Euro zone bank profitability may weaken on slowdown: ECB

© Reuters. FILE PHOTO: Governing Council of the ECB monetary policy meeting in Vilnius © Reuters. FILE PHOTO: Governing Council of the ECB monetary policy meeting in Vilnius

FRANKFURT (Reuters) – Profitability across the euro zone bank sector is low and weakening growth could further dampen the sector’s prospects, European Central Bank Vice President Luis de Guindos said on Tuesday.

Negative ECB rates are not the cause of the weakness as super easy monetary policy has so far had a neutral effect on bank profits, de Guindos told a conference in Rome.

“Nevertheless, the overall effects of negative rates on the banking sector need to be carefully monitored, particularly because the balance of their effects will depend on how long rates remain in negative territory,” he added.

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YOUR MONEY – Do the math before you pick the expensive school zone

© Reuters.  YOUR MONEY - Do the math before you pick the expensive school zone © Reuters. YOUR MONEY – Do the math before you pick the expensive school zone

By Chris Taylor

NEW YORK (Reuters) – For John Bohnsack, it was a classic parental dilemma: Get a small, expensive house in a high-quality school district, or pay less and get more house in a worse neighborhood.

The financial planner, 34, and his wife opted for the better school district in College Station, Texas, a university town that is home to Texas A&M. His two girls, 5 and 8, are thriving.

“It comes down to your values: Is it worth it?” said Bohnsack, who estimates their monthly payment is about 10% higher than it would be for comparable homes in lower-performing school districts nearby.

The choice is not an easy one, but it is common across the United States. A whopping 58% of parents admit they are paying more for rent or their mortgage to be in a good school district, according to the latest “Parents, Kids & Money” survey by Baltimore money managers T. Rowe Price.

“People recognize that there is a trade-off involved,” said Stuart Ritter, senior financial planner with T. Rowe Price. “School zone is important, but at the same time, it has to be integrated with other financial goals too.”

Getting into a good school zone affected 42% of families’ finances to a “considerable” degree, the T. Rowe Price survey found, while 20% said it was more like an “extreme” amount. That takes away from other necessities like funding retirement or the kids’ college fund.

For parents, the trick is to strike the right balance.

Some tips:

* Research school quality.

The rankings site Niche.com puts out a report of best national school districts (https://www.niche.com/k12/search/best-school-districts/). Its top performers in 2019: Jericho, New York, Solon, Ohio, and West Lafayette, Indiana.

At the site GreatSchools.org, parents can crunch the numbers to discover which schools may be a good fit.

Beyond general rankings, you can add your own screens for factors that are critical to you. You may be most concerned with student-teacher ratio, graduation rates or special-needs services, so drill down into what matters most.

Then follow up with in-person work, suggests GreatSchools spokesperson Carrie Goux. Visit on-site, talk to other parents and read reviews, all of which give you valuable insights that numbers may not.

* Compare with housing prices.

The real estate site HomeUnion went a step further and combined affordable zip codes with the best public schools around the country. Its nationwide winners for 2017 were: Blue Springs, Missouri; Tuttle, Oklahoma; Fenton, Missouri and Boca Raton, Florida – all of which offer average single-family housing prices under $ 200,000.

For average home prices in your local zip codes, check out sites like Zillow.com or Trulia.com.

* Think outside the box.

If a particular school district is terrific but it’s just too expensive to live in, then you may need to look at other options. High-performing kids may test into schools that are outside of their home districts, for instance.

You may also make the determination that it is cheaper to live in a more affordable neighborhood, but then look at charter-school options or pay for a private education.

Average annual K-12 private-school tuition for 2018-19 is $ 10,671, according to the site Private School Review. It’s $ 9,631 for elementary school, and $ 14,575 for high school. Over 12 years, if the differential in house prices is more than $ 150,000, it might be worth it.

* Keep your head.

Realize that if you are paying more to get into a good school district, that gives you less financial flexibility, and you will likely have to cut back in other areas. In the T. Rowe Price survey, almost one in 10 parents said more than 50% of their income is going toward rent or mortgage – that is a lot of money.

On the plus side, if you do locate in a prime school zone, that will help you when the time comes to sell. According to Zillow’s 2018 Consumer Housing Trends Report, a home in a preferred school district is very or extremely important to a whopping 66% of buyers with kids. That is enough to make anyone house proud.

(The writer is a Reuters contributor. The opinions expressed are his own.)

