Germany suspects ‘targeted attack’ on Russian gas pipeline – media — RT Business News

Berlin suspects the leak that caused Nord Stream to lose pressure may not be a coincidence

While the loss of pressure in three natural gas pipelines between Russia and Germany is still officially being investigated, Berlin is reportedly no longer convinced it was a coincidence, and suspects a “targeted attack” on behalf of either Ukraine or Russia, the newspaper Tagesspiegel reported on Monday evening. 

Pressure in one of the Nord Stream 2 lines dropped sharply overnight, followed by the same happening to both Nord Stream 1 pipes on Monday afternoon. Denmark announced that a gas leak was spotted off the coast of Bornholm island in the Baltic Sea and closed the area for maritime traffic, but could not confirm if this was what caused the pressure loss.

According to Tagesspiegel, the German government and agencies investigating the incident “can’t imagine a scenario that isn’t a targeted attack,” according to an anonymous source familiar with their assessments. “Everything speaks against a coincidence.”

The outlet explained that a deliberate attack on the bottom of the sea has to involve special forces, navy divers or a submarine. Berlin is reportedly examining two possible scenarios. In the first, Ukraine or “Ukraine-affiliated forces” could be behind the attack. The second option is that Russia did it as a “false flag,” to make Ukraine look bad and drive the EU energy prices even higher.

With Nord Stream offline since late August, Russian gas can only be delivered to Germany and central Europe via the older pipelines going through Poland and Ukraine, Tagesspiegel noted. 

“We are in the process of clarifying the situation here,” a spokeswoman for the federal ministry of economics told the outlet. “We don’t currently know what caused the pressure drop.”

Nord Stream 1 was built in 2011. Construction on Nord Stream 2 began in 2018, and took much longer due to political pressure and economic sanctions from the US. NS2 was finished and pressurized by September 2021. However, two days prior to Russia’s military operation in Ukraine, the German government put its certification on indefinite hold, and has categorically refused any suggestion from Moscow – or its own people – to unblock the pipeline.

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King Charles banknote design revealed by end of year – but when can you get your hands on the real thing? | UK News

Images of banknotes featuring a portrait of the King will be revealed by the end of this year – but the public won’t be able to get their hands on the cash until 2024.

Under the Bank of England plans, coins and banknotes featuring King Charles III and Queen Elizabeth II will co-circulate.

Currency featuring the Queen will be replaced over time as coins and notes become damaged or worn.

The Royal Mint said that coins bearing the effigy of the King will enter circulation in line with demand from banks and post offices, and will circulate alongside coins featuring the Queen “for many years to come”.

Anne Jessopp, chief executive officer of the Royal Mint, said: “We are honoured to have struck each UK coin of her late majesty’s reign, documenting her journey from young Queen to respected head of state.

“As official coin makers to the UK, we have told the story of each monarch since Alfred the Great and are now preparing for the biggest change in British coinage for several decades.

“The first coins bearing the effigy of His Majesty King Charles III will enter circulation in line with demand from banks and post offices.

“This means the coinage of King Charles III and Queen Elizabeth II will co-circulate in the UK for many years to come.”

New banknotes featuring King Charles are expected to enter circulation by mid-2024 and his portrait will appear on existing designs of the £5, £10, £20 and £50.

The Bank of England has a gloomy forecast for the economy in 2022.

This will be a continuation of the current polymer series and no additional changes to the banknote designs will be made, the Bank of England said.

Current banknotes featuring the portrait of the Queen will continue to be legal tender and will only be removed from circulation once they become worn or damaged, meaning they will co-circulate with those featuring Charles.

The Royal Mint said it will unveil further details about coins featuring the King over the coming weeks.

Meanwhile, all UK coins bearing the effigy of the Queen will remain legal tender and in active circulation, the Mint said.

There are around 27 billion coins currently circulating in the UK bearing the effigy of the Queen. These will be replaced over time as they become damaged or worn, and to meet demand for additional coins.

Historically it has been commonplace for coins featuring the effigies of different monarchs to co-circulate.

