市场消息

LONDON (Reuters) – Iran announced on Wednesday it was scaling back curbs to its nuclear program under a 2015 deal with world powers, and threatened to do more — including enriching uranium to a higher level — if countries did not shield it from U.S. sanctions.

A year after Washington pulled out of the nuclear deal with Iran, President Hassan Rouhani unveiled measures that do not appear to violate the deal’s terms yet, but could do so in the future if Iran were to persist on the course he set out.

Rouhani said Tehran would halt a program to sell excess enriched uranium and heavy water to other countries, an arrangement used under the nuclear deal to keep its own stockpiles below permitted caps.

And he threatened that in 60 days Iran would resume enrichment of uranium beyond the low level permitted under the deal, unless the five other powers signed up to it find a way to protect Iran’s oil and banking industries from U.S. sanctions.

“If the five countries came to the negotiating table and we reached an agreement, and if they could protect our interests in the oil and banking sectors, we will go back to square one,” Rouhani said.

“The Iranian people and the world should know that today is not the end of the JCPOA,” he said, using the acronym for the nuclear deal. “These are actions in line with the JCPOA.”

The 2015 deal was signed between Iran, the United States, Russia, China, Britain, France and Germany. Iran agreed to curbs on its nuclear program in return for the lifting of sanctions.

Washington’s European allies opposed President Donald Trump’s decision to pull out. They have tried to find ways to blunt the economic impact of new U.S. sanctions in the hope of persuading Tehran to continue to abide by it. However, their efforts have largely failed, with all major European companies abandoning plans to do business with Iran for fear of U.S. punishment.

France’s defense minister said she wanted to keep the nuclear deal alive and warned Iran it could face more sanctions if it did not honor its part of the deal.

“Today nothing would be worse than Iran, itself, leaving this agreement,” Florence Parly told BFM TV.

China said the agreement should be implemented and called on all sides to avoid an escalation of tensions.

TENSIONS
The weeks leading up to the anniversary of Trump’s withdrawal from the agreement have seen a sharp tightening of U.S. sanctions and an increase in tensions on other fronts.

From this month, Washington has effectively ordered countries around the world to stop buying any Iranian oil or face sanctions of their own, revoking waivers that had allowed some countries to continue buying Iranian oil. It says it aims to reduce Iranian crude exports to zero.

Washington has also blacklisted Iran’s Revolutionary Guards force as a terrorist organization and Iran responded with threats to close the Gulf’s strait of Hormuz if its ships were blocked there.

Washington announced the deployment of an aircraft carrier to the Gulf to counter what it says are Iranian threats. Tehran says the USS Abraham Lincoln is replacing another carrier that had already left the area under a scheduled rotation, and calls the announcement “psychological warfare” based on old news.

The looming total ban on oil sales is likely to sharply increase the economic hardship for Iran’s 80 million people, and finding a response is the biggest test yet for Rouhani, a pragmatist who has faced strong opposition from the hardline faction of Iran’s leadership throughout his six years in office.

The nuclear deal was the flagship policy of Rouhani, who won two landslide elections on promises to end Iran’s isolation and open its economy up to the world. Ultimate authority in Iran is in the hands of Supreme Leader Ali Khamenei, a cleric in power since 1989, who signed off on the nuclear deal but remains close to the hardline faction that challenges Rouhani.

Washington’s European allies say Trump’s repudiation of the deal hurts the pragmatic wing of Iran’s leadership and plays into the hands of hardliners. It means ordinary Iranians see no economic benefits from Rouhani’s efforts to open the country.

The Trump administration argues that the deal, negotiated by his predecessor Barack Obama, was flawed because it is not permanent, does not address Iran’s missile program and does not punish Iran for meddling in the affairs of other countries.

Trump’s hard line is backed by Israel and by Washington’s Arab allies in the Gulf, such as Saudi Arabia and the United Arab Emirates, which see Iran as a foe and which gain leverage over global oil prices by keeping Iranian crude off the market.

Iranian Foreign Minister Mohammad Javad Zarif tweeted: “After a year of patience, Iran stops measures that US has made impossible to continue.” Zarif said the remaining countries had a “narrowing window” to save the deal.

