Author Archives: Reuters News Agency

La Palma residents grapple with devastation wrought by volcano

By Miguel Pereira and Borja Suarez

LA PALMA, Spain (Reuters) -Residents of Spain’s La Palma were struggling on Thursday to come to terms with the devastation wrought by the Cumbre Vieja volcano, which has been ejecting a destructive cocktail of ash, smoke and lava for more than 10 days.

Carmen Rodriguez, who lost her home in the village of Todoque, was caught off guard by the advancing column of molten rock.

“We never thought that the volcano was going to reach our house, never,” she said, recalling how she rushed to salvage belongings during a last-minute evacuation before the lava engulfed her home.

“There were so many people and difficulties, there was a queue. Thankfully we were able to take the washing machine, the fridge and a cooker that I recently bought.”

“I only ask that they give us a place to live, that they give us a habitable house, nothing more,” she said.

Some 6,000 people have been evacuated and are yet to return to their houses, a local government spokesperson said on Thursday.

Since erupting on Sept. 19 the volcano has destroyed more than 800 buildings, as well as banana plantations, roads and other infrastructure.

“It’s unimaginable that this would happen, and now we are living worse days than the COVID state, which was already a bit unreal,” said Dutch national Emilie Sweerts, who has lived on the island in the Canaries archipelago for six years.

“I really thought this would be my paradise island,” she said from her jewelry store in Tazacorte, a small coastal town which the lava ploughed through on its way to the sea, wrecking houses and farms.

After meandering downhill to the coast for nearly 10 days, the lava reached the ocean just before midnight on Tuesday a kilometer west of Tazacorte and has created a rocky outcrop more than 500 meters wide.

On reaching the water, the lava cools rapidly, binding to the cliffside and enlarging the island’s territory.

Despite fears of toxic gases from the lava reacting with the seawater, authorities said the air remained safe to breathe inland.

Emergency services warned that ash thrown out from the crater was blocking sunlight and reducing visibility.

Several villages near the coastline remained locked down as a precaution but banana farmers were allowed access to their plantations to tend their crops.

Reuters correspondents on the island said the eruption appeared to have calmed from around 1000 GMT and no lava was being expelled from the crater, though smoke continued to billow out.

(Writing by Nathan Allen, Editing by Andrei Khalip and Raissa Kasolowsky)

U.S. Supreme Court to hear Boston Christian flag dispute

By Lawrence Hurley

WASHINGTON (Reuters) – The U.S. Supreme Court on Thursday agreed to hear a group’s challenge to Boston’s rejection of its request to fly a flag bearing the image of a Christian cross over city hall in a case involving religious and free speech rights.

The justices will consider an appeal by a Christian group called Camp Constitution of a lower court ruling in favor of the city, taking up the case four days before the start of their new nine-month term.

Camp Constitution is a volunteer group that teaches classes on U.S. history and current events. It unsuccessfully applied to raise a flag with a Christian cross on it over city hall in 2017. It noted that Boston had granted hundreds of requests brought by other private groups seeking to raise various flags.

The group said the city’s refusal to grant the request violated the U.S. Constitution’s First Amendment guarantee of freedom of speech. Part of the city’s defense is that raising the flag might violate another section of the First Amendment that prohibits government endorsement of religion.

Lower courts sided with the city, with the Boston-based 1st U.S. Circuit Court of Appeals finding in January that raising the flag would represent a form of government speech, which gives the city more leeway to decide what speech is allowed.

The city had never previously denied a request and had previously approved flags of other countries and private organizations, including the LGBT pride flag.

The court will hear oral argument early next year, with a ruling due by the end of June.

(Reporting by Lawrence Hurley; Editing by Will Dunham)

Israel foreign minister visits Bahrain to sign deals, open embassy

DUBAI (Reuters) -Israeli Foreign Minister Yair Lapid flew to Bahrain on Thursday on the highest-level Israeli visit to the Gulf state since the countries established formal relations last year.

Lapid, who landed at Bahrain’s international airport in an Israir plane with an olive branch painted on its nose, met Bahrain’s King Hamad bin Isa Al Khalifa and Crown Prince and Prime Minister Salman bin Hamad Al Khalifa.

