't know how you could accomplish e-commerce and not take data from me as an American user," Selepak said.
For Carl Tobias of the University of Richmond School of Law, "It seems like Trump has just eclipsed whatever Congress might have intended in terms of national security."
arp/msp

automobile

German auto supplier ZF axes electric projects as demand stalls

  • The move makes ZF Friedrichshafen the latest German company to report bumps in the road when it comes to the electric vehicle ramp-up.
  • Major German automotive supplier ZF Friedrichshafen said Friday it had scrapped some of its electric vehicle projects due to lacklustre demand, leading it to expect an annual loss.
  • The move makes ZF Friedrichshafen the latest German company to report bumps in the road when it comes to the electric vehicle ramp-up.
Major German automotive supplier ZF Friedrichshafen said Friday it had scrapped some of its electric vehicle projects due to lacklustre demand, leading it to expect an annual loss.
ZF had agreed with customers to "end earlier than planned several projects that were not proving as profitable as expected due to the slow ramp-up in e-mobility", it said in a statement.
Ending the projects early would likely tip ZF into the red for the year, finance boss Michael Frick said, adding that he nevertheless thought the hit would be worth it in the long run.
"The special charge in the e-mobility sector will result in an accounting loss for 2025, but it frees us from legacy burdens and lays the foundation for new opportunities," he said. 
The move makes ZF Friedrichshafen the latest German company to report bumps in the road when it comes to the electric vehicle ramp-up.
Europe's largest carmaker Volkswagen in October reported its first quarterly loss since the Covid pandemic after its luxury brand Porsche pushed back electric car launches citing weak demand.
Battery electric vehicles made up just 16.4 percent of new car sales in Europe in the first ten months of 2025, according to industry figures, far behind the more optimistic expectations of earlier years and off-target to meet strict European Union environmental rules.
In 2024, the most recent full year available, ZF posted sales of 41.4 billion euros ($48.6 billion).
The firm reports full results for 2025 and its outlook for 2026 on 19 March.
vbw/sr/cw

diplomacy

ECB chief thanks Davos 'euro-bashers' as welcome wake-up call

  • "Instead of becoming a truly global power, Europe remains a beautiful but fragmented kaleidoscope of small and middle powers," he said during his trip to Davos.
  • After a week of hearing various US officials denigrate Europe, its leaders and its regulations at Davos, ECB chief Christine Lagarde said Friday that the harsh words could be just what the continent needed.
  • "Instead of becoming a truly global power, Europe remains a beautiful but fragmented kaleidoscope of small and middle powers," he said during his trip to Davos.
After a week of hearing various US officials denigrate Europe, its leaders and its regulations at Davos, ECB chief Christine Lagarde said Friday that the harsh words could be just what the continent needed.
"We have heard a lot of European bashing in the last few days," Lagarde said at the closing session of the World Economic Forum's annual meeting in the Swiss Alps.
Among the more rankling comments was US Treasury Secretary Scott Bessent's quip in a TV interview dismissing "the dreaded European working group" in response to potential US tariffs aimed at seeking control of Greenland.
Ukraine's President Volodymyr Zelensky meanwhile blasted the EU's lack of "political will" in countering Russian leader Vladimir Putin.
"Instead of becoming a truly global power, Europe remains a beautiful but fragmented kaleidoscope of small and middle powers," he said during his trip to Davos.
Lagarde said such criticism meant Europe would have to face tough realities and find alternative ways of working to make sure it carries weight on the global stage.
"I think we should say thank you to the bashers," she said.
"It has given us a complete realisation of the fact that we have to be more focused, we have to work on those Plan Bs that I was talking about, and we have to focus on innovation, improvement of productivity, and the rest of it."
World Bank chief Kristalina Georgieva, speaking on the same stage, urged countries for her part to focus more on boosting growth as the risks of rising sovereign debt grow.
"All of a sudden, 3.3 percent looks like very good growth. What happened? We used to say that growth is not enough," she told the forum.
"Do not fall into complacency. Growth is not strong enough," she said. "And because it is not strong enough, the debt that is hanging from our necks, at 100 percent of GDP, is going to be a very heavy burden."
js/lt/cw

