In seasonally adjusted terms, the jobless figure remained the same as in December, at 2.976 million, while analysts and economists had predicted an increase by 4,000 in a Reuters poll

International News via Reuters:

The number of people out of work in Germany remained unchanged in January, labour office figures showed on Friday, underscoring a sluggish recovery and persistent lack of momentum in the job market of Europe’s biggest economy.

In seasonally adjusted terms, the jobless figure remained the same as in December, at 2.976 million, while analysts and economists had predicted an increase by 4,000 in a Reuters poll.

The seasonally adjusted jobless rate was unchanged from 6.3% a month earlier, also in line with the forecast.

“There is currently little momentum in the labour market,” labour office head Andrea Nahles said in a statement.

Chancellor Friedrich Merz has promised to haul Germany out of the downturn with a sharp increase in infrastructure and defence spending, but those measures are taking longer than expected to translate into better conditions on the ground. 

Writing by Friederike Heine, Editing by Miranda Murray

Eutelsat, whose shares fell 5% in early Paris trading, is headquartered in France and the French government is its largest shareholder with a 29.6% stake

International News via Reuters:

French Finance Minister Roland Lescure earlier this week blocked Eutelsat’s sale of its ground antennas, he said on Friday, citing national security concerns tied to the satellite operator, the main European rival to Elon Musk’s Starlink.

“These antennas are used for both civilian and military communications. Eutelsat is Starlink’s only European competitor. It is clearly a strategic asset. And so I said no,” Lescure told TV station TF1.

Eutelsat, whose shares fell 5% in early Paris trading, is headquartered in France and the French government is its largest shareholder with a 29.6% stake. On Thursday, the company said its planned sale of passive ground infrastructure to Swedish private equity firm EQT would not proceed.

The deal, initially announced in 2024, had been expected to generate net proceeds of about 550 million euros ($656 million). While a company spokesperson declined to comment on Lescure’s remarks, Eutelsat said that it would benefit from a 5% increase in profit margins over the next three years due to savings from no longer leasing these assets

“This decision is exclusively linked to the critical nature of this activity in terms of French sovereignty and is in no way linked to the quality of the investor,” Lescure wrote on Bluesky following his televised remarks.

Ground antennas, which connect satellites to terrestrial networks, are considered sensitive infrastructure because of their dual-use capabilities in civilian and military communications.

Eutelsat provides satellite services to the French army after it signed a 10-year contract valued at 1 billion euros last year.

Lescure also confirmed the government’s role in the sale of French defense firm LMB Aerospace to U.S.-based Loar Holdings.

The state will retain its “golden share”, while production will remain in France’s Correze region, the minister said. Efforts to identify a French or European buyer for the company were unsuccessful, Lescure added.

($1 = 0.8380 euros)

Reporting by Inti Landauro and Louise Rasmussen in Paris, Gianluca Lo Nostro in Gdansk; Editing by Matt Scuffham

ECB President Christine Lagarde and colleagues have been saying for months the central bank for the euro zone is “in a good place” after seeing inflation fall to its 2% target

International News via Reuters:

Euro zone consumers raised their longer-term inflation expectations to a record high in December, a European Central Bank poll showed on Friday, implying prices were seen growing faster than the ECB’s target pace for years to come.

ECB President Christine Lagarde and colleagues have been saying for months the central bank for the euro zone is “in a good place” after seeing inflation fall to its 2% target, and market expectations remain largely anchored around that level.

But the ECB’s latest Consumer Expectations Survey showed households had nudged up their inflation expectations five years ahead to 2.4% in December, the highest reading since the survey began in 2022 and a 20-basis-point increase from November.

The median respondent saw inflation at 2.8% over the next 12 months, unchanged from November, and at 2.6% in three years’ time, up from 2.5% a month earlier.

Still, ECB policymakers, who use these findings in their policy deliberations, could take comfort in the fact that consumers still expected inflation to come down over the poll’s time horizon.

The ECB is expected to hold its policy rate unchanged at 2% for the foreseeable future, but uncertainty relating, among other factors, to U.S. President Donald Trump’s unpredictable economic policy has kept investors and policymakers on tenterhooks.

Reporting by Francesco CanepaEditing by Peter Graff

The rocket maker is in discussions to merge with xAI ahead of a blockbuster public offering planned for this year

International News via Reuters:

SpaceX is exploring deals with other companies helmed by serial entrepreneur Elon Musk, leaving investors working through permutations between space, autonomous driving and artificial intelligence to analyze which combination makes the most sense.

The rocket maker is in discussions to merge with xAI ahead of a blockbuster public offering planned for this year, Reuters reported on Thursday. The combination would bring Musk’s rockets, Starlink satellites, X social media platform and Grok chatbot under one roof, according to a person briefed on the matter and two regulatory filings.

Reuters could not determine the deal’s value, timing or primary rationale.

SpaceX is also considering a merger with Musk’s electric vehicle maker Tesla, Bloomberg reported.

“I think it’s highly likely that (xAI) ends up with one of the two parties,” said Tesla shareholder Gene Munster, who is managing partner at xAI investor Deepwater Asset Management.

