ECB's Makhlouf Says Price Risks Less Clear in Medium-Term Than Near
The tense global trade situation is boosting the euro, while weighing on business confidence and tightening financial conditions, the Irish official said Wednesday in a speech in Dublin.
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San Francisco Chronicle
15 hours ago
- San Francisco Chronicle
This might be the real reason Joel Engardio is facing recall in the S.F.'s Sunset District
It was the affordable rent, by San Francisco standards, that lured James Parke to the Sunset District in the late 1980s. 'When we moved here, it was the cheap seats,' Parke, 74, a retiree, told me recently. 'There were tattoo parlors and massage parlors and all kinds of crap out here.' Parke grew to love the sleepy neighborhood and, after a few years of renting, bought a home in the Outer Sunset, where he and his wife still live today. Like Parke, families seeking to buy relatively affordable single-family homes and a quieter lifestyle have flocked to the Sunset for decades — first, large numbers of Irish and Italian immigrants, then Asian Americans, primarily Chinese, who are now about half of the district's residents. These days, things are neither affordable nor particularly sleepy. The neighborhood is changing. Like the rest of San Francisco, housing prices have skyrocketed in the Sunset. Some of the seedy shops Parke remembers have been replaced by yoga studios, cafes with pour-over coffee and cocktail lounges. And Supervisor Joel Engardio, who represents the Sunset, is facing a recall vote in September, primarily for championing Proposition K, which closed the Great Highway for an oceanfront park that is attracting thousands of outsiders to the neighborhood. Mayor Daniel Lurie's recently released rezoning plan would allow taller housing throughout the neighborhood and could further upend the suburban feel of the Sunset. All of this worries Parke, who doesn't want the Outer Sunset to transform from 'a family place into some kind of a Miami Beach on the West Coast.' 'If we keep building up and up in the Sunset, well, there goes that quality of life that we worked so hard for,' Parke said. There are no plans for Miami Beach-style skyscrapers in the Sunset. But Parke is not alone in his perception and false assumptions about what could happen. This is important because while the recall fight over the closure of the Great Highway to cars is ostensibly about traffic, it's hard not to think broader anxiety over what the future holds for the Sunset is also in play. 'I think it's just a lack of voice and lack of agency that folks have' over decisions in the neighborhood, said Lily Wong, director of the Sunset Chinese Cultural District, when I asked her about feedback she's heard from the community. (Full disclosure: My wife, Ramie Dare, serves on the board of Wah Mei School, the fiscal sponsor for the cultural district.) Arguably, that sentiment helped tank the reelection of former Supervisor Gordon Mar, who lost a close race to Engardio three years ago. During the campaign, Mar was anonymously branded a 'communist pedophile' in part for helping to push through the Sunset's first affordable housing project in decades. Engardio campaigned for office on a vision for San Francisco to be more like Paris ― buildings with housing and shops of six stories or so on corner lots and high-traffic corridors everywhere in the city, including the Sunset. It's an idyllic vision, but 'taller' and 'denser' are fighting words in San Francisco, and not everyone shares Engardio's or Lurie's ideas for housing. The six-story and eight-story buildings that the rezoning plan calls for would 'feel very out of character' for the Sunset — even on transit corridors — said Albert Chow, president of People of Parkside Sunset, an association representing about 100 businesses on Taraval Street, when I asked him what he thought of the mayor's proposal. Chow said he prefers smaller projects and worries new development could disrupt 'why people like the neighborhood' — the predominance of single-family homes. 'I like to say that San Francisco is the most progressive city that hates change,' Engardio told me recently when we discussed the future of the Sunset. He said he supports the mayor's rezoning. 'There will always be people opposed to new things or new housing. I think the mayor's housing plan is very pragmatic and reasonable because it's focusing housing on areas where it makes the most sense.' What's pragmatic to Engardio, however, isn't jiving these days with many of his constituents like Chow, an outspoken supporter of the recall who opposed Prop K. I'm an Outer Sunset resident who supported Prop K. In the long run, I believe Sunset Dunes park will benefit the Sunset and the city. And so will rezoning to allow more homes. There's been almost no new housing in Sunset and other western neighborhoods since the 1960s. Anytime denser housing can be built near major commercial and public transportation routes, it makes sense for everyone; it puts people into homes, creates economic activity and ideally gets some drivers out of their cars. Denser housing in Sunset is going to be a tough sell. But even Chow concedes the neighborhood has to 'take our share of the burden' for building housing in the city. 'The needs of the many outweigh the needs of the few,' he said, borrowing a quote from Spock of 'Star Trek.' Rezoning could be the first step in a decades-long process. Change is coming. Spock's Vulcan philosophy is something good to keep in mind during this transformation. The Sunset should never become Miami Beach. But it can't stay frozen in time, either, if the city is going to 'live long and prosper.' Harry Mok is an assistant editor, editorial board member and columnist for the Opinion section.
