North Korea conducts ballistic missile test

North Korea has fired a ballistic missile in the first such test since Donald Trump took office as US president.

Mr Trump assured Japan’s Prime Minister Shinzo Abe that “America stands behind Japan, its great ally, 100%”.

The missile flew east towards the Sea of Japan for about 500km (300 miles), South Korean officials say.

Mr Abe said the test was “absolutely intolerable”. Japanese officials say the missile did not reach its waters.

Speaking at a joint conference during a visit to the US, Mr Abe added that Mr Trump had also assured him that he was committed to “further enforcing our alliance”.

During his election campaign, Mr Trump said US defence commitments to Japan and South Korea were unfair and also called for Japan to pay the full cost of stationing US troops on its soil.

North Korea has conducted a number of nuclear tests in the past year that continue to alarm and anger the region.

Sunday’s launch took place at 07:55 local time (22:55 GMT Saturday) from the Banghyon air base in North Pyongan province on the west side of the Korean peninsula.

The missile reached an altitude of about 550km (350 miles), according to a South Korean official quoted by Reuters news agency, and appeared to be a Rodong medium-range missile.

In January, North Korean leader Kim Jong-un warned that his military was close to testing long-range missiles capable of reaching the United States and carrying nuclear warheads.

Mr Trump derided the claim in a tweet, saying: “It won’t happen.”

South Korea’s foreign ministry said that “North Korea’s repeated provocations show the Kim Jong-un regime’s nature of irrationality, maniacally obsessed in its nuclear and missile development”.

Japan’s Chief Cabinet Secretary Yoshihide Suga confirmed the missile had not reached Japanese territorial waters, adding that Tokyo would make a “strong protest” to North Korea over the incident.

There has so far been no comment from North Korea.

On a visit to South Korea last week, US Defence Secretary James Mattis said that any use of nuclear weapons by North Korea would be met with an “effective and overwhelming” response.

He also reconfirmed plans to deploy a US missile defence system in South Korea later this year.

North Korea conducted its fifth test of a nuclear device last year, and claims it is capable of carrying out a nuclear attack on the US, though experts are still unconvinced that its technology has progressed that far.

Source: BBC

Asia stocks, euro pressured by economic, political uncertainty

Appetite for Asian stocks and the euro ebbed on Tuesday as a rising tide of economic and political concerns added to anxiety over expectations China’s foreign exchange reserves fell again in January.

European stocks look set for sluggish start, with financial spreadbetter CMC Markets expecting Britain’s FTSE 100.FTSE to open up 0.1 percent, France’s CAC 40 .FCHI 0.1 percent lower and Germany’s DAX .GDAXI to be little changed.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was fractionally lower, while Japan’s Nikkei .N225 closed down 0.35 percent.

Chinese shares .CSI300 .SSEC dropped 0.4 percent ahead of data expected to show that foreign exchange reserves fell for the seventh straight month by about $10.5 billion to $3 trillion in January.

But some economists said reserves may have actually risen due to tighter controls on moving money out of the country, as well the impact of a weaker dollar.

Nevertheless, as foreign exchange reserves linger at around $3 trillion, concerns remain over the speed at which China has depleted its cash resources to defend the currency.

Overnight, both U.S. and European stocks dropped.

Wall Street dipped as much as 0.2 percent, led lower by the energy sector as oil prices fell, with investors still waiting for details of U.S. President Donald Trump’s economic policies.

“The market’s tone has been one of risk-off, as political fallout in both Europe and the United States is weighing on investor resolve, imposing an unpalatable risk on investor sentiment,” Stephen Innes, senior trader at OANDA in Singapore, wrote in a note.

Declines in European shares came on the heels of the French presidential campaign launch of far-right National Front Leader Marine Le Pen on a platform pledging to fight globalization and take France out of the European Union.

French stocks .FCHI lost 1 percent, and yields on 10-year French government bonds hit their highest level since September 2015.

“Despite the reaction in the French yields, polls show Le Pen would finish runner-up by a wide margin to either Independent Emmanuel Macron or Republican Francois Fillon,” James Woods, global investment analyst at Rivkin Securities in Sydney, wrote in a note.

