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Russia acknowledges new missile but says it does not breach treaty

By Stephanie Nebehay and Robin Emmott

GENEVA/BRUSSELS (Reuters) – Russia has recognized the existence of a cruise missile system that has prompted Washington to say it will quit the 1987 INF disarmament treaty, but has denied that it violates the pact, U.S. officials and NATO diplomats said on Monday.

Two weeks before the planned U.S. withdrawal from the treaty, which keeps nuclear-capable missiles out of Europe, Washington’s disarmament ambassador in Geneva said there was still time for Russia to destroy the system.

But after a session of the U.N.-sponsored Conference on Disarmament, Russian diplomat Alexander Deyneko told Reuters: “We shall not yield to any ultimatums like to liquidate or to eliminate (a) missile that doesn’t fall within the range of the treaty prohibitions.”

Russia had denied developing what U.S. intelligence calls the SSC-8/9M729 cruise missile system.

However, NATO diplomats said Moscow did now recognize its existence but argued that its range was within the 500-km limit set by the Intermediate-range Nuclear Forces treaty.

U.S. Ambassador Robert Wood said the system was a “potent and direct threat to Europe and Asia” as it had a range of 500 to 1,500 km (310-930 miles), contravening a treaty that is designed to prevent attacks at short notice.

“Russia must verifiably destroy all SSC-8 missiles, launchers and associated equipment in order to come back into compliance with the INF Treaty,” Wood said.

“Unfortunately, the United States increasingly finds that Russia cannot be trusted to comply with its arms control obligations and that its coercive and malign actions around the globe have increased tensions.”

After a meeting with Russian officials in Geneva last week, the United States said Moscow’s offer to save the treaty, negotiated by U.S. president Ronald Reagan and Soviet leader Mikhail Gorbachev, was not genuine because it could not be verified.

The impasse sets the stage for U.S. President Donald Trump to fulfill his threat to start withdrawing from the pact on Feb. 2, potentially allowing Washington to develop its own medium-range missiles.

The United States will still have six months to formally complete its withdrawal, however.

The U.S.-led NATO alliance said it had not given up on bringing Russia back into compliance. NATO’s 29 ambassadors will hold a special NATO-Russia Council with Moscow’s acting envoy to the alliance, Yuri Gorlach, in Brussels on Friday.

NATO diplomats told Reuters that European members of the alliance led by Germany hoped Washington would make a final push to convince the Kremlin to come into line, or possibly to renegotiate the INF to include China.

(Reporting by Stephanie Nebehay in Geneva and Robin Emmott in Brussels; Editing by Kevin Liffey)

Trump says no amnesty for ‘Dreamers,’ signals support in broader deal

U.S. President Donald Trump arrives to deliver remarks on border security and the partial shutdown of the U.S. government in the Diplomatic Room at the White House in Washington, U.S., January 19, 2019. REUTERS/Yuri Gripas

By David Morgan

WASHINGTON (Reuters) – President Donald Trump said on Sunday his proposed immigration deal to end a 30-day partial government shutdown would not lead to amnesty for “Dreamers,” but he appeared to signal support for amnesty as part of a broader immigration agreement.

In a morning Twitter storm, Trump also said he would not seek the removal of millions of illegal immigrants living in the United States, while bashing House of Representatives Speaker Nancy Pelosi and her fellow Democrats for turning down an offer he made on Saturday, including for Dreamers, the immigrants brought to the United States illegally as children.

“No, Amnesty is not a part of my offer. It is a 3-year extension of DACA. Amnesty will be used only on a much bigger deal, whether on immigration or something else,” Trump said on Twitter.

“Likewise there will be no big push to remove the 11,000,000 plus people who are here illegally-but be careful Nancy!”

The Dreamers are protected from deportation under the Deferred Action for Childhood Arrivals (DACA) program.

Banners outside a Catholic church in New York’s Queens borough express support for “Dreamer” immigrants in New York, U.S. January 20, 2019. REUTERS/Nick Zieminski

DACA was put in place under former President Barack Obama. The Trump administration said in September 2017 it would rescind DACA, but it remains in effect under court order.

