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Tag: EASIA

  • U.S. forces launch space unit in South Korea amid North’s growing threats

    U.S. forces launch space unit in South Korea amid North’s growing threats

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    SEOUL, Dec 14 (Reuters) – U.S. Forces Korea launched a new space forces unit on Wednesday as the allies ramp up efforts to better counter North Korea’s evolving nuclear and missile threats.

    The U.S. Space Forces Korea is the second overseas space component of the U.S. Space Force and is tasked with monitoring, detecting and tracking incoming missiles, as well as bolstering the military’s overall space capability. It will be led by Lt. Col. Joshua McCullion.

    U.S. Forces Korea commander Gen. Paul LaCamera said the unit would enhance the U.S. ability to ensure peace and security on the Korean peninsula and in Northeast Asia.

    “The U.S. military is faster, better connected, more informed, precise and legal because of space,” LaCamera told a ceremony at Osan Air Base in the South Korean city of Pyeongtaek.

    Seoul and Washington are seeking to boost security cooperation to deter North Korea, which this year has tested intercontinental ballistic missiles capable of reaching the U.S. mainland.

    South Korea’s air force also set up its own space unit this month to bolster its space power and operation capability together with the U.S. Space Force.

    U.S. officials have expressed concerns over rising security activity in space by major rivals, including China’s development of hypersonic weapons and Russia’s test of anti-satellite technology last year.

    Beijing has warned Seoul against joining a U.S.-led global missile shield, and criticised the THAAD U.S. missile defence system installed in South Korea.

    Seoul’s defence ministry said the creation of the U.S. space component had nothing to do with South Korea’s participation in existing missile defence programmes.

    Around 28,500 U.S. troops are stationed in South Korea under a mutual defence treaty forged after the 1950-1953 Korean War ended in an armistice, not a peace treaty.

    The U.S. Indo-Pacific Command and Central Command set up their space units last month in Hawaii and Florida.

    Reporting by Hyonhee Shin; Additional reporting by Hyunyoung Yi; Editing by Gerry Doyle and Edmund Klamann

    Our Standards: The Thomson Reuters Trust Principles.

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  • Medical staff in China’s hospitals say COVID-19 ripping through their ranks

    Medical staff in China’s hospitals say COVID-19 ripping through their ranks

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    HONG KONG, Dec 14 (Reuters) – A growing number of China’s doctors and nurses are catching COVID-19 and some have been asked to keep working, as people showing mostly moderate symptoms throng hospitals and clinics, according to medical staff and dozens of posts on social media.

    China’s health authority did not immediately respond to a request for comment on infections among medical staff.

    Health experts say China’s sudden loosening of strict COVID rules is likely to trigger a surge in severe cases in coming months, and hospitals in big cities are already showing signs of strain.

    Reuters was unable to immediately get verification from hospitals on waiting times and bed utilisation rates, but photographs circulated on social media showed patients in Beijing and neighbouring Baoding waiting for hours to get treated.

    Health officials have been recommending that people with mild COVID symptoms quarantine at home and have also said most of the cases reported in the country are mild or asymptomatic.

    “Our hospital is overwhelmed with patients. There are 700, 800 people with fever coming every day,” said a doctor surnamed Li at a tertiary hospital in Sichuan province.

    “We are running out of medicine stocks for fever and cold, now waiting for delivery from our suppliers. A few nurses at the fever clinic were tested positive, there aren’t any special protective measures for hospital staff and I believe many of us will soon get infected,” Li added.

    A nurse at another hospital in Chengdu said: “I was swamped with nearly 200 patients with COVID symptoms last night.”

    Ben Cowling, an epidemiologist at Hong Kong University, said insufficient medical resources to cope with an overload of COVID cases contributed to a surge in deaths in Hong Kong when infections peaked there earlier this year, and he warned that the same was going to happen in China.

    “One of the reasons we had such a high mortality rate (in Hong Kong) is because we simply didn’t have enough hospital resources to cope in the surge. And unfortunately, that is what is going to happen in about one to two months time in the mainland,” Cowling said.

    He said a surge in severe cases coupled with a surge of mild cases among the elderly who needed monitoring overwhelmed Hong Kong’s hospitals, and recommended separate isolation facilities for the elderly with mild cases to free up hospital beds.

    State media Xinhua reported on Tuesday in capital Beijing 50 patients are currently in a serious or critical condition in hospital with COVID.

    ‘WHAT A MESS’

    The sudden loosening of restrictions has sparked long queues outside fever clinics since last week in a worrying sign that a wave of infections is building, even though official tallies of new cases have trended lower recently as authorities eased back on testing.

    Some hospitals in Beijing have up to 80% of their staff infected, but many of them are still required to work due to staff shortages, a doctor in a large public hospital in Beijing told Reuters, adding he has spoken to his peers at other big hospitals in the capital.

    All operations and surgeries have been cancelled at his hospital unless the patient is “dying tomorrow”, he said, declining to be named due to the sensitivity of the subject.

    A post on the Weibo social media platform recounted a recent experience at the emergency ward at Beijing Hospital.

    “Those who have not been to the emergency department of Beijing Hospital don’t know what a mess it has become,” wrote a Weibo user called Moshang. The post went on to say that people in serious need of surgery were being made to wait.

    Beijing Hospital did not immediately respond to a Reuters’ request for comment.

    Wan Ling, a head nurse at a hospital in Huashan in China’s Anhui province, wrote on Weibo that many of her infected colleagues were relatively serious and had high fever.

    Several doctors from Wuhan province’s top public hospital Tongji have also tested positive for COVID-19, but since Sunday have not been allowed to take leave, a pharmaceutical sales representative with direct knowledge of the matter told Reuters, declining to be named, as the information is not public.

    “They have to stay at work while they are sick,” said the person who regularly visits the hospital and spoke to its doctors recently.

    Tongji hospital did not immediately respond to a Reuters request for comment.

    Reporting by the Beijing newsroom, David Stanway and the Shanghai newsroom, Julie Zhu and Selena Li in Hong Kong; Writing by Farah Master; Editing by Miyoung Kim & Simon Cameron-Moore

    Our Standards: The Thomson Reuters Trust Principles.

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  • Analysis: China’s massive older chip tech buildup raises U.S. concern

    Analysis: China’s massive older chip tech buildup raises U.S. concern

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    OAKLAND, Calif./SHANGHAI/WASHINGTON Dec 13 (Reuters) – China’s largest chip maker SMIC (0981.HK) is ramping up production of a decade-old chip technology, key to many industries’ supply chains, setting off alarm bells in the United States and prompting some lawmakers to try to stop them.

    The United States and allied nations could further step up restrictions if China announces a trillion yuan ($144 billion) support package for its chip industry, as Reuters exclusively reported on Tuesday, said TechInsights’ chip economist Dan Hutcheson.

    Starting with the Trump administration, the United States has been tightening the noose around China’s high-tech ambitions. It cut off the world’s largest telecommunications firm Huawei Technologies from the U.S. market and technologies, as well as cut off air supply to China’s advanced chip making through a series of rules this year.