WASHINGTON (Reuters) – Months before evangelical leader Jerry Falwell Jr.’s game-changing presidential endorsement of Donald Trump in 2016, Falwell asked Trump fixer Michael Cohen for a personal favor, Cohen said in a recorded conversation reviewed by Reuters.

Falwell, president of Liberty University, one of the world’s largest Christian universities, said someone had come into possession of what Cohen described as racy “personal” photographs — the sort that would typically be kept “between husband and wife,” Cohen said in the taped conversation.

According to a source familiar with Cohen’s thinking, the person who possessed the photos destroyed them after Cohen intervened on the Falwells’ behalf.

The Falwells, through a lawyer, declined to comment for this article.

Cohen, who began a three-year prison sentence this week for federal campaign violations and lying to Congress, recounted his involvement in the matter in a recording made surreptitiously by comedian Tom Arnold on March 25. Portions of the recording — in which Cohen appeared to disavow parts of his guilty plea — were first reported April 24 by The Wall Street Journal.

The Falwells enlisted Cohen’s help in 2015, according to the source familiar with Cohen’s thinking, the year Trump announced his presidential candidacy. At the time, Cohen was Trump’s confidant and personal lawyer, and he worked for the Trump Organization.

The Falwells wanted to keep “a bunch of photographs, personal photographs” from becoming public, Cohen told Arnold. “I actually have one of the photos,” he said, without going into specifics. “It’s terrible.”

Cohen would later prove successful in another matter involving Falwell, two people familiar with the matter told Reuters. Cohen helped persuade Falwell to issue his endorsement of Trump’s presidential candidacy at a critical moment, they said: just before the Iowa caucuses. Falwell subsequently barnstormed with Trump and vouched for the candidate’s Christian virtues.

Reuters has no evidence that Falwell’s endorsement of Trump was related to Cohen’s involvement in the photo matter. The source familiar with Cohen’s thinking insisted the endorsement and the help with the photographs were separate issues.

Cohen’s connection to the Falwells sheds light on the formidable alliance between Trump and a man who, through his university, is one of the most influential evangelical figures in America. Falwell’s backing helped galvanize evangelicals and persuaded many Christians concerned about Trump’s past behavior to embrace him as a repentant sinner.

Falwell’s support for Trump has not wavered throughout the New York celebrity-politician’s own tribulations, including the Access Hollywood recording of Trump talking about grabbing women’s genitals and payoffs made by Cohen to hide Trump’s extramarital affairs. This past weekend, Falwell tweeted that “Trump should have 2 yrs added to his 1st term” to make up for the two years of the Mueller investigation into Russian interference in the 2016 U.S. presidential election.

BLOCKBUSTER ENDORSEMENT
Falwell’s endorsement of Trump, however, did surprise some students and staff at Liberty University, the school in Lynchburg, Virginia, founded by Falwell’s father, Jerry. It was at Liberty where fellow Republican presidential candidate and major Trump rival Ted Cruz had chosen to launch his campaign the previous year. Cruz’s father was an evangelical preacher, much like Falwell’s father; Trump has been married three times and divorced twice. For years, prior to running for president, Trump boasted of his sexual exploits and supported a host of social positions, such as abortion rights, that run counter to beliefs espoused by Falwell.

Although Falwell declined interview requests for this story, he has said repeatedly that he endorsed Trump because Trump was the strongest candidate, had significant experience running a business, and had the right vision for the country.

The connection between Trump and Falwell goes back years. In 2012, Trump gave the convocation at Liberty University. One link between Trump and the couple appears to have been Cohen, a now-disbarred New York lawyer who formed a close bond with the Falwells.

During the campaign, Cohen worked closely with Liberty University to help promote Trump’s candidacy. It was around that time that Cohen heard from the Falwells about the photographs, said the source familiar with Cohen’s thinking.

The Falwells told Cohen that someone had obtained photographs that were embarrassing to them, and was demanding money, the source said. Reuters was unable to determine who made the demand. The source said Cohen flew to Florida and soon met with an attorney for the person with the photographs. Cohen spoke with the attorney, telling the lawyer that his client was committing a crime, and that law enforcement authorities would be called if the demands didn’t stop, the source said.

The matter was soon resolved, the source said, and the lawyer told Cohen that all of the photographs were destroyed.

