North Korea says Kim Jong Un oversaw test firings

North Korean media reported that leader Kim Jong Un supervised Saturday’s launch of a new weapons system, hours after President Trump said Kim had written him a letter with a “small apology” for the recent missile tests. South Korean media said Saturday that North Korea fired two more unidentified projectiles into East Sea.

“In a letter to me sent by Kim Jong Un, he stated, very nicely, that he would like to meet and start negotiations as soon as the joint U.S./South Korea joint exercise are over. It was a long letter, much of it complaining about the ridiculous and expensive exercises,” Mr. Trump wrote on Twitter Saturday morning. 

North Korea’s Foreign Ministry in a separate statement on Sunday blasted South Korea for continuing to host military drills with the United States, and said that its future dialogue will be held strictly between Pyongyang and Washington and not between the Koreas.

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South Korea’s military said the North on Saturday fired what appeared to be two short-range ballistic missiles. It said they flew about 248 miles before landing in waters between the Korean Peninsula and Japan. 

KCNA picture of North Korean leader Kim Jong Un guiding the test firing of a new weapon
North Korean leader Kim Jong Un guides the test firing of a new weapon, in this undated photo released on August 11, 2019 by North Korea’s Korean Central News Agency (KCNA).  KCNA / REUTERS

Kim expressed “great satisfaction” over the launches, which Pyongyang’s Korean Central News Agency said verified that the new weapon system performs as designed. The official Rodong Sinmun newspaper published several photos that showed Kim watching from an observation post and what appeared to be a missile soaring from a mobile launcher. 

The agency didn’t specify whether the weapons were ballistic missiles or rocket artillery, but said they were developed to suit the North’s “terrain condition” and provide “advantageous tactical character different from existing weapons systems.”

Kim Dong-yub, an analyst at Seoul’s Institute for Far Eastern Studies, said that North Korea’s photos and South Korea’s flight data of the launches suggest that the North tested a new weapon system that is different from the short-range ballistic missiles it repeatedly fired in recent weeks.

South Korea’s military had described the previous missiles as similar to the Russian-made Iskander, a solid-fuel, nuclear-capable missile that is highly maneuverable and travels on low trajectories, improving its chances of evading missile defense systems.

North Korea’s fifth round of weapons launches in less than three weeks was seen as a protest of the slow pace of nuclear negotiations and continuance of the U.S.-South Korea military drills the North claims are an invasion rehearsal.

Experts say Mr. Trump’s downplaying of the North’s launches allowed the country more room to intensify its testing activity while it seeks to build leverage ahead of a possible resumption of negotiations. Talks have stalled since the collapse of Mr. Trump’s second summit with Kim in Vietnam in February over disagreements on exchanging sanctions relief and disarmament, although Mr. Trump made a historic trip into North Korea after the G20 conference in June. 

By launching a slew of weapons that directly threaten South Korea but not the U.S. mainland or its Pacific territories, North Korea also appears to be dialing up pressure on Seoul to make stronger efforts to coax major concessions from the United States on Pyongyang’s behalf.

North Korea in recent months has ignored the South’s calls for dialogue while demanding that Seoul turn away from Washington and resume inter-Korean economic cooperation held back by U.S.-led sanctions against the North.

In a statement released through KCNA, Kwon Jong Gun, director of the U.S. affairs department at Pyongyang’s Foreign Ministry, criticized South Korea for raising concerns over the North’s recent testing activity while continuing the drills with the U.S.

The North also on Saturday lashed out at South Korea’s recent acquisition of U.S.-made F-35 fighter jets and other plans to expand its military capabilities, saying that the South will gain “nothing but destruction” if it pursues a contest of strength with the North.

“Though we are to enter into a dialogue in future as the currents flow in favor of dialogue, (the South) had better keep in mind that this dialogue would be held strictly between the D.P.R.K and the U.S., not between the North and the South,” Kwon said, referring to North Korea by its formal name, the Democratic People’s Republic of Korea.

“Given that the military exercise clearly puts us as an enemy in its concept, (the South) should think that an inter-Korean contact itself will be difficult to be made unless they put an end to such a military exercise or before they make a plausible excuse or an explanation in a sincere manner for conducting the military exercise,” Kwon said.