He also held talks with his Bahraini counterpart and will inaugurate Israel’s embassy in Manama.

“His Majesty’s leadership and inspiration have led to true cooperation and our meeting outlined the path forward for our relationship,” Lapid said on Twitter after meeting the king.

Bahrain and Gulf neighbor United Arab Emirates normalized relations with Israel last year in a U.S.-brokered deal known as the Abraham Accords that built on shared business interests and worries about Iran. Sudan and Morocco followed suit.

“We see Bahrain as an important partner, on the bilateral level but also as a bridge to cooperate with other countries in the region,” an Israeli Foreign Ministry spokesperson said.

The accords had been denounced by the Palestinians as abandoning a unified position under which Arab states would make peace only if Israel gave up occupied land.

In Gaza, the Islamist Hamas group criticized Bahrain for hosting Lapid, who returns to Israel on Thursday evening. Hamas spokesman Hazem Qassem said this represented “an encouragement” of what he described as Israeli “crimes against our Palestinian people and their sacred sites”.

The accords have also been criticized by Bahraini opposition figures, speaking largely from abroad, as well as locals who stand against normalization.

The island state, which quashed an uprising led mostly by Shi’ite Muslim members of its population in 2011, saw some sporadic acts of protest after the pact was signed.

On Thursday Bahraini activists circulated on social media images of what appeared to be small protests in Bahrain, including some tire burnings. Reuters was unable to independently verify these.

The Sunni-ruled kingdom, host to the U.S. Navy’s Fifth Fleet, accuses Iran of stoking unrest in Bahrain, a charge that Tehran denies.

The Israeli Foreign Ministry said five memorandums of understanding will be signed, including cooperation agreements between hospitals and water and power companies.

Bahrain’s Gulf Air is due to make its first direct commercial flight to Tel Aviv later in the day.

(Reporting by Jeffrey Heller, Nidal Al Mughrabi and Lisa Barrington; Editing by Giles Elgood, Emelia Sithole-Matarise, William Maclean)

Imminent UK border changes could add to trucker problems, industry group says

LONDON (Reuters) – Changes to Britain’s border rules this week which prevent European Union ID cards from being accepted as proof of identity could compound existing issues for freight entering the United Kingdom, a global road transport body said.

Under new immigration rules which come into force on Oct. 1 as part of post-Brexit measures to end freedom of movement, EU nationals will need a passport to enter the United Kingdom.

The International Road Transport Union (IRU) said that, despite working closely with the British government to inform haulers, some drivers were likely to be caught out.

“Aside from not seeing the real benefits of adding this layer of bureaucracy, and potentially affecting already difficult border freight flows post Brexit, we are also concerned that passports are generally more expensive than ID cards,” said Raluca Marian, IRU EU Advocacy Director.

“UK authorities need to implement the change from Friday respecting professional drivers, without unnecessary bureaucracy or causing border or supply chain disruptions that would compound the serious supply chain issues already being seen in the UK due to driver shortages.”

The Home Office, the government department that administers immigration policy, said ID cards are some of the “most insecure and abused documents,” and the haulage industry has had almost a year to prepare for the changes.

This comes as Britain struggles with a shortage of tens of thousands of truck drivers which has led to severe supply chain issues, with fuel stations running empty in recent days after a spate of panic-buying.

Britain left the EU’s single market at the beginning of 2021, creating a full customs border with the bloc. However, London did not immediately bring in import checks on goods entering Britain to give businesses time to adjust amid concern they would lead to delays.

Earlier this month, the government said those checks would now not be introduced until next year, citing the COVID pandemic as the reason.

(Reporting by Michael Holden. Editing by Andrew MacAskill)

Analysis: From chips to ships, shortages are making inflation stick

By Dhara Ranasinghe and Sujata Rao

LONDON (Reuters) – Soaring gas prices, staff shortages, a lack of ships — price pressures globally may be picking up faster than anticipated, challenging the view that inflation will prove transitory.

Central bankers, while adamant inflation will subside, are starting to concede it may stay higher for longer as a range of issues push up the prices of goods and services and lift future inflation expectations.

