US to begin easing economic sanctions on Iran

WASHINGTON (AP) — The United States will begin easing economic sanctions on Iran after it began shutting down its most sensitive nuclear work on Monday, the White House said.

Iran’s move was part of a landmark deal struck late last year with the U.S., five other world powers and the European Union to ease concerns over Tehran’s nuclear program and provide for the partial removal of some of the economic sanctions that have crippled the Iranian economy. Iran has insisted that its nuclear program was for peaceful purposes only.

The United Nations nuclear agency, the International Atomic Energy Agency, confirmed Monday that higher-level uranium enrichment at a facility in central Iran had stopped, an important step among others that together provided officials with the evidence needed to conclude that Iran was holding up its end of the agreement.

Ironically, Monday’s development came on the 33rd anniversary of Iran’s release of dozens of Americans held hostage, the same day that Ronald Reagan took the oath of office to be president of the United States.

The White House, which has vowed to prevent Iran from developing nuclear weapons, hailed Iran’s actions as “an important step forward.”

“These actions represent the first time in nearly a decade that Iran has verifiably enacted measures to halt progress on its nuclear program, and roll it back in key respects,” White House press secretary Jay Carney said in a statement. “Iran has also begun to provide the IAEA with increased transparency into the Iranian nuclear program, through more frequent and intrusive inspections and the expanded provision of information to the IAEA. Taken together, these concrete actions represent an important step forward.”

The European Union announced earlier Monday that it, too, was suspending some of the sanctions it has imposed on Iran.

Carney said the five world powers — the United Kingdom, France, Germany, Russia and China — also would begin providing relief to Iran.

At the same time, Carney said the group will continue its aggressive enforcement of sanctions that will remain in effect during the next six months, the period that Iran and the world powers will use to negotiate a final deal.

In a conference call with reporters, senior Obama administration officials noted the IAEA’s statement confirming that Iran was implementing initially agreed-upon requirements in what one official described as “a meaningful step forward.”

A second official said that Iran will not necessarily now largely “be open for business,” emphasizing that the U.S. would reach out to its counterparts to remind them of the continuing sanctions.

Regarding the desire of some in Congress to impose harsher sanctions, one of the officials said that Iran is starting to implement the steps and that “it would not be a wise time to take” take actions that “we don’t need.”

These officials insisted on anonymity to discuss a diplomatic matter they were not authorized to talk about by name.

___

Associated Press reporter Pete Yost in Washington contributed to this story.

Associated Press

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US to begin easing economic sanctions on Iran

China shares bounce as dismal trade data spurs easing talk

1 of 6. An employee of the Tokyo Stock Exchange (TSE) works at the bourse in Tokyo June 13, 2013.

Credit: Reuters/Toru Hanai

By Dominic Lau

TOKYO | Wed Jul 10, 2013 3:03am EDT

TOKYO (Reuters) – Chinese shares rose sharply on Wednesday, with traders citing talks that China’s central bank may ease policy to boost growth after the country’s exports fell for the first time in 17 months.

European shares were expected to open steady, with Britain’s FTSE 100 .FTSE seen down as much as 0.1 percent and Germany’s DAX .GDAXI up as much as 0.2 percent. U.S. stock futures suggested a flat opening for Wall Street.

China’s exports fell 3.1 percent in June from a year earlier, while imports dropped 0.7 percent, severely missing market expectations and reinforcing signs of a second-quarter economic slowdown in the world’s second-largest economy. Beijing also warned of a “grim” outlook for trade.

The downbeat data follow Beijing’s crackdown on the use of fake export documents to close a loophole for short-term money inflows that had exaggerated China’s export performance.

“The surprisingly weak June exports show China’s economy is facing increasing downward pressure on lackluster external demand. Exports are facing challenges in the second half of this year,” said Li Huiyong, economist at Shenyin & Wanguo Securities in Shanghai.

China’s CSI300 .CSI300 index gained 2.2 percent, however, on the easing talk.