Trump did not make clear what he was referring to regarding the 11 million people mentioned in his tweet. About 12 million people are living in the United States illegally, according to U.S. Department of Homeland Security estimates.

In a Saturday speech from the White House, Trump offered three years of protections for Dreamers and for holders of temporary protected status (TPS), another class of immigrants from designated countries affected by armed conflict, natural disaster or other strife.

Republican Senate Majority Leader Mitch McConnell welcomed the plan as a “bold solution,” while a spokesman said McConnell would seek Senate passage of the proposal this week.

The legislation will include bills to fund government departments that have been closed during the shutdown, as well as some disaster aid and the president’s immigration proposal, a McConnell aide said. The plan will contain $12.7 billion in disaster aid, said another Senate source who asked not to be named.

But Trump’s amnesty tweet caught some Republicans off guard.

“I don’t know what the president’s calling amnesty,” Senator James Lankford, an Oklahoma Republican, told ABC’s “This Week” program. “That’s a longer debate and obviously not something we can solve quickly.”

FILE PHOTO: A federal worker left unpaid or furloughed carries a free bag of groceries from Kraft Foods on the 27th day of the partial government shutdown in Washington, U.S., January 17, 2019. REUTERS/Joshua Roberts

Trump appeared to be responding to conservative critics who accused him of proposing amnesty and reneging on a campaign promise, which could alienate his right-wing base.

About one-quarter of the U.S. government shut down on Dec. 22 over Trump’s demand for $5.7 billion to fund a wall along the border with Mexico, which Democrats have refused to consider. Some 800,000 federal workers have been ordered to stay home or work without pay during the shutdown.

The promise of a border wall was a mainstay of Trump’s 2016 presidential election campaign. As a candidate, he said Mexico would pay for the barrier, but the Mexican government has refused.

The shutdown has caused widespread disruptions.

The Transportation Security Administration on Sunday reported an 8 percent national rate of unscheduled absences on Saturday, compared with 3 percent a year ago. More than 50,000 TSA officers are working without pay.

Some airports experienced longer wait times at security checkpoints, and Baltimore/Washington International Thurgood Marshall Airport closed one of its checkpoints because of excessive absences.

‘STARTING POINT’

On Sunday, a day after Trump’s DACA proposal, there appeared to be signs of movement, even as Democrats insisted the government should reopen before proceeding with talks over border security.

“What the president proposed yesterday – increasing border security, looking at TPS, looking at the Dreamers – I’ll use that as a starting point. But you’ve got to start by reopening the government,” U.S. Senator Mark Warner said on NBC’s “Meet the Press.”

Warner, a Virginia Democrat, also said Congress should approve pay for federal workers affected by the shutdown before they miss another paycheck this week.

Bennie Thompson, the Democratic chair of the House Homeland Security Committee, said Democrats were not opposed to physical barriers on the southern border but that Trump’s changing position posed a problem for resolving the border security issue.

“I would not rule out a wall in certain instances,” Thompson said on ABC’s “This Week” on Sunday.

(Reporting by David Morgan in Washington; Additional reporting by Yasmeen Abutaleb and Susan Cornwell in Washington; Editing by Susan Thomas and Peter Cooney)

Israel strikes in Syria in more open assault on Iran

What is believed to be guided missiles are seen in the sky during what is reported to be an attack in Damascus, Syria, January 21, 2019, in this still image taken from a video obtained from social media. Facebook Diary of a Mortar Shell in Damascus/Youmiyat Qadifat Hawun fi Damashq/via REUTERS

By Angus McDowall and Dan Williams

BEIRUT/JERUSALEM (Reuters) – Israel struck in Syria early on Monday, the latest salvo in its increasingly open assault on Iran’s presence there, shaking the night sky over Damascus with an hour of loud explosions in a second consecutive night of military action.

