Greek PM says differences between lenders delaying bailout review: paper

ATHENS Greek Prime Minister Alexis Tsipras said on Saturday that differences between the country's international lenders over its pension reform plans are delaying the first review of its latest financial bailout.Reforming Greece's ailing pension system is a prerequisite for the conclusion of the review, which is expected to open the way for debt relief talks.The government has faced widespread protests over its reform plans however, as austerity-weary Greeks push back against yet more cuts to the country's welfare system."There are differences among the lenders on Greece's pension reform that are delaying the whole process," Tsipras said without elaborating, in an interview in the newspaper "Sunday's Avgi" released on Saturday.He added that the negotiations for the review are in the final stage and repeated that he is willing to increase contributions to the pension funds to save pensioners' income. On Friday thousands of farmers from all over the country rallied in Athens in their first major demonstration in the capital. The pension reforms would triple their pension contributions.The International's Monetary Fund director for Europe, Poul Thomsen, said on Friday that Greece will need to implement extra measures worth about 9 billion euros to meet its fiscal targets by 2018. "We cannot see how Greece can do so without major savings on pensions," Thomsen said.Tsipras was elected last year on a promise to end austerity. But he was forced to accept a third bailout for the country in July and is struggling to conclude the bailout review and convince angry Greeks that after six years of belt-tightening the latest measures are worth it. Greece is being asked to cut pension spending by 1 percent of gross domestic product this year. Athens has refused to cut pensions as part of its bailout, and says it will increase social security contributions instead."We have presented our proposals on the pension reform, and informed the institutions (lenders) at the beginning of January. So far we don't have their official position," Tsipras said. (Reporting by Lefteris Papadimas; Editing by Hugh Lawson) Read more

Pfizer walks away from $118 billion AstraZeneca takeover fight

LONDON/NEW YORK Pfizer abandoned its attempt to buy AstraZeneca for nearly 70 billion pounds ($118 billion) on Monday as a deadline approached without a last-minute change of heart by the British drugmaker.The decision ends a month-long public fight between two of the world's biggest pharmaceutical companies that sparked political concerns on both sides of Atlantic over jobs and corporate tax maneuvers.British rules now require an enforced cooling-off period. AstraZeneca could reach out to Pfizer after three months and Pfizer could take another run at its smaller British rival in six months time, whether it is invited back or not.Pfizer's move came two hours before a 5.00 pm (1200 ET) deadline to make a firm offer or walk away, under UK takeover rules. Its decision to quit the stage, at least for now, had been widely expected after AstraZeneca refused its final offer of 55 pounds a share."Following the AstraZeneca board's rejection of the proposal, Pfizer announces that it does not intend to make an offer for AstraZeneca," Pfizer said in a short news release.The biggest U.S. drugmaker promised it would not go hostile by taking its offer directly to AstraZeneca shareholders, leaving the fate of what would have been the world's largest ever drugs merger in the hands of its target, whose board would have had to make a complete U-turn to get a deal done."We continue to believe that our final proposal was compelling and represented full value for AstraZeneca based on the information that was available to us," said Ian Read, Pfizer's chairman and chief executive.Pfizer's final offer was at a price that many analysts and investors had previously suggested would bring AstraZeneca to the table for serious negotiations. But in rejecting an earlier offer of 53.50 pounds as undervaluing the company, the British group indicated it needed a bid more than 10 percent higher, or at least 58.85 pounds per share, for its board to consider a recommendation.Pfizer had urged AstraZeneca shareholders to agitate for engagement and several expressed disappointment at its intransigence, although others - encouraged by AstraZeneca's promising drug pipeline - backed the firm's standalone strategy.AstraZeneca Chairman Leif Johansson welcomed Pfizer's decision to back down, which he said would allow the British company to focus on its growth potential as an independent company.What happens next will depend upon whether AstraZeneca's share price deteriorates in the coming weeks and how hard its shareholders push for it to revisit a deal with Pfizer. BlackRock, AstraZeneca's biggest shareholder, backed the board's rejection of Pfizer's 55 pounds a share offer, but urged it to talk again in the future.POLITICAL OPPOSITIONThe proposed transaction ran into fierce opposition from politicians in Britain, Sweden - where AstraZeneca has half it roots - and the United States over the likelihood that the marriage would lead to thousands of job cuts.Ultimately, it was price and the lack of room for eleventh-hour maneuvering by Pfizer that killed the deal. Pfizer had several reasons for taking aim at AstraZeneca for what would have been its fourth mega-merger in 14 years.Highest on the list appeared to be Pfizer's desire to take part in a recent trend of so-called tax inversions, under which it could reincorporate in Britain and pay significantly lower corporate tax. Pfizer would also be able to use tens of billions of dollars it has parked overseas, avoiding high U.S. taxes for repatriating the huge cash pile.Pfizer also had its eye on a promising portfolio of drugs in AstraZeneca's developmental pipeline, especially several potentially lucrative cancer medicines.It was this pipeline that AstraZeneca management used to make its case for Pfizer significantly undervaluing the company.Chief Executive Pascal Soriot went as far as making a 10-year forecast for a 75 percent rise in sales by 2023."As we said from the start, the pursuit of this transaction was a potential enhancement to our existing strategy," Pfizer's Read said. "We will continue our focus on the execution of our plans, bringing forth new treatments to meet patients' needs and remaining responsible stewards of our shareholders' capital."The merger would have restored Pfizer as the world's largest drugmaker by sales, a position it relinquished to Swiss-based Novartis when billions of dollars in annual revenue evaporated after its top-selling cholesterol fighter Lipitor began facing generic competition in 2011.(Editing by David Evans and Mark Potter) Read more