    But why worry about older chip technology?

    China, which in 2020 had 9% of the global chip market, has a track record of dominating key technologies by flooding the market with cheaper products and wiping out global competition, say China watchers.

    They did it with solar panels and 5G telecom equipment, and could do it with older technology chips, said Matt Pottinger, former Deputy National Security Advisor of the United States during the Trump administration who has been studying chip policy at the Hoover Institution.

    “It would give Beijing coercive leverage over every country and industry – military or civilian – that depend on 28 nanometer chips, and that’s a big, big chunk of the chip universe,” he said.

    “28 nanometer” refers to a chip technology commercially used since 2011. It is still widely used in automotive, weapons and the explosive category of internet of things gadgets, said Hutcheson.

    Hutcheson, who has been monitoring chip production capacity for four decades, said the concern is that Semiconductor Manufacturing International Corp (0981.HK) and other chipmakers in China could use government subsidies to sell chips at a low price. And a possible new round of financial support from Beijing would increase chip production even further.

    “The Chinese could just flood the market with these technologies,” he said. “Normal companies can’t compete, because they can’t make money at those levels.”

    U.S. LAWMAKERS PUSHING AGAINST SMIC

    Those concerns have pushed some lawmakers to use legislation for setting the defense budget hold back SMIC.

    While the measure is weaker than what was initially proposed, this week U.S. Senators are expected to pass the annual National Defense Authorization Act 2023 that includes a section barring the U.S. government from using chips from SMIC and two other Chinese memory chip makers. It is not clear what impact the restriction, which kicks in five years after it becomes law, will have on SMIC.

    Founded in 2000 with backing from Beijing, SMIC has long struggled to break into the ranks of the world’s leading chip manufacturers.

    But it is a giant in older technology, including chips that regulate power flows in electronics. And its revenue was close to $2 billion in the third quarter this year, roughly double the same period last year on the back of the global chip shortage.

    SMIC FILLING SUPPLY GAP

    With U.S. export controls making it impossible to produce advanced chips, SMIC is doubling down on mature technology chips and has announced four new facilities, or fabs, since 2020. When those come online, it would more than triple the company’s output, estimates Samuel Wang, Gartner chip analyst. He said there is a huge ramp up in new chip fabs across China.

    “All this will start to have an impact from early 2024 and will be full blown by 2027,” said Wang, adding the chip supply increase will put downward pressure on chip prices.

    The importance of older chip technology hit the industry in the face in 2021 as a shortage of those chips prevented manufacturing of millions of cars and consumer electronics.

    Mark Li, Bernstein Research’s chip analyst in Asia, said the company is becoming a formidable competitor to Taiwan’s UMC Microelectronics Corp (6615.T) and U.S.-headquartered GlobalFoundries Inc (GFS.O).

    “SMIC has been much more willing to add capacity than other fabs at the low-end, and especially in this shortage we’ve seen in the past two years,” he says. “It’s not an issue now…but who knows, maybe in a few years there will be another shortage and capacity will be a big problem.”

    ($1 = 6.9430 Chinese yuan renminbi)

    Reporting By Jane Lanhee Lee in Oakland, Calif and Josh Horwitz in Shanghai, and Alexandra Alper in Washington D.C.; Editing by Josie Kao

    Our Standards: The Thomson Reuters Trust Principles.

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  • Indonesia evacuates villagers as volcano erupts on Java island

    Indonesia evacuates villagers as volcano erupts on Java island

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    JAKARTA, Dec 4 (Reuters) – A volcano erupted in Indonesia on Sunday spewing a cloud of ash 15 km into the sky and forcing the evacuation of nearly 2,000 people, authorities said, as they issued their highest warning for the area in the east of Java island.

    There were no immediate reports of any casualties from the eruption of the Semeru volcano and Indonesia’s transport ministry said that there was no impact on air travel but notices had been sent to two regional airports for vigilance.

    “Most roads have been closed since this morning and now it is raining volcanic ash and it has covered the view of the mountain,” community volunteer Bayu Deny Alfianto told Reuters by telephone from near the volcano.

    Semeru, the tallest mountain on Java, erupted last year killing more than 50 people and displacing thousands.

    Indonesia’s disaster mitigation agency (BNPB) said 1,979 people had been moved to 11 shelters and authorities had distributed masks to residents. The eruption began at 2:46 a.m. (1946 GMT on Saturday) and rescue, search and evacuation efforts were going on.

    The volcano’s plume of ash reached a height of 50,000 feet (15 km), said Japan’s Meteorology Agency, which had initially been on alert for the possibility that the volcano could trigger a tsunami. It later ruled that out.

    The eruption, some 640 km (400 miles) east of the capital, Jakarta, follows a series of earthquakes in the west of Java, including one last month that killed more than 300 people.

    [1/7] Mount Semeru volcano spews volcanic ash during an eruption as seen from Candipuro in Lumajang, East Java province, Indonesia, December 4, 2022, in this photo taken by Antara Foto. Antara Foto/Iwan/ via REUTERS

    Indonesia’s Center for Volcanology and Geological Hazard Mitigation, PVMBG, raised the level of volcanic activity to its highest level and warned residents not to approach within 8 km (5 miles) of Semeru’s eruption centre.

    Hot ash clouds had drifted nearly 12 miles (19 km) from the centre of eruption, it said.

    PVMBG chief Hendra Gunawan said a bigger volume of magma could have built up compared with previous eruptions of the volcano, in 2021 and 2020, which could mean greater danger for a bigger area.

    “Semeru’s hot clouds could reach further and at a distance where there are many residences,” he said.

    In a video sent to Reuters by police in the area, villagers were seen moving away from the slopes of the volcano, some with belongings stacked on motor bikes. A damaged bridge was covered in volcanic ash.

    With 142 volcanoes, Indonesia has the world’s largest population living close range to volcano, with 8.6 million people within 10 km (6 miles) of one.

    The deadly late-November quake that hit in West Java was 5.6 magnitude but at a shallow depth. A 6.1 quake struck at a deeper depth on Saturday sending people running from buildings but it did not cause major damage or casualties.

    Reporting by Stefanno Sulaiman and Angie Teo in Jakarta; Additional reporting by Tetsushi Kajimoto in Tokyo; Editing by William Mallard and Lincoln Feast

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  • China’s Xi unwilling to accept western vaccines, U.S. official says

    China’s Xi unwilling to accept western vaccines, U.S. official says

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    WASHINGTON, Dec 3 (Reuters) – Chinese leader Xi Jinping is unwilling to accept Western vaccines despite the challenges China is facing with COVID-19, and while recent protests there are not a threat to Communist Party rule, they could affect his personal standing, U.S. Director of National Intelligence Avril Haines said on Saturday.

    Although China’s daily COVID cases are near all-time highs, some cities are taking steps to loosen testing and quarantine rules after Xi’s zero-COVID policy triggered a sharp economic slowdown and public unrest.

