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Airbus pulls anniversary book over fraud probe concerns

Airbus has halted sales of a new book that the planemaker had commissioned for its 50th anniversary to avoid hampering the manufacturer's attempts to win a settlement in a bribery probe, two people familiar with the matter said. The move is the latest sign of tension in Airbus as it nears the climax of a roughly $400 million, four-year internal probe carried out in support of an Anglo-French investigation into the use of intermediaries to win jetliner and other deals. Airbus has already fired more than 100 people over ethics and compliance issues as its probe has progressed. The book, "Airbus: The First 50 Years", written by former New York Times journalist Nicola Clark, charts the rise of Airbus against challenging odds to become a European rival to Boeing and has a chapter focusing on the probe. Sources said Airbus hoped to present its findings to the UK Serious Fraud Office and France's PNF police by the end of the year. By doing so, they said it would seek more leniency under a system of prosecution agreements that allows for heavy fines rather than charges that might bar it from public contracts. The two people said Airbus halted the book's sales because it was concerned its official links to the publication could hamper talks with the authorities or discussions over other litigation as it seeks a fresh start under new management. Airbus confirmed it had decided not to go ahead with the commissioned book, but denied any link to the bribery probe. It declined comment on the progress of the investigation itself. "We continue to co-operate in full with the ongoing investigation," an Airbus spokesman said. "The investigation and the book are two separate topics". Clark told Reuters she was "deeply disappointed with the very belated decision by Airbus to withdraw (the book)". UK-based publisher Urbane Publications declined to comment. The book stems from an unusual initiative launched in 2016 under which Airbus granted Clark unprecedented access and full independence to give an unvarnished account of 50 years of industrial co-operation just as Europe's political unity wavers. It was published on Amazon's Kindle service on May 29, half a century after Airbus was launched at a meeting of Franco-German founders including Roger Beteille, who died last month. The book was quickly withdrawn from online sale and plans to distribute already-printed copies at the Paris Airshow in June were scrapped at the last minute, casting confusion over the company's 50th anniversary celebrations. But copies have been circulating and a review was published by Leeham News, a website covering the aviation industry. Airbus said the version seen by the public was a draft. "The draft wasn't consistent with our ambition for celebrating 50 years of pioneering progress," the Airbus spokesman said. Clark said Airbus had not described the book as a draft before notifying her of the decision to withdraw it.

Ford, VW join forces on electric, autonomous cars

Ford Motor Co and Volkswagen AG joined forces to develop autonomous and electric cars on Friday and said they were also looking at other areas of cooperation, deepening a global alliance to slash development and manufacturing costs. Ford and VW have already started cooperating in the area of commercial vehicles as part of the auto industry's broader effort to redraw production and sales footprints to cope with more stringent regulation and fragmented markets. VW will invest $2.6 billion in Argo AI, Ford's self-driving cars venture, and will buy $500 million worth of Argo shares from Ford, giving the two automakers equal stakes in the startup. Ford also will build an electric car in Europe using VW's MEB electric vehicle platform, the companies said. "Our global alliance is beginning to demonstrate even greater promise, and we are continuing to look at other areas on which we might collaborate," VW's Chief Executive Herbert Diess said on Friday. Ford expects to build more than 600,000 electric vehicles in Europe over six years, sourcing components and the vehicle underpinnings from VW, helping both companies to drive down costs. VW said it had committed $7 billion to its MEB platform, which is expected to underpin 15 million vehicles worldwide from the VW group over the next decade. Analysts at Citi said Ford's licensing of Volkswagen's MEB platform was a "transformational" step for both companies. "It likely provides VW with an unassailable scale advantage," Citi analyst Angus Tweedie said in a note published on July 10. The broader alliance, which covers collaboration beyond joint investments in Argo AI, does not entail cross-ownership between the two companies. Ford created Ford Autonomous Vehicles LLC in 2018, pledging to invest $4 billion until 2023 and has sought outside investors to help share the spiraling cost of developing autonomous vehicles. Volkswagen will contribute its Autonomous Intelligent Driving (AID) company to Argo, which will boost the self-driving unit's employees to 700 from 500.