The index has been battered recently as Beijing tried to bring risky lending under control. At one point, it had fallen as much as 24 percent from a near three-month peak touched on May 29, and is down nearly 13 percent this year.

MSCI Asia-Pacific ex-Japan index .MIAPJ0000PUS was up 0.7 percent after gaining as much as 1.2 percent to a one-week high before the Chinese data. Earlier, Asian shares were buoyed by Wall Street’s gains on optimism for U.S. company earnings.

Assets in Australia, seen as a proxy of China’s growth, were also hit after the data. The Australian dollar fell to a session low of $ 0.9125 before stabilizing at $ 0.9192, and the country’s S&P/ASX 200 index .AXJO also pared gains.

Copper prices reversed early losses incurred after the trade data from China, a top consumer of raw materials, as Chinese stocks moved higher. They added 0.5 percent to above $ 6,700 a metric ton (1 metric ton= 1.1023 ton), while gold put on 0.2 percent, extending Tuesday’s 1.1 percent rise.

Brent crude prices were steady at just below $ 108 a barrel after rising 0.6 percent in the previous session on concerns that violence in Egypt could ignite conflict in the Middle East.

YEN GAINS

But concerns over China pulled the dollar .DXY further from a three-year high against a basket of major currencies touched on Tuesday. It was last down 0.1 percent after rising as high as 0.2 percent.

The dollar also fell 0.6 percent to 100.52 yen, which weighed on Tokyo’s Nikkei average .N225, down 0.4 percent.

Investors have been betting on further dollar gains as the U.S. Federal Reserve prepares to scale back its $ 85 billion a month stimulus program. The U.S. central bank is to release its minutes of the June policy meeting later in the day, plus Fed Chairman Ben Bernanke is to speak on Wednesday.

“Dollar buying will continue. With rising Treasury yields, there is no incentive to sell the dollar, particularly against the euro,” said Masashi Murata, senior currency strategist at Brown Brothers Harriman in Tokyo.

But Murata added, “any evidence of a slowdown in China will prompt some people to buy back the yen.”

EURO STABILISED

The euro steadied at $ 1.2793 after sliding to a three-month low of $ 1.2755 after ratings agency Standard & Poor’s cut Italy’s debt rating by one notch to BBB, the second lowest of the investment grade status, and left its outlook on negative, citing concerns about prospects for the Italian economy.

The downgrade, which moved in line with rival Moody’s, came a day before Italy was due to sell 9.5 billion euros of Treasury bills and two days before a planned sale of up to 6.5 billion euros of medium- and long-term bonds.

Also weighing on the common currency were comments by European Central Bank policymaker Joerg Asmussen, who said the central bank’s guidance on interest rates staying at record lows extends beyond 12 months.

The ECB later issued a statement saying Asmussen had not intended to give any guidance on the exact length of time for which it expects to keep rates at record lows.

Sterling was up 0.1 percent at $ 1.4883 after sliding to a three-year low of $ 1.4814 in the previous session on weak factory output and trade data, seen as raising the risk of the Bank of England easing monetary policy in the coming months.

(Additional reporting by China Economics Team, Lisa Twaronite in Tokyo and Ian Chua in Sydney; Editing by Richard Borsuk)

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China shares bounce as dismal trade data spurs easing talk

Wall Street Shaped Bill Easing Oversight, and Kept Contributions Coming

Banking industry lobbyists helped members of the House Financial Services Committee craft a bill loosening regulators’ oversight of various types of trading, with lobbyists from Citibank playing a large role in the process, according to a report in today’s New York Times. Seventy-one of the 80 lines in a bill recently approved by the panel were written with the assistance of lobbyists for major banks, said the report, which is based on emails reviewed by the paper’s reporters; two paragraphs were copied from the lobbyists nearly word-for-word.

According to Center for Responsive Politics data, in the first quarter of 2013, members of that committee received more than $ 1.3 million in donations to their campaigns and leadership PACs from the securities and investment industry and commercial banks.