Yen, bonds, gold all gain at dollar's expense, stocks sag

SYDNEY Fresh cracks appeared in global markets on Thursday as investors sought the safety of Japanese yen, gold and top-rated bonds while dumping U.S. dollars on bets the Federal Reserve could be done raising interest rates.Even the absence of Tokyo for a holiday could not stop the dollar from hitting a 15-month low on the yen, and gold finally broke major chart resistance to reach its highest since May.Insatiable demand for U.S. Treasuries drove longer-term yields to one-year lows and flattened the yield curve in a way that has presaged economic recession in the past."In some ways it is reminiscent of 2008 with tightening credit markets, bank shares under pressure and worries central banks are powerless," said Shane Oliver, head of investment strategy at AMP Capital, though he suspects markets are overly pessimistic this time.The flight from risk told on most Asian shares, with Hong Kong .HSI - a favourite channel for global investors to play China - diving 3.9 percent as investors there returned from the long Lunar New year holidays. Mainland China markets are closed all week.MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS shed 1.4 percent, and South Korea .KS11 resumed with a 2.9 percent drop.EMini futures for the S&P 500 ESc1 fell 0.5 percent.Wall Street had ended Wednesday mixed after Fed Chair Janet Yellen sounded optimistic on the U.S. economy, but acknowledged risks from market turmoil and a slowdown in China. Analysts took that to mean a hike in March was unlikely, but further tightening remained possible later in the year."Yellen made it clear that while the Fed still expects to continue on its gradual tightening path, policy was not on a pre-set course and would respond appropriately to developments," said Justin Fabo, a senior economist at ANZ."The real test may come later, if markets continue to deteriorate and look to central banks to save them. Are policymakers' guns loaded with blanks?"YIELDS FLATTENED It seemed some were already preparing for the worst.Longer-term U.S. debt rallied hard as investors wagered that either the Fed would be unable to tighten at even a gradual pace, or that if it did hike it would only hasten the arrival of recession and deflation.In a marked turnaround, yields on 10-year Treasuries fell to 1.673 percent US10YT=TWEB, from a top of 1.773, almost exactly matching the lowest close from February last year. Futures TYc1 imply further price gains lie ahead.As a result, the spread over two-year paper US2YT=TWEB shrank to just 98 basis points, the smallest gap since late 2007 just before the global financial crisis hit. Likewise, Fed fund futures <0#FF:> are pricing in the shallowest of shallow tightening paths. The market implies a rate of 45 basis points for the end of this year, 60 basis points at the end of 2017 and 90 by the close of 2018. The inexorable decline in U.S. yields continued to drag on the dollar, which reached lows last seen in October against a basket of currencies .DXY.The yen was again lifted by safe-haven flows, as befits Japan's position as the world's largest creditor nation. The dollar dove through 113.00 yen to reach depths not delved since November 2014 at 112.515 JPY=EBS.The euro also weakened against its Japanese peer, sliding to a near three-week low of 127.26 yen EURJPY=R. Against the greenback, the euro held firm at $1.1292 and within reach of a three-month high of $1.13385 set earlier in the week.The aversion to risk helped lift gold XAU= as far as $1,213.00 an ounce, clearing stiff resistance around $1,200.Oil prices resumed their decline as U.S. crude CLc1 slid 47 cents to $26.98 a barrel, while Brent futures LCOc1 lost 18 cents to $30.66. (Reporting by Wayne Cole; Editing by Shri Navaratnam and Kim Coghill) Read more

