Paul Taylor

DAVOS, Switzerland, Jan 24 (Reuters) – Central banks are
coming under too much pressure from politicians to act to
promote growth and weaken currencies, the head of the world’s
central banking forum said on Thursday.

Jaime Caruana, general manager of the Bank for International
Settlements, also said in a Reuters Insider television interview
that the world was reaching the point where the damage from
central banks’ printing money could outweigh the benefits.

Asked about pressure from the new Tokyo government on the
Bank of Japan to increase asset purchases to drag the economy
out of its fourth recession since 2000 and end deflation, he
said authorities should focus more on their own actions.

“There is always a risk of overburdening central banks.
There is perhaps excessive pressure when we discuss about
growth; probably the attention should be focusing on
productivity, competitiveness, labour market participation.
There is a bit too much focus on central banks,” Caruana said.

Central bank measures such as cutting interest rates could
only buy time for governments to take action on structural
economic reform, but “sometimes low rates provide incentives
that time is not used so wisely”, he said.

DAVOS, Switzerland (Reuters) – The world is awash in easy money, with consequences that are starting to worry some central bankers and business leaders at the Davos World Economic Forum (WEF), though so far inflation fears seem overdone.

With developed world government finances constrained by huge debts and deficits, central banks have pumped trillions of dollars into the system to try to revive sluggish economies, combat deflation and prop up weak banks.

The Fed, the Bank of England, the Bank of Japan and to a lesser extent the European Central Bank have strayed far from traditional inflation fighting to take into account objectives such as reducing unemployment, raising nominal GDP, and ensuring the smooth functioning of the sovereign bond market.

DAVOS, Switzerland, Jan 22 (Reuters) – The world is awash in
easy money, with consequences that are starting to worry some
central bankers and business leaders at the Davos World Economic
Forum (WEF), though so far inflation fears seem overdone.

With developed world government finances constrained by huge
debts and deficits, central banks have pumped trillions of
dollars into the system to try to revive sluggish economies,
combat deflation and prop up weak banks.

The Fed, the Bank of England, the Bank of Japan and to a
lesser extent the European Central Bank have strayed far from
traditional inflation fighting to take into account objectives
such as reducing unemployment, raising nominal GDP, and ensuring
the smooth functioning of the sovereign bond market.

LONDON, Jan 21 (Reuters) – Prime Minister David Cameron is
leading Britain into a minefield in seeking to renegotiate its
terms of membership of the European Union. His gamble could
easily end in a bust.

Cameron postponed a landmark speech on Europe, due to have
been delivered in Amsterdam last Friday, because of a hostage
crisis in Algeria, but he had already disclosed the thrust of
his plan to try to change London’s relationship with the EU.

Extracts from the undelivered speech released by his office
show he planned to say Britain would “drift towards the exit”
unless the EU reformed itself. That sounded reminiscent of a
1930s British newspaper headline: “Fog in the Channel, the
continent cut off”.

LONDON (Reuters) – Prime Minister David Cameron is leading Britain into a minefield in seeking to renegotiate its terms of membership of the European Union. His gamble could easily end in a bust.

Cameron postponed a landmark speech on Europe, due to have been delivered in Amsterdam last Friday, because of a hostage crisis in Algeria, but he had already disclosed the thrust of his plan to try to change London’s relationship with the EU.

Extracts from the undelivered speech released by his office show he planned to say Britain would “drift towards the exit” unless the EU reformed itself. That sounded reminiscent of a 1930s British newspaper headline: “Fog in the Channel, the continent cut off”.

PARIS (Reuters) – France should hold a national debate, like Germany or Britain, on what it wants out of the European Union without waiting for Berlin to define the next stage in European integration, France’s European commissioner said on Monday.

Michel Barnier urged President Francois Hollande to appoint a cross-party panel of elder statesmen to report on French interests in Europe and lead a debate on the next steps towards closer union.

“It is high time we agreed to debate these subjects, which never get discussed in this country,” the commissioner in charge of the internal market and financial regulation told the Europresse association in Paris.

BRUSSELS, Dec 14 (Reuters) – Germany rebuffed calls for more
financial risk-sharing in the euro zone on Friday, rejecting a
proposal for a fund to help debt-laden countries cope with
economic shocks and leaving open who would pay to wind down
stricken banks.

With an eye on a general election next year, Chancellor
Angela Merkel made EU officials drop any mention of a
shock-absorber fund, backed by France and southern European
states, from the conclusions of a two-day European Union summit.

She also resisted efforts by French President Francois
Hollande and Italy to loosen EU budget discipline rules by
exempting public investment when calculating national deficits.

BRUSSELS, Dec 13 (Reuters) – European leaders agreed to
press on with further steps to shore up their finances and
sustain momentum in tackling the debt crisis on Friday, a day
after clinching a deal on banking supervision and approving
long-delayed aid to Greece.

After more than eight hours of late-night talks at a summit
in Brussels, leaders promised to push ahead with setting up a
mechanism to wind down problem banks, although it was unclear
when the facility would be completed.

They also launched tentative discussions on how to make
countries stick to economic targets and on creating a
“solidarity fund” to help member states suffering one-off
economic shocks, but did not delve deeply into either issue,
pushing the debate out to the middle of next year.

BRUSSELS, Dec 13 (Reuters) – The euro zone agreed on
Thursday to provide nearly 50 billion euros ($64 billion) in
long-delayed aid to Athens, prompting its Prime Minister Antonis
Samaras to declare an end to talk of a Greek exit from the
single currency.

The deal averts a catastrophic default and secures Greece’s
survival in the euro zone after months of doubt and political
turmoil. Athens had repeatedly missed fiscal targets agreed with
the EU and the International Monetary Fund, and stalled
structural economic reforms.

“We are convinced that the programme is back on a sound
track,” Jean-Claude Juncker, chairman of the 17-nation euro
area’s finance ministers told a news conference after they met
in Brussels ahead of an EU summit later in the day.

PARIS (Reuters) – A chill has settled over the Rhine seven months after the election of Socialist French President Francois Hollande, reshuffling the cards in Europe’s perpetual power game.

The cooling of traditionally close Franco-German relations was partly an intentional step by Hollande to demonstrate that he is not in conservative Chancellor Angela Merkel’s pocket but wants to change the policy direction of the European Union.

It also reflects a fraught process of rebalancing power to accommodate Germany’s greater political heft and economic clout.