Headlines

European Central Bank council member Jens Weidmann said policy makers are already discussing ways to withdraw some of the emergency cash they injected into the banking system to fight the sovereign debt crisis, Bloomberg reported. “All council members are aware that non-standard measures create risks and have to be unwound,” Weidmann, who heads Germany’s Bundesbank, said at a press conference in Frankfurt today. “We need this discussion and it is taking place.

The Bank of Japan said Tuesday it will stoke the economy with an additional ¥2 trillion ($24.32 billion) in lending, following a surprise monetary easing at its last meeting as it heightens its drive to rid the economy of debilitating deflation, The Wall Street Journal reported. "We came up with the measure as part of a package" to deal with deflation along with the credit-easing move last month, BOJ Gov. Masaaki Shirakawa said at a news conference following a two-day meeting of the bank's policy board.

ECB President Mario Draghi said on Tuesday that a growing competitiveness gap between members of the euro zone should be a source of concern for policy makers and he warned this could make it more difficult to keep the euro zone together, Reuters reported. "Increasingly larger and persistent current account deficits have resulted from significant losses of national competitiveness," Draghi told a conference in Paris.

Eurozone finance ministers called on Spain to make new cuts in its 2012 budget to reduce its deficit by another 0.5 per cent of economic output, a stinging rebuke to the new government of premier Mariano Rajoy, which publicly flouted Brussels-imposed deficit targets less than two weeks ago, the Financial Times reported. Despite the new cuts, Madrid will still be allowed to breach a previously agreed deficit limit of 4.4 per cent of gross domestic product this year by nearly a full percentage point; its new target will be 5.3 per cent, according to a senior eurozone official.

Royal Bank of Scotland and former directors including ex-chief executive Fred Goodwin and ex-chairman Sir Tom McKillop have been hit with a £2.4 billion ($4.6 billion) legal claim from angry investors in the taxpayer bailed-out bank, The New Zealand Herald reported. RBOS Shareholders Action Group was due to deliver claims letters to the bank and 17 former directors, including the former head of investment banking Johnny Cameron.

Households are spending more of their post-tax income on food than at any time since the mid-2000s as stagnant wages and high inflation squeezes living standards, official figures show. The poorest 20 percent of families spent 20.7 percent of their disposable income on food last year, the highest since the same level was reached in 2005, according to data from Statistics Korea Monday, The Korea Times reported. The average household spent 14.18 percent of its disposable income on food last year, the highest since 14.61 percent measured six years earlier.

Senior Government figures, including Tánaiste Eamon Gilmore and Minister for Finance Michael Noonan, have urged caution about any early breakthrough with the troika over improving the terms of the €30 billion promissory note for the former Anglo Irish Bank, the Irish Times reported. Yesterday, Mr Gilmore, Mr Noonan and Minister for Communications Pat Rabbitte separately confirmed progress has been made with the European Commission, the ECB and the IMF, but all dampened expectations about new terms being agreed in the immediate future.

French President Nicolas Sarkozy said Monday he will establish a new tax linked to nationality to prevent rich taxpayers from leaving the country and taking up residency in other countries with lower tax rates, if he's elected for a second term in May, Dow Jones reported. "I want tax payment and nationality to be linked," Sarkozy said, answering questions in an election show on TF1.

Struggling British video games retailer Game, denied new titles by suppliers, has put itself up for sale and warned shareholders their equity in the firm could be worthless, Reuters reported.

After helping to push through a Greek debt restructuring that is the largest in history, eurozone governments will revive a debate about boosting firewalls to shield Spain, Portugal and other vulnerable economies from the flames of the crisis, the Financial Times reported. Finance ministers from the 17-member club are set to discuss the issue at a meeting in Brussels on Monday evening, according to European Union officials, although no decisions are expected.