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ECB Pushes Back Bank Rate Hike Again as Trade War Hits Euro Zone

© Reuters.  © Reuters.

Investing.com — The European Central Bank again pushed back the date when it will start to consider raising interest rates, effectively acknowledging that the global slowdown largely started by the U.S.-China trade dispute is undermining the Eurozone economy too.

However, the bank chose not to reintroduce the possibility of another interest rate cut into its forward guidance. That raises the likelihood that the euro’s interest rate differential with the dollar will narrow in the future, given that the Federal Reserve appears to be pivoting to a looser policy stance.

In a statement, the ECB said that “the Governing Council expects the key ECB interest rates to remain at their present levels at least through the first half of 2020.”

It’s the second straight meeting that the ECB has extended the timeframe for its first hike since 2011. At its last meeting, it had pushed out the timing from September to the end of 2019. The new stance means that whoever replaces Mario Draghi as president of the ECB in November will find it near impossible to move the bank’s interest rates for at least eight months.

“The biggest news for markets is not that the ECB won’t hike, but that the ECB won’t *cut* rates over the next 12 months,” said Pictet Asset Management economic Frederik Ducrozet via Twitter.

In addition, the bank said it would price its new round of “Targeted Long-Term Refinancing Operations”, or TLTROs, which begins in September, at as little as 10 basis points over its deposit rate, which is currently at -0.40%. The precise rate will vary, depending on how much banks lend on to companies and households.

The reacted by rising around one-third of a cent against the dollar, hitting an intra-day high of $ 1.1271, while the yield on the benchmark rose by 2 basis points to -0.21%, having been close to a new all-time low immediately before the decision.

“ECB forward guidance change was the big underpriced risk today and it has now materialized,” said Lena Komileva, chief executive of G+ economics. “Once again, Draghi’s ECB has moved ahead of the markets’ expected timeline.”

As expected, the ECB left its official interest rates all unchanged. The deposit rate has been at -0.4% and the key refinancing rate has been at 0% since March 2016.

President Mario Draghi will expand on the decision at his press conference, which begins at 8.30 AM ET (1230 GMT).

Draghi is also due to unveil the ECB’s updated forecasts for growth and inflation for the next two years.

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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Human traffic jam atop Mount Everest’s “death zone”

Last Updated May 24, 2019 7:39 PM EDT

Two more climbers died Friday on Mount Everest, becoming the eighth and ninth people to die there since last week. That’s more than all of last year.

The deaths come amid massive crowding near the summit of the world’s highest peak.

It’s a human traffic jam at the top of Mount Everest as hundreds of climbers wait hours for their chance to stand at the top of the world. Lukas Furtenbach reached the summit Thursday, he’s still climbing down.

“It was very crowded,” Furtenbach said. “We are here every year and I’ve never seen such a year. We lost about three hours waiting at the most difficult part of the rock.”

Climbers call the area above 26,000 feet the “death zone,” because the air is so thin. Most need supplemental oxygen.

“And that’s very dangerous if you run out of oxygen, you can die within a couple of hours,” Furtenbach said.

So far this season, at least nine climbers have died on everest, more than all of last year. Almost all died coming down from the traffic jam at the summit. 

Experienced Everest climbers said it’s particularly busy this year, because weather conditions provided only five days where the skies were clear enough to summit.

“Everybody is sharing weather forecasts,” said Alan Arnette.  “And in the end everybody goes for the summit at the same time.”

Arnette climbed everest in 2011 and he now chronicles climbers on his blog

“The human body was not designed to survive above 26,000 feet,” Arnette said. “You are just getting weaker my the minute. So in that respect the crowds are certainly a contributing factor to these deaths.”

Most of the bodies will remain on Mount Everest — a solemn reminder to future climbers.

© 2019 CBS Interactive Inc. All Rights Reserved.

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Euro buoyant on improved economic views, awaits euro zone PMI

© Reuters. FILE PHOTO: U.S. dollar and Euro banknotes are seen in this picture illustration © Reuters. FILE PHOTO: U.S. dollar and Euro banknotes are seen in this picture illustration

By Shinichi Saoshiro

TOKYO (Reuters) – The euro was buoyant on Thursday after more evidence of strength in China improved the outlook for the global economy, with the market looking next to European indicators to provide the currency with a further boost.

The euro was a shade higher at $ 1.1298, having eked out a gain of 0.1 percent the previous day.

The single currency has steadily recovered from a recent low of $ 1.1183 plumbed at the start of April.

