Tag Archives: China

Huawei secretly helped North Korea build, maintain wireless network: Washington Post

WASHINGTON (Reuters) – Huawei Technologies Co Ltd [HWT.UL], the Chinese company put on a U.S. blacklist because of national security concerns, secretly helped North Korea build and maintain its commercial wireless network, the Washington Post reported on Monday, citing sources and internal documents.

The Chinese telecommunications giant partnered with a state-owned Chinese firm, Panda International Information Technology Co Ltd., on a number of projects in North Korea over at least eight years, the Post reported.

Such a move would raise questions of whether Huawei, which has used U.S. technology in its components, violated American export controls to furnish North Korea with equipment, according to the Post.

The United States put Huawei on a blacklist in May, citing national security concerns. The move banned U.S. companies from selling most U.S. parts and components to Huawei without special licenses but President Donald Trump said last month American firms could resume sales in a bid to restart trade talks with Beijing.

Huawei did not immediately respond to a request for comment but said in a statement to the Washington Post it had “no business presence” in North Korea. It was not immediately possible to reach the Panda Group.

The Commerce Department, which also did not immediately respond to a request for comment, has investigated possible links between Huawei and North Korea since 2016 but has not publicly connected the two, the Post said.

Huawei and Panda vacated their Pyongyang office in the first half of 2016, the newspaper reported.

(Reporting by Makini Brice; Editing by Bill Trott)

U.S.-China officials discuss trade; Mnuchin eyes possible in-person talks

FILE PHOTO: Treasury Secretary Steven Mnuchin testifies before the House Financial Services Committee hearing on "The Annual Testimony of the Secretary of the Treasury on the State of the International Financial System" in Washington, U.S., May 22, 2019. REUTERS/Mary F. Calvert

CHANTILLY, France/WASHINGTON (Reuters) – U.S. and Chinese officials spoke by telephone on Thursday as the world’s two largest economies seek to end a year-long trade war, with U.S. Treasury Secretary Steven Mnuchin suggesting in-person talks could follow.

Mnuchin and U.S. Trade Representative Robert Lighthizer spoke with their Chinese counterparts over the phone, Lighthizer’s office said on Thursday, following earlier comments by the Treasury secretary in an interview on the sidelines of the G7 meeting in Chantilly, France.

The United States and China have been embroiled in a tit-for-tat tariff battle since July 2018, as Washington presses Beijing to address what it sees as decades of unfair and illegal trading practices.

China has countered that any deal needs to be fair and equitable, leaving the two sides apparently still far from an agreement to end the back-and-forth that has roiled global supply chains and upended financial markets.

“Right now we’re having principal-level calls and to the extent that it makes sense for us to set up in-person meetings, I would anticipate that we would be doing that,” Mnuchin told Reuters.

Asked if Thursday’s call could lead to a face-to-face meeting, Mnuchin said: “It’s possible, but I’m not going to speculate on the outcome.”

Lighthizer’s office later confirmed that the conversation took place as scheduled, but gave no details.

China’s foreign ministry said on Friday the two sides had discussed ways to implement the consensus reached by the two countries’ presidents, but gave no other details.

Separately, Su Ge, former president of the China Institute of International Studies, a think tank affiliated with China’s Foreign Ministry, said he expected more formal discussions to resume this month.

“These are difficult questions … but at least they agreed to let the two negotiation teams to restart their work, so we will keep our fingers crossed,” he said.

William Lee, chief economist for the Milken Institute, said tensions were simmering, with neither China nor the United States appearing ready to budge on critical issues.

“That high level of trade uncertainty is causing manufacturing firms to be reticent to make investments. That high degree of uncertainty is a drag on U.S. growth,” he said. “The real issue is that China wants respect. China wants a face-saving way of coming to the table.”

TARIFFS AND PROMISES

Global stocks were rattled this week after U.S. President Donald Trump reiterated threats to impose further tariffs on Chinese imports. Signs that the trade dispute was starting to take a toll on corporate earnings further unnerved investors, sending stocks lower on Thursday.

“We have a long way to go as far as tariffs, where China is concerned, if we want. We have another $325 billion that we can put a tariff on if we want,” Trump said at a cabinet meeting on Tuesday.