Trump to hold news conference on 2020 Census, citizenship question

U.S. President Donald Trump on Thursday will announce an executive action over his administration's effort to add a citizenship question to the 2020 census despite ongoing court challenges, two administration officials told Reuters. Trump, in a tweet, said he would hold a news conference about the census on Thursday afternoon. The White House said Trump would make remarks on citizenship and the census at 5 p.m. (2100 GMT). The administration's attempts to add the contentious question have been blocked in the courts because of challenges from some U.S. states and civil rights groups. The census is used to determine how many seats each state gets in the U.S. House of Representatives and also affects how billions of dollars in federal funds are doled out across the country. Critics say that asking about citizenship in the census discriminates against racial minorities and is aimed at giving Republicans an unfair advantage in elections. Trump and his supporters say it makes sense to know how many non-citizens are living in the country. The administration was still ironing out the details of the action, which was likely to be an executive order, one of the officials said. Trump and his administration's efforts to add a question to the nation's once-a-decade population survey have become embroiled in a legal fight not only over plaintiffs' opposition but also over the Department of Justice's handling of the cases. The case had already made its way to the U.S. Supreme Court, which last month ruled against the Republican president's first attempt to add the question, saying the administration's rationale was "contrived" but leaving the door open to its possible addition if officials could offer a new explanation. Since then, the Justice Department has sought to shake up its legal team by replacing the lawyers handling the case. On Wednesday, a second federal judge rejected the department's efforts, saying it had to offer detailed reasoning for the change. Attorneys within the Trump administration have been studying the census issue and intend to keep the president's order within the confines of the Supreme Court decision, but they are cognizant that whatever action he takes is likely to be challenged in court again. The U.S. Constitution specifically assigns the job of overseeing the census to Congress, limiting a president's authority, which could complicate any effort to add the question via presidential missive. Trump is insistent that the question be added to the census despite the legal challenges. Democratic U.S. Senator and 2020 presidential candidate Amy Klobuchar on Thursday said the Census should not ask about citizenship status and that Trump and his administration's were pushing it "for political reasons." "Now I guess you have the president looking for rational behind every painting and under every sofa in the Oval Office. But the truth is they don`t have a rational," she told MSNBC, adding that any executive action would likely be illegal.

Brazil cotton farmers sue Bayer over patent on GMO seed

Brazilian cotton producers in the state of Mato Grosso on Thursday sued Bayer AG, seeking to cancel the chemical company's patent protection for its Bollgard II RR Flex genetically modified cotton seed, according to a statement sent to Reuters. The farmers, hoping to regain $151 million in royalty payments, claim the genetically modified seed does not constitute a de facto technological innovation, according to the statement issued by the Mato Grosso Cotton Producers Association (AMPA). The lawsuit also names Brazil's national patents office as a defendant. Mato Grosso soybean farmers used a similar argument when they sued in Brazil to cancel patent rights over the widely used Intacta RR2 PRO seed. Sidney Pereira de Souza Jr., the attorney representing the farmers, confirmed that they were suing Bayer and the patent office, but would not comment further. Valor Econômico newspaper was first to report on the farmers' litigation plans on Thursday. In a statement, Bayer said it had not been formally notified of any patent dispute related to the Bollgard II RR Flex technology. Bayer noted that this cotton seed technology was quickly adopted by Brazilian cotton growers, and was the most used in Mato Grosso. AMPA said it will request a refund of $151 million worth of royalties that Mato Grosso farmers have already paid for use of the technology. "If the patent cancellation request is granted, aside from getting the refund, the cotton farmers will save $240 per hectare in the coming harvests," the statement said alluding to the royalties related to the seed. Bollgard II RR Flex combines resistance to insects and weed-killers. The technology was developed by U.S.-based Monsanto, a company taken over by Germany's Bayer in a $63 billion transaction. No binding ruling has been issued in relation to the Intacta patent dispute, a Bayer spokeswoman said by telephone.

Dollar Drops as Fed's Powell Flags Likely Rate Cut

The U.S. dollar fell on Wednesday after Federal Reserve Chairman Jerome Powell signaled a readiness to cut interest rates in response to "uncertainty" over the outlook for the U.S. economy. The prepared testimony was released by the Fed ahead of Powell’s appearance at the House Committee on Financial Services. Powell will elaborate on the comments later in the day. "Apparent progress on trade turned to greater uncertainty, and our contacts in business and agriculture reported heightened concerns over trade developments," Powell said, noting that business investment, an important component of economic growth, "seems to have slowed notably" in recent months. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell around a quarter of a percent following the release, extending the slight losses it had made earlier in the day. The greenback traded at 96.76 by 9:44 AM ET (13:44 GMT), compared to 97.07 ahead of the release. Powell indicated that overall growth has "moderated" and said "there is a risk that weak inflation will be even more persistent than we currently anticipate." The Fed chief's remarks were taken to imply that the U.S. central bank would be open to the 25 basis point cut that markets currently price in for the July 30-31 meeting. "Powell's dovishness took me by surprise as it's hard to understand how he can say that uncertainty has increased since the Fed's June policy meeting," Investing.com analyst Jesse Cohen said. "We got good news on the U.S.-China and U.S.-Mexico trade fronts as well as a strong jobs report... only thing that seemed to rise in uncertainty since June was Powell's job security." Gregory Daco, chief U.S. economist with Capital Economics, compared a 25 basis point move at the end of the month to an "immunization shot", which could be followed in September by another 25 basis point "booster shot" if the U.S. data on inflation and employment, along with the global economy, fail to respond.

