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Hoping to win back voters, UK’s Johnson returns to election pledges

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© Reuters. A car carrying Britain’s Queen Elizabeth’s crown leaves the Buckingham Palace for the State Opening of Parliament at the Palace of Westminster, Britain, May 10, 2022. REUTERS/Henry Nicholls

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By Elizabeth Piper and Andrew MacAskill

LONDON (Reuters) -British Prime Minister Boris Johnson returned to his election pledges to tackle regional inequalities and maximise post-Brexit freedoms on Tuesday, hoping to win back voters in southern England who abandoned his party at local polls last week.

In the traditional Queen’s Speech, read for the first time in 59 years by Prince Charles rather than Queen Elizabeth due to her mobility problems, Johnson said his Conservative government would “deliver on the promises we made” in the 2019 election.

But there was little to comfort the millions of people struggling with higher fuel and food costs, with the government reiterating that it would “repair the public finances” rather than channel additional money to cushion the blow.

“Her Majesty’s government’s priority is to grow and strengthen the economy and help ease the cost of living for families,” Charles said, reading a text written by the government that sets out its plans for the next parliamentary session.

In a ceremony full of pageantry, Charles read the speech in front of robed lords and lawmakers, who had walked from the House of Commons to the upper chamber, the House of Lords, led by Johnson and opposition Labour leader Keir Starmer.

Charles, Queen Elizabeth’s heir, was drafted in after Buckingham Palace said on Monday the 96-year-old monarch was experiencing “episodic mobility problems” and had reluctantly decided she could not attend.

The Queen’s Speech set out 38 bills, including measures to revitalise Britain’s high streets, crack down on illicit finance and make the City, London’s financial district, more attractive to global investors after the country left the European Union.

In an introduction to the government’s legislative programme, Johnson said: “This is a Queen’s Speech to get our country back on track and ensure that we deliver on the promises we made at the start of this parliament.”

“While we must keep our public finances on a sustainable footing – and we cannot completely shield people from the fallout from global events – where we can help, we will.”

SHIFTING FOCUS

Johnson and his government are keen to return the focus on what they call the “real issues” and turn the page on scandals after months of reports of COVID-19 lockdown-busting gatherings at the prime minister’s Downing Street office and residence.

After Johnson and his finance minister, Rishi Sunak, were both handed fines for one such gathering, opposition leader Starmer stepped up the pressure by pledging to resign if police found he had also broken lockdown rules.

Neither Johnson nor Sunak have stepped down, and Downing Street is still awaiting the results of a police investigation into other gatherings.

Johnson is also under pressure to tackle a growing cost-of-living crisis, but the Queen’s Speech offered no clues on any immediate action the government might take to help people struggling to pay their bills.

The Bank of England said last week Britain risks a double-whammy of a recession and inflation above 10%.

Johnson was punished in last week’s local elections, when voters in southern England abandoned his party over the scandals and the cost of living. This prompted some in his party to urge a return to a more traditional Conservative agenda of tax cuts and preventing housing from encroaching on rural areas.

With his critics falling short of the numbers needed within the governing party to try to oust him, Johnson is hoping he can double-down on an agenda he believes won him a large majority in the 2019 national election.

“From the moment I became prime minister, my mission has been to deliver for the British people,” he said in the introduction to the agenda.

“Over the remainder of this parliament, this government will work night and day to ensure we do just that.”

Economy

Exclusive-Japan Inc turns against central bank’s monetary stimulus, Reuters survey shows

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© Reuters. FILE PHOTO: A businessman walks near the Bank of Japan headquarters in Tokyo, Japan, Feb. 15, 2016. REUTERS/Thomas Peter

By Tetsushi Kajimoto

TOKYO (Reuters) – More than 60% of Japanese companies want the central bank to end its policy of massive monetary easing this fiscal year due to pain from the weak yen, with roughly a quarter calling for it to take action now, a Reuters survey shows.

Less than a year ago, Japan Inc had enthusiastically backed the Bank of Japan’s policy but this year’s rapid slide in the yen to a two-decade low has jacked up prices of fuel and raw materials imports, lifting not only corporate costs but also hitting household spending.

This month the yen hit a fresh low of 131.34 to the dollar, a 14% decline since the start of the year.

“Any weakening of the yen beyond 125 to the dollar is excessive and policymakers should take action in some way, including – but not limited to – hiking rates,” one manager at a chemicals maker wrote in the monthly Reuters Corporate Survey.

Twenty-four percent of respondents said the central bank should abandon large-scale monetary stimulus now, while 23% said by the end of the first half in September.

All in all, 64% want large-scale stimulus gone by March when the fiscal year ends and that number jumps to 84% for April when BOJ Governor Haruhiko Kuroda serves out his term.

While Kuroda has said the yen’s moves have been rapid, he argues that a weak yen on the whole benefits the economy. In stark contrast to shifts to interest hikes in other parts of the world, Kuroda has also said the central bank will continue with monetary powerful easing given the impact of the pandemic and tepid inflation.

Of those respondents keen to see a change in BOJ policy, 58% want to see negative rates scrapped, 35% want interest rates hiked and 25% are eager to see the bank drop or change its 2% inflation target. Multiple answers were allowed for this question.

The results of the April 26-May 13 poll of 500 large and midsize non-financial firms, which saw 230 firms respond, represent a major U-turn from July when the survey last asked comparable questions about monetary policy.

At that time, 72% of Japanese firms saw a positive impact from BOJ policy with a majority saying ultra-low rates should continue for another 3-4 years.