    Haines, speaking at the annual Reagan National Defense Forum in California, said that despite the social and economic impact of the virus, Xi “is unwilling to take a better vaccine from the West, and is instead relying on a vaccine in China that’s just not nearly as effective against Omicron.”

    “Seeing protests and the response to it is countering the narrative that he likes to put forward, which is that China is so much more effective at government,” Haines said.

    “It’s, again, not something we see as being a threat to stability at this moment, or regime change or anything like that,” she said, while adding: “How it develops will be important to Xi’s standing.”

    China’s foreign ministry did not immediately respond to a request for comment sent on Sunday.

    China has not approved any foreign COVID vaccines, opting for those produced domestically, which some studies have suggested are not as effective as some foreign ones. That means easing virus prevention measures could come with big risks, according to experts.

    China had not asked the United States for vaccines, the White House said earlier in the week.

    One U.S. official told Reuters there was “no expectation at present” that China would approve western vaccines.

    “It seems fairly far-fetched that China would greenlight Western vaccines at this point. It’s a matter of national pride, and they’d have to swallow quite a bit of it if they went this route,” the official said.

    Haines also said North Korea recognized that China was less likely to hold it accountable for what she said was Pyongyang’s “extraordinary” number of weapons tests this year.

    Amid a record year for missile tests, North Korean leader Kim Jong Un said last week his country intends to have the world’s most powerful nuclear force.

    Speaking on a later panel, Admiral John Aquilino, the commander of the U.S. Indo-Pacific Command, said China had no motivation to restrain any country, including North Korea, that was generating problems for the United States.

    “I’d argue quite differently that it’s in their strategy to drive those problems,” Aquilino said of China.

    He said China had considerable leverage to press North Korea over its weapons tests, but that he was not optimistic about Beijing “doing anything helpful to stabilize the region.”

    Reporting by Michael Martina, David Brunnstrom, Idrees Ali, and Eric Beech; Additional reporting by Martin Quin Pollard in Beijing; Editing by Sandra Maler and Lincoln Feast

    Our Standards: The Thomson Reuters Trust Principles.

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  • Consumer inflation in Japan’s capital rises at fastest pace in 40 years

    Consumer inflation in Japan’s capital rises at fastest pace in 40 years

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    • Tokyo Nov core CPI up 3.6% vs f’cast +3.5%
    • Tokyo CPI stays above BOJ’s 2% target for 6th straight month
    • Data underscores broadening inflationary pressure

    TOKYO, Nov 25 (Reuters) – Core consumer prices in Japan’s capital, a leading indicator of nationwide trends, rose at their fastest annual pace in 40 years in November and exceeded the central bank’s 2% target for a sixth straight month, signalling broadening inflationary pressure.

    The increase, driven mostly by food and fuel bills but spreading to a broader range of goods, cast doubt on the view of the Bank of Japan (BOJ) that recent cost-push inflation will prove transitory, some analysts said.

    The Tokyo core consumer price index (CPI), which excludes fresh food but includes fuel, was 3.6% higher in November than a year earlier, government data showed on Friday. The rise exceeded a median market forecast of 3.5% and the 3.4% increase seen in October

    The last time Tokyo inflation was faster was April 1982, when the core CPI was 4.2% higher than a year before.

    While the rise was driven mostly by electricity bills and food prices, companies were also charging more for durable goods as the weak yen pushed up the cost of imports, the data showed.

    “Price hikes are broadening and suggests the weak yen could keep inflation elevated well into next year,” said Mari Iwashita, chief market economist at Daiwa Securities.

    “Core consumer inflation may stay around the BOJ’s 2% target for much of next year, which would make it hard for the bank to keep arguing that the price rises are temporary.”

    The Tokyo core-core CPI index, which excludes fuel as well as fresh food, was 2.5% higher in November than a year earlier, picking up from the 2.2% annual gain seen in October.

    BOJ AN OUTLIER

    The BOJ has kept interest rates ultra-low on the view that inflation will slow back below its target next year when the boost from fuel price gains dissipate. The central bank has therefore remained an outlier from a wave monetary tightening around the world aimed at combating soaring inflation.

    Contrary to the experience of some western economies, where wages have surged with inflation, growth in wages and services prices remain muted in Japan.

    Of the components making up the Tokyo CPI data, services prices in November were up just 0.7% on a year earlier, after a 0.8% annual increase seen in October. That compared with a 7.7% spike in durable goods prices for November, which followed October’s 7.0% annual gain.

    Separate data released by the BOJ on Friday showed the corporate service price index, which measures prices that firms charge each other for services, had been 1.8% higher in October than a year earlier. That was slower than a 2.1% annual gain seen in September.

    BOJ Governor Haruhiko Kuroda has repeatedly said that, for inflation to sustainably hit his 2% inflation target, wages must rise enough to offset the rise in goods prices.

    Slow wage growth has been among factors delaying Japan’s recovery from the coronavirus pandemic. The world’s third-largest economy unexpectedly shrank an annualised 1.2% in the third quarter, partly because of soft consumption.

    The Tokyo CPI data heightens the chance of further rises in nationwide core consumer prices, which in October were 3.6% higher than a year earlier, also marking a 40-year high. The nationwide data for November is scheduled for release on Dec. 23.

    Reporting by Takahiko Wada and Leika Kihara; Editing by Sam Holmes and Bradley Perrett

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  • Exclusive: Russians, Ukrainians met in UAE to discuss prisoner swap, ammonia, sources say

    Exclusive: Russians, Ukrainians met in UAE to discuss prisoner swap, ammonia, sources say

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    RIYADH, Nov 24 (Reuters) – Representatives from Russia and Ukraine met in the United Arab Emirates last week to discuss the possibility of a prisoner-of-war swap that would be linked to a resumption of Russian ammonia exports, which go to Asia and Africa, via a Ukrainian pipeline, three sources with knowledge of the meeting said.

    The sources said the talks were being mediated by the Gulf Arab state and did not include the United Nations despite the U.N.’s central role in negotiating the ongoing initiative to export agricultural products from three Ukrainian Black Sea ports. Ammonia is used to make fertilizer.

    However the talks aim to remove remaining obstacles in the initiative extended last week and ease global food shortages by unblocking Ukrainian and Russian exports, they added.

    The sources asked not to be named in order to freely discuss sensitive matters.

    The Russian and Ukrainian representatives travelled to the UAE capital Abu Dhabi on Nov. 17 where they discussed allowing Russia to resume ammonia exports in exchange for a prisoner swap that would release a large number of Ukrainian and Russian prisoners, the sources said.

    Reuters could not immediately establish what progress was made at the talks.

    The Ukrainian ambassador to Turkey, Vasyl Bodnar, told Reuters that “releasing our prisoners of war is part of negotiations over opening Russian ammonia exports”, adding “Of course we look for ways to do that at any opportunity”. Bodnar said he was unaware if a meeting took place in the UAE.