Their conclusions will ultimately determine how quickly policymakers unwind the trillions of dollars of monetary stimulus unleashed to ease the COVID-19 crisis.

“Will central bankers be more focused on growth and be a “bit behind the curve”? Or will they be more concerned about inflation and take the punchbowl away quickly?,” said Charles Diebel, head of fixed income at asset manager Mediolanum International Funds.

Here are five key elements in the inflation debate:

1/ GASFLATION

European and U.S. gas prices have soared more than 350% and more than 120% respectively this year. Oil is up around 50% and Goldman Sachs expects Brent crude to hit $90 a barrel by end-2021 from around $80 currently.

Gas and electricity make up 4.8% of the euro area harmonized-inflation (HICP) basket used by the European Central Bank. Rabobank reckons the price surge is a separate ‘shock’ that could add 0.15 percentage points (ppts) to its 2.2% euro zone inflation forecast for 2021 and another 0.25 ppts to 2022’s 1.8% projection.

Many economists see higher gas prices as here to stay, due to slowing U.S. output, rising costs of carbon emissions permits for polluters and curbs on the usage of dirtier fuels.

In China, where factory inflation hit 9.5% in August, power cuts have slashed output of goods from cement to aluminum.

These outages are a risk to end-users such as those in auto supply chains, Morgan Stanley said, noting “cost-push inflation and tightening upstream supply that could affect downstream production and profits.”

2/ CHIPFLATION

Semiconductors, or chips as they are known, are tiny but are having an outsized impact on global factories. At General Motors alone, chip shortages are seen cutting Q3 vehicle deliveries by 200,000, while falling output has sent used-car prices spiraling.

Chip prices have risen and semiconductor giant Taiwan’s TSMC is mulling further hikes of up to 20%. That will ripple across everything from electronics to cars and phones to washing machines. But chipmakers themselves face higher input costs from commodities to power.

“It does seem likely that these semiconductor shortages are going to persist into next year,” said Jack Allen-Reynolds, senior European economist at Capital Economics.

Or beyond. Intel’s CEO predicts chips will comprise a fifth of a car’s cost by 2030, from 4% in 2019 as vehicles become self-driving or electric.

3/ FOODFLATION

Global food prices rose 30% year-on-year in August, an index compiled by the UN Food and Agriculture Organization shows — a sign of broadening price pressures.

While higher agricultural commodity prices are behind the jump, JPMorgan analysts also attribute food price inflation to pandemic-related pressures such as logistics disruptions and transport costs.

In emerging markets, where food makes up a large chunk of inflation baskets, there is more pressure to tighten monetary policy. It is less of a problem for developed nations but price rises look inevitable for items such as soft drinks and snacks.

4/GREENFLATION

Stringent rules to guide the transition to a greener future are blamed for stoking ‘greenflation,’ for instance by shutting out polluting factories, vehicles, ships and mines, in turn reducing the supply of key goods and services.

Prices for European carbon emission allowances, have doubled this year to 65 euros a tonne. A price of 100 euros would lift European retail power prices 12%, adding 35 bps to headline euro zone inflation, Morgan Stanley estimated in June.

There are other examples. Falling ship orders due to upcoming rule changes on fuels may be a tailwind for shipping rates that have already surged 280% this year.

NatWest attributes the commodity rally at least partly to the shift to greener technologies raising mining and production costs.

All this may not fully have seeped into inflation calculations. For instance, markets see euro area inflation hitting 2% only after a decade, Danske Bank sees “upside risks to inflation expectations…once implementation of the green transition gathers momentum”.

5/ WAGEFLATION

As prices rise, so do expectations of future inflation among consumers, who accordingly demand pay hikes.

The carbon emission allowances picture is mixed. U.S average hourly earnings jumped 0.6% in August and U.S. five-year inflation expectations are running around 3%, surveys show.

In some UK sectors, earnings have risen as much as 30% this year. Euro area labor costs fell in Q2 but inflation as well as inflation expectations are rising.

“Maybe markets are a little bit extreme in their pricing, but I’m not recommending investors should fade that move,” Societe Generale senior rates strategist Jorge Garayo said.

