The head of the International Monetary Fund has been placed under formal investigation over the Bernard Tapie case, but insists she will not resign.Earlier: Lunchtime summaryGerman consumer confidence hit by geopolitical risksFrench industrial morale down tooItaly to revise growth forecasts downGerman bond yields dragged to new record lows 4.18pm BST Over in Greece prime minister Antonis Samaras is about to hold talks with senior government ministers in a bid to fine-tune strategy ahead of the relaunch of negotiations with troika mission chiefs in Paris next week. From Athens, our correspondent Helena Smith reports:Its back to business as usual with the Greek government hunkering down in preparation of next weeks crucial talks with mission heads representing [lenders] the EU, ECB and IMF in Paris. Samaras will meet his deputy, the socialist leader Evangelos Venizelos and other senior government ministers for what coalition leaders hope will be a final session of strategising ahead of the new round of talks next Tuesday. The stakes are high and the trade-offs potentially enormous. We want everything to go smoothly which, as you know, is why this time the talks will take place in a neutral setting, said one government insider referring to the decision to relaunch negotiations in the French capital. Were fine-tuning details. 3.33pm BST Despite expectations the ECB is close to introducing new stimulus measures to boost the eurozone economy, it may not happen at next weeks meeting after all.According to a Reuters report the ECB is unlikely to take action next week unless August inflation figures, due on Friday, show the eurozone moving significantly closer to deflation.So, they don't know? RT @TradeDesk_Steve: New Ecb Action Next Week Unlikely But Outcome Much Depends On August Inflation Data - Ecb Sources 2.54pm BST Wall Street has opened and, in common with the European markets, it seems uncertain which way to go after its record breaking gains. The Dow Jones Industrial Average is virtually flat (down 3.85 points to be precise) while the S&P 500 has edged up 0.46 points.Meanwhile the FTSE 100 has dipped 3.54 points after early attempts to edge higher, while Germanys Dax is down 2.12 points while Frances CAC is up 2.92 points. 2.33pm BST It looks like the European Central Bank is indeed readying itself for further measures to stimulate the flagging eurozone economy, as its president Mario Draghi suggested in the US on Friday. According to a report on Bloomberg, the ECB has appointed investment manager BlackRock to advise on developing a program to buy asset-backed securities:BlackRock Solutions, a unit of the New York-based company, will provide advice on the design and implementation of a potential ABS-purchase plan, an ECB spokesman said in response to e-mailed questions. Safeguards against any conflict of interest are included in the agreement, the spokesman said.ECB President Mario Draghi said in June that the central bank is intensifying preparations to purchase ABS as it strives to revive the faltering euro-area economy. While the effort could help revitalize a $1.9 trillion market that has contracted 34 percent since 2009, and at the same time inject liquidity into the financial system, officials have yet to agree on what such a program should look like. French Pm Says Trusts Ecb To Use All Available Tools To Meet Inflation Mandate, Says More Needs To Be Done 2.02pm BST With the French government collapsing over the weekend after a rift over austerity measures, leading to a new cabinet announced yesterday, the debate over cutbacks and spending is back in the spotlight. So what to make of this:France, Italy Seen Likely To Push Together Against Austerity: EU Officials - MNI 1.05pm BST To recap...Christine Lagardes position as the head of the International Monetary Fund is under scrutiny today after magistrates put her under formal investigation, over the Bernard Tapie fraud inquiry.I have instructed my lawyer to appeal this decision which I consider totally without merit.I return back to Washington where I will indeed brief my board. 12.50pm BST Another photo from Paris, of Christine Lagarde speaking to her lawyer, Yves Repiquet, today. 12.48pm BST So, how serious is a charge of negligence? The Financial Times says it could potentially lead to a prison term (were a long way from that at this stage, though)From Paris, Hugh Carnegy reports:Ms Lagardes spokesman told the FT that the charge was relatively minor but one that nevertheless carried a maximum penalty of one year in prison and a fine of 15,000 if convicted. 