Financial Times Europe - 20.02.2020

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Briefing

i anchester City rejects funding chargesM

The English Premier League football club has firmly

dismissed Uefa’s charges, with chief executive

Ferran Soriano claiming that its Champions League

ban was the result of an “unfair process”.— PAGE 11

i hip passengers pose virus risk, says USS

A US public health institution has warned that

Japan’s release of hundreds of travellers from the

Diamond Princess poses an “ongoing risk”.— PAGE 4;

LEX, PAGE 10; CRUISE INDUSTRY, PAGE 14; MARKETS, PAGE 17

i ed more optimistic in January meetingF

Policymakers agreed the risk to the outlook was

“somewhat more favourable” at the meeting in

which they held rates at 1.5-1.75 per cent, according

to minutes. They also noted the coronavirus threat.

i urkey cuts interest rates for sixth timeT

The central bank has cut its

benchmark again, despite

geopolitical risks and currency

volatility. President Recep

Tayyip Erdogan has targeted

single-digit rates.— PAGE 3

i erlin online bill raises censorship fearsB

The German cabinet has approved a bill that would

force social networks to report criminal posts to the

police, in a move that some say could pave the way

for censorship.— PAGE 2; EDITORIAL COMMENT, PAGE 8

i hina to throw out WSJ reportersC

Beijing has said it will expel three reporters after an

article “smeared” the antivirus fight in the country.

The US a day before designated five Chinese media

outlets as foreign diplomatic missions.— PAGE 3

i ankruptcy risks rise in US shale sectorB

Rating agency Moody’s has warned that weak oil

prices and tightening access to credit are worsening

the outlook for the industry just as a “staggering”

$86bn in debt starts to come due.— PAGE 11

Datawatch

Venezuela’s exodus

Refugee crisis pushes Colombia

to its limits— BIG READ, PAGE 7

THURSDAY20 FEBRUARY 2020 WORLD BUSINESS NEWSPAPER EUROPE

World Markets

STOCK MARKETS

Feb 19 prev %chg

S&P 500 3389.58 3370.29 0.

Nasdaq Composite 9823.51 9732.74 0.

Dow Jones Ind 29370.68 29232.19 0.

FTSEurofirst 300 1690.83 1677.46 0.

Euro Stoxx 50 3862.88 3836.54 0.

FTSE 100 7457.02 7382.01 1.

FTSE All-Share 4158.30 4118.84 0.

CAC 40 6111.24 6056.82 0.

Xetra Dax 13789.00 13681.19 0.

Nikkei 23400.70 23193.80 0.

Hang Seng 27655.81 27530.20 0.

MSCI World $ 2421.47 2430.69 -0.

MSCI EM $ 1095.66 1107.99 -1.

MSCI ACWI $ 577.32 580.02 -0.

CURRENCIES

Feb 19 prev

$ per € 1.079 1.

$ per £ 1.295 1.

£ per € 0.833 0.

¥ per $ 110.950 109.

¥ per £ 143.697 143.

SFr per € 1.061 1.

€ per $ 0.927 0.

Feb 19 prev

£ per $ 0.772 0.

€ per £ 1.200 1.

¥ per € 119.743 118.

£ index 81.569 81.

SFr per £ 1.274 1.

COMMODITIES

Feb 19 prev %chg

Oil WTI $ 53.56 52.29 2.

Oil Brent $ 59.26 57.75 2.

Gold $ 1589.85 1580.80 0.

INTEREST RATES

price yield chg

US Gov 10 yr 1.56 0.

UK Gov 10 yr 0.62 -0.

Ger Gov 10 yr -0.42 -0.

Jpn Gov 10 yr -0.05 0.

US Gov 30 yr 115.63 2.01 0.

Ger Gov 2 yr 105.76 -0.65 0.

price prev chg

Fed Funds Eff 1.55 1.55 0.

US 3m Bills 1.58 1.58 0.

Euro Libor 3m -0.43 -0.43 0.