Damascus did not say what damage or casualties resulted from the strikes. The Syrian Observatory for Human Rights war monitor said 11 people were killed. Syria’s ally Russia said four Syrian soldiers had died and six were wounded.

Israeli Prime Minister Benjamin Netanyahu said the air raid had mostly targeted Iranian forces, but also hit Syrians helping them. “We will strike at anyone who tries to harm us,” he said.

The threat of direct confrontation between arch-enemies Israel and Iran has long simmered in Syria, where the Iranian military built a presence early in the nearly eight year civil war to help President Bashar al-Assad’s government.

Israel, regarding Iran as its biggest threat, has repeatedly attacked Iranian targets in Syria and those of allied militia, including Lebanon’s Hezbollah.

With an election approaching, Israel’s government has begun discussing its strikes more openly and has also taken a tougher stance towards Hezbollah on the border with Lebanon. It said a rocket attack on Sunday was Iran’s work.

The Israeli shift comes a month after U.S. President Donald Trump unexpectedly announced a sudden plan to pull the 2,000 U.S. troops from Syria, a move long sought by Assad and his Russian and Iranian allies. Trump’s decision shocked American allies in the region and was opposed by top U.S. officials including Defense Secretary Jim Mattis who quit in response.

The Israeli military said its fighter jets had attacked Iranian “Quds Force” targets early on Monday, including munition stores, a position in the Damascus International Airport, an intelligence site and a military training camp. Its jets then targeted Syrian defense batteries after coming under fire.

It followed a previous night of cross-border fire, which Israel said began when Iranian troops fired an Iranian-made surface-to-surface missile from an area near Damascus at a ski resort in the Israeli-occupied Golan Heights.

Syria said it was Israel that had attacked and its air defenses had repelled the assault. Syria had endured “intense attack through consecutive waves of guided missiles”, but had destroyed most “hostile targets”, state media quoted a military source as saying.

The Russian defense ministry said Syrian air defenses, supplied by Russia, had destroyed more than 30 cruise missiles and guided bombs, according to RIA news agency.

In Tehran, airforce chief Brigadier General Aziz Nasirzadeh said Iran was “fully ready and impatient to confront the Zionist regime and eliminate it from the earth”, according to the Young Journalist Club, a website supervised by state television.

Assad has said Iranian forces are welcome to stay in Syria after years of military victories that have brought most of the country back under his control. Just two big enclaves are still outside Assad’s grip, including the area Trump plans to exit.

Netanyahu, who is hoping to win a fifth term in the April 9 election, last week told his cabinet Israel has carried out “hundreds” of attacks over recent years.

“We have a permanent policy, to strike at the Iranian entrenchment in Syria and hurt whoever tries to hurt us,” he said on Sunday.

“EVERY LAST BOOT”

The Israeli military distributed footage of what it said were missiles hitting the Syrian defense batteries, as well as satellite images showing the location of the alleged Iranian targets. Syrian state media showed footage of explosions.

In a highly publicized operation last month, the Israeli military uncovered and destroyed cross-border tunnels from Lebanon it said were dug by Hezbollah to launch future attacks.

Israel last fought a war with Hezbollah, on Lebanese soil, in 2006. It fears Hezbollah has used its own role fighting alongside Iran and Assad in Syria to bolster its military capabilities, including an arsenal of rockets aimed at Israel.

Tensions have also risen with Israel’s construction of a frontier barrier that Lebanon says passes through its territory.

Washington has sought to reassure allies it still aims to eject Iran from Syria despite pulling its own troops out. U.S. Secretary of State Mike Pompeo, who visited the region this month, has vowed to expel “every last Iranian boot” from Syria.

Israel has sought reassurances from Moscow that Iranian forces in Syria would not be a threat. Israeli military spokesman Lieutenant Colonel Jonathan Conricus said the missile fired at the ski resort was launched from “an area we were promised the Iranians would not be present in”.