budget

France PM survives no-confidence vote over forced budget

  • After his symbolic survival on Friday, the prime minister announced he was officially ramming through the expense part of the 2026 state budget, causing the hard left to declare it was filing another no-confidence motion.
  • French Prime Minister Sebastien Lecornu survived two no-confidence votes Friday following his move to force his budget through parliament, in a symbolic victory with more such challenges expected.
  • After his symbolic survival on Friday, the prime minister announced he was officially ramming through the expense part of the 2026 state budget, causing the hard left to declare it was filing another no-confidence motion.
French Prime Minister Sebastien Lecornu survived two no-confidence votes Friday following his move to force his budget through parliament, in a symbolic victory with more such challenges expected.
Lecornu on Tuesday used a constitutional power to ram the income part of the 2026 state budget through parliament without a vote, after making concessions to gain the backing of the Socialists.
The key swing group showed their support Friday by not supporting two no-confidence motions, filed by the hard left and far right.
Lecornu will likely be exposed to a series of other such no-confidence votes in coming weeks.
After his symbolic survival on Friday, the prime minister announced he was officially ramming through the expense part of the 2026 state budget, causing the hard left to declare it was filing another no-confidence motion.
That one is to be examined on Tuesday, and also expected to be rejected.
"When debate no longer allows a conclusion, someone has to take responsibility," he told the National Assembly just ahead of the votes Friday.
"Invoking the government's responsibility, in my view, should be neither an easy way out nor a shortcut. It is a tool of last resort," he added of the constitutional power used.
The move marked a rowback for Lecornu, who pledged last year to seek parliament's approval, in a bid to avoid the fate of his two predecessors who were ousted over budget negotiations.
But on Monday, Lecornu conceded with "a certain degree of regret and a bit of bitterness" that he had to invoke the power to push the budget through.
On Friday, he reassured lawmakers that the constitutional power could only be used going forward "in the absolute and last resort" in order "to "preserve institutions".

'Betrayal' 

Still, opponents remained outraged over the measure.
Leader of the far-right National Rally (RN), Marine Le Pen, denounced the prime minister's "betrayal" for having used the measure.
"Everything should have led you to resign," she added, pointing to the government's "powerlessness".
The left also appeared divided, with the France Unbowed (LFI), Greens and Communist parties calling for Lecornu to be ousted while the Socialists sided with government.
Ahead of Friday's vote, the Socialists signalled that the use of the measure was "the least bad solution" and the latest draft showed "progress" with concessions including an increase in a top-up benefit for the lowest-paid employees and the rollout of one-euro meals for students.
Greens lawmaker Benjamin Lucas-Lundy warned the Socialists Friday that a few concessions "do not make progress". 
If Lecornu survives that second attempt to topple him, the budget bill must then be reviewed by the upper-house Senate before returning to the lower-house National Assembly for final adoption. 
Lecornu will have to use the same constitutional power to force the whole bill into law, which will expose him to more no-confidence votes.
sl/sde/giv/ah/cw

Trump

Did Trump make Davos great again?

BY LAURENT THOMET

  • If the World Economic Forum is going to be useful, going forward, it has to regain that trust," Fink said.
  • US President Donald Trump stole the show at the World Economic Forum in Davos, but he may have also made the annual gabfest of the global elite relevant again -- at least for a week.
  • If the World Economic Forum is going to be useful, going forward, it has to regain that trust," Fink said.
US President Donald Trump stole the show at the World Economic Forum in Davos, but he may have also made the annual gabfest of the global elite relevant again -- at least for a week.
The relevance of the gathering of CEOs and political leaders in the Swiss Alps is regularly questioned by critics who deride it as an out-of-touch echo chamber where little gets done.
But all eyes were on this year's Davos as Trump barrelled into town with a geopolitical storm hanging over the picturesque ski resort, where he pressed his case to acquire Greenland.
Hundreds of people stood in huge lines to hear Trump deliver a speech that drew gasps and nervous laughs as he mocked allies but also praised the "brilliant" A-listers in the room -- and ultimately ruled out using force to take Greenland.
"It's interesting that people were lining up to hear President Trump like they were not lining to hear any other speaker. None has got such kind of interest," Latvian President Edgars Rinkevics told AFP.
"I think that to some extent, Davos is back to what it was meant to be. To hear different perspectives, to argue, to discuss, to disagree sometimes, to agree, to somehow build bridges rather than to destroy them," he said.
Davos became the scene of intense diplomacy, culminating with Trump announcing a "framework of a future deal" on Greenland following talks with NATO Secretary-General Mark Rutte.
A day later, Trump met Ukrainian President Volodymyr Zelensky as part of his effort to end Russia's war in Ukraine, while also launching his "Board of Peace".
There was even a rare standing ovation this year -- for Canadian Prime Minister Mark Carney, who described a "rupture" in the global order in a speech that angered Trump.