    Putin said on Wednesday that Russian officials would work to unblock Russian fertilisers stuck in European ports and to resume ammonia exports.

    The UAE’s foreign ministry did not respond to Reuters’ request for comment.

    Lana Nusseibeh, UAE’s Assistant Minister of Foreign Affairs and International Cooperation, said Abu Dhabi remains firmly committed to help keep channels of communication open, encourage dialogue and support diplomacy to end the war in Ukraine.

    “In times of conflict, our collective responsibility is to leave no stone unturned towards identifying and pursuing paths that bring about a peaceful and swift resolution of crises,” Nusseibeh said in a statement carried by state news agency WAM.

    Russia and Ukraine’s defence and foreign ministries did not respond to Reuters’ requests for comment.

    Asked if the United Nations were involved in the talks, a spokesperson for the organisation declined to comment.

    WESTERN PRESSURE

    The export of Russian ammonia would be via an existing pipeline to the Black Sea.

    The pipeline was designed to pump up to 2.5 million tonnes of ammonia gas per year from Russia’s Volga region to Ukraine’s Black Sea port of Pivdennyi, known as Yuzhny in Russian, near Odesa for onward shipment to international buyers. It was shut down after Russia sent its troops into Ukraine on Feb. 24.

    The export of ammonia was not part of the renewal of the U.N.-backed grains corridor deal that restored commercial shipping from Ukraine.

    Last week, Rebeca Grynspan, Secretary-General of U.N. agency UNCTAD, who leads the negotiations on fertiliser, said she was optimistic Russia and Ukraine could agree to the terms for the export of Russian ammonia via the pipeline, without giving details.

    Ukraine’s President Volodymyr Zelenskiy has publicly set several conditions before allowing Russia to resume its ammonia exports via the pipeline, including a prisoner swap and reopening of Mykolaiv port in the Black Sea.

    Neither Russia nor Ukraine have released official figures on how many prisoners of war they have taken since Russia invaded in February. On Oct. 29, Ukrainian President Volodymr Zelenskiy said that since March, Russia had freed a total of 1,031 prisoners.

    Russia and Ukraine have disclosed few details about direct meetings between representatives from the two countries following the abandonment of ceasefire talks in the first few weeks following Moscow’s invasion on February 24.

    Abu Dhabi’s efforts follow in the footsteps of Saudi Arabia, which scored a diplomatic win by securing freedom for foreign fighters captured in Ukraine in September.

    The UAE, like Saudi Arabia, is a member of the OPEC+ oil alliance that includes Russia and has also maintained good ties with Moscow despite Western pressure to help isolate Russia over the invasion of Ukraine, which Moscow calls its “special military operation”.

    UAE President Mohammed bin Zayed al-Nahyan visited Moscow last month where he discussed with President Vladimir Putin the possibility of Abu Dhabi mediating for an ammonia deal, two of the sources said.

    Ukraine is a major producer of grains and oilseeds. Russia is the world’s largest wheat exporter and a major supplier of fertilisers to global markets.

    Since July, Moscow has repeatedly said its shipments of grain and fertilisers, though not directly targeted by sanctions, are constrained because sanctions make it harder for exporters to process payments or to obtain vessels and insurance.

    Reporting by Aziz El Yaakoubi in Riyadh, Pavel Polityuk in Kiev and Jonathan Saul in London, additional reporting by Jonathan Spicer; Editing by Frank Jack Daniel and Jon Boyle

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  • U.S. may skirt recession in 2023, Europe not so lucky – Morgan Stanley

    U.S. may skirt recession in 2023, Europe not so lucky – Morgan Stanley

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    TOKYO, Nov 14 (Reuters) – Britain and the euro zone economies are likely to tip into recession next year, Morgan Stanley said, but the United States might make a narrow escape thanks to a resilient job market.

    At the same time, China’s expected reopening after almost three years of COVID-19 curbs is set to lead a recovery in its own economy and other emerging Asian markets, the investment bank’s analysts said in a series of reports published on Sunday.

    “Risks are to the downside,” the reports said, projecting the global economy to grow by 2.2% next year, lower than the International Monetary Fund’s latest 2.7% growth estimate. read more

    Next year, Morgan Stanley predicts a sharp split between developed economies “in or near recession” while emerging economies “recover modestly” but said an overall global pickup would likely remain elusive. China’s economy was predicted to grow 5% in 2023, outpacing the average 3.7% growth expected for emerging markets, while the average growth in the Group of 10 developed countries was forecast at just 0.3%.

    Central banks across the globe have raised interest rates this year to curb raging inflation, and in the United States, Morgan Stanley predicted the Federal Reserve to keep rates high in 2023 as inflation remains strong after peaking in the fourth quarter of this year.

    “The U.S. economy just skirts recession in 2023, but the landing doesn’t feel so soft as job growth slows meaningfully and the unemployment rate continues to rise,” the report said, predicting a 0.5% expansion next year.

    “The cumulative effect of tight policy in 2023 spills over into 2024, resulting in two very weak years,” the report added.

    Globally too, the peak in inflation should come in the current quarter, the analysts said, “with disinflation driving the narrative next year”.

    • U.S. core inflation to fall to 2.9% at end-2023, headline inflation to 1.9%
    • Asia growth to dip to 3.4% in 1H23 before recovering to 4.6% in 2H23, fuelled by domestic demand
    • Cross-asset returns – especially in fixed income – will look much better in 2023 than in 2022, driven by cheaper starting valuations
    • High-grade fixed income to outperform global equities
    • EM and Japan stocks to outperform, with U.S. shares lagging

    Reporting by Kevin Buckland, editing by Miral Fahmy

    Our Standards: The Thomson Reuters Trust Principles.

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  • Biden and Xi clash over Taiwan in Bali but Cold War fears cool

    Biden and Xi clash over Taiwan in Bali but Cold War fears cool

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    • Biden, Xi meet for 3 hours before G20
    • Both leaders stress need to get ties back on track
    • Indonesia seeks partnerships on global economy at G20
    • Ukraine’s Zelenskiy to address G20 on Tuesday

    NUSA DUA, Indonesia, Nov 14 (Reuters) – U.S. President Joe Biden and Chinese President Xi Jinping engaged in blunt talks over Taiwan and North Korea on Monday in a three-hour meeting aimed at preventing strained U.S.-China ties from spilling into a new Cold War.

    Amid simmering differences on human rights, Russia’s invasion of Ukraine, and support of domestic industry, the two leaders pledged more frequent communications. U.S. Secretary of State Antony Blinken will travel to Beijing for follow-up talks.

    “We’re going to compete vigorously. But I’m not looking for conflict, I’m looking to manage this competition responsibly,” Biden said after his talks with Xi on the sidelines of the G20 summit in Indonesia.

    Beijing has long said it would bring the self-governed island of Taiwan, which it views as an inalienable part of China, under its control and has not ruled out the use of force to do so. It has frequently accused the United States in recent years of encouraging Taiwan independence.