(Reporting by Ellen Francis in Beirut, Ari Rabinovitch and Dan Williams in Jerusalem and Maria Kiselyova in Moscow; writing by Angus McDowall; Editing by Nick Macfie and Raissa Kasolowsky)

‘Life-and-death’ cold grips eastern, Midwest United States

FILE PHOTO: The U.S. Capitol is seen behind a snow pile in Washington, U.S., January 16, 2019. REUTERS/Yuri Gripas/File Photo

By Rich McKay

(Reuters) – Winter winds brought extreme cold and ice-slicked roads to the Midwestern and Eastern United States on Monday, with the U.S. Martin Luther King Jr. Day holiday and an ongoing government shutdown allowing many to heed official advice to stay indoors.

The arctic blast of frigid air has followed a January storm that dumped more than a foot (30 cm) of snow and sleet across the Northeast, which started melting Sunday.

Pedestrians walk in the rainy day at Time Square in the Manhattan borough of New York City, New York, U.S., January 20, 2019.REUTERS/Jeenah Moon

Temperatures fell to single-digits Fahrenheit (about -20 C) from New York City to Boston and through northern New England and froze melting snow late on Sunday and early Monday, said Marc Chenard at the National Weather Service’s Weather Prediction Center in College Park, Maryland. Winds up to 30 to 40 miles per hour (48-64 kph) added possibly deadly wind chill.

“This is definitely dangerous, life-and-death kind of weather happening,” Chenard said. “Minnesota and Wisconsin will see temperatures in the negative 20s.”

“Boston will be just 3 degrees (Fahrenheit) this morning, with wind chills of minus 12 or more,” he said. “New York City and D.C. will be in that same range, maybe hitting the teens later today. It’ll be record or near-record cold.”

The NWS issued wind-chill advisories and warnings for more than 10 states, from North Dakota and to East Coast metropolitan centers.

High temperatures for Monday are forecast at 17 Fahrenheit (minus 8 Celsius) for New York City and 12 F (minus 11 C) for Boston.

Many Americans had the day off work on Monday, either because of the holiday or because they are among the furloughed federal government workers who find themselves in the longest shutdown in U.S. history, caused by an impasse over funding U.S. President Donald Trump’s plans to build more barriers on the U.S.-Mexico border. [nL1N1ZK05R]

More than 6,000 flights were delayed, mostly in New York and New England, according to FlightAware.com, down from more than 14,000 on Sunday. More than 500 flights were canceled early Monday compared with more than 2,000 Sunday, the website reported.

Tuesday’s weather will be only slightly warmer, Chenard said, with temperatures reaching the low 20s Fahrenheit in the Northeast. By Wednesday, some areas such as Boston will be in the high 30s or low 40s. Washington D.C. temperatures might reach 50 degrees, he said.

But the relatively warmer temperatures won’t last. Another arctic blast is on its way in time for next weekend.

(Reporting by Rich McKay in Atlanta, additional reporting by Jonathan Allen in New York; Editing by Scott Malone and Nick Zieminski)

Top North Korea envoy meets Pompeo, headed for talks with Trump

U.S. Secretary of State Mike Pompeo escorts Vice Chairman of the North Korean Workers' Party Committee Kim Yong Chol, North Korea's lead negotiator in nuclear diplomacy with the United States, into talks aimed at clearing the way for a second U.S.-North Korea summit as they meet at a hotel in Washington, U.S., January 18, 2019. REUTERS/Joshua Roberts

By David Brunnstrom and Matt Spetalnick

WASHINGTON (Reuters) – A North Korean nuclear envoy held talks with Secretary of State Mike Pompeo on Friday and was then due to meet President Donald Trump at the White House, a diplomatic flurry aimed at laying the groundwork for a second U.S.-North Korea summit.

The visit of Kim Yong Chol, Pyongyan’s lead negotiator with the United States, marked a rare sign of potential movement in a denuclearization effort that has stalled since a landmark meeting between Trump and North Korean leader Kim Jong Un in Singapore last year.