The donations came from PACs representing the financial firms, individuals they employ and lobbyists who represent the firms. By far the largest source of cash from the two industries was the Investment Company Institute, a trade association representing Wall Street firms. The ICI gave at least $ 129,000 to members of the House Financial Services Committee. Other trade groups representing banks and investment firms, including the American Bankers Association and the Independent Community Bankers of America, were also major contributors. 

Among individual corporations, UBS was the top donor to the committee’s members, contributing $ 88,000 so far this year.

The banking and securities and investment industries together contributed about the same amount overall to members of the committee in the first quarter of 2011 as in the first three months of 2013 — roughly $ 1.3 million. But the commercial banking industry — including Citigroup — gave substantially more this time around, while the securities industry gave less.

Banking industry companies increased their contributions in 2013 to $ 640,286, from $ 497,169 in early 2011. Citigroup, in particular, jumped from $ 19,500 in donations to committee members to $ 39,500. UBS went from $ 64,250 to $ 88,000. Wells Fargo also opened its checkbook a little wider this year, giving $ 80,000, compared with $ 31,250 in 2011.

The ABA gave $ 90,750 in the first quarter of 2013, up from $ 58,650 in the comparable period in 2011.

Although the New York Times article cites a growing friendliness between the banking industry and congressional Democrats, the money going to the members of the committee this year overwhelmingly tilted towards Republicans. Seventy percent of the $ 1.3 million went to GOP lawmakers. Republicans control the House, and thus the committee, and it is not unusual to see the majority party pick up more cash from donors, regardless of the topic or committee.

The top recipient of cash from the two industries so far this year is Rep. Jeb Hensarling (R-Texas), the chairman of the committee, who has picked up $ 140,400. The top Democrat on the committee, Rep. Maxine Waters (D-Calif.), who has criticized the legislation in question, received only $ 6,000.

The bill, the Swaps Regulatory Improvement Act (H.R. 992), was sponsored by committee member Randy Hultgren (R-Ill.), who has received $ 50,100 from commercial banks and the securities and investment industry, the majority of which came from individuals rather than PACs. One of his co-sponsors, who defended the legislation to the Times, is Rep. Jim Himes (D-Conn.) who took in a similar amount from the two industries — about $ 47,700.

According to FEC records, Citigroup’s PAC gave Hultgren’s campaign committee $ 2,000. And it gave Himes’ campaign $ 1,000 and his leadership PAC, Jobs and Innovation Matter PAC (JIM PAC) another $ 2,500. The donations to Hultgren, JIM PAC and a $ 5,000 donation to Hensarling’s leadership PAC were all made on March 26.

The panel passed the bill this month despite objections from the Treasury Department. It awaits action in the full House.

Images: Stock market board via BigStockPhoto.com

OpenSecrets Blog

Wall Street Shaped Bill Easing Oversight, and Kept Contributions Coming

VIDEO: S&P 500 says hello to new high

Summary of business headlines: S&P 500 claims new territory with post-crisis record close; Cyprus calm after banks reopen; U.S. jobless claims, Midwest economy point to easing recovery; Boeing CEO expects 787 up sooner rather than later. Conway G. Gittens reports.

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VIDEO: S&P 500 says hello to new high

Bernanke says Fed stimulus benefits clear, downplays risks

WASHINGTON (Reuters) – Federal Reserve Chairman Ben Bernanke strongly defended the U.S. central bank’s monetary stimulus before Congress on Tuesday, easing financial market worries over a possible early retreat from bond buys.

Reuters: Top News

Bernanke says Fed stimulus benefits clear, downplays risks

Coming Together . . . for What?

All of the fuss by the G-7 and the G-20 at their meeting this week about whether Japan should be condemned for attempting to end decades of stagnation by easing monetary policy, with the effect of driving down the yen, makes for good copy.

The Weekly Standard

Coming Together . . . for What?