Morning papers: Senate nears deal to reopen US government

Senate leaders were late on Monday closing in on a deal to reopen the federal government and avert a potentially catastrophic default on US borrowings, reports the Financial Times.

The deal, which has yet to be finalised, would raise the debt ceiling until early February, reopen the government until January and include a mechanism to force lawmakers into longer-term budget discussions.

David Cameron to back proposed axe to swathes of EU red-tape

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The measures, put forward by a panel of six business leaders including Marks & Spencer chief executive Marc Bolland and former Diageo chief executive Paul Walsh, are designed to remove or amend 30 pieces of problematic EU legislation, reports The Daily Telegraph.

The panel’s landmark report, ‘Cut EU Red Tape,’ includes a series of recommendation to slash labour rules, including exempting companies with less than 10 employees from all new employment laws, ending plans to compel restructuring businesses from paying to retrain redundant staff, and allowing employers to change employment contracts in TUPE-style takeover situations.

Investors pile pressure on Tesco

Some of the biggest shareholders in Tesco are asking whether top management has a good enough grip on its many problems, after Britain’s biggest retailer shocked investors with a collapse in profits from central Europe, reports the Financial Times.

Two weeks ago, Tesco, which is battling to turn round its domestic business as well as struggling abroad, announced a 70 per cent fall in trading profit from central Europe, to £55m; analysts had pencilled in £130m.

Cable under pressure as Royal Mail shares soar

MPs are set to intensify their investigation into the price at which the Government sold the Royal Mail as the valuation of shares in the privatisatised national postal network hit fresh highs on their second day of trading, reports The Times.

An inquiry by the House of Commons Business Select Committee could be widened to interrogate Lazard, the Government’s adviser, as to how the 330p-a-share sale price was settled upon

Greece Bailout to Fall Short, ECB Official Says

Greece will need to pass fresh budget cuts next year to hit the targets set by its international creditors, a senior European Central Bank official said Monday, setting the stage for another clash with Athens over how much austerity the country can bear, reports The Wall Street Journal.

ECB executive board member Jörg Asmussen, appointed last year from the German Finance Ministry, also said Greece’s international creditors will need to do more to cover the country’s financing needs, starting from mid-2014.

American trio share Nobel economics prize for work on asset prices

The widespread criticism of economists’ failure to predict the banking crash was addressed on Monday by the Nobel committee when it awarded the much coveted prize for economics to three academics who try to show how financial markets work, reports The Guardian.

The Royal Swedish Academy of Sciences awarded the prize to Eugene Fama and Lars Peter Hansen of the ultra-conservative Chicago school alongside Robert Shiller, the liberal Yale economist famous for warning of the US sub-prime housing bubble in 2005.