Kim Yong Chol and Pompeo, with tight smiles, posed together for photographs at a Washington hotel before holding about 45 minutes of talks that could determine whether the two sides can make headway. There has been no indication of any narrowing of differences over U.S. demands that North Korea abandon a nuclear weapons program that threatens the United States or over Pyongyang’s demand for a lifting of punishing sanctions.

Hours before Kim Yong Chol’s arrival on Thursday, Trump – who declared after the Singapore summit in June that the nuclear threat posed by North Korea was over – unveiled a revamped U.S. missile defense strategy that singled out the country as an ongoing and “extraordinary threat.”

The State Department said after the meeting that Pompeo had a “good discussion” with Kim Yong Chol “on efforts to make progress on commitments President Trump and Chairman Kim Jong Un made at their summit in Singapore.” But it provided no specifics.

After the talks with Pompeo, Kim Yong Chol, a hardline former spy chief, the White House confirmed that he would hold a meeting with the president in the Oval Office later on Friday.

The high-level visit could yield an announcement of plans for a second summit. Both Trump and Kim have expressed an interest in arranging but some U.S.-based analysts say it would be premature due to the lack of obvious progress so far.

Their first meeting produced a vague commitment by Kim to work toward the denuclearization of the Korean peninsula, but he has yet to take what Washington sees as concrete steps in that direction.

(Reporting By Matt Spetalnick; Editing by Jeffrey Benkoe and Alistair Bell)

On Day 28, no sign of end to U.S. partial government shutdown

Long lines are seen at a Transportation Security Administration (TSA) security checkpoint at Hartsfield-Jackson Atlanta International Airport amid the partial federal government shutdown, in Atlanta, Georgia, U.S., January 18, 2019. REUTERS/Elijah Nouvelage

By James Oliphant

WASHINGTON (Reuters) – As the partial U.S. government shutdown hit the four-week mark on Friday, tensions mounted in Washington on either side of the standoff over President Donald Trump’s demand for $5.7 billion to help fund a U.S.-Mexico border wall.

That ultimatum, which congressional Democrats have rejected, has prevented Congress from approving legislation to restore funding to about a quarter of the federal government, which closed down partially on Dec. 22 when several agencies’ funds expired for reasons unrelated to the border.

The Democratic-led House of Representatives has left town for a three-day weekend, returning late on Tuesday. The Senate was expected to reconvene on Friday, but its exact plans were unsettled.

The Republican-controlled Senate, toeing Trump’s line on the wall, has not acted on any of several shutdown-ending bills approved in recent days by the House, all lacking wall funding.

The partial shutdown – already the longest in U.S. history – seemed certain to drag well into next week, meaning 800,000 federal workers nationwide would continue to go unpaid and some government functions would remain impaired.

Any serious debate about immigration policy has deteriorated into a test of political power. After House Speaker Nancy Pelosi suggested to Trump that he delay the annual State of the Union address until after the government reopens, Trump responded by denying Pelosi and a congressional delegation use of a military aircraft for a planned trip to Belgium and Afghanistan.

Trump’s intervention stopped the trip just as Pelosi and other lawmakers were about to travel.

Pelosi’s spokesman said on Friday that the congressional delegation had been prepared to fly commercially after the military plane was revoked, but learned the administration had also leaked the commercial travel plans.

“In light of the grave threats caused by the President’s action, the delegation has decided to postpone the trip so as not to further endanger our troops and security personnel, or the other travelers on the flights,” Drew Hammill wrote on Twitter.

Hammill said the State Department had to pay for the commercial flight, which was how the White House knew about the travel plans that Hammill said were leaked.

A White House official, speaking on condition of anonymity, denied leaking the travel plans, adding, “When the speaker of the House and about 20 others from Capitol Hill decide to book their own commercial flights to Afghanistan, the world is going to find out.”

In tweets on Friday, Trump reiterated his claim that farmworkers would still be able to enter the country and stressed again his demand for the border wall, which he says is needed to stem illegal immigration and drug trafficking. Democrats have resisted the wall as wasteful and unworkable.