Trump and Chinese President Xi Jinping agreed during a Group of 20 nations summit in Japan last month to resume discussions, easing fears of escalation after talks broke down in early May. At the time of the G20, Trump agreed to suspend a new round of tariffs on $300 billion worth of imported Chinese consumer goods while the two sides resumed negotiations.

“What they did was not appropriate,” Trump said Tuesday. “They are supposed to be buying farm products. Let’s see whether or not they do.”

U.S. government data published on Thursday showed China last week made its largest purchase of U.S. sorghum since April. Sorghum was one of the first casualties of the trade war, which has slowed exports of soybeans and pork to China.

Asked about the role of Huawei Technologies Co Ltd, which the administration has blacklisted over national security concerns, Mnuchin said on Thursday that allowing any U.S. sales to the Chinese telecoms equipment company was an issue independent from the trade talks.

After meeting with Xi at the G20, Trump said American firms could sell products to Huawei. Earlier this month, Commerce Secretary Wilbur Ross said licenses would be issued where there is no threat to national security.

Reuters reported on Sunday that the United States may approve licenses for companies to restart new sales to Huawei in as little as two weeks, according to a senior U.S. official.

Mnuchin denied a Wall Street Journal report last week that the Treasury chief was urging U.S. suppliers to seek exemptions to sell to Huawei, saying he talks to corporate executives about many issues, including trade.

“My participation in this is only informational. I’ve never encouraged companies one way or the other to do things.”

The Wall Street Journal reported this week that discussions were at a standstill as Washington weighs limits over business with Huawei.

Derek Scissors, a scholar at the American Enterprise Institute think tank who has advised the White House on technology issues, said he expected further relaxations on Huawei to be part of any U.S.-China trade deal.

“The treatment of Huawei has been a circus,” he told a panel hosted by the Brookings Institution. “If we have a deal, Huawei will absolutely be part of it because the president doesn’t care … about technology competition.”

He said Trump was more focused on getting a trade deal and increasing access for U.S. farmers to Chinese markets.

(Reporting by David Lawder in Chantilly, France, Susan Heavey and Andrea Shalal in Washington and Koh Gui Qing in New York; Additional reporting by Chris Prentice in New York and Michael Martina in Beijing; Editing by Chizu Nomiyama and Peter Cooney)

Hong Kong retailers forecast sharp drop in sales as protests rock city

FILE PHOTO: Pro-democracy protesters hold umbrellas inside a mall as they face the riot police after a march at Sha Tin District of East New Territories, in Hong Kong, China July 14, 2019. REUTERS/Tyrone Siu/File Photo

By Donny Kwok and Anne Marie Roantree

HONG KONG (Reuters) – Hong Kong retailers said on Tuesday they expect sales for July and August to drop by double-digits from a year earlier due to large and sometimes violent protests that have gripped the Chinese-ruled city for more than a month.

On top of that forecast, the Hong Kong Retail Management Association also sharply changed its full-year retail sales forecast to a double-digit fall instead of single-digit growth.

It urged the government to resolve the dispute over a proposed extradition bill peacefully.

Millions have taken to the streets over the past month to protest a bill that would allow people to be sent to mainland China for trial in courts controlled by the Communist Party.

The retail group’s statement came after a relatively peaceful rally descended into chaos late on Sunday when protesters in a shopping mall housing some of the world’s largest luxury brands threw umbrellas and plastic bottles at police who retaliated by firing pepper spray and swinging batons.

The retail industry “is worried that the incident will hit Hong Kong’s international image as a safe city with good food and a shopping paradise,” the association said in a statement.

Last month, PwC revised its Hong Kong full-year retail sales forecast to a 5% drop, from a 3% fall.

PwC also said recent political and social unrest, coupled with a lack of new tourist attractions, might lower mainland tourists’ appetite to visit Hong Kong in the short run.

The Hong Kong Inbound Travel Association estimates that so far this month, the number of organized tours to the city has dropped 20% to 30% from the same period a year earlier.

“The impact has begun to surface and we start to see tours from mainland China and overseas postponing their leisure visits,” association chairman Paul Leung told Reuters. “We hope both sides can resolve the issue in a peaceful manner.”

The value of Hong Kong retail sales slid 1.3% from a year earlier in May, the fourth straight month of decline.