South Korea has said North Korea’s recent launches could hurt efforts to stabilize peace on the Korean Peninsula and called for the North to uphold an agreement to form a joint military committee to discuss reducing tensions, which was part of an inter-Korean military agreement reached last year.

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Pound Plunge May Test Johnson’s ‘Pain Threshold’: Commerzbank

(Bloomberg) — A deep and swift slump in the pound will prompt the U.K. government to rethink its approach to leaving the European Union without a divorce deal.

A plunge of about 10% in sterling in a short span of time may cause Prime Minister Boris Johnson’s cabinet to refrain from pursuing a no-deal exit, according to Commerzbank. A decline that takes the currency below $ 1.19 would leave markets in “uncharted waters”, says Manulife Asset Management that oversees almost $ 400 billion.

The pound, which has emerged as one of the loudest voices of opposition to the government’s handling of Brexit, has slumped more than 4% in July, set for the biggest monthly drop since October 2016, when the currency plunged in a one-minute flash crash. Prime Minister Boris Johnson, who took office earlier this month, hinted he may hold no negotiations with the European Union before the Brexit deadline on Oct. 31.

“We have seen from time to time that the market is able to put pressure on governments,” said Thu Lan Nguyen, a currency strategist at Commerbank AG. “Increasing market turmoil could put the government under pressure to refrain from a no-deal Brexit. As a pain threshold, I could imagine a depreciation just above 10% in a short time that takes the currency close to parity against euro.”

traded around $ 1.2150 on Tuesday, having touched $ 1.2119 earlier, its weakest since March 2017. The pound was at 91.61 pence per .

A messy departure from the EU has long been deemed the worst-case scenario by markets. Those fears crystallized after Johnson appointed Brexiteers to key government positions and demanded changes to the existing agreement with the EU, which Brussels has ruled out.

Still, some analysts say it’s a bit too early for the tremors in the pound to be upsetting the political calculations at 10 Downing Street.

“The government has a pain threshold, but we’re not there yet,” said Ned Rumpeltin, head of currency strategy at Toronto-Dominion Bank. “It’s too early into Johnson’s term for him to be seen as being brought to heel by the markets. It may not be a level, per se, but may be more a function of the speed with which the pound may collapse that attracts their attention.”

With lawmakers on recess until early September and the Bank of England silent before its policy decision on Thursday, investors say the currency is bound to fall further in the weeks to come.

“Ultimately it’s the pound that takes the Brexit strain,” said Grant Peterkin, a senior managing director at Manulife Asset Management which manages $ 386 billion in assets globally. “It’s the purest way to reflect the concerns financial markets have for the U.K. economy.”

Manulife Asset Management’s Absolute Return Rates Fund is betting on further declines in sterling. “Into the $ 1.19’s would be moving into relatively uncharted territory for cable,” Peterkin said.

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Top defense official suggests Russia violating nuclear test ban treaty

A top defense official suggested Russia might have illegally tested low-yield nuclear missiles, effectively violating a 1996 international ban on nuclear tests. 

Speaking Wednesday at the Hudson Institute, a Washington think tank, Lt. Gen. Robert P. Ashley Jr., director of the Defense Intelligence Agency (DIA), said the U.S. believes Russia “probably is not adhering to the nuclear testing moratorium.” The United Nations Comprehensive Nuclear Test Ban Treaty (CTBT) bans nuclear explosions of any size, for either civilian or military purposes.

“The U.S. has determined that Russia’s actions have strained key pillars of arms control architecture,” said Ashley. “Russia claims to be developing new warhead designs for strategic systems such as a new high-yield, earth-penetrating warhead to attack hardened military targets like the U.S. allied and Chinese Command and Control facilities.”

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Ashley contended that Russia’s current testing activities would help the country vastly improve its nuclear weapon capabilities. According to The Wall Street Journal, Trump administration officials say that view is also shared by other intelligence agencies in the U.S.

When pressed on the allegation by Journal reporter Michael Gordon, Ashley would only say Russia had the “capability” to conduct very low-yield nuclear tests, a capability which Russia, China and the United States have long possessed, according to the Arms Control Association. He did not say whether Russia has conducted or is conducting such tests.