The sharpness of the currency’s decline has outweighed the benefits normally associated with a weaker yen, namely the inflation of profits earned abroad when repatriated and longer term the ability to export more cheaply. Japanese exporters have also continued to shift production abroad.

“As the production shift continues, the impact on the economy from higher raw materials costs and other imports from the weaker yen is greater than the apparent increase in profits for exporters,” said one manager at a retailer.

Respondents reply to the survey on condition of anonymity.

BOJ SLAMMED

Some managers were withering in their criticism of BOJ policy, expressing concern the weak yen could ultimately erode Japan’s economic might.

“The easing policy has turned out to be nothing but a stupid plan that weakens national power,” one manager at a services firm wrote.

The survey also found firms wary of boosting capital spending due to the impact of the weak yen and rising input costs. Almost a half of them plan to keep business investment flat this fiscal year while another 14% expect it to decline.

The survey also showed that China’s anti-COVID measures – including a lockdown in Shanghai – have hurt nearly two-thirds of Japanese firms. Ten percent said they were suffering a “big impact” on business.

“Imports of China-produced car parts have stopped, putting downward pressure on car output,” a chemicals maker manager wrote.

($1 = 129.02 yen)

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Economy

Brazil’s govt will maintain GDP outlook for 2022 and 2023 -sources

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© Reuters. FILE PHOTO: Consumers shop at a weekly street market in Rio de Janeiro, Brazil, September 2, 2021. REUTERS/Ricardo Moraes

By Marcela Ayres

BRASILIA (Reuters) – Brazil’s Economy Ministry will hold its economic growth outlook at 1.5% in 2022 and 2.5% in 2023, two officials told Reuters on Wednesday, forecasting activity ahead of market projections due to labor market strength and growing private investments.

The ministry will update its forecasts for economic indicators on Thursday and inflation figures are expected to be lifted from the previous outlook, in March, when the IPCA consumer price index was seen at 6.55% this year.

Data will be used in the bi-monthly income and expenditure report calculations, scheduled for Friday.

Economists have been increasing their forecasts for this year’s GDP, bringing the numbers closer to those forecast by the government.

Analysts say demand in the country has been helped by greater fiscal stimulus, following an increase in a cash transfer program to poorer people. In addition, the job market has shown signs of strength and the Omicron coronavirus wave has not knocked social mobility as feared.

However, they say expectations for 2023 have deteriorated, with aggressive central bank monetary tightening to tame inflation set to affect activity from the second half of the year onwards.

The central bank has raised interest rates to 12.75% from a record-low 2% in March 2021, and has already signaled another likely hike in June.

Goldman Sachs (NYSE:GS) and Credit Suisse now see Brazil’s GDP rising 1.25% and 1.4% this year, respectively, against previous 0.6% and 0.2% projections. For 2023, Goldman Sachs lowered its forecast to 0.9% from 1.2%, while Credit Suisse cut its outlook to 0.9% from 2.1%.

Bank of America (NYSE:BAC) projected on Tuesday that Brazil will grow 1.5% in 2022 from 0.5% earlier. However, expansion is now seen at 0.9% in 2023, from 1.8% previously.

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Economy

Factbox-U.S. companies offering abortion travel benefits

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© Reuters. Signage is seen at an Amazon facility in Staten Island, New York City, U.S., April 24, 2022. REUTERS/Andrew Kelly

(Reuters) -A small but growing number of companies, including Amazon.com (NASDAQ:AMZN) and Tesla (NASDAQ:TSLA) Inc, are rolling out policies to offer benefits to U.S. employees who may need to access abortion services as some state legislatures impose tighter restrictions.

An unprecedented leak of a draft opinion earlier this month suggests that the U.S. Supreme Court is set to vote to overturn the landmark 1973 Roe v. Wade ruling, which legalized abortion nationwide.

Following is a list of companies who have offered their U.S. employees reproductive healthcare benefits including abortion coverage or travel benefits for out-of-state abortions.

Company Benefit(s) Offered

Citigroup Inc (NYSE:C) The bank has started covering travel expenses for employees

who go out of state for abortions because of newly enacted

restrictions in Texas and other places, becoming the first

major U.S. bank to make that commitment.

Yelp (NYSE:YELP) Inc The crowd-sourced review platform will extend its abortion

coverage to cover expenses for its employees and their

dependents who need to travel to another state for abortion

services.

Amazon.com The second-largest U.S. private employer told employees it

will pay up to $4,000 in travel expenses yearly for

non-life threatening medical treatments, among them

elective abortions.

Levi Strauss (NYSE:LEVI) & CO The apparel company will reimburse travel expenses for its

full- and part-time employees who need to travel to another

state for healthcare services, including abortions.

United Talent Agency The private Hollywood talent agency said it would reimburse

travel expenses related to women’s reproductive health

services that are not accessible in an employee’s state of

residence.

Tesla Inc Tesla’s Safety Net program and health insurance includes

travel and lodging support for its employees who may need

to seek healthcare services that are unavailable in their

home state, according to the company’s 2021 impact report.

[https://www.tesla.com/ns_videos/2021-tesla-impact-report.pdf

]

Microsoft Corp (NASDAQ:MSFT) Microsoft Corp said that it would extend its abortion and

gender affirming care services for employees in the United

States to include travel expense assistance.

Starbucks Corp (NASDAQ:SBUX) Starbucks Corp said it will reimburse U.S. employees and

their dependents if they must travel more than 100 miles

from their homes to obtain an abortion.

Mastercard Inc (NYSE:MA) Mastercard Inc said it will fund travel and lodging for

employees seeking abortions outside their home states from

June, according to an internal memo seen by Reuters.

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