Yahoo
a day ago
- Yahoo
EU banks can weather recession driven by global trade war, stress test shows
By Valentina Za and Balazs Koranyi MILAN (Reuters) -Banks across the European Union are strong enough to weather an economic shock driven by geopolitical and trade tensions, the European Banking Authority said on Friday as it presented the outcome of its latest health check of the sector. The EBA tested how 64 European banks, including 51 euro zone lenders, would react to a prolonged recession across the EU and other advanced economies, finding none would breach their core capital requirement, and only one would breach its leverage requirement. "The results indicate that the EU banking system could withstand a severe but plausible macroeconomic scenario, reflecting the resilience built up by banks in recent years," the EBA said, urging lenders to maintain adequate capital. European and U.S. banking authorities introduced formal, comprehensive stress tests after the global financial crisis of 2008 led to costly state bailouts of banks. Some elements of this year's adverse scenario had begun to materialise, the EBA said, pointing to U.S. trade tariffs and escalating tension in the Middle East. Lenders accounting for three quarters of EU banks' total assets took part in the exercise, which simulates the losses banks would incur by analysing their performance over a three-year period under a baseline and an adverse scenario. Under the adverse scenario, worsening geopolitical tensions and protectionist trade policies lift energy and commodity prices, disrupt supply chains and hurt consumption and investment, driving a cumulative 6.3% contraction in EU economic output over 2025-2027. That would translate into combined losses of 547 billion euros for the sampled banks, the EBA said, higher than the 496 billion euros envisaged in its 2023 stress test. While the hit to capital reserves is particularly severe for some European subsidiaries of major U.S. banks, all the lenders remained able to meet core capital requirements, the EBA said, although one would breach the requirement on the leverage ratio. For 17 lenders, the adverse scenario would entail limits or adjustments to bonus and dividend payments for at least one of the three years. In terms of capital reserves - calculated using the current 'transitional' regime that tightens progressively through 2033 - the adverse scenario would knock 3.7 percentage points off the sample's aggregate core capital ratio, pushing it to 12.1% in 2027 from 15.8%. When looking at individual countries, Irish, Danish, French, German and Belgian banks experienced the biggest capital impact, EBA data showed. For individual banks, Landesbank Baden-Wuerttemberg and two other German regional banks, as well France's Credit Agricole and La Banque Postale, saw the largest capital depletion effect. While there is no pass/fail threshold in the EU-wide stress test, its outcome feeds into the risk assessment of lenders carried out by supervisors every year, setting bank-specific capital requirements and guidance known as 'Pillar 2'.
Yahoo
2 days ago
- Yahoo
Eurozone growth slows: Spain leads and Germany contracts
After a strong start to the year, the eurozone economy lost some steam in the second quarter of 2025, with fresh data showing a clear slowdown. Germany, the bloc's economic powerhouse, fell back into contraction territory, while Spain continued to outpace its peers. According to the preliminary flash estimate released on Wednesday, seasonally adjusted gross domestic product (GDP) rose by 0.1% in the eurozone and by 0.2% in the European Union in the second quarter of 2025, compared with the previous quarter. While the reading slightly surpassed economist expectations of a flat growth rate, this marks a notable deceleration from the 0.6% and 0.5% expansions seen in the eurozone and EU respectively in the first quarter. Year-on-year, growth also eased a little, with the eurozone up 1.4% and the EU up 1.5%, both slightly below the pace seen earlier in 2025. "Although the slowdown is to a large extent a by-product of a misleadingly healthy Q1 number, broad-based weakness across national data indicates that the economy lacks momentum, with only a handful of countries blowing into its sails," said Riccardo Marcelli Fabiani, senior economist at Oxford Economics. Spain and Portugal shine, Germany drags The slowdown wasn't uniform across the continent. Spain stood out with the strongest quarterly growth at 0.7%, thanks to solid consumer spending, a rebound in business investment, and rising exports. "Spain is in another league, showing stubbornly robust dynamism. The moderate Q2 decline in Irish GDP suggests that there is ample room for further correction," Marcelli Fabiani added. Portugal and Estonia also delivered solid results, expanding by 0.6% and 0.5%, respectively. On the other hand, Germany shrank by 0.1%, ending a run of modest growth. It marked the country's first contraction since mid-2024. Related IMF chief: European lifestyle is at risk if productivity isn't boosted Spain's economy grows 0.7% as it continues to outshine eurozone peers The decline was mainly due to weaker investment in machinery and construction, although household and government spending still offered some support. Italy's GDP contracted by 0.1% in the second quarter, reversing the 0.3% gain recorded in the first quarter and defying market expectations of a 0.2% increase. It was the country's first contraction since Q2 2023, reflecting weak domestic demand and softening industrial activity. There was some good news from France, where the economy picked up more than expected. GDP rose 0.3% — the best result in nearly a year — helped by stronger domestic demand. Yet Oxford Economics remains cautious, noting that France's expansion paints an overly rosy picture, driven largely by stockbuilding, while both domestic demand and net trade actually dragged on GDP. Markets steady as investors digest US-EU trade deal Financial markets responded calmly to the data, with eurozone assets stabilising following recent volatility tied to the US-EU trade deal, which analysts broadly view as tilting in Washington's favour over Brussels. The euro was steady at $1.1550, recovering slightly after enduring its worst two-day drop since February 2023. The EURO STOXX 50 index edged 0.1% higher, while the broader EURO STOXX 600 was flat. French consumer staples were among the top performers, with Danone rising 6.7% and L'Oréal up 4% after reporting strong quarterly earnings boosted by Chinese demand. Nokia also rallied 5.4%. In contrast, Adidas fell over 6% following a revenue miss and a profit warning, while Mercedes-Benz Group dropped 1% after reporting a halving of its first-half profits and cutting its full-year revenue forecast below last year's €146 billion. Germany's DAX index was unchanged at 24,200 points, about two percentage points below its all-time high, while Italy's FTSE MIB climbed 0.3% to 41,350 points, its highest since July 2007 and eyeing its ninth positive session in the last ten. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