“We believe they have the capability in the way they are set up,” Ashley said.

For years, Pentagon officials have been expecting the Russians to violate the treaty, according to CBS News’ David Martin, but Wednesday’s comments mark the first time the U.S. has explicitly said Moscow has failed to observe its commitments under the CTBT. The U.S. has signed but not ratified that treaty.

Critics of the pact, including national security adviser John Bolton, have said the treaty does not properly define a nuclear test and that other countries, including Russia and China, have a vastly different interpretation of what the treaty prohibits. Bolton previously claimed the CTBT offered “illusionary protections.”

The Kremlin responded to Wednesday’s remarks in kind.  

“The statement of the director of the United States Defense Intelligence Agency (DIA) about Russia’s alleged secret nuclear tests reveals the U.S. military’s declining professionalism,” head of the State Duma Defense Committee Vladimir Shamanov told Russia’s state-run Interfax news agency. 

“He just could not have made a more irresponsible statement. Nuclear tests cannot be carried out secretly with equipment, which is controlling these processes today,” Shamanov said Wednesday.

The U.S. has similarly accused Russia of violating the Intermediate-Range Nuclear Forces (INF) agreement. In February, President Trump said Washington was starting the process of withdrawing from the treaty in six months time. Many analysts say abandoning that 1987 treaty could effectively signal the start of a new arms race.

Asked what U.S. policy should be moving forward with regards to the escalating tensions with Russia, foreign policy expert Angela Stent of Georgetown University told CBS News senior national security contributor Michael Morell that the U.S. needs to have “realistic expectations” with Russia on arms control. 

“We have a major treaty that’s going to expire, the new START Treaty in 2021. These are areas where, as the world’s two nuclear superpowers with what, 93% of the weapons, we do need to work with the Russians,” Stent said on Morell’s podcast “Intelligence Matters.”

“We have to define narrowly where we need to work with them, and but not have any illusions about the fact that they’re going to move any closer to our view of the world than we have at the present,” she said.

Olivia Gazis and Tucker Reals contributed to this report. 

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A $19 Billion Test Is Coming Straight for China’s Battered Yuan

© Bloomberg. An employee counts Chinese one-hundred yuan banknotes for a photograph at the Korea Exchange Bank headquarters in Seoul, South Korea. Photographer:SeongJoon Cho/Bloomberg © Bloomberg. An employee counts Chinese one-hundred yuan banknotes for a photograph at the Korea Exchange Bank headquarters in Seoul, South Korea. Photographer:SeongJoon Cho/Bloomberg

(Bloomberg) — Sign up for Next China, a weekly email on where the nation stands now and where it’s going next.

China’s yuan, already battered by the U.S. trade dispute, will soon have a catalyst for further depreciation.

Offshore-listed Chinese companies will sell the yuan to buy foreign currencies and fund their $ 18.8 billion dividend bill due from June to August, according to Bloomberg calculations. While that’s less than last year’s $ 19.6 billion, the payments come at a sensitive time: the yuan is near its weakest this year and speculation is mounting it will fall to 7 per dollar, regarded as a key psychological level.

The has already dropped about 2.9% in May, making it one of the world’s worst-performing currencies. The spat with the U.S. has put the yuan under pressure because it is likely to hurt China’s economic growth and narrow its trade surplus, while there’s also the possibility the central bank will weaken the currency to offset the blow from tariffs. The U.S. increased levies on Chinese imports on May 10 and has threatened more.

Wall Street Turns More Bearish on Yuan as Trade War Worsens

“The yuan will face seasonal depreciation pressures,” said Tommy Ong, managing director for treasury and markets at DBS Hong Kong Ltd. “But a more important driver for the exchange rate is the trade talks. The currency may weaken towards 7 amid the negotiations, but won’t break that level as that would agitate the U.S.”

The peak for dividend payouts will come in July, when Chinese companies hand out $ 9.9 billion to shareholders. Pressure on the yuan could build before then as firms buy foreign-exchange to prepare themselves, though they might not need to if they already hold dollar reserves offshore.