Months later, in early 2016, Trump faced what seemed like an enormous challenge. The Iowa caucus was coming up, and Cohen — then deeply loyal to Trump — was concerned about how Trump would fare, the source said. Cohen felt Trump “was being slaughtered in that community,” and “didn’t want to see him embarrassed or, you know, without support,” said the source familiar with Cohen’s thinking. Cohen repeatedly reached out to Jerry Falwell, and pleaded with him to back Trump, the source said.

Soon after, according to this account, Falwell made his historic announcement. “I am proud to offer my endorsement of Donald J. Trump for President of the United States,” Falwell was quoted saying in a statement issued by the Trump campaign. “He is a successful executive and entrepreneur, a wonderful father and a man who I believe can lead our country to greatness again.”

TOKYO (Reuters) – Asian equities tracked Wall Street’s slide on Wednesday, while investors switched to safe-haven government bonds, driven by fears that global growth will suffer as a potential trade deal between the United States and China appeared to be unraveling.

Beijing said on Tuesday that Chinese Vice Premier Liu He will visit Washington on Thursday and Friday for trade talks, setting up a last-ditch bid to salvage a deal that would avoid a sharp increase in tariffs on Chinese goods ordered by U.S. President Donald Trump.

In early European trade on Wednesday, pan-region Euro Stoxx 50 futures were down 0.09 percent, German DAX futures were up 0.05 percent and FTSE futures were down 0.03 percent.

MSCI’s broadest index of Asia-Pacific shares outside Japan, which earlier on Wednesday morning touched its lowest level since late March, was down 0.55 percent.

The index had climbed to a nine-month peak three weeks ago, buoyed by factors including strong Chinese economic data and views that Sino-U.S. trade negotiations were progressing and would end in a deal.

The Shanghai Composite Index retreated 0.1 percent.

Australian stocks declined 0.4 percent, South Korea’s KOSPI fell 0.3 percent and Japan’s Nikkei was down 1.9 percent.

“The stock market had held an optimistic view towards U.S.-China trade, likely pricing in an end to negotiations. But the sudden resurgence in trade tensions has forced it to grapple with uncertainties, such as the risk of the talks taking an unforeseen turn,” wrote strategists at Goldman Sachs.

Wall Street stocks had slid on Tuesday, with the S&P 500 losing 1.65 percent and the Dow shedding 1.8 percent on the U.S.-China trade concerns.

Global stocks had a rocky start to the week after Washington on Monday accused Beijing of backtracking from commitments made during trade negotiations. That followed President Donald Trump’s unexpected statement on Sunday that he would raise tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent.

“From an equity market perspective, the immediate focus is on the two-day talks scheduled to take place between the U.S. and Chinese officials,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.

“However, it is difficult to imagine the two parties resolving their differences in just two days of talks. The markets may have to begin pricing in the trade conflict as a long-term factor once again.”

Government bond prices surged and their yields fell sharply as investor panic took a toll on growth asset markets.

Benchmark 10-year yields on U.S. Treasuries, German bunds and Japanese government bonds (JGBs) sank to one-month lows.

Japan’s 10-year yield burrowed deeper into negative territory and last stood at minus 0.055 percent .

In currency markets, the dollar declined for the fourth day and touched a six-week low of 109.905 yen .

The Japanese yen, a perceived safe-haven, often gains against its peers in times of market turmoil and political strife.

The euro was a little higher at $1.1204 after ending the previous day nearly flat, and having held in a tight range for the last few sessions.

The New Zealand dollar was down 0.2 percent at $0.6560 after the country’s central bank cut interest rates to a record low 1.5 percent from 1.75 percent on Wednesday amid weaker domestic activity and employment headwinds.

The kiwi had earlier dropped to $0.6525, its lowest since November 2018.

The Australian dollar edged up 0.2 percent to $0.7022 .

The Aussie was on the front foot after the Reserve Bank of Australia kept its policy interest rate unchanged at 1.5 percent on Tuesday, defying expectations for a cut.

U.S. West Texas Intermediate crude futures rose 0.78 percent to $61.88 per barrel, recovering some ground after sinking 1.36 percent on Tuesday.

Crude oil prices had dropped as renewed U.S.-China trade worries stoked concerns of slower global growth crimping demand for commodities. But a relatively tight market conditions due to U.S. sanctions on Iran and Venezuela has provided underlying support for oil prices.