    In a statement after their meeting, Xi called Taiwan the “first red line” that must not be crossed in U.S.-China relations, Chinese state media said.

    Biden said he sought to assure Xi that U.S. policy on Taiwan, which has for decades been to support both Beijing’s ‘One China’ stance and Taiwan’s military, had not changed.

    He said there was no need for a new Cold War, and that he did not think China was planning a hot one.

    “I do not think there’s any imminent attempt on the part of China to invade Taiwan,” he told reporters.

    On North Korea, Biden said it was hard to know whether Beijing had any influence over Pyongyang weapons testing. “Well, first of all, it’s difficult to say that I am certain that China can control North Korea,” he said.

    Biden said he told Xi the United States would do what it needs to do to defend itself and allies South Korea and Japan, which could be “maybe more up in the face of China” though not directed against it.

    “We would have to take certain actions that would be more defensive on our behalf… to send a clear message to North Korea. We are going to defend our allies, as well as American soil and American capacity,” he said.

    Biden’s national security adviser Jake Sullivan said before the meeting that Biden would warn Xi about the possibility of enhanced U.S. military presence in the region, something Beijing is not keen to see.

    Beijing had halted a series of formal dialogue channels with Washington, including on climate change and military-to-military talks, after U.S. House of Representatives Speaker Nancy Pelosi upset China by visiting Taiwan in August.

    Biden and Xi agreed to allow senior officials to renew communication on climate, debt relief and other issues, the White House said after they spoke.

    Xi’s statement after the talks included pointed warnings on Taiwan.

    [1/7] U.S. President Joe Biden speaks during a news conference following his meeting with Chinese president Xi Jinping, ahead of the G20 leaders’ summit, in Bali, Indonesia, November 14, 2022. REUTERS/Kevin Lamarque

    “The Taiwan question is at the very core of China’s core interests, the bedrock of the political foundation of China-U.S. relations, and the first red line that must not be crossed in China-U.S. relations,” Xi was quoted as saying by Xinhua news agency.

    “Resolving the Taiwan question is a matter for the Chinese and China’s internal affair,” Xi said, according to state media.

    Taiwan’s democratically elected government rejects Beijing’s claims of sovereignty over it.

    Taiwan’s presidential office said it welcomed Biden’s reaffirmation of U.S. policy. “This also once again fully demonstrates that the peace and stability of the Taiwan Strait is the common expectation of the international community,” it said.

    SMILES AND HANDSHAKES

    Before their talks, the two leaders smiled and shook hands warmly in front of their national flags at a hotel on Indonesia’s Bali island, a day before a Group of 20 (G20) summit set to be fraught with tension over Russia’s invasion of Ukraine.

    “It’s just great to see you,” Biden told Xi, as he put an arm around him before their meeting.

    Biden brought up a number of difficult topics with Xi, according to the White House, including raising U.S. objections to China’s “coercive and increasingly aggressive actions toward Taiwan,” Beijing’s “non-market economic practices,” and practices in “Xinjiang, Tibet, and Hong Kong, and human rights more broadly.”

    Neither leader wore a mask to ward off COVID-19, although members of their delegations did.

    U.S.-China relations have been roiled in recent years by growing tensions over issues ranging from Hong Kong and Taiwan to the South China Sea, trade practices, and U.S. restrictions on Chinese technology.

    But U.S. officials said there have been quiet efforts by both Beijing and Washington over the past two months to repair relations.

    U.S. Treasury Secretary Janet Yellen told reporters in Bali earlier that the meeting aimed to stabilise the relationship and to create a “more certain atmosphere” for U.S. businesses.

    She said Biden had been clear with China about national security concerns regarding restrictions on sensitive U.S. technologies and had raised concern about the reliability of Chinese supply chains for commodities.

    G20 summit host President Joko Widodo of Indonesia said he hoped the gathering on Tuesday could “deliver concrete partnerships that can help the world in its economic recovery”.

    However, one of the main topics at the G20 will be Russia’s war in Ukraine.

    Xi and Putin have grown close in recent years, bound by their shared distrust of the West, and reaffirmed their partnership just days before Russia invaded Ukraine. But China has been careful not to provide any direct material support that could trigger Western sanctions against it.

    Reporting by Nandita Bose, Stanley Widianto, Fransiska Nangoy, Leika Kihara, David Lawder and Simon Lewis in Nusa Dua, and Yew Lun Tian and Ryan Woo in Beijing; additional reporting by Jeff Mason and Steve Holland in Washington; Writing by Kay Johnson and Raju Gopalakrishnan; Editing by Angus MacSwan, Grant McCool, Heather Timmons and Rosalba O’Brien

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  • Analysis: Sanctions fail to halt North Korea’s accelerating weapons programs

    Analysis: Sanctions fail to halt North Korea’s accelerating weapons programs

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    WASHINGTON, Nov 4 (Reuters) – Economic sanctions, the primary means the United States has used for years to try to exert pressure on North Korea, have abjectly failed to halt its nuclear and missile programs or to bring the reclusive northeast Asian state back to the negotiating table.

    Instead, North Korea’s ballistic missile program has become stronger and it has carried out a record-breaking testing regime of multiple types of weapons this year – including of intercontinental ballistic missiles designed to reach the U.S. mainland. Expectations are that it may soon end a self-imposed five-year moratorium on nuclear bomb testing.

    Now, U.S. policy makers and their predecessors can do little more than pick through the wreckage and seek to determine what went wrong, and who might be to blame.

    “We’ve had a policy failure. It’s a generational policy failure,” said Joseph DeThomas, a former U.S. diplomat who worked on North Korea and Iran sanctions and served in the administrations of Democratic Presidents Bill Clinton and Barack Obama.

    “An entire generation of people worked on this. It’s failed … so alright, now we have to go to the next step, figure out what we do about it.”

    Biden administration officials concede that sanctions have failed to stop North Korea’s weapons programs – but they maintain they have at least been effective in slowing North Korea’s nuclear program.

    “I would disagree with the idea that sanctions have failed. Sanctions have failed to stop their programs – that’s absolutely true,” a senior administration official told Reuters. “But I think that if the sanctions didn’t exist, (North Korea) would be much, much further along, and much more of a threat to its neighbors to the region and to the world.”

    The State Department, U.S. Treasury and White House’s National Security Council did not immediately respond to requests for comment.

    Former officials and experts say sanctions were never imposed robustly enough for long enough and blame faltering U.S. overtures to North Korea as well as pressures like Russia’s war in Ukraine and U.S-China tensions over Taiwan for making them ineffective and easy for North Korea to circumvent.

    North Korea has long been forbidden to conduct nuclear tests and ballistic missile launches by the U.N. Security Council.

    The Security Council has imposed sanctions on North Korea since 2006 to choke off funding for it nuclear and ballistic missile programs. They now include exports bans coal, iron, lead, textiles and seafood, and capping imports of crude oil and refined petroleum products.