Toyota to build new SUV, rather than car at Alabama plant

Toyota Motor Corp said on Wednesday it will build a new sport utility vehicle at a $1.6 billion joint venture assembly plant in Alabama rather than produce Corolla cars. The largest Japanese automaker announced in January 2018 would build the factory in Alabama with Mazda Motor Corp. Toyota, which said the shift was due to "a growing consumer appetite for light trucks and SUVs," still expects to start production in 2021. Last week, the company said U.S. Corolla sales fell 5% in the first six months to 152,868, while overall Toyota car sales fell 8%. Its U.S. SUV sales only fell 1% over the same period. In recent years, American vehicle buyers have dramatically shifted away from cars to crossovers, SUVs and pickup trucks. Still, U.S. auto industry sales have been declining, and there is some concern the new plant could exacerbate overcapacity and pressure vehicle prices. U.S. new vehicle sales fell 2.2% in the first half of 2019. Toyota will continue to build Corolla cars at its Mississippi plant. Mazda said previously it would build a new SUV at the joint venture plant that will assemble up to 300,000 vehicles annually. The plant is on a 2,500-acre site about 14 miles from Toyota’s engine plant in Huntsville, Alabama. Among U.S. states, Alabama is already the fifth largest producer of cars and light trucks. The state has more than 150 major auto suppliers and 57,000 automotive manufacturing jobs. Early in 2017, then-President-elect Donald Trump criticized Toyota and threatened hefty tariffs against the Japanese automaker if it built its Corolla sedan for the U.S. market in Mexico. Toyota said in October 2017 it would shift production of Corollas from Canada to the new venture rather than Guanajuato, and would build Tacoma pickups in Mexico instead. Toyota will now rely on its Mississippi plant and Japan for Corolla production, a spokesman said.

Gold Prices Held Steady Despite Signs of Economic Woes

Even with stocks heading lower on Monday, safe-haven gold seemed unable to take advantage of further indications of global economic malaise as investors turned cautious ahead of key references for the Federal Reserve’s next policy decision. Gold futures for August delivery on the Comex division of the New York Mercantile Exchange, dipped $1.05, or 0.1%, to $1,399.05 a troy ounce by 10:42 AM ET (14:42 GMT). In a session bereft of major economic reports in the U.S., Japan’s core machinery orders fell by the most in eight months in a worrying sign that global trade tensions are taking a toll on corporate investment. Although German industrial production showed a meager recovery in May, the meager growth was still weaker than expected, failing to erase concerns over the slowdown in the euro zone’s largest economy. “The upside: the German economy is not falling off a cliff. The downside: the relief is too feeble to justify any optimism,” Carsten Brzeski, chief economist at ING in Germany, said in a note. Following the strong U.S. employment report that reduced expectations for aggressive easing from the Fed, markets turned their attention to a busy week in references for the next policy decision at the end of the month. With no fewer than 10 policymakers on this week’s agenda, the focus will likely be on Fed Chairman Jerome Powell’s testimony to Congress on both Wednesday and Thursday. With Fed funds futures fully pricing in a quarter-point reduction to interest rates at the July 30-31 meeting, Powell will have the opportunity to send a clearer to message to markets on the Fed’s intentions. In other metals trading, silver futures rose 0.5% to $15.0683 a troy ounce by 10:47 AM ET (14:47 GMT). Palladium futures fell 0.6% to $1,555.35 an ounce, while sister metal platinum gained 1.4% to $822.80. In base metals, copper traded up 0.2% to $2.667 a pound.

Russian Rate Cut on July’s Agenda as Inflation Surprises

Inflation in Russia is decelerating more sharply than Bloomberg Economics expected, while the weakness in demand appears to be lingering. BE now sees the central bank favoring a rate cut at its July 26 meeting, bringing forward the easing previously anticipated for September. Food costs drove the bigger-than-forecast decline, but broader price pressure has been soft for several months. To contact the staff on this story: Scott Johnson (Economist) in London at This email address is being protected from spambots. You need JavaScript enabled to view it. To contact the editor responsible for this story: Zoe Schneeweiss at This email address is being protected from spambots. You need JavaScript enabled to view it.

TIM to extend 5G services to six more Italian cities by year-end

Italy's biggest phone company, Telecom Italia, plans to extend 5G services to six more Italian cities as well as dozens of tourist spots and business hubs by the end of the year. The former monopoly unveiled its 5G mobile services plan on Friday. It is also negotiating with rival Vodafone to share 5G infrastructure to deliver services at a lower cost across wider areas of the country. TIM has already begun 5G services in Rome, Turin and Naples, is testing them in southern cities of Matera and Bari and plans to move next in Milan, Bologna, Verona and Florence by year-end. The group plans to cover 120 Italian cities within two years, or 22% of the population, it said in a statement. TIM will offer tiered data-download packages to consumers and business clients, rather than unlimited data plans, according to details of its offers outlined on Friday.

Trump repeats call for Fed to lower interest rates

U.S. President Donald Trump on Friday repeated his call for the Federal Reserve to lower interest rates, saying that such a step would further boost the economy. In comments made to reporters outside the White House, Trump also touted the country's low unemployment rate of 3.7% and the 224,000 jobs added last month, in figures released by the Labor Department on Friday. Trump has repeatedly railed against the central bank for hiking interest rates and against the Fed's chairman, Jerome Powell, whom Trump nominated, in particular. Fed officials, in turn, have argued that last year's rate hikes were a proper precaution against inflation or financial sector bubbles. But Fed officials' sentiment began shifting in May, amid concerns that Trump's trade policy was beginning to undermine economic sentiment, business investment and growth. Fed officials are poised to cut rates by as much as half a percentage point by the end of the year.