The euro was lifted after data on Wednesday showed China’s economy grew at a steady 6.4 percent pace in the first quarter, defying expectations for a further slowdown, as industrial production surged and consumer demand showed signs of improvement.

“A recovering Chinese economy is also good news for the German economy, and thus positive for the euro. The ongoing surge in bund yields amid ‘risk on’ is a key factor supporting the euro,” said Junichi Ishikawa, senior FX strategist at IG Securities in Tokyo.

The 10-year German bund yield rose to a one-month high of 0.10 percent overnight, in a sharp rebound from a 2-1/2-year low of minus 0.094 percent set at the end of March.

Bund yields had sunk in March as concerns about slowing global growth gripped the broader market. Investors are now watching Chinese and European economic data for signs that the global economy is performing better than initially feared.

The Purchasing Managers Indexes (PMIs) for the manufacturing and service sectors in Europe due later on Thursday will provide the next indication of strength for the European economy.

“Data from China cleared the way for the euro, which needs follow through support in the form of strong euro zone indicators,” Ishikawa at IG Securities said.

The against a basket of six major currencies was flat at 97.015 after dipping 0.05 percent the previous day.

The U.S. currency was steady at 112.035 yen after briefly touching a four-month peak of 112.17 on Wednesday amid a bounce in U.S. Treasury yields to a one-month high.

Commodity-linked currencies sagged after a surge in prices ran out of steam.

The Canadian dollar stood at C$ 1.3352 per dollar, having pulled back from a one-month high of C$ 1.3275 brushed on Wednesday.

The Australian dollar was down 0.1 percent at $ 0.7173 after popping up to a two-month peak of $ 0.7206 the previous day in response to the stronger-than-expected Chinese economic growth data.

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.

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Major currencies tread water ahead of euro zone, China data

© Reuters. FILE PHOTO:  U.S. dollars and other world currencies lie in a charity receptacle at Pearson international airport in Toronto © Reuters. FILE PHOTO: U.S. dollars and other world currencies lie in a charity receptacle at Pearson international airport in Toronto

By Daniel Leussink

TOKYO (Reuters) – Major currencies remained confined to well-trodden ranges on Tuesday, as markets look next to European and Chinese data for more evidence that the worst may be over for the global economy.

The yen remained close to 2019 lows against the U.S. and Australian dollars after investors reduced exposure to the safe-haven currency to seek higher yields elsewhere.

The Japanese currency has fallen against both units after rising to recent highs in late March, said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.

“That’s probably because the market’s concern about the global economy is easing and also the U.S.-China trade war will not intensify further,” he said.

The dollar was unchanged at 112.00 yen, holding above its 200-day moving average for the fourth straight session.

It traded less than a sixth of a percent off the year’s high of 112.135 yen hit in early March.

The was basically flat at 80.35 yen, also trading above its 200-day moving average, for the third session, after last breaching the key technical level in December last year.

The data in focus includes Germany’s ZEW economic index for April, due around 0900 GMT, and China’s gross domestic product set for Wednesday, which is expected to offer more insight on the health of the world’s second-largest economy. Chinese exports and credit data last week signaled some stabilization, prompting markets to adjust their outlook on global growth.

Market participants eyed European manufacturing data due on Thursday for cues on whether growth in that region is improving.

The euro was steady at $ 1.1307 after inching up less than a tenth of a percent overnight.

The last stood at 96.932 after ending the previous session basically unchanged.

Investors also kept their focus on trade issues, including talks between Japanese Economy Minister Toshimitsu Motegi and U.S. Trade Representative Robert Lighthizer.

Motegi said late on Monday both sides had confirmed that new bilateral trade talks would proceed based on the two nations’ joint statement issued last September. Motegi and Lighthizer are slated to continue their talks on Tuesday.

Meanwhile, U.S. Treasury Secretary Steven Mnuchin said over the weekend he hoped Sino-U.S. trade negotiations were close to their final round.

Reuters reported on Sunday that U.S. negotiators had tempered demands that China curb industrial subsidies as a condition for a trade deal after strong resistance from Beijing.

The Australian dollar, a barometer of investor sentiment, was unchanged at $ 0.7174, hovering close to a near seven-week high brushed on Friday.

Mizuho’s Yamamoto said traders were unwinding bets on two interest rate cuts in 2019 by Australia’s central bank to counter the country’s slowing economic growth.

“The unwinding of that expectation is happening now. That’s why it’s supporting the Australian dollar,” he said.

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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