Hong Kong leader Carrie Lam on Monday called protesters who clashed with police on Sunday “rioters”, and said she supported the police in upholding the law and seeking perpetrators.

(Additional reporting by Felix Tam; Editing by Richard Borsuk)

U.S., Russia to discuss nuclear arms limits in Geneva on Wednesday: officials

National flags of Russia and the U.S. fly at Vnukovo International Airport in Moscow, Russia April 11, 2017. REUTERS/Maxim Shemetov

By Roberta Rampton

WASHINGTON (Reuters) – Representatives from the United States and Russia are set to meet in Geneva on Wednesday to explore the idea of a new accord limiting nuclear arms that could eventually include China, U.S. senior administration officials said on Monday.

U.S. President Donald Trump has said that he would like to see a new type of arms control deal with Russia and China to cover all types of nuclear weapons, a topic that he has discussed individually with Russian President Vladimir Putin and Chinese President Xi Jinping.

China is not currently a party to nuclear arms pacts between the United States and Russia.

The U.S. delegation will be led by U.S. Deputy Secretary of State John Sullivan and will include Tim Morrison, a top aide at the White House National Security Council, as well as representatives from the Pentagon, the Joint Chiefs of Staff, and the National Security Agency, said the U.S. officials, who spoke to reporters on condition on anonymity.

Russia’s deputy foreign minister, Sergei Ryabkov, will lead the Russian delegation, the U.S. officials said.

“We actually feel that – touch wood – we’ve actually got to a point where we can try to start this again,” one of the officials said, listing off a long series of incidents that have soured relations between the United States and Russia during the past year.

“I say touch wood because we’re always just one incident away from unfortunately things getting derailed,” the official said.

(Reporting by Roberta Rampton; Editing by Marguerita Choy)

Saudi Arabia and Russia among 37 states backing China’s Xinjiang policy

FILE PHOTO: People hold signs protesting China's treatment of the Uighur people, in Vancouver, British Columbia, Canada, May 8, 2019. REUTERS/Lindsey Wasson

By Tom Miles

GENEVA (Reuters) – Saudi Arabia, Russia and 35 other states have written to the United Nations supporting China’s policies in its western region of Xinjiang, according to a copy of the letter seen by Reuters on Friday, in contrast to strong Western criticism.

China has been accused of detaining a million Muslims and persecuting ethnic Uighurs in Xinjiang, and 22 ambassadors signed a letter to the U.N. Human Rights Council this week criticizing its policies.

But the letter supporting China commended what it called China’s remarkable achievements in the field of human rights.

“Faced with the grave challenge of terrorism and extremism, China has undertaken a series of counter-terrorism and deradicalization measures in Xinjiang, including setting up vocational education and training centers,” the letter said.

The letter said security had returned to Xinjiang and the fundamental human rights of people of all ethnic groups there had been safeguarded. It added there had been no terrorist attack there for three years and people enjoyed a stronger sense of happiness, fulfillment and security.

As well as Saudi Arabia and Russia, the letter was signed by ambassadors from many African countries, North Korea, Venezuela, Cuba, Belarus, Myanmar, the Philippines, Syria, Pakistan, Oman, Kuwait, Qatar, the United Arab Emirates and Bahrain.

Beijing has denied any human rights violations in the region and Chinese Ambassador Xu Chen, speaking at the close of the Council’s three-week session on Friday, said China highly appreciated the support it had received from the signatories.

(Reporting by Tom Miles; Editing by Kevin Liffey and Frances Kerry)

Taiwan president in U.S. after warning of threat from ‘overseas forces’

Taiwan's President Tsai Ing-wen arrives at the hotel where she is supposed to stay during her visit in the Manhattan borough of New York, New York, U.S., July 11, 2019. REUTERS/Carlo Allegri

By Michelle Nichols and Carlo Allegri

NEW YORK (Reuters) – Taiwanese President Tsai Ing-wen arrived in the United States on Thursday on a trip that has angered Beijing, warning that democracy must be defended and that the island faced threats from “overseas forces,” in a veiled reference to China.

China, which claims self-ruled and democratic Taiwan as its own and views it as a wayward province, had called on the United States not to allow Tsai to transit there on her overseas tour.

Tsai is spending four nights in the United States – two on the first leg and two on the way back from a visit to four Caribbean allies. She began her trip in New York and is expected to stop in Denver on her way back.

