Due to a technical problem on Wednesday Jan
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News Headlines to Jan 16 2008
Jan 17 2008 News Links
Markets News Afternoon: US and European stocks slide; Dublin market rises
Annual Irish Consumer Inflation falls to 4.7% in December 2007
Euribor 3-Month Inter-Bank Rate falls to the lowest level since the onset of the Credit Crunch in August 2007
European Central Bank warns again that it may raise interest rates
Slashing Energy Waste in China - Energy efficiency would do 'the most, the quickest,' to reduce CO2 emissions - World Bank
Study links corporate performance to employee enablement - Economist Intelligence Unit
Markets News Thursday: Asia-Pacific and European stocks rise
Thursday Newspaper Review - Irish Business News and International Stories
Big drugs companies raided by European competition regulators
Bank warns again that it may raise interest rates
The European Central Bank reconfirmed
today that it is ready to raise interest rates if necessary to
prevent a rise in price inflation in the Eurozone.
The ECB is particularly concerned
about the impact of "second-round effects" - wage and price
setting in reaction to the high levels of inflation at a rate of
3.1% compared with its target of "below but close to 2%."
Inflation has been fuelled by spikes in both food and energy prices.
"The Governing Council
remains prepared to act pre-emptively so that second round effects
and upside risks to price stability over the medium term do not
materialise," the ECB said in its
January Monthly Bulletin.
"It is imperative that all
parties concerned meet their responsibilities and that second round
effects on wage and price-setting stemming from current inflation
rates be avoided. In the view of the governing council, this is
absolutely essential in order to preserve price stability in the
medium run," it said.
The ECB said it is closely monitoring
wage negotiations with particular attention.
In Germany, public sector unions have
staked wage claims at more than double the current inflation rate.
The ECB said that risks to the
inflation outlook are clearly on the upside.
The central bank expects inflation to
remain significantly above 2% in the coming months and to moderate
only slowly in the course of 2008, it said. The assumptions are
based on a moderation of commodity prices and reasonable wage
The ECB said it still expects the
Eurozone economy to continue growing around its 2.0% potential rate,
describing the region's economic fundamentals as sound.
However, it also said that
uncertainty about the economic impact of recent tensions in credit
markets remains high and risks to the growth outlook lie on the
Times reported today that the euro slid sharply on Wednesday after
investors bet comments by a European Central Bank council member
meant eurozone rate cuts were more likely.
Luxembourg’s central bank governor, said the ECB should “be
cautious” amid the widespread economic uncertainty and hinted
that Eurozone growth forecasts might soon have to be revised
Mr Mersch represents one
of the Eurozone’s smallest states, but he is regarded as one of the
more hawkish members of the 21-strong ECB council. His comments in a
Bloomberg interview suggest at least some bank members are
moderating their tone as the US Federal Reserve prepares to cut
Earlier, Axel Weber,
president of the Bundesbank, also appeared to be hedging his usually
hawkish stance. He acknowledged that German inflation could have
eased significantly by 2009.