11.59am BST The AFP news agency has confirmed that Christine Lagarde has no plans to resign.From the wires:The investigating commission of the court of justice of the French Republic has decided to place me under formal investigation, she said in exclusive comments to AFP. In France, being placed under formal investigation is the nearest equivalent to being charged, and happens when an examining magistrate has decided there is a case to be answered. It does not, however, always lead to a formal charge. 11.51am BST Lagardes lawyer, Yves Repiquet, has told Reuters that the IMF chief believes the decision to formally investigate her for negligence over the Bernard Tapie case was unfounded:We are appealing it, Repiquet said by telephone, adding that Lagarde, who was due to return to IMF headquarters in Washington later on Wednesday, had no plans to resign.In previous rounds of questioning, Lagarde accused Richard of having used her pre-printed signature to sign off on a document facilitating the payment, local media has said. However Richard has stated that Lagarde was fully briefed on the matter. 11.35am BST Christine Lagarde has been questioned for 15 hours yesterday by the Court of Justice of the Republic over her involvement in the Bernard Tapie case, flags up City AM. 11.16am BST Christine Lagarde, head of the International Monetary Fund, has been placed under formal investigation by French magistrates who are investigating a political fraud case that has gripped the nation.IMF chief Christine Lagarde has been put under formal investigation for negligence in fraud case. Says no intention of resigning. 10.52am BST Britains supermarkets remain locked in a toe-to-toe price war, meaning prices are rising at their lowest rate since at least October 2006.Grocery price inflation fell for the eleventh consecutive quarter to just 0.2%, according to the latest figures from Kantar Worldpanel. The battle to cut prices on staple items such as vegetables, milk and bread all drove down inflation over the summer. Of the UKs biggest six supermarkets, only Asda and Waitrose managed to increase their share of the market in that tough environment while Tesco, Morrisons, Sainsburys and The Co-op all lost ground. 10.41am BST In the City, speculation that a US e-commerce giant could snap up British online fashion success ASOS has sent its shares up 15% this morning, having gained 7% yesterday. 10.13am BST Italian consumers, like their German counterparts, have suffered a drop in confidence this month. But their worries are mainly domestic based, as they watch the Italian economy slide back into recession.Italian consumer confidence falls more than expected: Index down to 101.9 in August, from 104.4 in July (RT poll was 104.4) - ISTAT 9.49am BST Shorter-term German bond yields are now in negative territory, meaning investors are actually paying for the chance to own one, two, and three-year bunds.German government bond yields are now negative out to 3 years pic.twitter.com/0482E0tEIJ 9.47am BST The tumble in eurozone bond yields is a clear signal that investors expect the eurozone to become bogged down in a low-growth, deflationary spiral, repeating Japans experience over the last two decades.The Euro Abenomics trade is ON. Italian 10-years yield hit new record low at 2.375%, German 10-years yield hit new record low at 0.921%, 9.41am BST I'd love to know who's buying German 10 years bunds with a sub-1% yield. Anyone owning up? 9.40am BST The yield, or interest rate, on German 10-year bonds has hit a new record low this morning.Strong demand for German 10-year bunds has pushed their price to new highs, meaning they are now yielding just 0.917% this morning.When the EMUs largest economy is falling behind, this is very much increasing the chances of the ECB heading for further monetary measures, above all QE. 9.20am BST Foxtons, the London estate agent famous for pushy sales tactics and garish Minis, has sounded a cautious note on the housing market.The range of policy initiatives introduced in 2014 aimed at controlling mortgage lending, together with the expectation of early increases in interest rates, is now having an impact on short term demand among buyers. Consistent with others in the sector, we expect this to lead to lower rates of market growth in both property sales transactions and prices during the second half of the year. 9.16am BST Labours shadow business secretary, Chuka Umunna, says hes shocked by the poor sales practices exposed at RBS and NatWest today. Hes also alarmed that it too so long to address them.Taking out a mortgage is the biggest purchase a consumer makes and, as such, the FCA findings into RBS are both shocking and disappointing.Swap misselling by banks to small businesses happened 8yrs ago - this mortgage misselling by RBS was happening less than 18months ago!The FCA raised concerns with RBS on mortgage sales in 2011- it's disgraceful this was not immediately acted on.We still have some way to go in reforming our banking sector so it serves individuals and businesses - the real economy - properly. 