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Minister for Finance Michael Noonan (l) pictured at the Eurogroup meeting in the Royal Palace of Gödöllő, Hungary, April 08, 2011.
Spending Review: Minister for Public Expenditure Brendan Howlin said on Monday
after a Cabinet meeting that he wanted to ensure Ministers were not
“captured” by their departments into defending existing levels of spending.
He said the Cabinet agreed to begin the comprehensive spending review promised
in the programme for government. The process will be completed in September
before the annual estimates process.
Howlin said one cost-saving measure departments will be allowed to explore is
the outsourcing of non-essential activity to the private sector.
He said he had brought two memoranda to Cabinet last night; one dealing with a
process to curtail current spending and the other with capital spending.
“I wanted it to happen early in the life of the Government so that people
wouldn’t be captured by their departments and have to defend every line of
spending,” said the Minister.
Yesterday, the IMF cut its 2011 growth forecast
for Ireland from 1% to 0.5%.
Irish Insurance Federation has reported that insurance companies have made
payouts of more than €220m in compensation to home and business owners after
last winter's severe weather. Claims of almost 30,000 were made in respect of
damage caused by burst pipes.
Counties Cork, Galway and Dublin were worst affected by the worst weather in
parts of the country in more than a century.
The IIF says that €224m has been paid out in compensation to date, with most of
the claims made by home owners.
The IMF says there's no fear of a double dip as the recovery gains strength but it warns of high unemployment in developed economies. Oliver Blanchard, chief economist at the IMF, joined CNBC for more:
Economic View: IMF forecasts now being watched more closely in Ireland
-- Goodbody chief economist, Dermot O’Leary, commented - -
emanating from the IMF in Washington have taken on a higher level of importance
here in Ireland since the Fund’s arrival in late November last year. Yesterday,
it published its latest World Economic Outlook. While global growth forecasts
were left unchanged at a healthy 4.4% and 4.5% in 2011 and 2012, respectively,
there was a notable downward revision for Ireland, albeit not unexpected.
When the Memorandum of Understanding (MoU) between the Troika (IMF/EU/ECB)
and Ireland was struck last December the IMF pencilled in growth of 0.9% in
2011. It now predicts growth of only 0.5%, in line with our own estimate of 0.4%
growth. For 2012, it left its forecast unchanged 1.9%. The significance of the
forecast changes lies in what it means for the fiscal consolidation targets that
have been agreed with the Troika. In the MoU in December, the Irish authorities
stated that we 'stand ready to take any corrective actions that may become
appropriate for this purpose as circumstances change.'
Quarterly reviews by the Troika determine whether any further action is
necessary. One of these reviews is taking place at the current time. In our
view, the most important milestones in this first review are in relation to the
banking system, where important targets have been met. Interestingly, there were
calls by the IMF yesterday for a cut in the interest rate that Ireland is being
charged for its loans.
In relation to the fiscal targets, it is still early days and tax returns
were largely in line with estimates in the first quarter of the year but there
are warning signs that fiscal targets may indeed slip for the full-year, perhaps
necessitating further action at the time of the second review by the Troika
during the summer. At the very least, we would expect a downgrade from the
Department of Finance to its 1.7% growth forecast for 2011 to arrive soon."
CEO Pay in the USA:
IMF lowers 2011 GDP forecast for Ireland but no change to
expected rate of growth in 2012; little change to global estimates:
Davy analyst Florence O'Donoghue comments --
"As part of
its twice-yearly world economic outlook, the IMF cut its 2011
forecast for Ireland yesterday (April 11th). It is now forecasting
GDP growth of 0.5% this year, down from a forecast of 0.9% back in
December. A higher rate of unemployment (14.5% in 2011 compared to
the previous estimate of 13.5%) and a more downbeat outlook for the
key export markets of the US and UK are factors in the downgrade of
economic growth projections for this year. However, the IMF
continues to predict GDP growth in Ireland of almost 2% in 2012.
These updated forecasts are more pessimistic than our own
expectations: we are forecasting GDP growth of 1.6% this year and
2.4% in 2012.
The IMF's revised forecasts follow a similar pattern for the
UK: it is forecasting growth of 1.7% this year, down from its
earlier estimate of 2%, but has not changed its 2.3% growth estimate
for 2012. Overall, the IMF's global economic GPD forecast is little
changed, with growth of 4.4% this year expected to be followed by a
4.5% expansion next year.
Elsewhere, figures released by the CSO on April 11th indicated
that on a seasonally adjusted basis, Irish manufacturing volumes in
February were 2.3% down on January but unchanged on February 2010.
With the exception of a spike last July, manufacturing output in
Ireland has remained quite steady since the start of 2010."
In New York Monday, the Dow inched up 1 point to 12, 381.
The S&P 500 slid 0.285 and the Nasdaq slipped 0.32%.
MSCI Asia Pacific Index fell 1.4% Tuesday after Japan's nuclear safety agency
raised the severity rating of the crisis at its nuclear plant to the highest
level today, comparable with the 1986 Chernobyl disaster.
Japan's Nikkei 225 dipped 1.69%; China's Shanghai composite index slipped 0.05%;
Australia's S&P/ASX 200 Index slid 1.46% and the Bombay Stock Exchange's Sensex index dipped 0.97% in Mumbai.
BDI closed at 3,005 on Thursday, Dec 31st - - a rise of 289% in 2009. The index
averaged 59% lower in 2009 than a year earlier.
Thursday, July 15, 2010, the index fell for the 35th straight session, by 9
points, or 0.537%, to 1,700 points,
On Friday July16th, the BDI rose 20
points or 1.12% to 1,700 to break the 35-session losing streak.
Monday this week, the BDI slipped 17 points or 1.23% at 1,359.
The Financial Times reported
earlier in January, that Australia’s flooding and fears of ship oversupply has
pushed down a gauge of the cost of hiring ships to carry coal, iron ore and
other dry bulk by nearly half since October to the lowest level since the
aftermath of the financial crisis. The Baltic Dry index, the widely watched
measure of dry bulk charter rates, fell to 1,453, nearly half the 2,784 peak
reached on October 27, 2010.
margin between the US benchmark WTI (West Texas Intermediate) used on the New
York Mercantile Exchange and Brent is over $14.
said in early February that a surge in oil inventories in Cushing, Oklahoma,
where WTI is delivered into America’s pipeline system, has depressed the value
of the benchmark against other yardsticks. The
International Energy Agency said on Thursday that with “few relief valves” to
cut the stock overhang in Cushing, the price dislocation “may persist for months
[or years] to come”.