    However U.N. experts regularly report that North Korea is evading sanctions and continuing to develop its programs.

    Russia and China backed toughened sanctions after North Korea’s last nuclear test in 2017, but it is not clear what U.N action – if any – they might agree to if Pyongyang conducts another nuclear test.

    CHINESE AND RUSSIAN INFLUENCE

    The senior Biden administration official told Reuters Washington believes China and Russia have leverage to persuade North Korea not to resume nuclear bomb testing. But the Biden administration has accused China and Russia of enabling North Korean leader Kim Jong Un.

    Anthony Ruggiero, who headed North Korea sanctions efforts under former President Donald Trump, said they were only pursued vigorously enough from the last year of the Obama administration to early in Trump’s second year. They then dropped off in the ultimately vain hope of progress in summit negotiations between Trump and Kim.

    Some critics like sanctions expert Joshua Stanton fault both the Trump and Biden administrations for failing to exert maximum pressure to stop China allowing North Korea’s sanctions evasion. They point to the powerful option of imposing sanctions on big Chinese banks that have facilitated this.

    “The sanctions we don’t enforce don’t work, and we haven’t been enforcing them since mid-2018,” Stanton said, noting that history had shown a correlation between stronger enforcement and North Korea willingness to engage diplomatically.

    “The Biden administration’s most significant failure is its failure to prosecute or penalize the Chinese banks we know are laundering Kim Jong Un’s money,” he said.

    Some experts like DeThomas argue that taking what some call the “nuclear option” of going after Chinese banks could exclude huge Chinese institutions from the international financial system and have catastrophic consequences not just for the Chinese, but for the U.S. and global economies – something Stanton considers unfounded.

    “Going full bore against the Chinese over North Korea is always a possibility, but it’s a high-risk option,” said DeThomas, arguing that such a measure should be reserved for an even more pressing scenario, such as deterring any move by China to all-out support for Russia’s war in Ukraine.

    “You want them to be thinking about that. And you can’t fire that gun twice,” he said. “And even if you sanctioned the Chinese banks, you wouldn’t get the North Koreans to change.”

    Some U.S. academic experts argue that Washington should recognize North Korea for what it is – a nuclear power that is never going to disarm – and use sanctions relief to incentivize better behavior.

    “I do think we can buy things other than disarmament with our economic leverage,” Jeffrey Lewis, a non-proliferation expert at the Middlebury Institute of International Studies told a conference in Ottawa this week.

    “I do think we can buy things other than disarmament with our economic leverage,” Jeffrey Lewis, a non-proliferation expert at the Middlebury Institute of International Studies, told a conference in Ottawa this week.

    The senior Biden administration official said maintaining sanctions was not just punitive, but about the international community showing it is united.

    He rejected the idea that Washington should recognize North Korea as a nuclear-armed state.

    “There is an extraordinarily strong global consensus … that the DPRK should not, and must not, be a nuclear nation,” he said. “No country is calling for this … the consequences of changing policy, I think would be profoundly negative.”

    Additional reporting by Steve Holland and Michelle Nichols
    Editing by Alistair Bell

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  • China says it reserves right to use force over Taiwan

    China says it reserves right to use force over Taiwan

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    BEIJING, Oct 15 (Reuters) – China reserves the right to use force over Taiwan as a last resort in compelling circumstances, though peaceful reunification is its first choice, a Communist Party spokesman said on Saturday.

    Reunification of China and Taiwan meets the interests of all, including Taiwan compatriots, Sun Yeli told a news conference in Beijing.

    President Xi Jinping is poised to win a third five-year term as general secretary of the ruling party, the most powerful job in the country, at the congress to be held in the Great Hall of the People in Beijing for a week starting on Sunday.

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    Reporting by Yew Lun Tian, Writing by Martin Quin Pollard

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  • China has ‘destroyed’ tacit agreement on Taiwan Strait – minister

    China has ‘destroyed’ tacit agreement on Taiwan Strait – minister

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    TAIPEI, Oct 5 (Reuters) – China has destroyed a tacit agreement on military movements in the Taiwan Strait by crossing an unofficial “median line” running down the waterway, Defence Minister Chiu Kuo-cheng said on Wednesday.

    While acknowledging the end of the tacit understanding on the median line, Chiu told Taiwan’s parliament Taiwan would react if China crossed its “red line”.

    He did not say what Taiwan’s “red line” was but suggested it included Chinese aircraft, including drones, flying into Taiwan’s territory. He did not identify the median line as a “red line”.

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    China, which views the democratically governed island as its own territory, mounted large-scale drills including firing missiles over Taipei in August to show its anger over a visit to Taiwan by U.S. House Speaker Nancy Pelosi.

    Chinese military activities near Taiwan have continued since then, though at a much reduced level, and Chinese military aircraft are routinely crossing the median line, which had for years acted as unofficial barrier between the two sides.

    “The median line was supposed to be a tacit agreement for everyone,” Chiu told a parliament committee meeting.

    “That tacit agreement has been destroyed.”

    Taiwan Defence Minister Chiu Kuo-cheng speaks at a rank conferral ceremony for military officials from the Army, Navy and Air Force, at the defence ministry in Taipei, Taiwan December 28, 2021. REUTERS/Annabelle Chih

    China never officially recognised the line that a U.S. general devised in 1954 at the height of Cold War hostility between Communist China and U.S.-backed Taiwan although the People’s Liberation Army had largely respected it.

    The Taiwan Strait is some 180 km (110 miles) wide and at its narrowest, the median line is about 40 km (25 miles) from Taiwan’s waters.

    Some Taiwan officials and security analysts have said it would be difficult for the island to defend the median line without raising the risk of dangerous escalation.

    Chiu said China’s crossings of the median line indicated a new way of doing things, which Taiwan would resist.

    “They want to build a new normal but we do not change … We will stand firm when they come. We do not give in.”

    For years, China tacitly acknowledged the unmarked median line but in 2020 a foreign ministry spokesman stated it “did not exist”. China says its armed forces have a right to operate around Taiwan as it is Chinese territory.

    Taiwan rejects China’s sovereignty claims, saying as China has never ruled Taiwan, only the island’s 23 million people have the right to decide their future.

    Speaking to reporters earlier on Wednesday, Chiu said extending compulsory military service beyond four months was a matter of “urgency”, but the ministry was still in talks with other government agencies to work out details.

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    Reporting By Yimou Lee; Editing by Robert Birsel

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  • South Korea, U.S. fire missiles to protest ‘reckless’ North Korean test

    South Korea, U.S. fire missiles to protest ‘reckless’ North Korean test

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    SEOUL/UNITED NATIONS, Oct 5 (Reuters) – South Korea and the U.S. military conducted rare missile drills and an American supercarrier repositioned east of North Korea after Pyongyang flew a missile over Japan, one of the allies’ sharpest responses since 2017 to a North Korean weapon test.

    U.S. Secretary of State Antony Blinken warned that nuclear-armed North Korea risked further condemnation and isolation if it continued its “provocations.”