Shortly before Tsai was due to arrive at her Manhattan hotel, a Reuters photographer witnessed a brawl at the hotel’s entrance between dozens of pro-China and pro-Taiwan protesters, which was eventually broken up by police.

The New York Police Department was not immediately able to comment on whether there had been any arrests.

Tsai was last in the United States in March, but her stops this time will be unusually long, as normally she spends just a night at a time in transit.

The U.S. State Department has said there had been no change in the U.S. “one-China” policy, under which Washington officially recognizes Beijing and not Taipei, while assisting Taiwan.

However, analysts said the extended stopovers served to emphasize the Trump administration’s support for Tsai at a time when she has been coming under increasing pressure from Beijing, a major U.S. security rival with which Washington has been engaged in a year-long trade war.

Speaking before departure at Taipei’s main international airport at Taoyuan, Tsai said she would share the values of freedom and transparency with Taiwan’s allies, and was looking forward to finding more international space for Taiwan.

“Our democracy has not come easily and is now facing threats and infiltration from overseas forces,” Tsai said, without being specific.

“These challenges are also common challenges faced by democracies all over the world,” she said. “We will work with countries with similar ideas to ensure the stability of the democratic system.”

CARIBBEAN STOPS

Taiwan has been trying to shore up its diplomatic alliances amid pressure from China. Taipei now counts only 17 countries as diplomatic allies, almost all small Central American, Caribbean or Pacific nations.

Tsai will be visiting St Vincent and the Grenadines, St Lucia, St Kitts and Nevis, and Haiti on her overseas tour.

In New York, Tsai will meet with members of the Taiwanese community and U.N. ambassadors of allied countries.

The State Department described Tsai’s visit as “private and unofficial” and said she would be greeted in New York by James Moriarty, chairman of the American Institute in Taiwan, the de facto U.S. embassy in Taipei. It did not respond when asked if Tsai would have contact with any other U.S. officials.

Seeking to bolster Taiwan’s defenses, the United States this week approved an arms sale worth an estimated $2.2 billion for Taiwan, despite Chinese criticism.

Tsai, who is up for re-election in January, has repeatedly called for international support to defend Taiwan’s democracy in the face of Chinese threats. Beijing has regularly sent military aircraft and ships to circle Taiwan on drills in the past few years.

Douglas Paal, who served as U.S. representative to Taiwan from 2002 to 2006, said Tsai’s extended stopovers showed U.S. approval for the “caution and restraint” she had shown in her dealings with Beijing.

“It makes sense to reinforce that with generous transit treatment,” he said. “This is also … a message to China. The U.S. government believes Tsai is behaving responsibly in respecting the framework of U.S.-China-Taiwan relations.”

Paal said the Trump administration had yet to indicate a significant shift in the traditional U.S. approach to Taiwan, but this could change in the event of a deterioration of U.S. relations with Beijing.

“It’s like an engine running at a high idle,” he said. “Trump has not engaged the gears, but there is a lot of activity at lower levels seeking to upgrade relations. So change has not occurred in a big way yet, but it could happen at any time. With unpredictable consequences.”

(Reporting by I-Hwa Cheng; Additional reporting by Yimou Lee in Taipei and David Brunnstrom in Washington; writing by Ben Blanchard; editing by Leslie Adler and James Dalgleish)

Kudlow says U.S. expects China to start purchasing crops very soon

FILE PHOTO: White House chief economic advisor Larry Kudlow speaks with reporters on the driveway outside the West Wing of the White House in Washington, U.S. June 27, 2019. REUTERS/Yuri Gripas

WASHINGTON (Reuters) – White House economic adviser Larry Kudlow said on Thursday the United States expects China to start purchasing crops and U.S. agricultural products soon and noted that trade talks between the two countries are ongoing.

The United States and China agreed last month to restart trade talks that stalled in May. President Donald Trump agreed not to impose new tariffs and U.S. officials said China agreed to make agricultural purchases, but those have not yet materialized.

(Reporting by Jeff Mason; Editing by Chizu Nomiyama)

U.S., China to relaunch talks with little changed since deal fell apart

By David Lawder and Chris Prentice

WASHINGTON/NEW YORK (Reuters) – The United States and China are set to relaunch trade talks this week after a two-month hiatus, but a year after their trade war began there is little sign their differences have narrowed.

