Europe's banks pledge t maintain low benchmark rate

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FRANKFURT, Germany -- The European Central Bank and the Bank of England on Thursday underlined their determination to keep interest rates low in an attempt to reassure markets unsettled by the possible end of the U.S. Federal Reserve's bond-buying program.

Abandoning a longtime practice of saying it "never precommits" on interest rate decisions, the ECB said it would keep its benchmark interest rate the same or lower "for an extended period of time."

The statement followed a meeting of the bank's rate council which left the refinancing rate for the 17 European Union countries that use the euro unchanged at 0.5 percent. European Central Bank president Mario Draghi said crucial interest rates would "remain at present or lower levels for an extended period of time." Until Thursday, the central bank had steadfastly refused to pin itself down on future policy.

Koreas to negotiate

SEOUL, South Korea -- South and North Korea agreed Thursday to meet Saturday to discuss reopening a jointly operated industrial complex, three weeks after their last effort to start a dialogue collapsed amid mutual recriminations.

If the meeting, to be held in the border village of Panmunjom, takes place as planned, it would provide the two Koreas with an opportunity to move toward a thaw after years of tensions that hit a peak this year, when the North's third nuclear test led to international sanctions and the North issued a stream of threats against the South and its ally, the United States.

IMF presses Italy

ROME -- In a report at the end of its annual visit to the country, the International Monetary Fund pressed Italy on Thursday to do more about "unacceptably high" unemployment, especially among young people and women, and urged it to bring back an unpopular property tax whose return could threaten the survival of Premier Enrico Letta's coalition government.

Former Premier Silvio Berlusconi made suspension of the tax on primary residences a condition of his conservative forces vital support for Mr. Letta's government. Mr. Letta reluctantly agreed to let property owners skip paying the tax in June, and has said his government would decide later in the year whether to revive the tax.

$5.3B bailout for Pakistan

LONDON -- The International Monetary Fund and Pakistan reached a provisional agreement on Thursday on a $5.3 billion bailout package that aims to bolster Pakistan's flagging economy and its perilously low foreign exchange reserves.

The rescue package is expected to soothe Western fears about the state of Pakistan's economy, which has slumped in recent years amid unrelenting Taliban violence and deeply rooted corruption that have shaken investor confidence.

Mandela family feuding

JOHANNESBURG -- South Africa President Jacob Zuma late Thursday denied reports that Nelson Mandela was in a "vegetative state" while confirming that the anti-apartheid icon was in "a critical but stable condition."

The phrase describing the grim condition was used in court papers filed by members of the Mandela family, who are feuding with the former president's grandson, Mandla Mandela.The family is being rocked by internal disputes over where to bury Nelson Mandela when he dies.

The 94-year-old Nobel peace laureate was admitted to the hospital on June 8 for a recurring lung infection.

-- Compiled from news services



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