    However, Russia’s deputy U.N. envoy told a U.N. Security Council meeting called by the United States that imposing sanctions on North Korea was a “dead end” that brought “zero result,” and China’s deputy U.N. ambassador said the council needed to play a constructive role “instead of relying solely on strong rhetoric or pressure.”

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    North Korea test-fired an intermediate-range ballistic missile (IRBM) farther than ever before on Tuesday, sending it soaring over Japan for the first time in five years and prompting a warning for residents there to take cover.

    Washington called the test “dangerous and reckless,” and the U.S. military and its allies have stepped up displays of force.

    South Korean and American troops fired a volley of missiles into the sea in response, South Korea’s Joint Chiefs of Staff said on Wednesday, and the allies earlier staged a bombing drill with fighter jets in the Yellow Sea.

    The aircraft carrier Ronald Reagan, a U.S. Navy ship that made its first stop in South Korea last month for the first time in years, will also return to the sea between Korea and Japan with its strike group of other warships. The South Korean military called it a “highly unusual” move designed to show the allies’ resolve to respond to any threats from North Korea.

    Speaking during a visit to Chile, Blinken said the United States, South Korea and Japan were working closely together “to demonstrate and strengthen our defensive and deterrent capabilities in light of the threat from North Korea.”

    He reiterated a U.S. call for Pyongyang to return to dialogue, and added: “If they continue down this road, it will only increase the condemnation, increase the isolation, increase the steps that are taken in response to their actions.”

    The U.N. Security Council met on Wednesday to discuss North Korea despite China and Russia telling council counterparts they were opposed to an open meeting of the 15-member body.

    The top U.S. diplomat for East Asia, Daniel Kritenbrink, accused China and Russia this week of emboldening North Korea by not properly enforcing sanctions.

    U.S. Ambassador to the United Nations, Linda Thomas-Greenfield, in an address to the Security Council, said North Korea had “enjoyed blanket protection from two members of this council.”

    In May, China and Russia vetoed a U.S.-led push to impose more U.N. sanctions on North Korea over its renewed ballistic missile launches, publicly splitting the Security Council for the first time since it started punishing Pyongyang with sanctions in 2006.

    A surface-to-surface missile is fired into the sea off the east coast in this handout picture provided by the Defense Ministry, South Korea, October 5, 2022. South Korean Defense Ministry/Handout via REUTERS

    Kritenbrink also said a resumption of nuclear weapons testing by North Korea for the first time since 2017 was likely only awaiting a political decision.

    South Korean officials said North Korea had completed preparations for a nuclear test and might use a smaller weapon meant for operational use or a big device with a higher yield than in previous tests.

    SOUTH KOREAN MISSILE FAILURE

    The South Korean military confirmed that one of its Hyunmoo-2C missiles failed shortly after launch and crashed during the exercise, but that no one was hurt.

    Footage shared on social media by a nearby resident and verified by Reuters showed smoke and flames rising from the military base.

    South Korea’s military said the fire was caused by burning rocket propellant, and although the missile carried a warhead, it did not explode. It apologised for worrying residents.

    It is not rare for military hardware to fail, and North Korea has suffered several failed missile launches this year as well. However, the South Korean failure threatened to overshadow Seoul’s efforts to demonstrate military prowess in the face of North Korea’s increasing capabilities.

    The Hyunmoo-2C is one of South Korea’s latest missiles and analysts say its capability as a precision “bunker buster” make it a key part of Seoul’s plans for striking the North in the event of a conflict.

    In its initial announcement of the drill, South Korea’s military made no mention of the Hyunmoo-2C launch or its failure, but later media briefings were dominated by questions about the incident.

    South Korean President Yoon Suk-yeol, who has made such displays of military force a cornerstone of his strategy for countering North Korea, had vowed that the overflight of Japan would bring a decisive response from his country, its allies and the international community.

    U.S. President Joe Biden and Japanese Prime Minister Fumio Kishida condemned North Korea’s test in the “strongest terms,” and the European Union called it a “reckless and deliberately provocative action.” U.N. Secretary-General Antonio Guterres condemned the launch and said it was a violation of Security Council resolutions.

    It was the first North Korean missile to follow a trajectory over Japan since 2017, and its estimated 4,600-km (2,850-mile) flight was the longest for a North Korean test, which are usually “lofted” into space to avoid flying over neighbouring countries.

    Analysts and security officials said it may have been a variant of the Hwasong-12 IRBM, which North Korea unveiled in 2017 as part of what it said was a plan to strike U.S. military bases in Guam.

    Neither North Korea’s government nor its state media have reported on the launch.

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    Reporting by Joori Roh in Seoul, Humeyra Pamuk in Santiago, David Brunnstrom in Washington and Michelle Nichols at the United Nations; Editing by Chris Reese, Sandra Maler, Gerry Doyle and Jonathan Oatis

    Our Standards: The Thomson Reuters Trust Principles.

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  • Prominent Chinese commentator urges COVID experts to ‘speak out’

    Prominent Chinese commentator urges COVID experts to ‘speak out’

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    BEIJING, Sept 26 (Reuters) – Prominent Chinese commentator Hu Xijin said on Sunday that as China ponders its COVID-19 policies, epidemic experts need to speak out and China ought to conduct comprehensive research and make any studies transparent to the public.

    Hu’s unusual call on Chinese social media for candour and transparency earned him 34,000 likes on the popular Twitter-like microblog Weibo, as well as frank responses from netizens in a normally tightly policed internet quick to censor voices deemed a risk to social stability.

    China’s top leaders warned in May amid the COVID lockdown of Shanghai and widespread restrictions in the Chinese capital Beijing that they would fight any comment or action that distorted, doubted or repudiated the country’s COVID policies. read more

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    “About the future, China needs very rational research and calculations,” said Hu, former editor-in-chief of nationalist state tabloid Global Times.

    “Experts must speak out, and the country should organise comprehensive studies and make them transparent to the public: what are the pros and cons for our common people, and what are the overall pros and cons for the country?”

    China has significantly tightened its COVID-19 policies this year to contain the spread of the highly transmissible Omicron variant even as its death toll since the pandemic began remains low – around 5,226 as of Saturday – and as many other countries let go of tough restrictions and learn to live with the coronavirus.

    “Oppose excessive epidemic prevention,” one Weibo user wrote in response to Hu’s post.

    In the name of putting the lives of people first, entire cities have been subjected to varying degrees of lockdown, while the infected or suspected cases are confined in facilities or at home, and local populations are required to take a PCR test every two to three days or be barred from public amenities and spaces. read more

    “I don’t mind being infected, but I fear you can’t help but stop me from moving freely,” another Weibo user said.