After meeting with Chinese President Xi Jinping in Japan just in late June, U.S. President Donald Trump agreed to suspend a new round of tariffs on $300 billion worth of imported Chinese consumer goods while the two sides resumed negotiations.

Trump said then that China would restart large purchases of U.S. agricultural commodities, and the United States would ease some export restrictions on Chinese telecom equipment giant Huawei Technologies.

But sources familiar with the talks and China trade watchers in Washington say the summit did little to clear the path for top negotiators to resolve an impasse that caused trade deal talks to break down in early May.

A U.S. official said last week the discussions were expected to resume with a phone call between U.S. Trade Representative Robert Lighthizer, Chinese Vice Premier Liu He and Treasury Secretary Steven Mnuchin.

A USTR spokesman said the call was expected this week, but gave no further details.

The United States is demanding that China make sweeping policy changes to better protect American intellectual property, end the forced transfer and theft of trade secrets and curb massive state industrial subsidies. At stake, U.S. officials say, is dominance of the high-tech industries of the future, from artificial intelligence to aerospace.

“We’ve had a change in atmospherics,” said Derek Scissors, a China expert at the American Enterprise Institute, a business-oriented Washington think tank. “While this is great for markets, the administration has not said one specific thing about how we’re unstuck.”

Scissors, who has at times consulted with Trump administration officials, said that both sides got what they wanted out of the summit — a lowering of the temperature and the avoidance of new tariffs that would have been painful for both sides.

“The pressure for one side to give into the other is diffused right now. I expect this to drag out for months,” Scissors added.

NO FIRM COMMITMENTS

Washington and Beijing appear to have different ideas of what the two leaders agreed in Osaka.

Three sources familiar with the state of negotiations say that the Chinese side did not make firm commitments to immediately purchase agricultural commodities.

One of the sources said Trump raised the issue of agricultural purchases twice during the meeting, but Xi only agreed to consider purchases in the context of a broader final agreement.

Other than a small purchase of American rice by a private Chinese firm, no purchases have materialized. Chinese officials and state media accounts in the past week have emphasized that any deal, including agricultural purchases, is dependent on removal of U.S. tariffs.

“The Chinese have been clear they didn’t promise anything,” said one source familiar with the talks.

“The idea they would give up their main leverage before getting anything doesn’t make sense. I could see them buying some pork and buying some soybeans, but it’s still going to be pennies.”

Trump administration officials have also downplayed the extent of pledges to allow Huawei to purchase U.S. technology products, with White House trade adviser Peter Navarro saying that only “lower-tech” U.S. semiconductors could be made available for sale to the company..

Reuters reported last week that the Commerce Department’s export control enforcement staff was told to continue to treat Huawei as a blacklisted entity as the department considers requests for licenses to U.S. firms to sell products and services to Huawei

Chinese officials point out that they only got the United States to concede on Huawei at the Osaka talks, rather than on their other demand, which was removing the existing tariffs.

So the focus on the upcoming talks will be the scrapping on the tariffs, they say.

A second source said that U.S. tariffs on $250 billion worth of Chinese goods and Chinese tariffs on $160 billion worth of U.S. goods could wind up being “the new normal.”

One Chinese official familiar with the situation said that trade talks would be re-started very quickly, but that there was a “fairly large gap” in the core demands of both countries and it would be a challenge to reach consensus on the toughest issues.

“The negotiating environment is even more severe,” the official said.

Another official said China remained concerned about the presence of hawks in the U.S. team, such as Trump advisor Peter Navarro.

“There are bullies there,” the official said.

The officials spoke to Reuters on condition of anonymity.

China’s foreign ministry cited Xi as telling Trump at Osaka that “on issues concerning China’s sovereignty and dignity, China must safeguard its core interests”.

A senior Beijing-based Asia diplomat said there would be pressure on China’s leadership not to give in to the United States and for any outcomes to seen as equal and balanced.

“A trade deal cannot be portrayed as a victory for the United States,” the diplomat said, citing conversations with Chinese officials.

WHICH TEXT?

There has been no indication the two sides will resume negotiations using a text that had been largely agreed before China backtracked on commitments in early May, prompting Trump to proceed with a long-threatened tariff hike to 25 percent on a $200 billion list of Chinese imports.