“When we go into next year, that will be the big test.”

(Reporting by Dhara Ranasinghe and Sujata Rao; Additional reporting by Stefano Rebaudo ; Editing by Kirsten Donovan)

Death toll in Ecuador prison riot rises to 116, six decapitated

QUITO (Reuters) -The death toll from a riot at one of Ecuador’s largest prisons rose to 116, President Guillermo Lasso said on Wednesday, adding that he would send additional security forces and free up funds to avoid a repeat.

Another 80 inmates were injured during the Tuesday night clashes at the Penitenciaria del Litoral in Guayas province, which has been the scene of bloody fights between gangs for control of the prison in recent months.

“It is unfortunate that criminal groups are attempting to convert prisons into a battleground for power disputes,” Lasso told reporters in Guayaquil, Ecuador’s largest city. “I ask God to bless Ecuador and that we can avoid more loss of human life.”

Tuesday’s clash was the most deadly act of violence ever reported in Ecuador’s penitentiary system. Similar clashes took place in February and July 2021 in various prisons throughout the country. At least 79 people died in the February violence, and in July at least 22 lives were lost.

Dozens of people arrived at the jail to seek information about relatives and demand accountability from officials responsible for the inmates’ safety. The government bolstered military presence outside the facility. Lasso said the state would assist the families of dead and injured inmates.

The South American country’s prosecutor’s office said earlier on Wednesday that six of the slain prisoners at Penitenciaria del Litoral had been decapitated.

The Inter-American Commission on Human Rights (IACHR) has previously condemned the violence, and Human Rights Watch urged Ecuador’s government to fully investigate the prison violence and bring those responsible to justice.

Lasso in August said the government would provide more funding for the overcrowded prison system to build new wards and install new equipment to improve security.

(Reporting by Alexandra Valencia in Quito; Editing by Bill Berkrot, Sam Holmes and Lincoln Feawst)

EU to deploy election observation mission to Venezuela

BRUSSELS (Reuters) – The European Union will send observers to regional elections in Venezuela scheduled for Nov. 21, on the invitation of the country’s National Electoral Council, the bloc’s foreign policy chief said in a statement on Wednesday.

“An unprecedented electoral process will take place, with the concurrence of the majority of political forces for the first time in recent years, to elect more than 3,000 regional and municipal representatives in Venezuela,” EU High Representative for Foreign Affairs Josep Borrell said.

“The EU Election Observation Mission will undertake an independent technical assessment of all aspects of the electoral process and will propose recommendations to improve future elections,” he said.

The vote comes after three years of opposition election boycotts and a failed U.S.-backed effort to force Socialist Party President Nicolas Maduro from power through sanctions and the creation of a parallel opposition-led government.

The regional elections are expected to pose little threat to Maduro’s control of Venezuela. He has hung on to power despite a breathtaking collapse of the country’s economy as well as the broad U.S. sanctions program meant to force him from power.

The EU will send 11 election experts who will arrive in Caracas in October and will be joined by the end of that month by up to 62 long-term observers who will be deployed in the country’s regions.

A further 34 EU short-term observers and 20 locally recruited ones will reinforce the mission on election day. The EU team will stay in Venezuela until the completion of the electoral process, the EU statement said.

The EU observers will issue a preliminary statement and hold a news conference in Caracas after the elections and will also issue a final report with recommendations for future elections after the finalization of the electoral process.

(Reporting by Jan Strupczewski; editing by Jonathan Oatis)

Coronavirus can transform pancreas cell function; certain genes may protect an infected person’s spouse

By Nancy Lapid

(Reuters) – The following is a summary of some recent studies on COVID-19. They include research that warrants further study to corroborate the findings and that have yet to be certified by peer review.