Brent crude oil futures were up 0.54 percent at $70.26 per barrel, pulling back from a one-month trough of $68.79 brushed on Monday.

LONDON (Reuters) – World markets steadied on Tuesday after being rattled by U.S. President Donald Trump’s latest threat to ramp up trade tariffs on China, though Turkey’s lira was back in trouble as concerns about its politics erupted again.

It was a calmer start from Europe’s main bourses after Trump’s threat to ratchet up tariffs on hundreds of billions of dollars of Chinese goods triggered the biggest sell-off in European equities since March.

London dipped 0.2 percent as it had to play catch-up after a long weekend, but Frankfurt, Paris and the pan-European STOXX 600 index all flitted between gains and losses as more normal service resumed.

Some investors are holding out hope that the tariff threats are a negotiating tactic, especially as Beijing confirmed its top negotiator, Vice Premier Liu He, would go to Washington on Thursday and Friday as planned.

MSCI’s broadest global and Asian indexes had largely held their ground overnight, though Japan’s Nikkei did take a delayed 1.5 percent hit, having been closed for over a week.

Asia tumbled 2 percent on Monday and Chinese markets had suffered their worst drop in more than three years.

“We expect the situation to de-escalate as the issue seems solvable and Liu He, China’s lead negotiator, is continuing with his plans to travel to Washington D.C. for talks this week,” said Oxford Economics economist Louis Kuijs.

“Nonetheless, the probability of renewed escalation of the U.S.-China trade war has risen substantially, which would be a drag on their respective economies, especially on China.”

China’s yuan had recouped most of its early losses against the dollar by the end of trading there as investors largely digested the situation.

The offshore yuan clawed as high as 6.7628 per dollar at one point, trimming the intraday loss to 6 pips from the previous late night close of 6.7622.

LIRA PRESSURE
There was plenty more keeping traders busy too.

Australia’s dollar jumped almost 1 percent to a one-week top of $0.7048, after the country’s central bank kept rates on hold, wrongfooting some who had expected it to cut. [/FRX]

Other major currencies remained confined to well-trodden ranges, with the euro trading virtually flat at $1.1212 ahead of new European Commission economic forecasts and the dollar holding steady at 110.63 yen.

In emerging markets though, the Turkish lira was back under heavy fire after the country’s elections board ruled to scrap and re-run Istanbul elections. It slid 1.5 percent past the 6.15 per dollar which also sent government bonds tumbling.

“The rule of law is under scrutiny by markets,” UniCredit EM FX strategist Kiran Kowshik said.

“It is also clear that Turkish reserves are depleted and there are questions about whether Turkey can weather its immediate challenges without an external anchor like the IMF.”

In the commodity market, oil futures traded steady to higher on Tuesday as U.S. sanctions on crude exporters Iran and Venezuela kept supply concerns alive.

U.S. West Texas Intermediate (WTI) crude futures inched up to $62.34 per barrel while Brent crude oil futures were little changed at $71.23.

Bloomberg – The government and opposition Labour Party are set for a crunch meeting on Tuesday that could define the course of Brexit. If the two sides fail to agree a compromise, the chances of another referendum or even an emergency general election will rise.

May’s Uneasy Courtship of Corbyn Puts Brexit Deal on Knife Edge

Key Developments:
Government talks with Labour to resume at 4 p.m.
Foreign Secretary Jeremy Hunt says he doesn’t personally favor a customs union long-term, but compromise needed
Seamus Milne, a key Labour adviser, is said to be fully engaged in the talks
If negotiations fail, the next step would be a series of votes in Parliament seeking a consensus for an alternative
Tory activists to meet June 15 to debate petition to replace May
Brexit Talks to Resume at 4 p.m. (12:30 p.m.)

Government talks with the opposition Labour Party are set to resume at 4 p.m., Theresa May’s spokesman, James Slack, told reporters in London. The aim is to secure a Brexit solution that will garner a “stable” majority in Parliament, he said, a comment that indicates the government is looking for Labour to support the Withdrawal Agreement Bill at every stage of its passage through the House of Commons.