Beijing had cut out of that text commitments to make changes to its laws reflecting reform pledges, arguing that this would violate its national sovereignty.

Lighthizer has insisted on legal changes to make it more likely that Chinese reform pledges will be carried out.

Finding a way around this issue is paramount for talks. Beyond that, there are many other difficult issues to resolve, including the structure of an enforcement mechanism designed to hold the two sides to their pledges.

U.S. demands for curbs to provincial and local subsidies for Chinese state companies, access to China’s cloud computing market, agricultural biotech approvals and the ultimate size of China’s purchases of agricultural products are all divisive issues for the two sides.

Claire Reade, a former China trade negotiator at USTR who is now a Washington-based trade lawyer with the firm Arnold and Porter, said there was room on both sides to get a deal.

“It’s a question of political will and there are ways to maneuver around the current red flags that have been put in the ground,” Reade said. “Both President Xi and President Trump have to come out of this saying they stood strong, and they in-effect got a win.”

One way for China to avoid the appearance of giving in to U.S. demands is to take some legal steps on key issues before the deal is agreed. That way they can say they’re doing it on their own terms, she added.

(Additional reporting by Ben Blanchard in Beijing and Andrea Shalal in Washington; Editing by Simon Webb and Alistair Bell)

Fed faces tougher task in deciding whether to cut U.S. rates

The Federal Reserve building is pictured in Washington, DC, U.S., August 22, 2018. REUTERS/Chris Wattie/

By Trevor Hunnicutt

NEW YORK (Reuters) – U.S. employers are hiring workers at a brisk pace, but that is only making the Federal Reserve’s job harder.

On Friday, the Labor Department said nonfarm employers added 224,000 jobs last month – the most in five months, and not the kind of labor market that would normally cause policymakers at the U.S. central bank to cut interest rates.

But the Fed opened up the possibility of cuts last month, citing muted inflation pressures and an economic outlook clouded by a U.S. trade war and slower global growth.

This complicates a debate Fed policymakers are having over whether the economy needs stimulus, setting up a possible standoff with markets at their July 30-31 meeting.

“They are in a bit of a bind,” said Karim Basta, chief economist at III Capital Management. “On the surface, the data, in my opinion, doesn’t really support an imminent cut, but markets are expecting it, and I do think there’s a risk at this stage that they disappoint.”

Markets are overwhelmingly betting the Fed’s next move will be its first rate cut since the financial crisis a decade ago, and President Donald Trump on Friday renewed demands for lower rates to strengthen the economy.

Fed Chairman Jerome Powell has repeatedly said the central bank makes decisions independently from both markets and the White House, but failing to deliver a cut could cause a stock and short-term bond selloff and reduce economic activity.

U.S. interest rates futures fell after the jobs report on Friday. Markets still see a rate cut this month as a near-certainty, though they largely priced out changes for an aggressive half-percentage-point cut.

“These are good numbers, but a rate cut in July is still all but inevitable,” said Luke Bartholomew, investment strategist for Aberdeen Standard Investments. “Employment growth remains a bright spot amid a fairly mixed bag of U.S. data and yet markets have come to expect a cut now so (they) will fall out of bed if they don’t get one.”

The U.S. has not resolved its trade dispute with China, but the two countries agreed last weekend to resume trade talks, putting off new tariffs.

There are still signs of a pullback in economic activity. Businesses’ spending on machines and other equipment is tepid, but employers keep hiring hotel maids, electricians, daycare providers and other workers. They are also paying them more. Average hourly earnings rose at a 3.1%-a-year pace. A May payroll gain of 72,000 now seems like a fluke rather than a sign of deterioration.

Those are not the prototypical conditions for a rate cut. Unemployment at 3.7% is near its lowest levels since 1969 and policymakers have traditionally seen job gains with low unemployment posing risks of inflation.

But economists have grown less confident in academic models that forecast an inverse relationship between unemployment and inflation. The core personal consumption expenditures index is running at 1.6% a year, short of the Fed’s 2% goal.

In its semi-annual report to Congress, the Fed on Friday repeated its pledge to “act as appropriate” to sustain the economic expansion, with possible interest rate cuts in the coming months, but notably said the jobs market had “continued to strengthen” so far this year, and described recent weak inflation as due to “transitory influences.”