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Gas leak found on blocked Russian pipeline — RT Business News

Danish authorities spotted a breach near Bornholm after Nord Stream 1 and 2 lost pressure 

Denmark has observed a gas leak near the island of Bornholm in the Baltic Sea and closed the immediate area for traffic, state media reported on Monday. The discovery comes after the Russo-German Nord Stream 2 pipeline suffered a drastic loss of pressure overnight.

“A gas leak is observed at position 54° 52.60’N – 015° 24.60’E,” the Danish Maritime Authority said in a notice to mariners, warning of a “danger to navigation.”

Denmark also closed the area in the radius of five nautical miles (9.26 kilometers) around the site, which is just southeast of Bornholm.

The location is now under investigation, but it has not yet been confirmed if the leak is behind the sudden drop of pressure in the Nord Stream 2 pipeline, the Danish public broadcaster DR reported.

As of Monday evening, pressure has also dropped in both lines of the older Nord Stream 1, Forbes reported, citing the pipeline operator. The cause of the drop was still under investigation.

Nord Stream 1 was built in 2011, enabling Russia to deliver natural gas directly to Germany without having to rely on transit through Ukraine or Poland. Construction on Nord Stream 2 began in 2018, but was hampered by political pressure – and economic sanctions – from the US. The pipeline was finished and pressurized by September 2021.

On February 22 – prior to Russia’s military operation in Ukraine – the government in Berlin placed an indefinite hold on the certification of Nord Stream 2. Since then, Germany has categorically refused any suggestion from Moscow – or its own people – to stop blocking the pipeline.

Meanwhile, the volume of gas supplied through NS1 has dropped, due to what Moscow said were technical issues made worse by the anti-Russian sanctions.

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Mortgages withdrawn from sale as market reels after mini-budget | Business News

The market turmoil caused by Friday’s seismic mini-budget has hit mortgage offerings as providers withdrew partial and entire lending ranges.

Virgin Money and Skipton Building Society have temporarily withdrawn their entire mortgage product range, while Halifax, the country’s largest mortgage lender, said it is to remove fee-paying mortgages.

Fee-paying mortgages allow borrowers to pay a fee in exchange for a lower interest rate.

Britons warned of 6% interest rates – live updates

Halifax’s changes are to take effect on Wednesday, while the Virgin Money and Skipton Building Society decisions have already taken effect.

Chancellor Kwasi Kwarteng’s announcement of the most extensive programme of tax cuts for 50 years, and the associated market upset, has traders expecting that the Bank of England will raise interest rates to 6% – even higher than it outlined last Thursday.

On Monday, the Bank fuelled those fears when, in a surprise statement, it said it “will not hesitate to change interest rates as necessary”.

That uncertainty around the future of rate rises has caused the withdrawal, one broker told Reuters.

“The uncertainty around the risk of an emergency rate rise is likely to see other lenders withdrawing products or increasing rates dramatically until they know the extent of how this all pans out,” Jamie Lennox, a director at Dimora Mortgages, said.

Read more:
Five reasons why pound’s ‘doom loop’ matters to you
Could mini-budget bankrupt UK? Your questions answered

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Why has the pound fallen to a record low?

Parent company Lloyds said Halifax was making the changes to its mortgage product offering “as a result of significant changes in the cost of funding”.

Virgin Money made its decision “given market conditions”, a spokesman said in a statement, with already submitted applications to be processed as normal.

The provider said it hopes to launch new products towards the end of the week.

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Worst bond market crash in over 70 years coming – Bloomberg — RT Business News

The central banks’ aggressive interest rate hikes could cause a heavy selloff, strategists reportedly warn

Global government bonds are on course for their worst performance since 1949 as losses mount in the face of aggressive central banks, Bloomberg reported over the weekend citing Bank of America projections.

According to the report, the escalating losses reflect how far the US Federal Reserve and other central banks have shifted away from the monetary policies of the Covid pandemic, when they held rates near zero to keep their economies going. The reversal has hit everything from stock prices to oil as investors brace for an economic slowdown.