Coronavirus transforms pancreas cell function

When the coronavirus infects cells, it not only impairs their activity but can also change their function, new findings suggest. For example, when insulin-producing beta cells in the pancreas become infected with the virus, they not only produce much less insulin than usual, but also start to produce glucose and digestive enzymes, which is not their job, researchers found. “We call this a change of cell fate,” said study leader Dr. Shuibing Chen, who described the work in a presentation on Tuesday at the annual meeting of the European Association for the Study of Diabetes, held virtually this year. It is not clear whether the changes are long-lasting, or if they might be reversible, the researchers noted earlier in a report published in Cell Metabolism. Chen noted that some COVID-19 survivors have developed diabetes shortly after infection. “It is definitely worth investigating the rate of new-onset diabetes patients in this COVID-19 pandemic,” she said in a statement. Her team has been experimenting with the coronavirus in clusters of cells engineered to create mini-organs, or organoids, that resemble the lungs, liver, intestines, heart and nervous system. Their findings suggest loss of cell fate/function may be happening in lung tissues as well, Chen, from Weill Cornell Medicine in New York, told Reuters.

Certain genes may protect an infected patient’s spouse

A study of couples in which both partners were exposed to the coronavirus but only one person got infected is helping to shed light on why some people may be naturally resistant to the virus. The researchers had believed such cases were rare, but a call for volunteers who fit that profile turned up roughly a thousand couples. Ultimately, they took blood samples from 86 couples for detailed analysis. The results suggest resistant partners more often have genes that contribute to more efficient activation of so-called natural killer (NK) cells, which are part of the immune system’s initial response to germs. When NKs are correctly activated, they are able to recognize and destroy infected cells, preventing the disease from developing, the researchers explained in a report published on Tuesday in Frontiers in Immunology . “Our hypothesis is that the genomic variants most frequently found in the susceptible spouse lead to the production of molecules that inhibit activation of NKs,” study leader Mayana Zatz of the University of São Paulo, Brazil, said in a statement. The current study cannot prove this is happening, she added. Even if the findings are confirmed with more research, the contributions of other immune mechanisms would also need to be investigated, the researchers said.

Experimental pill shows promise against coronavirus variants

Laboratory studies show that Merck & Co’s experimental oral COVID-19 antiviral drug, molnupiravir, is likely to be effective in patients infected with any of the known variants of the coronavirus, including the dominant, highly transmissible Delta, researchers said on Wednesday in a presentation during IDWeek 2021, the virtual annual meeting of infectious disease organizations. Molnupiravir does not target the spike protein of the virus, which is the target of all current COVID-19 vaccines. Instead, it targets an enzyme the virus uses to make copies of itself. It is designed to work by introducing errors into the genetic code of the virus. Data showed that the drug is most effective when given early in the course of infection, Merck said. The company is conducting two large late-stage trials of the drug – one for treatment of COVID-19 and another as a preventive.

(Reporting by Nancy Lapid and Deena Beasley; Editing by Bill Berkrot)

Global supply disruptions could still get worse, central bankers warn

By Balazs Koranyi and Francesco Canepa

FRANKFURT (Reuters) – Supply constraints thwarting global economic growth could still get worse, keeping inflation elevated longer, even if the current spike in prices is still likely to remain temporary, the world’s top central bankers warned on Wednesday.

The disruptions to the global economy during the pandemic have upset supply chains across continents, leaving the world short of a plethora of goods and services from car parts and microchips to container vessels that transport goods across the seas.

“It’s … frustrating to see the bottlenecks and supply chain problems not getting better, in fact at the margin apparently getting a little bit worse,” Federal Reserve Chair Jerome Powell told a conference.

“We see that continuing into next year probably and holding inflation up longer than we had thought,” Powell told the European Central Bank’s Forum on Central Banking.

Speaking alongside Powell, ECB chief Christine Lagarde voiced similar concerns, arguing that the end of these bottlenecks, once thought by economists to be just weeks away, is uncertain.

“The supply bottlenecks and the disruption of supply chains, which we have been experiencing for a few months … seem to be continuing and in some sectors accelerating,” Lagarde said. “I’m thinking here about shipping, cargo handling and things like that.”

VERY ATTENTIVE

Global inflation has spiked in recent months on a surge in energy prices, and the production bottlenecks are pushing prices even higher, raising fears that the runup, if it lasts long enough, could seep into expectations and raise the overall profile of inflation.

Indeed, Lagarde said the ECB would be “very attentive” to these second-round effects while Bank of England Governor Andrew Bailey, another speaker at the forum, said he would keep a “very close watch” on inflation expectations.