Some policymakers think a rate cut could lift inflation expectations, reducing chances of more drastic rate cuts being needed later. With rates at 2.25%-2.50%, policymakers have less room to cut before they resort to unconventional measures.

A cut could also reduce the Fed’s firepower in the case of a more severe downturn and signal greater concern about the future and even that more stimulus is on the way.

(Reporting by Trevor Hunnicutt in New York; Additional reporting by April Joyner in New York and Howard Schneider in Washington; Editing by Jennifer Ablan and James Dalgleish)

Hong Kong mothers march in support of anti-extradition students

People wave flashlights during a gathering of Hong Kong mothers to show their support for the city's young pro-democracy protesters in Hong Kong, China July 5, 2019. REUTERS/Thomas Pet

By Noah Sin and Vimvam Tong

HONG KONG (Reuters) – Thousands of mothers marched in Hong Kong on Friday in support of students who have taken to the streets in recent weeks to protest against an extradition bill that would allow people to be sent to mainland China for trial.

Hong Kong Chief Executive Carrie Lam has asked to meet students in the Chinese-ruled city as she tries to fend off pressure after a month of protests over a proposed law that has plunged the Chinese-ruled city into turmoil.

Protesters stormed Hong Kong’s legislature on Monday, the 22nd anniversary of the former British colony’s return to China. This followed mass demonstrations last month against Lam’s extradition bill.

Beijing-backed Lam has suspended the bill but protesters are demanding a full withdrawal.

A woman holds a placard during a gathering of Hong Kong mothers to show their support for the city’s young pro-democracy protesters in Hong Kong, China July 5, 2019. REUTERS/Thomas Peter

“Young people have already done a lot for us. We should at least stand out once for them. I am so distressed for them. Even though they seem a little bit violent … they didn’t hurt anyone,” said Carina Wan, 40, a primary school teacher on the mothers’ march.

“The ones who hurt us is the government. If they don’t release the young people, we will keep standing out.”

The organizers estimated that 8,000 mothers had joined the march, while the police put their number at 1,300.

In an emailed statement, a spokeswoman for Lam said on Thursday she had “recently started inviting young people of different backgrounds for a meeting, including university students and young people who have participated in recent protests”.

The student union at the Hong Kong University of Science and Technology (HKUST), one of eight major higher education institutions, turned down the offer, saying Lam had requested a closed-door meeting.

“The dialogue must be open to all Hong Kong citizens to participate, and allow everybody the right to speak,” the union said in a statement published on Facebook.

Lam’s spokeswoman said the meeting would be held in a “small-scale and closed-door manner” to ensure an “in-depth and frank exchange of views”.

A leader of the Hong Kong University Students’ Union, Jordan Pang, said he would only agree if the government promised not to investigate protesters involved in the protests.

“We don’t understand why she didn’t openly respond to the people’s demands but prefer to do it through a closed-door meeting,” Pang said.

“We want to ask if the government sincerely wants to communicate with young people or if it’s just another political PR show.”

The Hong Kong Bar Association (HKBA) renewed calls for the government to set up an independent inquiry to look into events on June 12, when police fired rubber bullets and tear gas at protesters, and also on Monday when demonstrators stormed the legislature.

“HKBA calls on the government to respond in a sincere way to the demands of the community voiced so emphatically over the past weeks,” it said. “A refusal to engage with the public over important and pressing issues is inimical to the rule of law.”

Hong Kong returned to China under a “one country, two systems” formula that allows freedoms not enjoyed in mainland China, including freedom to protest and a much-cherished independent judiciary.

But many resent what they see as increasing meddling by the mainland and the erosion of those freedoms. Beijing denies the charge.

Students have echoed opposition calls in recent weeks for the withdrawal of the extradition bill, for Lam to step down and for an investigation into complaints of police brutality.

They have also called for Lam to stop labeling protesters “rioters” and to introduce genuine universal suffrage.

Students at the Chinese University of Hong Kong, another of the city’s eight higher education institutions, were also invited to meet Lam but had not decided how to respond, a source at the student union there said.

(Reporting by Noah Sin, Felix Tam and Meg Shen; Editing by Anne Marie Roantree, Nick Macfie and Hugh Lawson)