On Friday, the UK’s five-year bonds plummeted by the most since 1992 after the government rolled out a massive tax-cut plan. Two-year US Treasuries are in the middle of the longest losing streak since at least 1976, falling for 12 straight days.

“Bottom line, all those years of central bank interest-rate suppression – poof, gone,” Peter Boockvar, chief investment officer at Bleakley Advisory Group told the media outlet. “These bonds are trading like emerging market bonds, and the biggest financial bubble in the history of bubbles, that of sovereign bonds, continues to deflate,” he explained.

The Fed raised its policy-rate range to 3.25% on Wednesday, which is its third straight 75-basis-point hike, hinting further increases beyond 4.5%.

“With more Fed rate hiking coming and quantitative tightening, as well as the possibly more government debt issuance down the road amid less Treasury buyers out there now, it all just means higher rates,” managing director at Mischler Financial Glen Capelo said, adding: “The 10-year yield is definitely going to get closer to 4%.”

According to Bloomberg, in the coming week the market may face fresh volatility from the release of inflation data and public speaking engagements by Fed officials. Also, the sale of new two-, five- and seven-year Treasuries will likely spur trading volatility in those benchmarks, it reports.

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Rush to deposit paper £20 and £50 banknotes ahead of deadline to remove them as legal tender | UK News

UK Post Offices are expecting a “last moment” influx of customers depositing paper £20 and £50 banknotes this week before they can no longer be used in shops.

Friday 30 September is the deadline that the Bank of England’s paper notes will have legal tender status.

After that date, only polymer banknotes will be acceptable in shops or to pay businesses.

So far, £1.2bn of paper banknotes have been deposited at the Post Office’s 11,500 branches – £372m of £20 notes and £820m of £50.

More than £100m of the notes have already been deposited this month.

Martin Kearsley, Post Office banking director, said: “We’re fully aware that people lead busy lives and some may put off depositing their paper £20 and £50 banknotes until the last moment.

“Postmasters and their staff are on hand to provide that human reassurance that your old notes have been deposited into your bank account and will provide a receipt too. Most Post Offices are open long hours including on Friday.”

However, even after the deadline if you have a UK bank account you will still be able to deposit old paper banknotes at your bank branch or at a Post Office.

The new £20 note features artist JMW Turner, whilst the new £50 note features Bletchley Park codebreaker Alan Turing.

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Oil prices slump on recession fears — RT Business News

Oil prices were on a downslide on Monday, falling to their lowest level since the start of the year, trading data shows.

The European benchmark, Brent crude oil futures for November, dropped in price by 2.4% to $84.55 a barrel on the London Intercontinental Exchange. Brent slid below $85 per barrel for the first time since January 14.

The US benchmark, West Texas Intermediate crude fell by 2.6% to $77.24 per barrel, its lowest since January 6.

Analysts who spoke to news outlet RBK said the current decline in oil prices is occurring against the backdrop of a stronger US dollar, the anticipation of further interest-rate hikes by global central banks, and recession fears.

Rising interest rates could lead to the deterioration of the global economy and to recession, which would lower fuel demand, while a stronger US dollar limits the ability of non-dollar consumers to buy oil, analysts explain.

A backdrop of global monetary policy tightening by the key central banks to quell elevated inflation, and a splendid run-up in the greenback towards more than two-decade highs, has raised concerns about an economic slowdown and is acting as a key headwind for crude prices,” Sugandha Sachdeva, vice president of commodity research at Religare Broking, told Reuters.

The markets are now waiting for the next meeting of the Organization of the Petroleum Exporting Countries and allies (OPEC+), scheduled for October 5. Currently, the group is producing below its targeted output, having missed its target by 3.58 million barrels per day in August.

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OECD predicts $2.8trn hit to global economy next year with UK flatlining entirely | Business News

The global economy will suffer a $2.8trn (£2.6trn) hit next year in the wake of Russia’s war in Ukraine, according to an international policy forum that is predicting zero growth for the UK.

The Organisation for Economic Cooperation and Development (OECD) said its projection for lost output worldwide was based on a comparison between its pre-invasion forecast and its latest projections.