U.S. lawmakers seek to bar states from mandating encryption weaknesses

WASHINGTON U.S. House of Representatives lawmakers will introduce bipartisan legislation on Wednesday that would prohibit states from requiring tech companies to build encryption weaknesses into their products.The move marks the latest foray into an ongoing debate over encryption between Silicon Valley and Washington. While tech companies generally oppose weakened security standards, federal authorities have warned about a "going dark" phenomenon in which criminal suspects use powerful encryption in their communications so that investigators cannot access a phone's content, even with a warrant.The ENCRYPT Act, sponsored by Democratic Representative Ted Lieu and Republican Blake Farenthold, would prevent any state or locality from mandating that a “manufacturer, developer, seller, or provider” design or alter the security of a product so it can be decrypted or surveilled by authorities, according to bill text viewed by Reuters.The legislation is in response to proposals in recent months in New York and California that would require companies to be able to decrypt their smartphones manufactured after 2017, Lieu said. "It is completely technologically unworkable for individual states to mandate different encryption standards in consumer products," Lieu told Reuters in an interview. "Apple (AAPL.O) can't make a different smartphone for California and New York and the rest of the country."It is unclear how much momentum the bill will have in the House, though the chamber has staked out positions sympathetic to digital privacy in recent years. Encryption has been an area of disagreement between tech companies and law enforcement authorities for decades, but it gained renewed scrutiny after Apple and Google (GOOGL.O) began offering strong encryption by default on their products in 2014. FBI Director James Comey told a Senate panel on Tuesday that federal investigators have still been unable to access the contents of a cellphone belonging to one of the killers in the Dec. 2 shootings in San Bernardino, California, because of encryption. But technology companies, privacy advocates and cryptographers say any mandated vulnerability would expose data to hackers and jeopardize the overall integrity of the Internet.A study from the Berkman Center for Internet and Society at Harvard University released last month, citing some current and former intelligence officials, concluded that fears about encryption are overstated in part because new technologies have given investigators unprecedented means to track suspects. (Editing by Richard Cowan and Matthew Lewis) Read more

Obama to lay out 2017 spending priorities in final White House budget

WASHINGTON U.S. President Barack Obama unveils his final White House budget on Tuesday with a blueprint for fiscal year 2017 that will lay out his spending proposals for priorities from fighting Islamic State to providing for the poor.The budget for the fiscal year beginning on Oct. 1 is largely a political document and is unlikely to be passed by the Republican-controlled Congress.But it gives the Democratic president, who leaves office in January, a chance to make a last pitch for funding on issues such as education, criminal justice reform and job creation."That document ... will be President Obama's final vision of how he lays out the fiscal future for the country," said Joel Friedman, vice president for federal fiscal policy at the Center on Budget and Policy Priorities."I don't think anyone expects it to be enacted this year. Republicans aren't going to embrace it, but that doesn't mean it's not going to be a useful document." Congress can advance elements of the budget without endorsing the entire proposal, which is likely to call for roughly $4 trillion in total spending, in line with Obama's $3.99 trillion proposal for fiscal year 2016. The White House formally unveils its full budget at 11:00 a.m. ET (1600 GMT) with the administration already having released some key elements. Obama is slated to meet with his national security team to discuss cyber security around that same time. The budget seeks $19 billion for cyber security across the U.S. government.The budget is likely to stay within the confines of an agreement reached between the White House and Congress last year that lifted mandatory "sequestration" cuts on both defense and domestic spending. Friedman noted that Obama and Republican Speaker of the House of Representatives Paul Ryan agreed on some ways to fight poverty, such as an expansion of the Earned Income Tax Credit to encourage low-income Americans to work.But differences between the two political parties in a presidential election year are especially pronounced, and Republican lawmakers have taken the unusual step of not inviting White House budget director Shaun Donovan to brief about the proposal. “Maybe they are taking the Donald Trump approach to debates about the budget. They are just not going to show up,” White House spokesman Josh Earnest told reporters last week, referring to the Republican presidential front-runner's decision to skip a debate with his counterparts ahead of the nominating contest in Iowa.Key elements include the Pentagon asking for more than $7 billion for the fight against Islamic State, up about 35 percent from the previous year's request. Also, Obama will seek a 20 percent boost for renewable energy research funding to a total of $7.7 billion.The White House also proposes a $10-a-barrel tax on crude oil to raise $20 billion to expand transit systems and research self-driving cars and calls for a 20-percent increase in funding for renewable energy research. (Additional reporting by Roberta Rampton and Susan Cornwell; Editing by Chizu Nomiyama) Read more

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