Musk, the world’s richest man, is CEO of SpaceX and artificial intelligence company xAI, which controls X. He also runs Tesla, tunnel company The Boring Co and neurotechnology firm Neuralink.

“What’s important for Elon is to have a massive vision that’s way out there that he’s early on,” Munster said. A compelling prospect would be Tesla taking xAI which would improve the EV maker’s robot and self-driving car plans, he said.

Predictions hub Polymarket late on Thursday put the chance of a SpaceX-xAI merger by mid-year at 48% and Tesla-xAI merger at 16%.

Musk, SpaceX, xAI and Tesla did not respond to requests for comment. Tesla’s share price rose 3% in after-hours trade.

SpaceX plans to go public some time this year with a valuation likely above $1 trillion, Reuters and other media reported. It is the world’s most-valuable privately held company – at $800 billion in a recent private share sale. xAI was valued at $230 billion in November, the Wall Street Journal reported. Tesla’s market capitalization is $1.4 trillion.

For SpaceX, a massive deal may complicate its IPO but add momentum to efforts to launch data centers into orbit, a key goal in the escalating AI race against the likes of OpenAI, Meta Platforms and Alphabet’s Google.

Some Tesla shareholders have long advocated bringing Musk’s companies together. Bloomberg reported that investors have been pushing the idea of joining SpaceX and Tesla.

“Musk has too many separate companies,” said Dennis Dick, chief market strategist at Stock Trader Network. “A major risk thesis for Tesla is that Musk is spreading himself out too much. As a Tesla shareholder, I applaud further consolidation.”

Under a SpaceX-xAI merger, xAI shares would be exchanged for SpaceX shares. Two entities have been established in Nevada to facilitate, said the person briefed on the matter, requesting anonymity because discussions are confidential.

Filings showed those entities were set up on January 21 but did not detail their purpose or role in any deal. One lists SpaceX and its chief financial officer, Bret Johnsen, as managing members. The other lists Johnsen as sole officer.

Johnsen did not respond to a request for comment.

Some xAI executives could be given the option to receive cash instead of SpaceX stock as part of the deal, said the person briefed on the matter. No final agreement has been signed and the deal timing and structure remain fluid, the person said.

DATA CENTERS IN SPACE

Space-based AI processing, powered by solar energy, is aimed at cutting the cost of generating the computing power that runs and trains AI models such as xAI’s Grok. Billionaire Jeff Bezos’ Blue Origin has announced a high-capacity backbone network of thousands of satellites, while Google is researching space-based data centers under Project Suncatcher.

Speaking in Davos, Switzerland, last week, Musk – whose timing projections are rarely realized – said “the lowest cost place to put AI will be in space. And that will be true within two years, maybe three at the latest.”

Building data centers in space is a risky proposition considering AI is evolving rapidly and unpredictably. Analysts and executives have questioned whether envisioned cuts in energy consumption are worth the cost of tailoring systems for space.

Folding in xAI could also boost SpaceX’s prospects for contracts at the Pentagon, which has sought to ramp up AI adoption in military networks, said Caleb Henry of space research and advisory Quilty Analytics.

U.S. Defense Secretary Pete Hegseth this month visited SpaceX’s Starbase development site in Texas where he said xAI’s language model and chat platform Grok will be integrated into military networks as part of an “AI acceleration strategy” aimed at speeding up military decision-making and planning.

xAI has a contract worth as much as $200 million to provide Grok products to the Pentagon. Through xAI, Musk is building out a supercomputer for AI training in Memphis, Tennessee, called Colossus.

Starlink and national security variant Starshield already rely heavily on AI, such as for automated satellite maneuvers in orbit. Starshield, under a contract with a U.S. intelligence agency, is building a network of hundreds of classified satellites equipped with sensors that are widely expected to use AI to help track moving targets on Earth.

LATEST MERGER BETWEEN MUSK COMPANIES

Musk already has been combining businesses. In 2016, he used Tesla stock to buy solar-energy company SolarCity. Last year, he folded X into xAI in a share swap that gave the AI startup access to the microblog’s data and distribution.

xAI also received a $2 billion investment commitment from SpaceX as part a $5 billion equity fundraising, the Wall Street Journal reported last year.

This month, xAI raised $20 billion in an upsized Series E funding round, exceeding its $15 billion target at a valuation of $230 billion. It also gained a commitment of about $2 billion from Tesla on Wednesday.

Ross Gerber, CEO of Tesla and xAI investor Gerber Kawasaki Wealth and Investment Management, said he could envision a marriage of Musk businesses.

“It’s like a bunch of overvalued companies merging together into one big overvalued mess run by Elon. But it’s a pure play now. It’s like, you want to invest in Elon? Here you go. Like, you get all this. And it’s much more attractive, actually, as an investment.”

Reporting by Echo Wang and Joey Roulette; Additional reporting by Milanna Vinn, Sabrina Valle, David Jeans and Abhirup Roy; Editing by Paritosh Bansal, Peter Henderson and Christopher Cushing