The report said economic growth worldwide was slowing more than expected as energy prices spike and the resulting inflation crisis takes its toll on demand.

While global growth this year was still expected at 3%, it is now projected to slow to 2.2% in 2023.

That was down from a forecast in June of 2.8% – with Europe accounting for much of the decline.

The OECD was particularly gloomy about Germany’s Russian-gas dependent economy, forecasting it would contract 0.7% next year, slashed from a June estimate for 1.7% growth.

The report warned that further disruption to energy provision in the EU would push many countries into recession.

The UK, which opened its economy earlier than most following COVID restrictions, may already be in recession if Bank of England projections last week are realised in official data.

The OECD said it expected the UK to grow by 3.4% in 2022 – above the international average – as a whole but that achieving growth in gross domestic product (GDP) next year would be difficult.

It called on those governments that were increasing support packages to help households and businesses cope with high inflation, to target those most in need and keep such programmes under review so as not to place undue pressure on borrowing.

It issued the forecast at a time of market turmoil that saw the pound hit a record low against the dollar early on Monday.

The slump in confidence, which began on Friday after the publication of the government’s growth plan, was also widely reflected on the bond markets with investors demanding rates of return for government borrowing not seen since the financial crisis of 2008.

OECD secretary-general Mathias Cormann said of the outlook: “The global economy has lost momentum in the wake of Russia’s unprovoked, unjustifiable and illegal war of aggression against Ukraine.

“GDP growth has stalled in many economies and economic indicators point to an extended slowdown.”

The report also predicted a downturn for the United States as the Federal Reserve raises its core interest rate range to get a grip on inflation.

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Pound crashes to all-time low — RT Business News

The British pound sterling plunged nearly 5% to an all-time low against the US dollar on Monday. The currency lost as much as 4.85%, dropping to an unprecedented $1.0327 and extending a 3.61% plunge recorded on Friday.

Market analysts say the drop has been brought about by the announcement of a ‘mini-budget’ last week by finance minister Kwasi Kwarteng, which entails historic tax cuts and the biggest increase in borrowing in over 50 years.

Sterling is in the firing line as traders are turning their backs on all things British. There is a creeping feeling the extra government borrowing that is in the pipeline will severely weigh on the UK economy,” David Madden, a market analyst at Equiti Capital, told The Guardian.

The announcement, which came a day after the Bank of England hiked interest rates to rein in inflation, is viewed as jeopardizing the financial credibility of the government. A weaker pound pushes up the cost of imports, which in turn adds to medium-term inflationary pressures. Many analysts claim that, for the majority of British people, much of the help from tax cuts will be swallowed up by higher energy bills, as well as higher mortgage and borrowing costs.

Some economists predict that the pound’s plunge could force the Bank of England to raise interest rates to support the currency. They expect a doubling of UK interest rates to more than 5% by next summer.

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One in six elderly Germans at risk of poverty – media — RT Business News

A growing number of citizens over the age of 65 have less than 60% of the median income, Funke media group found

Around one in six Germans over the age of 65 is at risk of falling into poverty, according to a study by the Federal Statistical Office and published by the German media group Funke.

The poverty risk rate for people over 65 increased from 14.7% to 17.4% between 2018 and 2021. Nearly one in six people over 65 in Germany is at risk of poverty, meaning they have less than 60% of the median income at their disposal,” the study was cited in the report.

According to the finding, elderly women are more likely to be at risk of poverty. The poverty risk rate for women over 65 was 19.3%, while for men it was 15.1%.
In response to the findings, the left-wing faction of the Bundestag demanded government intervention.

The chancellor’s ‘stable pensions’ are a fairy tale. Poverty in old age is exploding,” parliamentary group leader Dietmar Bartsch told the Funke newspaper. He reiterated his party’s demand for a minimum pension of €1,200, and warned that soaring energy prices this winter may leave many more elderly Germans destitute.

Germany has been grappling with record-high inflation, which accelerated to 8.8% in August, the highest level in nearly 50 years. Energy prices were up 35.6% year-on-year despite the relief measures, while food prices soared by 16.6%, accelerating for the sixth month in a row.

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