'Failed policy'

It had been years since the WEF, founded in 1971, had been at the epicentre of such a momentous political episode.
The forum's previous landmark moments include hosting a thaw in Greek-Turkish tensions in 1988, and talks between Nelson Mandela and South Africa's apartheid-era president F. W. de Klerk in 1992.
Yet the renewed attention on Davos was not just about diplomacy and deal-making. It was also about confrontation.
The Trump administration descended on the Swiss resort in force to push its America First agenda -- the antithesis of the WEF's pro-globalisation creed.
"We are here to make a very clear point: globalisation has failed the West and the United States of America," US Commerce Secretary Howard Lutnick said during a panel discussion.
"It's a failed policy. It is what the WEF has stood for," Lutnick said. 
This year's meeting also comes at a turning point for the WEF after its founder, Klaus Schwab, stepped down as head of the forum amid allegations of wrongdoing, for which he was later cleared after an internal investigation.
The head of US investment giant BlackRock, Larry Fink, took over as interim co-chair and acknowledged in his opening remarks to the forum the criticism that the WEF has faced.
"It's also obvious that the world now places far less trust in us to help shape what comes next. If the World Economic Forum is going to be useful, going forward, it has to regain that trust," Fink said.
The billionaire floated the idea of hosting WEF meetings in "places where the modern world is actually being built", such as Detroit or Dublin.

'The people who matter are here'

But the WEF is still a place where the rich and powerful come to network and do business first.
Marc Benioff, the CEO of tech firm Salesforce, was in his element as he shook hands with other corporate titans in the corridors of the congress centre.
"I think for CEOs, still, the fundamental operation of their business, the implementation of AI, the transformation into this new world, that's number one," Benioff told AFP after chatting with PepsiCo boss Ramon Laguarta.
"Obviously, there's a geopolitical situation going on, but I think for the vast majority of attendees, it's not impacting them," he said.
Benioff was among an A-list of CEOs that included Apple's Tim Cook and Nvidia's Jensen Huang, invited to meet Trump in Davos.
"The people who matter are here and the conversations that are important are happening here," Benioff said.
Davos, he said, "has never been more relevant".
lt/js/yad

election

Japan PM Takaichi dissolves parliament for snap election

BY KYOKO HASEGAWA AND JULIEN GIRAULT

  • The speaker of parliament on Friday read out a letter, officially dissolving the lower house as lawmakers shouted the traditional rallying cry of "banzai".
  • Japanese Prime Minister Sanae Takaichi dissolved parliament on Friday ahead of a snap election on February 8, counting on her cabinet's high poll numbers to steer her otherwise unpopular ruling party to victory.
  • The speaker of parliament on Friday read out a letter, officially dissolving the lower house as lawmakers shouted the traditional rallying cry of "banzai".
Japanese Prime Minister Sanae Takaichi dissolved parliament on Friday ahead of a snap election on February 8, counting on her cabinet's high poll numbers to steer her otherwise unpopular ruling party to victory.
The country's first woman premier announced her intentions on Monday, seeking public backing for measures to shield households from rising living costs and increase spending on defence.
The speaker of parliament on Friday read out a letter, officially dissolving the lower house as lawmakers shouted the traditional rallying cry of "banzai".
The ruling coalition of Takaichi's Liberal Democratic Party (LDP) and the Japan Innovation Party (JIP) has only a slim majority in the powerful lower chamber.
But Takaichi is hoping widespread support for her cabinet will help deliver her a stronger mandate even though the LDP itself is battling low approval ratings and a string of scandals.
Her government has around 90 percent support among those under 30, according to a poll published at the end of December by the conservative Sankei Shimbun newspaper and Fuji Television.
"It's not clear if high public support for the Takaichi cabinet will actually lead to support of the LDP," Hidehiro Yamamoto, a politics professor at the University of Tsukuba, told AFP.
"What the public are concerned about is measures to address inflation," he said.
Public discontent over rising prices largely contributed to the downfall of Shigeru Ishiba, whom Takaichi succeeded in October.
While Japan was long haunted by deflation, it has more recently faced a surge in living costs and a chronically weak yen that has made imports more expensive.
Vowing to address the issue and shore up the world's fourth-largest economy, Takaichi's cabinet approved a record 122.3-trillion-yen ($770 billion) budget for the fiscal year from April 2026.
But critics say dissolving the lower house risks delaying its passage through parliament. 
To Shoichi Shirai, a 62-year-old company worker, Takaichi's decision "felt like a truly selfish dissolution", he told AFP in Tokyo, accusing her of prioritising elections over budget discussions.   
"She kept saying she would get to work, but dissolving the parliament at this time is completely disregarding the will of the people," he said. 
Still, the ruling LDP aims to "secure a majority" together with its partner the JIP to "regain and establish political stability," secretary-general Shunichi Suzuki said after the dissolution. 
The upcoming campaign can also see immigration -- a charged topic that led to the advent of an upstart populist party in summer elections -- thrust back into the spotlight.    
On Friday, Takaichi's conservative government approved a set of policies including firming up a crackdown on illegally staying foreigners and curbing overtourism more.
      