UK 3m 0.76 0.76 0.

Prices are latest for edition Data provided by Morningstar

R I C H A R D M I L N E— STOCKHOLM

M A RT I N A R N O L D— FRANKFURT

Sweden’s central bank governor has

warned that policies other than nega-

tive interest rates will be needed in the

next global downturn, weeks after the

country ended its own experiment

with sub-zero monetary policy.

StefanIngves,governoroftheRiksbank,

told the Financial Times that govern-

ment spending and asset purchases by

thecentralbankwouldneedtodomuch

more of the work as the ability to cut

interestratesbelowzerowaslimited.

“I think there actually is a lower

boundforthepolicyrate.Ifindithardto

imagine that you would go negative to,

say,minus5percent,”hesaid.

he Riksbank’s almost five-yearT

periodwithnegativeinterestratescame

to an end early this year but some econ-

omists and business leaders have ques-

tioned its decision to raise rates to zero

while Sweden’s economy slows, arguing

it suggests the central bank believes

monetarypolicyisclosetoitslimits.

The Riksbank governor underscored

thatcentralbankscontrolboththeprice

ofmoney—throughinterestrates—and

thequantityofmoney.Inafuturedown-

turn“whatyou’retalkingaboutisessen-

tially expanding the balance sheet in

onewayoranother”.

But he added the difficulty would be

to get a lot of “bang for the buck” by

increasing aggregate demand in the

economy.

Mr Ingves stressed that in Sweden the

government “has much more space”

than households to increase debt and

demand. Swedish households have debt

equivalent to almost 200 per cent of

their disposable income — one of the

highest levels in the world — whilegov-

ernment debt to GDP is expected to be

just above 30 per cent this year, one of

thelowestinEurope.

Leading central bankers are con-

cernedthatwithinterestratesandinfla-

tionremaininglow,theyarerunningout

of ammunition to stimulate the econ-

omy, prompting calls for governments

totakeupthebaton.

“Monetary policy cannot, and should

not, be the only game in town,” Chris-

tine Lagarde, president of the European

Central Bank, told the European Parlia-

ment this month. “Other policy areas —

notably fiscal and structural policies —

alsohavetoplaytheirpart.

Jay Powell, US Federal Reserve chair-

man, this month told congress that with

interest rates already low “it would be

important for fiscal policy to help sup-

porttheeconomyifitweakens”.

Central bank chief warns of sub-zero

rates’ limits after Swedish experiment

© THE FINANCIAL TIMES LTD 2020

No: 40,328★†

Printed in London, Liverpool, Glasgow, Dublin,
Frankfurt, Milan, Madrid, New York, Chicago, San
Francisco, Orlando, Tokyo, Hong Kong, Singapore,
Seoul, Dubai, Doha

AnalysisiPAGE 3; exL iPAGE 10

Bloomberg rides high on

big bucks ad campaign

Austria €3.90 Malta €3.
Bahrain Din1.8 Morocco Dh
Belgium €3.90 Netherlands €3.
Bulgaria Lev7.50 Norway NKr
Croatia Kn29 Oman OR1.
Cyprus €3.70 Pakistan Rupee
Czech Rep Kc105 Poland Zl 20
Denmark DKr38 Portugal €3.
Egypt E£45 Qatar QR
Finland €4.70 Romania Ron
France €3.90 Russia €5.
Germany €3.90 Serbia NewD
Gibraltar £2.90 Slovak Rep €3.
Greece €3.70 Slovenia €3.
Hungary Ft1200 Spain €3.
India Rup220 Sweden SKr
Italy €3.70 Switzerland SFr6.
Latvia €6.99 Tunisia Din7.
Lithuania €4.30 Turkey TL
Luxembourg €3.90 UAE Dh20.
North Macedonia Den

China is seen as

the leading global

economic power

by a rising number

of countries. It has

gained influence

both in the west

and in emerging

countries such as

Indonesia, Kenya

and Poland, where

the US has lost

some of its clout

Rise and fall

Which is the leading economic power?