Slack also said it’s becoming more likely each day that passes that the U.K. will have to take part in European Parliament elections. He said Cabinet discussed Brexit for an hour on Tuesday morning, and May reiterated that the results of last week’s local elections showed the public wants both major parties to get on with delivering the U.K.’s departure from the EU.

Tories Plan June 15 Debate on Replacing May (9:15 a.m.)
Conservative activists have been invited to an emergency meeting in London June 15 to debate whether the party should choose another leader. Andrew Sharpe, chairman of the Conservative National Convention, set the date in a letter to members, which also set out the petition he received from 65 local Conservative association chairmen calling for Theresa May to resign.

A debate and vote on May’s leadership will be the only item on the agenda at the meeting, according to Sharpe’s letter, which was posted on the ConservativeHome website. While it’s not legally binding, it would — if passed — add to pressure on the prime minister to name her resignation date.

What Next As Cross-Party Brexit Talks Conclude

Hunt Hints at Customs Union Compromise (7:30 a.m.)
Foreign Secretary Jeremy Hunt said he doesn’t “personally” favor a customs union with the European Union as a “long-term” outcome, but compromise will be needed on all sides.

Hunt told BBC Radio 4 his view is that the U.K. economy is too big for a customs union to work long-term. The key word here may be long-term: one of the proposals in talks is for a temporary customs union.

Why is May Meeting Brady? (7:20 a.m.)
Education Secretary Damian Hinds downplayed May’s scheduled meeting on Tuesday with Graham Brady, chairman of the so-called 1922 Committee of rank-and-file Conservative members of Parliament. According to media reports, Brady is planning to tell May to set a date for her departure.

“The prime minister has already been clear and straightforward about what she will do; that she will see through this first phase of Brexit,” Hinds told the BBC. “I don’t think you should read too much into the fact the prime minister is meeting the chairman of the 1922 Committee; that’s what happens as a matter of course.”

The EU and Then Some
An intricate network of agreements and regulations holds Europe together

WASHINGTON (Reuters) – Congressional Democrats moved closer on Monday to citing Attorney General William Barr for contempt of Congress over his failure to give them an unredacted version of the Mueller report, escalating a showdown with the White House.

The Democratic-led House Judiciary Committee released a report citing Barr, an appointee of President Donald Trump, for contempt of Congress after the expiration of a second deadline to produce the full report. Barr also skipped a hearing before the committee last week.

The panel will vote on whether to move ahead with a contempt citation on Wednesday, and if it does so, the full House will vote on the issue.

Barr has released a redacted version of Special Counsel Robert Mueller’s report here on his investigation into Russian interference in the 2016 U.S. presidential election. House Judiciary Committee Chairman Jerrold Nadler subpoenaed the full document and underlying evidence, setting an initial deadline that Barr missed last week.

Assistant Attorney General Stephen Boyd said he was disappointed with the committee’s contempt move and invited committee staff to the Justice Department to discuss a possible compromise on Wednesday afternoon, after the committee’s expected vote.

Later, Nadler said in a statement that Justice Department officials had agreed to shift the meeting to Tuesday. The Justice Department did not immediately respond to a request for comment.

The Trump administration is stonewalling multiple probes by House committees.

A contempt citation could lead to a civil court case against Barr, raising the possibility of fines and even imprisonment for failure to comply.

Some Democrats on Nadler’s panel say lawmakers could also exercise their own little-used “inherent” authority to act outside the U.S. judicial system to apprehend, fine and even imprison officials who do not comply with congressional subpoenas.

‘NO CHOICE’
“The attorney general’s failure to comply with our subpoena … leaves us no choice but to initiate contempt proceedings,” Nadler said in a statement. But he held out the possibility that Barr could avoid contempt by making a “good faith” offer for access to the material.

Republicans reject Nadler’s efforts as political theater, which they say is intended to satisfy the Democrats’ voters.

“Democrats have launched a proxy war smearing the attorney general when their anger actually lies with the president and the special counsel, who found neither conspiracy nor obstruction,” Representative Doug Collins, top Republican on the committee, said in a statement.

Some Democrats have called on Barr to resign, accusing him of protecting Trump by effectively clearing the president of criminal obstruction of justice and excusing actions viewed by them as evidence of misconduct.

Nadler’s committee views the full Mueller report as vital to its own corruption and obstruction of justice investigation of Trump. The chairs of five other House committees investigating the president have also called for its release.