Hong Kong-listed banks are among the biggest payers. China Construction Bank Corp. will hand out $ 4.2 billion in July, and Bank of China Ltd. will pay $ 2.1 billion, according to Bloomberg calculations based on exchange filings.

Beijing has moved to support the : the People’s Bank of China set its daily reference rate stronger than analysts and traders projected Monday. The offshore yuan was up 0.11% at 6.9417 per dollar as of 5:06 p.m. in Hong Kong, after touching as low as 6.9514 earlier in the day. The onshore rate strengthened 0.08%.

Foreign inflows to onshore stocks and bonds due to index inclusion could help partly offset the pressure that dividend payouts place on the yuan, said Alan Yip, a senior foreign-exchange strategist at Bank of East Asia Ltd. But the currency may still slide to as weak as 6.98 per dollar because of the trade war, he said.

Foreign investors’ holdings of onshore stocks and bonds stood at 3.5 trillion yuan ($ 506 billion) at the end of March, a 37% surge from a year earlier, according to official data. That figure is set to grow as MSCI Inc. adds more A shares to its gauges and after yuan bonds started to get included in a major global index in April.

(Updates the yuan’s moves.)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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SpaceX launches crew ship on historic test flight

Opening a new era in American spaceflight, a Falcon 9 rocket streaked into space early Saturday, boosting the company’s first Crew Dragon spacecraft into orbit on an unpiloted test flight, the first launch of a commercially developed capsule intended to carry astronauts to and from the International Space Station.

Lighting up the deep overnight sky for miles around, the rocket’s nine first stage engines ignited and throttled up to full thrust at 2:49 a.m. EST (GMT-5), generating 1.7 million pounds of thrust and quickly thundering skyward from launch complex 39A at the Kennedy Space Center.

Trailing a long jet of brilliant exhaust, the 215-foot-tall rocket smoothly accelerated as it shot away to the northeast, climbing directly into the plane of the International Space Station’s orbit. The lab complex passed over Florida 26 minutes before liftoff and was sailing 258 miles above Iraq at the moment of launch.

Looking on 3.2 miles from the launch pad in the SpaceX launch control room were astronauts Douglas Hurley and Robert Behnken, who plan to be aboard the next Crew Dragon when it takes off on the program’s second test flight in the mid-summer timeframe. That will be the first launch of American astronauts aboard a U.S. rocket since the shuttle program ended in 2011.

A SpaceX Falcon 9 rocket climbs away from the Kennedy Space Center early Saturday, kicking off a long-awaited unpiloted test of the company’s commercially built Crew Dragon capsule intended to ferry astronauts to and from the International Space Station starting later this year. NASA

“I can’t begin to explain to you how exciting it is for a test pilot to be on a first flight of a vehicle,” Hurley, a shuttle veteran and former Marine Corps F/A-18 test pilot, told reporters before launch. “We’ll be ready when SpaceX and NASA are ready for us to fly it.”

That will depend on how the unpiloted Crew Dragon does this week during the Commercial Crew Program’s initial launch, a flight intended to thoroughly test the spacecraft’s myriad systems before trusting it to carry astronauts.

“We’re going to test its navigation capabilities, we’re going to test avionics, telemetry, we’re going to test the reaction control system, its ability to dock, its ability to re-enter,” said NASA Administrator Jim Bridenstine. “We’re going to make assessments based on this about how it might need to be tweaked or changed.

“Eventually, we’re going to do a launch abort test as well. And then depending on how all of these tests go, we want to launch American astronauts on American rockets from American soil for the first time since the retirement of the space shuttle (in 2011).”

The mission got off to a spectacular start, thrilling thousands of tourists and area residents expected to gather along Florida’s “Space Coast.”

The first stage engines powered the Falcon 9 out of the thick lower atmosphere, shutting down about two-and-a-half minutes after liftoff. The stage then fell away and headed for landing on an off-shore droneship while the single engine powering the Falcon 9’s second stage continued the Crew Dragon’s climb to orbit.

The second stage engine shut down about nine minutes after launch, about a minute before the first stage settled to a pinpoint landing on the “Of Course I Still Love You” droneship, chalking up SpaceX’s 35th successful booster recovery.