9.05am BST Budget airline Ryanair has taken another step towards scrubbing up its image, launching a new business class service today.Features include flexible tickets, more check-in baggage, priority boarding and premium seats, as it tries to lure more executives onboard. 8.52am BST Britains banking sector continues to demonstrate a remarkable inability to treat its customers properly.Todays culprit is Royal Bank of Scotland, which has been fined £14.5m for failing to offer decent advice to mortgage customers. Only 2 of the 164 sales reviewed were considered to meet the standard required overall in a sales process. In the firms own mystery shopping there were examples of advisers giving personal views on the future movement of interest rates. This was highly inappropriate and may have resulted in the borrower being sold the wrong type of mortgage for them.Ross McEwan: Taking a mortgage is one of the biggest moments in our lives, and our customers should expect the best service (2/5)In the past we just didnt get this right; this was unacceptable and should never have happened (3/5) 8.36am BST German consumer confidence had been steadily rising over the last 18 months until todays drop (see 8.00am for details), as this tweet shows:German consumer climate falls in September: GfK index drops to 8.6 pic.twitter.com/W9dKQm77cZMajor upheavals in the global economy have so far only affected the consumer mood in Germany to a very limited extent. In order to ensure that this remains the case for consumers in future, it is important that the situations in the crisis regions do not escalate further and that long-term solutions are found instead. However, if domestic framework conditions also deteriorate decisively as a result of any potential further escalation, it is probable that more difficult times will also lie ahead for the German economy. 8.32am BST Italys economy minister has predicted that it could lower its growth forecasts making it a hat-trick of bad news for the eurozone this morningThe Italian governent currently predicts that GDP will rise by 0.8% this year, but that was before Italy fell back into recession. A rethink is now needed.We must revise the GDP (gross domestic product) growth forecast to the downside. Italy to revise down its GDP growth forecasts. French government too busy to think about that right now. 8.18am BST Bad news from France too -- morale among French companies has fallen again.Statistics body INSEE reports that the industry morale dipped again in August, to 96 from 97 on its monthly survey (where 100 is the long-term average). 8.00am BST German consumer confidence has suffered its first fall since January 2013, as the weakening eurozone economy and geopolitical risks hit Europes largest economy.The forward-looking survey of German morale, by polling firm GfK, found that economic expectations have collapsed this month, as the wider consumer climate suffers a setback. Consumers are increasingly taking the intensified geopolitical situation into consideration in their assessment of how the German economy will develop over the coming months. The indicator dropped by 35.5 points, plummeting to 10.4 points. A decline of this magnitude in just one month has not been recorded since the survey began in 1980. Consequently, virtually all improvement in the economic expectations indicator over the past year has been negated in one fell swoop. In August 2013, the indicator value was 1.8 points. Consumers are expecting the economy to shift down a gear or two at least. Given that no long-term solutions appear to be on the cards yet for any of the crises, uncertainty is rising in the population on the potential consequences for the German economy. In particular, the sanctions against Russia, which are already significantly impacting exports, could become a real risk for the German economy. German Consumer Confidence: Actual: 8.6 vs Forecast: 9 pic.twitter.com/JodHiKbXfl 7.54am BST Good morning, and welcome to our rolling coverage of the financial markets, the world economy.Coming up today -- a new survey of German consumers has found that confidence has been hit by economic weakness in the eurozone, and geopolitical threats across the globe. Continue reading...
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