The House has passed short-term spending bills that would end the shutdown and reopen the government, but Republican Senate Majority Leader Mitch McConnell has refused to allow a floor vote on them, saying they lacked White House support.

A House Republican aide told Reuters on Thursday that no back-channel talks to resolve the shutdown were taking place.

During the week, a small group of Senate Republicans sought support for a plan to urge Trump to agree to a short-term funding bill in exchange for a debate on border security. Their efforts went nowhere.

The Trump administration worked to minimize the damage being done to government operations across the country. On Thursday, the State Department said it was calling furloughed employees back to work.

(Reporting by James Oliphant; additional reporting by Richard Cowan, Susan Cornwell, Jeff Mason and Makini Brice; editing by Kevin Drawbaugh, Peter Cooney and Jonathan Oatis)

‘Super Blood Wolf Moon’ to get star billing in weekend lunar eclipse

FILE PHOTO: A combination photo shows the lunar eclipse from a blood moon (top L) back to full moon (bottom right) in the sky over Frankfurt, Germany, July 27, 2018. REUTERS/Kai Pfaffenbach/File Photo

By Barbara Goldberg

NEW YORK (Reuters) – Look up into the night sky on Sunday and – if it is clear – you may witness the so-called “Super Blood Wolf Moon” total lunar eclipse, which will take a star turn across the continental United States during prime time for viewing.

The total eclipse, which will begin minutes before midnight on the East Coast (0500 GMT) and just before 9 p.m. in the West, will unfold on the day before Martin Luther King Jr. Day, a national holiday when most Americans have no school or work.

That means even the youngest astronomy buffs may get to stay up late and attend one of many watch parties that have been organized from Florida to Oregon.

The total eclipse will last for about an hour, and the best viewing is from North and South America, according to National Geographic. Partial eclipses leading up to and following the total eclipse mean the entire event will last 3.5 hours.

Total lunar eclipses occur when the moon moves into perfect alignment with the sun and earth, giving it a copper-red or “blood” appearance to those watching from below.

“Amateur astronomy clubs are throwing parties because this is what they live for – to get entire families excited about our place in the universe by seeing the mechanics of the cosmos,” said Andrew Fazekas, spokesman for Astronomers Without Borders.

In Pennsylvania, the York County Astronomical Society has invited the public to peer through its observatory’s telescopes for a close-up look. In Los Angeles, Griffith Observatory said it was anticipating “extremely large crowds,” and its website will live-stream a telescopic view of the eclipse.

COPPERY RED GLOW

A “super” moon occurs when the moon is especially close to earth, while a “wolf moon” is the traditional name for the full moon of January, when the howling of wolves was a sound that helped define winter, according to The Farmers Almanac.

In a total lunar eclipse, the moon never goes completely dark. Rather, it takes on a reddish glow from refracted light as the heavenly bodies move into position – hence the “blood moon” moniker. The more particulate or pollution in the atmosphere, the redder the moon appears.

“All of the sunrises and sunsets around the world are simultaneously cast onto the surface of the moon,” Fazekas said.

As many as 2.8 billion people may see this weekend’s eclipse from the Western Hemisphere, Europe, West Africa and northernmost Russia, according to Space.com.

While total lunar eclipses are not especially rare, the 2019 version takes place early enough in the evening that it can be enjoyed by U.S. stargazers of all ages, said George Lomaga, a retired astronomy professor from Suffolk County Community College. He plans to attend an eclipse party at Hallock State Park Preserve on New York’s Long Island.

There, astrophotographer Robert Farrell will demonstrate how to use a mobile phone to photograph celestial objects through a telescope so the spectacle can be shared online.

If skies are clear, the phenomenon can be seen with the naked eye and no protection is needed to safely enjoy the view, Griffith Observatory said.

Granted permission to stay up past his 8 p.m. bedtime, Gabriel Houging, 8, of Citrus Heights, California, is already dreaming of what he’ll see.

“It’s going to be a moon, but it’s going to look like you painted it orange!” Houging said.