The Mueller report details extensive contacts between Trump’s 2016 campaign and Moscow, but did not find that there was a conspiracy between Moscow and the campaign. The report also describes actions Trump took to try to impede Mueller’s investigation.

If lawmakers established that Trump obstructed justice by seeking to impede Mueller, Nadler’s panel could move to impeachment proceedings against the president.

Trump denied any wrongdoing in a tweet on Monday. “Also, there are ‘No High Crimes & Misdemeanors,’ No Collusion, No Conspiracy, No Obstruction. ALL THE CRIMES ARE ON THE OTHER SIDE, and that’s what the Dems should be looking at, but they won’t. Nevertheless, the tables are turning!” the president wrote on Twitter.

NEW YORK (Reuters) – Michael Cohen, President Donald Trump’s former personal lawyer, took a parting shot at his former boss – denouncing “xenophobia, injustice and lies” – before reporting to a U.S. federal prison on Monday to begin a three-year sentence.

Cohen, who once vowed to “take a bullet” for Trump but now calls him a “con man,” checked into the Federal Correctional Institution in Otisville, New York, about 70 miles (110 km) northwest of New York City, to serve his sentence for arranging hush payments to two women who said they had sexual encounters with Trump, financial crimes and lying to Congress.

Cohen, 52, hinted he had more secrets to divulge as he made brief remarks to a crush of camera crews and reporters gathered on the sidewalk outside his Manhattan residence – the Trump Park Avenue apartment building – before being driven to the prison.

“I hope that when I rejoin my family and friends that the country will be in a place without xenophobia, injustice and lies at the helm of our country,” Cohen said, without uttering Trump’s name. “There still remains much to be told, and I look forward to the day that I can share the truth.”

Cohen was driven to the prison in a black SUV, arriving shortly after 11:30 a.m. (1530 GMT), some 2-1/2 hours before his deadline to report. Aerial TV news video showed Cohen stepping out of the SUV, then removing his jacket and leaving it inside the vehicle before walking with two men, apparently prison officials, into a building entrance.

The U.S. Bureau of Prisons, which runs the facility, confirmed by email Cohen was in its custody. Cohen is expected to stay at the prison’s minimum security camp.

Cohen’s prison term completes a stunning fall for the native of New York’s Long Island whose career was tethered to Trump as he evolved from wealthy real estate developer to reality TV personality to politician. For more than a decade, Cohen served as Trump’s personal lawyer and self-described “fixer.”

Trump has blasted Cohen, calling him a “rat” as well as a “bad lawyer and fraudster.”

Cohen, who has been disbarred as an attorney, was dressed in jeans, sneakers, a white shirt and a navy blue blazer as he exited his apartment building, with a doorman holding the door.

Several dozen bystanders stopped to take pictures, and one shook his hand. After Cohen made his remarks, the scene became chaotic, with equipment and people falling to the ground. Cohen helped one journalist to get back on his feet. Cohen then climbed into the SUV.

FBI agents in April 2018 raided Cohen’s Rockefeller Center office and Park Avenue hotel room as part of an investigation that grew out of Special Counsel Robert Mueller’s investigation into Russian interference in the 2016 U.S. election. That set in motion events that caused Cohen’s dramatic split with Trump.

‘TELL THE TRUTH’
Lanny Davis, spokesman for Cohen, issued a statement saying Cohen “will continue to be accessible to Congress and to federal, state and local law enforcement.”

“I will continue questioning why Michael is the only person within the Trump Organization to be prosecuted for crimes committed at the direction of and for the benefit of Mr. Trump,” Davis added.

Davis praised Cohen’s “courageous decision … to tell the truth about why Donald Trump represented a danger to our Constitution, our freedoms, and our nation’s fundamental values.”

Cohen had originally been due to report to prison on March 6, but was granted an extension to recover from shoulder surgery and testify before Congress.

Cohen broke with Trump in July 2018, telling ABC News he intended to put family and loyalty to his country ahead of the president. Cohen and his wife, Laura Shusterman, 49, have two adult children, Samantha and Jake.

In February congressional testimony, Cohen said, “I am ashamed that I chose to take part in concealing Mr. Trump’s illicit acts rather than listening to my own conscience. I am ashamed because I know what Mr. Trump is. He is a racist. He is a con man. He is a cheat.”