    Even Chinese-controlled Hong Kong is moving to scrap its controversial COVID-19 hotel quarantine policy for all arrivals, more than 2 1/2 years after it was first implemented, and just weeks ahead of a major Communist Party congress in Beijing next month when President Xi Jinping is expected to secure a precedent-breaking third term as China’s leader. read more

    Macau is also planning to reopen its borders to mainland tour groups in November, the Chinese special administrative region surprised with an announcement on Saturday. read more

    “The people must trust the state, but the state must also trust the understanding of the people,” Hu said.

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    Reporting by Ryan Woo; Editing by Toby Chopra and Stephen Coates

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  • Dow posts record closing high, stocks gain for 3rd week; dollar dips

    Dow posts record closing high, stocks gain for 3rd week; dollar dips

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    • S&P 500, Nasdaq end session lower
    • Evergrande averts default with surprise interest payment
    • U.S. 10-year yields lower

    NEW YORK, Oct 22 (Reuters) – The Dow Jones industrial average registered a record closing high on Friday and major equity indexes posted a third straight week of gains while the U.S. dollar slipped.

    On the day, MSCI’s broadest gauge of global shares (.MIWD00000PUS) was flat, and the S&P 500 (.SPX) and Nasdaq (.IXIC) ended lower.

    Stocks came under pressure after Federal Reserve Chair Jerome Powell said the U.S. central bank was “on track” to begin reducing its purchases of assets. read more

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    Intel’s stock (INTC.O)fell 11.7% and was among the biggest drags on the S&P 500. Late Thursday, Intel reported sales that missed expectations and pointed to shortages of chips holding back sales of its flagship processors. read more

    American Express Co’s stock (AXP.N) gained, boosting the Dow after the company beat profit estimates for the fourth straight quarter.

    Next week brings reports from several key mega-cap names including Amazon (AMZN.O). read more

    The dollar pared losses after Powell’s comments, but the dollar index was last down 0.10% at 93.64, and is off from a one-year high of 94.56 last week. read more

    “There’s a bit of a positioning unwind taking place. We’ve obviously seen a firmer dollar since the September” Fed meeting, said Mazen Issa, senior FX strategist at TD Securities in New York. “That also dovetails with the seasonal tendency for the dollar to soften into the end of the month.”

    Investors also digested news that China Evergrande Group (3333.HK) appeared to avert default with a source saying it made a last-minute bond coupon payment. read more

    The Dow Jones Industrial Average (.DJI) rose 73.94 points, or 0.21%, to 35,677.02, the S&P 500 (.SPX) lost 4.88 points, or 0.11%, to 4,544.9 and the Nasdaq Composite (.IXIC) dropped 125.50 points, or 0.82%, to 15,090.20.

    The pan-European STOXX 600 index (.STOXX) rose 0.46% and MSCI’s gauge of stocks across the globe shed 0.03%.

    The MSCI index posted gains for a third straight week along with the three major U.S. stock indexes.

    In the U.S. bond market, yields on longer-dated U.S. Treasuries slid.

    The yield on 10-year Treasury notes was down 1.6 basis points to 1.659% after rising to a five-month high of 1.7064% late Thursday.

    Oil rose and ended up for the week, near multi-year highs. Brent crude futures rose 92 cents to settle at $85.53 a barrel, and registered its seventh weekly gain. U.S. crude futures gained $1.26, to settle at $83.76, and rose for a ninth straight week. read more

    Spot gold was up 0.6% at $1,793.82 per ounce.

    Among cryptocurrencies, bitcoin last fell 2.21% to $60,841.96.

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    Additional reporting by Simon Jessop in London, and Karen Brettell, Sinead Carew and Herbert Lash in New York and Kevin Buckland in Tokyo
    Editing by Hugh Lawson Mark Potter and David Gregorio

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  • White House repeats no Taiwan policy change; experts see Biden gaffe

    White House repeats no Taiwan policy change; experts see Biden gaffe

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    WASHINGTON, Oct 22 (Reuters) – The White House on Friday reiterated that Joe Biden was not signaling a change in U.S. policy toward Taiwan when he said the United States would come to the island’s aid if it was attacked by China, and analysts dismissed the president’s remark as a gaffe.

    While Washington is required by law to provide Taiwan with the means to defend itself, it has long followed a policy of “strategic ambiguity” on whether it would intervene militarily to protect Taiwan in the event of a Chinese attack.

    Biden called that into question when he was asked at a CNN town hall in Baltimore on Thursday night whether the United States would come to Taiwan’s defense if it was attacked by China and he replied: “Yes, we have a commitment to do that.”

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    Shortly after he spoke, a White House spokesperson said there was no change in policy and analysts said it appeared the president misspoke.

    Asked at a Friday news briefing whether it was Biden’s intention to move away from strategic ambiguity to make an unambiguous statement about how the United States would respond to a Chinese attack on Taiwan, White House spokeswoman Jen Psaki said: “Our policy has not changed. He was not intending to convey a change in policy, nor has he made a decision to change our policy.”

    Psaki added that, as stated in Brussels earlier on Friday by U.S. Defense Secretary Lloyd Austin, “nobody wants to see cross-strait issues come to blows, certainly not President Biden, and there’s no reason that it should.”

    Psaki said the U.S. defense relationship with Taiwan was guided by the long-established Taiwan Relations Act, under which Washington would “continue assisting Taiwan in maintaining a sufficient self-defense capability.”

    Another principle of the act was that Washington “would regard any efforts to determine the future of Taiwan by other than peaceful means a threat to the peace and security of the Western Pacific and of grave concern to the United States,” she added.

    Bonnie Glaser, a Taiwan expert at the German Marshall Fund of the United States, called Biden’s remark a “gaffe” and said it was “patently not true” that Washington has a commitment to defend Taiwan.

    “Some are suggesting a deliberate effort to send unclear signals, but in my view, that makes no sense. A confused U.S. policy weakens deterrence,” she said, noting that Biden’s Asia policy czar, Kurt Campbell, had rejected “strategic clarity” over Taiwan.

    Another Taiwan expert, Douglas Paal, a former U.S. representative in Taipei, said Biden was focused at the town hall on selling his domestic economic agenda.

    “Despite his reputation on foreign affairs, he can be occasionally sloppy when distracted,” Paal said. “The White House was right to issue a speedy ‘no-change-in-policy’ correction, because that is where policy is.”

    Biden’s remark comes at an awkward time, while White House officials are gearing up for a virtual meeting between him and Chinese leader Xi Jinping, which, sources say, they hope will show the world Washington can responsibly manage tense relations between the rival superpowers.

    China, which claims self-ruled Taiwan as its own, expressed its displeasure, with a foreign ministry spokesman saying Beijing has no room for concessions on its core interests.

    China urges the United States “not to send the wrong signals to the forces of Taiwan independence, to avoid seriously harming Sino-U.S. ties and peace and stability in the Taiwan Strait,” spokesman Wang Wenbin said.

    Taiwan’s presidential office said its position remained the same, which is that it will neither give in to pressure nor “rashly advance” when it gets support.

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    Reporting by Jeff Mason, Tim Ahmann and David Brunnstrom; Editing by Chizu Nomiyama and Jonathan Oatis

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