“If this period of higher inflation, even though it ultimately is very likely to prove temporary, if it lasts long enough, will it start affecting, changing the way people think about inflation? We monitor this very carefully,” Powell added.

The problem is that central banks, the main authority for controlling prices, have no influence over short-term supply disruptions, so they are likely to be bystanders, waiting for economic anomalies to self-correct without lasting damage.

“Monetary policy cannot solve supply side shocks. Monetary policy cannot produce computer chips, it cannot produce wind, it cannot produce truck drivers,” Bailey said.

Still, even as policymakers called for heightened attention to inflation, all maintained their long standing view that the spike in inflation would be temporary and price rises would moderate next year, moving back to or below central bank targets.

Concerns about “sticky” inflation have fueled a debate about the need to unwind crisis-era stimulus measures, and comments from Wednesday’s panel reinforced expectations for the world’s biggest central banks to move on vastly different schedules, staying out of sync for years to come.

The Fed, the BoE and the Bank of Canada have openly discussed policy tightening while central banks in such countries as South Korea, Norway and Hungary have already raised interest rates, beginning a long road to policy normalization.

The ECB and the Bank of Japan are meanwhile likely to be the last movers, exercising extreme caution after undershooting their inflation targets for years.

The ECB even refuses to discuss tapering and already signaled its tolerance for overshooting its inflation target as it would rather move too late than too early.

This sort of patience was only reinforced by Lagarde and Bank of Japan Governor Haruhiko Kuroda, even as both provided a relatively upbeat outlook on growth, arguing that their economies could be back at their pre pandemic levels in the coming months.

(Additional reporting by Leika Kihara, Howard Schneider, Dan Burns, David Milliken and Andy Bruce; Editing by Hugh Lawson)

Rohingya community leader shot dead in Bangladesh refugee camp

By Ruma Paul and Poppy McPherson

(Reuters) – Gunmen shot and killed a prominent Rohingya Muslim leader in a refugee camp in southern Bangladesh on Wednesday, a United Nations spokesperson and a local police official said, following months of worsening violence in the world’s largest refugee settlement.

Mohib Ullah, who was in his late 40s, led one of the largest of several community groups to emerge since more than 730,000 Rohingya Muslims fled Myanmar after a military crackdown in August 2017.

Invited to the White House and to speak to the United Nations Human Rights Council, he was one of the most high-profile advocates for the Rohingya, a Muslim minority that has faced persecution for generations.

Rafiqul Islam, a deputy police superintendent in the nearby town of Cox’s Bazar, told Reuters by phone that Mohib Ullah had been shot dead but had no additional details.

A spokesperson for the U.N. High Commissioner for Refugees said the agency was “deeply saddened” by the killing of Mohib Ullah. “We are in continuous contact with law enforcement authorities in charge of maintaining peace and security in the camps,” the spokesperson said.

Mohib Ullah’s group, the Arakan Rohingya Society for Peace and Human Rights, made its name documenting atrocities the Rohingya suffered during the Myanmar crackdown, which the U.N. has said was carried out with genocidal intent.

At the Bangladesh refugee camps, Mohib Ullah went from hut to hut to build a tally of killings, rape and arson that was shared with international investigators.

His organization worked to give refugees more of a voice inside the camps and internationally. Speaking to the U.N. Human Rights Council, he said the Rohingya wanted more of a say over their own future.

But his high profile made him a target of hardliners and he received death threats, he told Reuters in 2019. “If I die, I’m fine. I will give my life,” he said at the time.

The sprawling camps in Bangladesh have become increasingly violent, residents say, with armed men vying for power, kidnapping critics, and warning women against breaking conservative Islamic norms.

Aung Kyaw Moe, a Rohingya civil society activist and an adviser to Myanmar’s National Unity Government, the parallel civilian government established after February’s coup, said Mohib Ullah’s death was a “big loss for the Rohingya community.”

“He was always aware there is a threat, but he thinks that despite the threat if he is not doing the work he is doing, no one else would,” he said.

(Reporting by Ruma Paul and Poppy McPherson, Editing by Rosalba O’Brien)