During his December sentencing in New York, Cohen said, “My weakness can be characterized as a blind loyalty to Donald Trump, and I was weak for not having the strength to question and to refuse his demands.”

Cohen pleaded guilty to violating campaign finance law, bank fraud and tax evasion. Prosecutors said Trump himself directed illegal hush payments orchestrated by Cohen of $130,000 to adult film star Stormy Daniels and $150,000 to Playboy model Karen McDougal to avert a scandal shortly before the 2016 election.

Trump has denied sexual relationships with them and said he never directed Cohen to do anything illegal.

Cohen also pleaded guilty to lying to Congress about a proposed Trump tower project in Russia that was being negotiated at the same time he was running for president.

His prison time could be reduced by about 15 percent for good behavior.

WASHINGTON (Reuters) – U.S. Attorney General William Barr is headed for a showdown on Monday with Democrats in Congress, as lawmakers prepared to begin contempt proceedings against the top U.S. law enforcement officer if he fails to hand over the full, unredacted Mueller report.

House Judiciary Committee Chairman Jerrold Nadler gave Barr until 9 a.m. EDT to produce the full report and underlying evidence from Special Counsel Robert Mueller’s 22-month investigation into Russian election meddling in the 2016 presidential election. Nadler has subpoenaed the material but Barr missed an initial deadline to provide it last week.

Nadler’s committee views the full Mueller report as vital to its own corruption and obstruction of justice investigation of President Donald Trump. The chairs of five other House committees investigating the president have also called for its release.

The Mueller report details extensive contacts between Trump’s 2016 campaign and Moscow, and the campaign’s expectation that it would benefit from Russian hacking and propaganda. It also describes actions Trump took to try to impede Mueller’s investigation. Barr released a redacted version of the report on April 18.

Some Democrats have called on Barr to resign, accusing him of protecting Trump by clearing the president of criminal obstruction and excusing actions that many view as evidence of misconduct. House Speaker Nancy Pelosi even charged that the attorney general lied to Congress, adding: “That’s a crime.”

In a letter to the attorney general setting out the Monday morning deadline, Nadler put Barr on notice that “the committee will move to contempt proceedings and seek further legal recourse” unless the Justice Department complies with the subpoena. The Justice Department declined to comment on the letter.

Representative David Cicilline, a Democrat on Nadler’s panel, said on Sunday that Barr could avoid contempt proceedings by assuring lawmakers that he would provide the material.

“If Mr. Barr agrees to turn over what we’ve requested in a reasonable way, no one on the committee is interested in moving forward,” Cicilline told Fox News Sunday.

Republicans have rejected Nadler’s efforts as political theater, which they say is intended to satisfy a progressive voter base that helped give Democrats control of the House of Representatives in last year’s midterm election.

But unless Barr complies, the House Judiciary Committee is expected to begin moving forward on Monday with a contempt citation that could lead to a civil court case against Barr, raising the possibility of fines and even imprisonment for failure to comply.

Cicilline and others also say lawmakers could exercise their little-used authority to act outside the court system and fine or even imprison officials who do not comply with congressional subpoenas.

“We have to take this in a deadly serious way,” said Cicilline, who warned that the Trump administration could “extinguish our oversight function” by refusing to provide testimony and evidence.

After missing the initial subpoena deadline for turning over the Mueller material, Barr skipped a hearing before Nadler’s committee on Thursday after Democrats adopted an aggressive format that would have subjected the attorney general to questions from staff attorneys.

BEIJING/WASHINGTON (Reuters) – China said on Monday that a delegation is still preparing to go to the United States for trade talks, after U.S. President Donald Trump dramatically increased pressure on Beijing to reach a deal, saying he would hike tariffs on Chinese goods this week.

Trump’s comments on Sunday marked a major escalation in tensions between the world’s largest economies, and a shift in tone from the president, who as recently as Friday had cited progress toward a deal.

Stock markets sank and oil prices tumbled on his remarks, as negotiations to end the months-long trade war were thrown into doubt.

“We are also in the process of understanding the relevant situation. What I can tell you is that China’s team is preparing to go to the United States for the discussions,” Chinese Foreign Ministry spokesman Geng Shuang told a news briefing.