The euro EUR=EBS fell 0.3 percent to $1.0714 on Tuesday, after dropping as much as 0.7 percent the previous day to a near one-week low before recovering to close down 0.3 percent.

The dollar added about 0.1 percent to 111.845 yen JPY= on Tuesday, recovering some of its 0.8 percent loss from Monday.

The dollar index .DXY, which tracks the greenback against a trade-weighted basket of its peers, was steady at 99.907, retaining its small gains of almost 0.1 percent from Monday.

The Australian dollar AUD=D4 reversed earlier losses to rise 0.25 percent to $0.7679 after the Reserve Bank of Australia kept interest rates on hold at a record low 1.5 percent as expected, and played down a recent soft patch in economic growth as a temporary hiccup.

The New Zealand dollar NZD=D4 jumped 0.5 percent to $0.7363, after earlier touching a near a three-month high of $.0.7375.

Reserve Bank of New Zealand Governor Graeme Wheeler said on Tuesday he would not seek a second term when his current term ends on Sept. 26. Deputy Governor Grant Spencer will fill in for six months while a permanent replacement is sought.

Oil prices inched higher on Tuesday after posting their biggest one-day loss since Jan. 18 on Monday, as worries about rising oil supply out of the United States tussled with optimism about output curbs elsewhere.

U.S. crude CLc1 gained 0.1 percent to $53.07 a barrel, after falling 1.5 percent on Monday.

Global benchmark Brent LCOc1 also advanced 0.2 percent to $55.82, reclaiming some of Monday’s 1.9 percent loss.

Gold surrendered some of Monday’s strong gains but hovered close to its three-month high hit on the day.

Spot gold XAU= slipped 0.2 percent to $1,234.16 an ounce, after surging 1.3 percent on Monday.

Source: Reuters

In S Korea: South Korea’s acting president urges ‘swift’ THAAD deployment

South Korea's acting President and Prime Minister Hwang Kyo-ahn speaks during a New Year's press conference at the government complex in Seoul on January 23, 2017. / AFP PHOTO / POOL / AHN Young Joon

North Korea’s nuclear and missile capabilities are accelerating at an “unprecedented” pace, the South’s acting president said Monday, urging the swift deployment of a US anti-missile system that has infuriated Beijing.
Seoul and Washington agreed last year to install the Terminal High Altitude Area Defence (THAAD) system in the South after a string of North Korean nuclear and missile tests — prompting strong objections from China, which fears it will undermine its own ballistic capabilities.
Speaking to reporters on Monday, Acting President Hwang Kyo-Ahn said the North had conducted two nuclear tests and fired multiple ballistic missiles last year, averaging two per month.

“Its nuclear and missile capabilities are developing at an unprecedented pace,” Hwang said. “They are real and obvious threat.”
A “swift” deployment of the THAAD system “is necessary to protect the lives and safety of our people”, he added.
Within South Korea, voices opposing the installation have grown louder, with some opposition candidates pledging to scrap the agreement if they win a presidential election due this year.
The plan has also angered Beijing, which has imposed a string of measures seen in the South as economic retaliation, including effectively barring K-pop stars from performing on the mainland and not authorising South Korean airlines to operate charter flights between the countries.
“There are various concerns about economic retaliation from THAAD but the relationship between South Korea and China did not happen in just one or two years,” Hwang said.
He took over President Park Geun-Hye’s sweeping executive powers after she was impeached in December, becoming the de facto leader of Asia’s fourth largest economy.
Park is accused of colluding with close friend Choi Soon-Sil to strong-arm companies into handing over tens of millions of dollars to dubious foundations which Choi controlled.
The case is now being considered by the Constitutional Court — which has up to six months to reach a ruling — but hundreds of thousands of South Koreans have joined weekly protests calling for Park’s immediate departure from office.
If the court confirms the impeachment, a presidential election will have to be held within 60 days.

South Korea’s acting president urges ‘swift’ THAAD deployment