ECB raises key rate, hints at more increases (AP)

LONDON – The European Central Bank raised its key interest rate to 1.5 percent to dampen inflation and hinted at more increases in coming months, even though they would add pressure on debt-ridden economies like Greece.

Thursday's hike, the second this year, was widely expected in markets as the ECB focuses on its responsibility to get inflation, which is running at 2.7 percent, below its target of just below 2 percent.

In his press briefing, ECB president Jean-Claude Trichet hinted that there would be further interest rate rises in the months to come but probably not next month.

He said the bank was "monitoring very closely" price developments — it traditionally uses that phrase to indicate that the tightening cycle is not over but that rates would not rise next month.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

LONDON (AP) — The European Central Bank raised its key interest rate to 1.5 percent on Thursday to dampen down inflation, even though the move will add pressure on debt-ridden economies on the fringes of the 17-nation eurozone.

The hike, the second this year, was widely expected in markets as the ECB focuses on its responsibility to get inflation, which is running at 2.7 percent, below its target of just below 2 percent.

Though higher rates may be necessary for a potentially overheating economy like Germany's, they are likely to add to the growth concerns of some of the eurozone's more indebted nations, such as Greece and Portugal.

The main focus in the markets will be what ECB president Jean-Claude Trichet says in his upcoming press briefing regarding the outlook for the eurozone economy and Europe's ongoing debt difficulties.

On the economy, markets will be interested to see if Trichet is as hawkish on inflation as he has been of late. And regarding Europe's debt crisis, the focus will be on what he says about the situation in Greece and how it affects the ECB itself. The bank has significant exposure to Greek debt since it accepts Athens' bonds as collateral for loans that help keep the economy afloat.

The ECB has repeatedly insisted that a default on those obligations is out of the question.

"Trichet might give markets some comfort by hinting that the ECB could continue to accept Greek debt as collateral for its loans to commercial banks even if the ratings agencies downgrade it to default status," said Jennifer McKeown, senior European economist at Capital Economics.

"But he will stress that any roll-over of Greek government debt by the private sector will have to be deemed 'purely voluntary' by the ECB itself to gain its seal of approval," McKeown added.

Earlier in the day, the Bank of England held its base interest rate at an all-time low of 0.5 percent as the tepid economic recovery in Britain continues to outweigh concerns over inflation.

Thursday's decision by the nine-member Monetary Policy Committee to keep the rate unchanged for the 28th straight month was also anticipated in markets.

Though inflation is running at more than double the Bank's target of 2 percent at 4.5 percent, the majority of rate-setters think inflation will drop quickly next year as the impact of rising energy costs drops out of annual comparisons.

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Egypt PM hints at election delay (AFP)

CAIRO (AFP) – Egypt's premier has said that delaying a parliamentary election scheduled for September would give political parties more time to prepare, state media said Sunday, amid fears an early poll would benefit Islamists.

"Postponing the election would give the chance for a larger number of new political parties to develop," the state-owned Al-Ahram quoted Sharaf as saying.

However, "whatever the time of the election, we will exert all efforts to make it a success," he said.

Sharaf was answering questions at an event hosted by tycoon and politician Naguib Sawiris.

His comments come amid a mounting campaign by liberal and secular groups to delay the election until after a new constitution has been drafted.

The "Constitution First" campaign has sparked intense debate, with critics arguing that delaying the poll would keep the ruling military in place for longer.

In March, 77 percent of Egyptians voted in favour of holding elections first and having the new parliament draft a fresh consitution.

But others have argued that early elections would give the highly organised Muslim Brotherhood an unfair advantage and expressed concern that the Islamist group would have too much influence over the constitution.

Last week, more than 20 human rights groups said drafting the new charter should be the top priority.

"A new regime must take its place, and its institutions and the relationships between them must be based on a new constitution. This constitution must be drafted first, rather than building the institutions of the new order in accordance with the constitutional rules of the old regime," the groups said in a statement.

Arab League chief and presidential hopeful Amr Mussa has also thrown his weight behind calls to delay the vote.

"I am not for a postponement in the democratic process, and I believe it should start before the end of the year, but I think September is too early to hold a parliamentary election," he said.

"It's better to to start either with the election of a people's founding committee to put in place a new constitution or to hold a presidential election," he said at a government-organised "national consensus" conference.

The military, which has ruled the country since a revolt overthrew president Hosni Mubarak in February, has said the parliamentary poll will be held on schedule in September, followed by a new constitution and then a presidential vote.

The September election is expected to boost Islamists, particularly the Muslim Brotherhood, which has formed a party to contest roughly half of parliament's 508 elected seats.

Secular groups that spearheaded the revolt against Mubarak want the election postponed until they can better organise themselves into parties.

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Judge hints jurors may see raw video of Michael Jackson's last days

A 2009 handout photo shows Michael Jackson during a rehearsal, two days before his death.Dr. Conrad Murray's lawyers want Sony to hand over all raw video of Jackson's rehearsalsThe judge wants the defense to limit its "remarkably over-broad" requestMurray's involuntary manslaughter trial for Jackson's death starts in September

Los Angeles (CNN) -- Raw video of Michael Jackson's last days is not covered by laws protecting journalists from court subpoenas, making it likely that Sony will have to let lawyers use its video in their defense of Dr. Conrad Murray, a judge said Thursday.

Lawyers for Murray, who faces trial for involuntary manslaughter in the pop star's death, argued that the unseen rehearsal video could show that Jackson was ill and physically weak.

Prosecutors contend that Jackson died from an overdose of a surgical anesthetic that Murray gave him to induce sleep.

Sony Pictures, which bought the video from Jackson's estate, is fighting the subpoena from Murray's lawyers for access to about 100 hours of video that was used to produce the "This Is It" documentary, released several months after the singer's June 25, 2009, death.

The judge has given the prosecution permission to show clips from the movie to jurors during the trial, which is scheduled to start in September, but the defense wants to use video left on the cutting room floor.

Since Sony was under a contractual obligation with the estate to not use anything that showed Jackson in "a negative light," the unused video may be helpful to the defense, Los Angeles County Superior Court Judge Michael Pastor said.

The judge gave Sony a week to work out technical details with the defense for a way they can view the raw video without the risk of it leaking.

Sony's lawyer said the public release of the raw video could hurt the studio's plans to use it in other productions, such as an anniversary edition of the documentary.

"If they become part of the public record as an exhibit, we have a whole different problem," Sony attorney Gary Bostwick said. "That would immediately become viral on TMZ or some other website."

Defense lawyers were ordered to narrow their subpoena request for the video, which Pastor called "remarkably over-broad."

Michael Jackson hired video photographers to record his rehearsals as he prepared for his comeback concerts in London, scheduled for July 2009. His estate later sold the video and documentary rights to Sony for about $80 million.

Jackson was pronounced dead by an emergency room doctor at Ronald Reagan UCLA Medical Center. The Los Angeles County coroner ruled that his death was caused by an overdose of propofol, a powerful surgical anesthetic, in combination with "the contributory affects of the benzodiazepines."

Murray, who was hired as Jackson's personal doctor in the months leading up to the concert, was later charged with involuntary manslaughter in his death.

"Michael is not with us today because of an utterly inept, incompetent, reckless doctor, the defendant Conrad Murray," Los Angeles County Deputy District Attorney David Walgren said in his final arguments at Murray's preliminary hearing in January.

Murray's lawyers suggested that a frustrated and sleepless Jackson may have self-ingested the fatal dose while the doctor was out of his bedroom.

The defense is hoping the raw video will show Jackson's weakness and frustration as the concert dates neared.

CNN