But Geng did not say if Vice Premier Liu He, who is China’s lead official in the negotiations, was to be part of the delegation as originally planned.

“What is of vital importance is that we still hope the United States can work hard with China to meet each other half way, and strive to reach a mutually beneficial, win-win agreement on the basis of mutual respect,” Geng said.

The Wall Street Journal reported earlier that China was considering cancelling this week’s meetings in Washington in light of Trump’s comments, which took Chinese officials by surprise.

A less than rosy update from U.S. Trade Representative Robert Lighthizer, including details that China was pulling back from some previous commitments, prompted Trump’s decision.

“The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!” Trump said in a tweet.

Trump said tariffs on $200 billion of goods would increase to 25 percent on Friday from 10 percent, reversing a decision he made in February to keep them at the 10 percent rate thanks to progress between the two sides.

The president also said he would target a further $325 billion of Chinese goods with 25 percent tariffs “shortly,” essentially covering all products imported to the United States from China.

MARKET TURBULENCE

U.S. officials did not weigh in on whether they expected talks to go ahead this week. The White House and the U.S. Trade Representative’s Office declined to comment. China’s commerce ministry did not immediately respond to a request for comment.
“The atmosphere of the negotiations has changed,” said a Chinese official with knowledge of the situation.

Whether the talks proceed and how they proceed are issues that are now being re-evaluated, the official told Reuters on condition of anonymity.

“All that depends on the attitude of the United States,” the official said.

Chinese media outlets have been told not to independently report on Trump’s tweets, and instead adhere to any report from the official Xinhua news agency, said a source with direct knowledge of the matter.

Global financial markets, which had been expecting news of a trade deal soon, went into a tailspin. U.S. equity futures fell more than 2 percent and stocks across trade-reliant Asia tumbled, with China’s main indexes plunging 5 percent.

“There is still a question of whether this is one of the famous Trump negotiation tactics, or are we really going to see some drastic increase in tariffs,” said Nick Twidale, Sydney-based analyst at Rakuten Securities Australia. “If it’s the latter, we’ll see massive downside pressure across all markets.”

Mindful of his 2020 re-election bid, Trump had also suggested the duties were not leading to price increases for U.S. consumers. “The Tariffs paid to the USA have had little impact on product cost, mostly borne by China,” he tweeted.

Tariffs on Chinese goods are actually paid to the United States by the companies importing the goods, and most of those companies are U.S.-based. American businesses, while supportive of Trump’s crackdown on China’s trade practices, are eager for the tariffs to be removed, not expanded.

“Raising tariffs means raising taxes on millions of American families and inviting further retaliation on American farmers,” said Christin Fernandez, a spokeswoman for the Retail Industry Leaders Association.

‘HANG TOUGH’

Nevertheless, the president’s aggressive strategy drew rare bipartisan support from U.S. Senate Democratic leader Chuck Schumer, who urged Trump to “hang tough” in a tweet: “Don’t back down. Strength is the only way to win with China.”

One Chinese trade expert said recent signs of resilience in both economies were breeding over-confidence.

“The urgency is gone. So, it’s likely to see a longer trade war,” the expert said, speaking on condition of anonymity citing the sensitivity of the topic.

The trade war resulted in billions of dollars of losses for both sides in 2018, hitting industries including autos, technology – and above all, agriculture, while inflicting collateral damage on export-reliant economies and companies from Japan to Germany.

On Friday, Trump said talks with China were going well..

Treasury Secretary Steven Mnuchin called the round in Beijing “productive,” and one White House official told Reuters that dates were being looked at for a potential meeting between Presidents Trump and Xi Jinping in June.

Last week, industry sources said they believed the talks were in the endgame, but a Trump administration official said aides had told the president that significant hurdles remained.

The increase in U.S. tariffs on Friday would be the first since Trump imposed 10 percent tariffs on $200 billion of Chinese goods in September, coming on top of 25 percent tariffs on $50 billion of goods enacted earlier last year.

Negotiations about tariffs have been one of the remaining sticking points between the two sides. China wants the tariffs to be removed, while Trump wants to keep some, if not all, of them as part of any final deal to ensure China lives up to its commitments, a White House official said on Sunday.