(Reporting by Barbara Goldberg in New York; editing by Frank McGurty and Rosalba O’Brien)

U.S. names three killed in Syria blast claimed by Islamic State

American flags fly on National Mall with U.S. Capitol on background as high-wind weather conditions continue in Washington, U.S. March 2, 2018. REUTERS/Yuri Gripas

(Reuters) – The United States on Friday identified three Americans killed in a suicide attack in northern Syria this week that the U.S. government said was likely carried out by the Islamic State militant group.

Army Chief Warrant Officer Jonathan Farmer, 37, of Boynton Beach, Florida; Navy Chief Cryptologic Technician Shannon Kent, 35, identified as being from upstate New York, and Scott Wirtz, a civilian Department of Defense employee from St. Louis, died during the Wednesday attack in Manbij, Syria, the Department of Defense said in a statement.

U.S. Army Chief Warrant Officer Jonathan Farmer, 37, of Boynton Beach, Florida is pictured in an undated photo released by the U.S. Army, in Fort Bragg, North Carolina, U.S., January 18, 2019. U.S. Army/Handout via REUTERS

The Pentagon did not identify the fourth person killed, a contractor working for a private company.

The Manbij attack on U.S. forces in Syria appeared to be the deadliest since they deployed on the ground there in 2015. It took place in a town controlled by a militia allied with U.S.-backed Kurdish forces.

Two U.S. government sources told Reuters on Thursday that the United States views the Islamic State militant group as likely responsible for the attack. Islamic State has claimed responsibility.

The attack occurred nearly a month after President Donald Trump confounded his own national security team with a surprise decision on Dec. 19 to withdraw all 2,000 U.S. troops from Syria, declaring Islamic State had been defeated there.

U.S. Navy Cryptologic Technician Shannon M. Kent, 35, is pictured in an undated photo released by the U.S Navy, in Washington, DC, U.S., January 18, 2019. U.S. Navy/Handout via REUTERS

If Islamic State carried out the attack, that would undercut assertions, including by U.S. Vice President Mike Pence several hours after the blast on Wednesday, that the militant group has been defeated.

Experts do not believe Islamic State has been beaten despite its having lost almost all of the territory it held in 2014 and 2015 after seizing parts of Syria and Iraq and declaring a “caliphate.”

While the group’s footprint has shrunk, experts say it is far from a spent force and can still conduct guerilla-style attacks. An Islamic State statement on Wednesday said a Syrian suicide bomber had detonated his explosive vest in Manbij.

(Reporting by Gina Cherelus in New York; Editing by Scott Malone and Steve Orlofsky)

U.S. State Department recalls furloughed employees amid shutdown

People enter the State Department Building in Washington, U.S., January 26, 2017. REUTERS/Joshua Roberts/File Photo

WASHINGTON (Reuters) – The U.S. State Department said on Thursday it was calling its furloughed employees back to work next week as it takes steps to pay salaries despite a partial shutdown of the government.

“As a national security agency, it is imperative that the Department of State carries out its mission,” Deputy Under Secretary of State Bill Todd said in a statement posted on the department’s website. “We are best positioned to do so with fully staffed embassies, consulates and domestic offices.”

Todd said the department’s employees would be paid on Feb. 14 for work performed beginning on or after this coming Sunday. The department would review its available funds and “legal authorities” beyond the upcoming pay period to try to cover future payments, he said.

“Although most personnel operations can resume, bureaus and posts are expected to adhere to strict budget constraints with regard to new spending for contracts, travel, and other needs” given a lapse in congressionally appropriated funds, Todd added.

About one-quarter of federal agencies have been shuttered since Dec. 22, with Democratic lawmakers refusing to accede to President Donald Trump’s demands to pay for a wall along the U.S. border with Mexico.

Trump is holding out for $5.7 billion for a border wall. Democrats, who took over the U.S. House Representatives this month, have rejected his demands, saying there are cheaper, more effective ways of enhancing border security.