Change in views ( pts) -

Source: Pew Research Center,

Munich Security Report 

Indonesia

Kenya

Mexico

Brazil

UK

France

Russia

Poland

---    

US China

Feared no more

How Goldman Sachs lost the respect

of Wall St— JONATHAN GUTHRIE, PAGE 9

Deep waters

Great Lakes reflect the complexity

of climate change— NOTEBOOK, PAGE 8

JAV I E R E S P I N OZ A— BRUSSELS
M A D H U M I TA M U R G I A— LONDON
R I C H A R D WAT E R S— SAN FRANCISCO

Dominant technology companies will
have to open theirtroves of data to
smaller rivals underBrussels’ proposals
aimed at breaking the near-monopolies
enjoyed by the likes ofAmazon nda
Google.
Outlining its “strategy for data”, the
European Commission said yesterday
that it would explore “the need for legis-
lative action” to push companies
towardssharingandpoolingdata.
In areas where there has been market
failure, it said access to data “should be
made compulsory... under fair, trans-
parent, reasonable, proportionate and/
ornon-discriminatoryconditions”.
The commission said tech companies
had been able to build huge advantages
by guarding their data, while banks or
car companies were required to allow
third parties to access information
about customers. “The high degree of
market power resulting from the ‘data
advantage’ can enable large players to
set the rules on the platform and unilat-
erally impose conditions for access and
useofdata,”itsaid.
Margrethe Vestager,Brussels’ digital
and competition commissioner, said: “I
have had people coming to me saying,
‘We in the financial sector will have to
share the data that we have but Amazon
will not have to share the data the other
wayaround’.”
She added that forcing tech compa-
nies to open up their data might provide
a possible antitrust “remedy” that “will
actuallywork”.
“We have the fines to punish past
behaviour but we still have a market
that is upside down,” she said, adding
that the discussions on the digital strat-
egyremainedatanearlystage.
Nevertheless, the commission’s pro-
posals are likely to add to the growing
sense of US irritation that Europe is
picking on its tech champions. Just this
weekMark Zuckerberg, Facebook chief

executive,went to Brussels on a charm

offensive only to receive a frosty recep-

tion from high-ranking officials who

want the social media company to do

moretopolicecontentonitsplatform.

Ms Vestager has finedGoogle billions

of euros over nti-competitive behav-a

iour whileApple nd Amazon are alsoa

appealing against record fines in the EU

courts. The actions prompted Donald

Trump, the US president, to brand Ms

Vestager “the tax lady” and accuse her

of hating the US “perhaps worse than

anypersonI’veevermet”.

Last summer, Ms Vestager opened an

investigation into Amazon’s data-

gathering practices from small retailers

onitsplatformandthetechgroup’sdual

role as a marketplace andseller of its

ownbrands.

Separately, the commission has

accused Google of promoting its shop-

ping search engine at the expense of

smaller rivals in a case being contested

intheEUcourts.

Analystshighlightedsomeofthediffi-

cultiesfacingthecommission,including

how to define what kinds of data should

be shareable and who would bear any

legalliability.

New rules might also provoke a

potential clash with privacy regulators,

who have been taking steps to lock

downpersonaldata.

Facebook aiditwasbroadlyinfavours

of data sharing, both by the user and

between businesses, but added it

needed more clarity around the rules,

including how personal data would be

defined, for its own legal certainty and

to explain to its user community. Ama-

zonandGoogledeclinedtocomment.

Editorial Comment age 8p

EU aims to loosen big tech’s grip

by forcing groups to share data

3 Bid to break near-monopolies 3 Fresh threat to US companies 3 Potential clash over privacy

Margrethe

Vestager, EU

competition

commissioner,

says the current

system of data

sharing is not a

two-way street

Kenzo Tribouillard/AFP/Getty

‘We have the fines to

punish past behaviour

but we still have a market

that is upside down’