Tax relief

If elected, Takaichi has pledged to cut a sales tax on food for a two-year period to "alleviate the burden" on people struggling with inflation.
Opposition parties are also calling for the tax relief.
But Takaichi's "proactive" fiscal spending risks inflating the country's already colossal debt, which is expected to exceed 230 percent of GDP in the fiscal year 2025-26. Takaichi says the policy is "responsible".
The prospect of tax cuts roiled the bond market this week, after it was already rattled by the massive stimulus plan and worried about fiscal slippage financed by debt.
The Bank of Japan (BOJ), which is responsible for price stability, left its key interest rate unchanged at 0.75 percent in a policy decision Friday after a two-day meeting.

Centrist alliance

The LDP has governed Japan almost uninterrupted for decades, albeit with frequent leader changes.
The CDP has joined forces with another party, Komeito, hoping their new Centrist Reform Alliance (CRA) can draw swing voters away from Takaichi.
"We threw down the gauntlet under the banner of centrism. If that paid off big time, I think it's possible for us to come into power as a centrist government," Yoshihiko Noda, co-leader of the CRA, said. 
Analysts say the election could be a close battle depending on the success of the alliance, but the opposition's chances of winning remain slim.
"The key could be the voting behaviour of young and middle-aged groups, as was the case in the upper house election" in July, Mizuho Research & Technologies said in a note.
kh-jug/tmo/jm

TikTok

TikTok establishes joint venture to end US ban threat

BY ALEX PIGMAN

  • The new structure responds to a law passed under US President Donald Trump's predecessor Joe Biden that forced Chinese-owned ByteDance to sell TikTok's US operations or face a ban in its biggest market.
  • TikTok announced Thursday it has established a majority American-owned joint venture to operate its US business, allowing the company to avoid a ban over its Chinese ownership.
  • The new structure responds to a law passed under US President Donald Trump's predecessor Joe Biden that forced Chinese-owned ByteDance to sell TikTok's US operations or face a ban in its biggest market.
TikTok announced Thursday it has established a majority American-owned joint venture to operate its US business, allowing the company to avoid a ban over its Chinese ownership.
The video-sharing app is a global digital entertainment powerhouse but its mass appeal and links to China have raised concerns over privacy and national security.
The TikTok USDS Joint Venture LLC will serve more than 200 million users and 7.5 million businesses while implementing strict safeguards for data protection and content moderation, the company said.
The new structure responds to a law passed under US President Donald Trump's predecessor Joe Biden that forced Chinese-owned ByteDance to sell TikTok's US operations or face a ban in its biggest market.
Trump welcomed and claimed credit for the deal, but also thanked Chinese President Xi Jinping for approving it.
"I am so happy to have helped in saving TikTok!" Trump said in a post on Truth Social late Thursday.
"It will now be owned by a group of Great American Patriots and Investors, the Biggest in the World, and will be an important Voice."
"I would also like to thank President Xi, of China, for working with us and, ultimately, approving the Deal," he added.

Cybersecurity audit

ByteDance retains a 19.9 percent stake in the joint venture -- keeping its ownership below the 20 percent threshold stipulated by the law.
Three investors -- Silver Lake, Oracle and Abu Dhabi-based AI investment fund MGX -- each hold 15 percent stakes. Oracle's executive chairman Larry Ellison is a longtime Trump ally.
Other investors include Dell Family Office, affiliates of Susquehanna International Group and General Atlantic.
The joint venture will retain decision-making authority over trust and safety policies and content moderation for US users.
But TikTok's global entities will manage international product integration and commercial activities including e-commerce and advertising.
Under the arrangement, US user data will be stored in Oracle's secure cloud environment, with cybersecurity audited by third-party experts and adhering to federal standards, TikTok said.
Jasmine Enberg, co-CEO of Scalable, a media company focused on the creator economy, said TikTok users would be relieved by the deal but that there were "still big questions about how this will all play out."
"Behind the scenes, TikTok is likely working hard to assure advertisers it will remain business as normal," she told AFP.
"While the need for users to download a new app seems unlikely, brand partners will want to know that their TikTok strategies won't be disrupted."

Ellison in spotlight

The joint venture will be governed by a seven-member, majority-American board including TikTok CEO Shou Chew and executives from investment firms.
TikTok executive Adam Presser was appointed CEO of the new entity, with Will Farrell serving as chief security officer.
The 2024 law came as US policymakers, including Trump in his first presidency, warned that China could use TikTok to mine Americans' data or exert influence through its algorithm.
But Trump, crediting the app for his appeal with young voters, delayed enforcement through successive executive orders, most recently extending the deadline to January 22.
The deal largely confirms an outline announced to staff by Chew last month.
In September, one-time venture capitalist and Vice President JD Vance said the US entity would be valued at about $14 billion but it would ultimately be up to investors to determine pricing.
That month, Trump said a new venture had been agreed with China and would meet the law's requirements.
Trump specifically named Ellison, one of the world's richest men, as a major player in the arrangement.
Ellison has returned to the spotlight through his dealings with Trump, who has brought his old friend into major AI partnerships with OpenAI.
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