(Reporting by Tim Ahmann; editing by David Alexander and James Dalgleish)

U.S. labor market strong; mid-Atlantic factory activity improves

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – The number of Americans filing applications for jobless benefits unexpectedly fell last week, pointing to sustained labor market strength that should continue to underpin the economy.

Other data on Thursday showed factory activity in the mid-Atlantic region rebounded in January from near a 2-1/2-year low, driven by a surge in new orders, which could allay concerns that manufacturing production was slowing sharply.

While the data so far suggest the economy is in relatively good shape, there are concerns an ongoing partial shutdown of the federal government could erode both business and consumer confidence, leading to cuts in spending.

Initial claims for state unemployment benefits decreased 3,000 to a seasonally adjusted 213,000 for the week ended Jan. 12, the Labor Department said on Thursday. Economists polled by Reuters had forecast claims would rise to 220,000 last week.

The dollar gained against a basket of currencies. U.S. Treasury yields largely rose while stocks on Wall Street were mixed.

The claims data covered the survey period for the nonfarm payrolls portion of January’s employment report.

Claims fell 4,000 between the December and January survey periods. While that would suggest little change in labor market conditions after the economy created 312,000 jobs in December, the longest government shutdown in U.S. history raises the risk of a drop in payrolls.

Some 800,000 government workers missed their first paycheck last Friday because of the partial shutdown, which started on Dec. 22 as President Donald Trump demanded that Congress give him $5.7 billion this year to help build a wall on the country’s border with Mexico.

The pay period for most federal employees that includes the week of Jan. 12 runs from Jan. 6 to Jan. 19. About 380,000 workers have been furloughed, while the rest are working without pay. Furloughed workers will probably be counted as unemployed.

“The federal government shutdown could make the payroll jobs number a walking disaster,” said Chris Rupkey, chief economist at MUFG in New York. “Payroll employment is likely to dive in January with perhaps 300 or 400 thousand jobs lost.”

Private contractors working for many government agencies are also without pay. But Trump has signed legislation for all employees to be paid their salaries retroactively when the shutdown ends. Some economists say that could result in the shutdown having a small impact on January payrolls.

MODEST-MODERATE GROWTH

The Trump administration has been recalling some employees to work without pay in an effort to minimize the fallout from the shutdown. Publication of economic data compiled by the Commerce Department’s Bureau of Economic Analysis and Census Bureau has been suspended during the shutdown.

That includes December’s housing starts and building permits report, which was scheduled for release on Thursday. November’s construction, factory orders and trade figures have also been delayed, as well as December retail sales and November business inventories data.

The incomplete data is making it hard to get a clear read on the economy, which could complicate policy decisions.

The Federal Reserve said on Wednesday in its Beige Book report, which offers a snapshot of the economy, that eight of the U.S. central bank’s 12 districts reported “modest to moderate growth” in late December and early January.

The Fed noted that while outlooks generally remained positive, “many districts reported that contacts had become less optimistic.”

That was corroborated by a separate report on Thursday from the Philadelphia Fed showing its business conditions index increased to a reading of 17.0 in January from 9.1 in December, which was its lowest level since August 2016.

The survey’s six-month business conditions index increased to a reading of 31.2 this month from 29.9 in December. But its six-month capital expenditures index slipped to a reading of 31.6 in January from 34.5 in the prior month.

Despite the modest rebound in manufacturing in the region that covers eastern Pennsylvania, southern New Jersey and Delaware, the level of activity is lower than it was for most of 2017 and 2018.

This fits in with other signs that national factory activity is slowing, having hit a two-year low in December. A report from the New York Fed earlier this week showed a second straight monthly drop in its Empire State manufacturing index in January.

“Conditions have certainly downshifted from earlier in 2018 and compared with 2017,” said Adam Ozimek, a senior economist at Moody’s Analytics in West Chester, Pennsylvania. “This reflects simmering risks that threaten to derail the otherwise strong economy.”

(Reporting by Lucia Mutikani; Editing by Paul Simao)

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