A few moments later, the Crew Dragon capsule was released from the second stage, kicking off an automated 27-hour rendezvous with the space station. Bridenstine was thrilled, tweeting the launch opened a “new chapter in American excellence.”

If all goes well, the stubby capsule, carrying about 400 pounds of supplies and an instrumented astronaut test dummy nicknamed Ripley, after the heroine of the sci-fi thriller “Alien,” will catch up with the lab complex early Sunday, approaching from behind and below before looping up to a point directly ahead of the station.

ISS commander Oleg Kononenko, flight engineer Anne McClain and Canadian astronaut David Saint-Jacques will be standing by inside the outpost, closely monitoring the Crew Dragon’s trajectory and velocity to make sure it is performing as expected. They also plan to send commands to verify a station crew can abort an approach if necessary.

Once all of that is complete, the spacecraft will move in for a docking at the station’s forward port around 6 a.m. as the two vehicles pass over the Pacific Ocean northwest of Samoa at nearly five miles per second. Hatches will be opened about two hours later.

The ship will remain attached to the station until next Friday when it will undock, fire its braking rockets and head for a splashdown in the Atlantic Ocean 230 miles east of Cape Canaveral. Recovery crews will be stationed nearby to haul the capsule back to shore for extensive post-flight inspections.

A successful test flight, along with a critical in-flight test of the Falcon 9/Crew Dragon launch abort system in April, will help pave the way toward the first piloted test flight in the mid-July timeframe, ending an eight-year hiatus in NASA’s human space launch capability.

“This is an invaluable exercise for us to learn in the space environment how these systems will be working, and then making sure that these systems are ready to go for when we’re going to put our crews on,” Kathy Lueders, manager of NASA’s Commercial Crew Program, told reporters Thursday. “We instrumented the crap out of this vehicle.”

The Commercial Crew Program is the end result of a series of NASA-funded industry competitions in the wake of the shuttle’s retirement to develop a new American spacecraft to carry astronauts to and from low-Earth orbit.

NASA has awarded Boeing multiple contracts totaling $ 4.82 billion to develop a commercial crew ship now known as the CST-100 Starliner, a capsule that will launch from the Cape Canaveral Air Force Station atop a United Launch Alliance Atlas 5 rocket.

Spectators enjoy a spectacular view of the Falcon 9 climbing away from Florida’s “Space Coast” after a sky-lighting launch from the Kennedy Space Center. NASA

SpaceX also won a series of contracts totaling some $ 3.1 billion to date to develop a piloted version of the company’s Dragon cargo ship. The company holds a separate cargo contract valued at $ 3.04 billion for 20 space station resupply flights and another contract for an unspecified amount for at least six additional flights through 2024.

The NASA commercial crew contracts required both companies to provide funding of their own.

The Crew Dragon and CST-100 Starliner both will carry supplies and four astronauts at a time to the space station and both will approach the lab from directly ahead or above, docking at recently modified ports at the front end of the complex. The Starliner will return to a touchdown in the western United States while the Crew Dragon splashes down in the Atlantic Ocean east of Cape Canaveral.

Boeing plans to launch its CST-100 Starliner on an unpiloted test flight in the April-May timeframe. Assuming the uncrewed flights go well, along with remaining tests of each company’s launch abort system, SpaceX plans to launch Behnken and Hurley aboard another Crew Dragon in the mid-summer timeframe. That mission is known as Demo 2.

Boeing’s first piloted flight, carrying a crew of three, is expected this fall. If no major problems develop, operational crew rotation flights could begin before the end of the year, ending NASA’s sole reliance on Russian Soyuz spacecraft for rides to and from the station.

But NASA is hedging its bets. The final two U.S.-contracted seats on a Russian Soyuz spacecraft will be used in July to launch NASA astronaut Drew Morgan and Italian astronaut Luca Parmitano. NASA managers are exploring an option to buy two more Soyuz seats, one for use this fall and another next spring.

That would ensure American-sponsored astronauts in orbit aboard the station through most of next year even if the commercial crew program runs into major problems or delays in the test program.

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