In an unprovoked attack North Korea has fired dozens of shells on a South Korean island. The Korean Won and Japanese Yen weakened and global stock markets remain edgy as risk appetite retreats and the US dollar gains from safe haven flows. The threat of Portugal joining the poor queue behind Greece and Ireland will keep investors wary for now.
The Irish Green Party who is junior coalition partners in the Irish government has called for an election in January next year. This has caused instability as the Greens can certainly not be relied on to support the harsh austerity measures which will be forced on Ireland.
Irish Prime Minister Brian Cowan is refusing to step down until the bail-out package and budget plan are finalised. He knows no rescue funds will be made available until certain unpopular issues are agreed between lender and borrower.
European Central Bank officials have said Irish aid is strictly conditional on Ireland following the rules. These rules may include raising the low corporate tax rate from 12.5%, and lowering the minimum wage. Computer giant Hewlett-Packard has warned it would pull out of its planned investment in Ireland should the country raise the corporate tax rate. Irish Finance
Minister Brian Lenihan has declared the 12.5% corporate tax rate as non-negotiable, but “beggars can’t be choosers” and pressure from Germany may mean this is a pre-requisite of the bail-out.
German Q3 GDP growth expanded +0.7% this morning on expectation. This follows the massive +2.3% surge in growth in Q2. The breakdown of the number showed an encouraging increase of +2.3% in exports and +3.7% in equipment investment.
The UK housing market looks to be entering choppy waters once more. This morning Nationwide warned UK house prices will fall further due to the government public spending cuts. The British Banking Association released their October mortgage approvals number which was the lowest since March 2009, in the depths of the recession.
The Reserve Bank of New Zealand Quarterly Inflation Expectations Survey revealed that executives at the 78 businesses surveyed expected inflation to remain steady at 2.6% in 2-years time.
Important US data is released today at 13:30pm (Q3 2nd estimate GDP growth), 15:00pm (October existing home sales) and 19:00pm (Minutes from the Federal Reserve meeting) for those of you unlucky enough still to be at work!
The Irish may be suffering at present but you can’t knock their entrepreneurial spirit. Puckout.com has released a sure thing for the number one stocking filler this Christmas. Boxer shorts and g-strings with the slogan “I’d rather be screwed by the IMF” and “The IMF took me coat” are a great way to vent your frustration this festive season.