Morning business news - April 7

Monday 07 April 2014 09.10
Morning business news - April 7
Morning business news - April 7

Nationwide UK (Ireland), together with the ESRI, measures attitudes to savings each month.

In March, the overall index was up five points which was mainly accounted for by the activities of the over-50s.

The index is now back at levels seen before a number of measures were introduced in the Budget that might have been considered discouraging towards saving.

Brendan Synnott of Nationwide said people were disappointed with Budget increases in taxes and Dirt tax, together with a general lowering in interest rates.

"There was a level of apathy setting in with over-50s. They are constantly hit and now they are at an acceptance level and they're going to get on with it."

Mr Synnott said the desire to save among the over-50s is very strong because the guaranteed return of savings is far more attractive than a speculative investment such as stocks or bonds.

He said the savings behaviour of the under-50 age cohort was largely dictated by the demands on that generation.

"We had seen people saving for specific reasons, like a deposit for a house, but prices are now moving out of their reach again so they're not comfortable with the way the property market is going."

Many of their counterparts are also servicing very large debts having bought property in the boom. Some are moving off fixed rates onto variable rates.

Brendan Synnott said the activities of the ECB also had an impact on the savings environment.

"We've seen from the experience of other countries that a zero return results in a reversion to a cash economy. People store money under the bed and in boxes. It leads to the deconstruction of a regularised economy," he concluded.

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Bord Gáis Energy tracks movements in energy prices internationally every month and produces an Energy index.

The overall index was up 1% in March - that was mainly due to a 6% month-on-month increase in wholesale electricity prices which was offset by falling oil and wholesale gas prices.

The hike in electricity costs was accounted for by low volumes from wind turbines on days when gas and coal powered plants were out of action.

The situation in Ukraine and Crimea has had no perceptible long term impact on energy prices so far, it says.

But Ukraine has been resisting moves by Russia to double the price of Russian gas supplies and threatened legal action.


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Indian pharma company Sun Pharmaceuticals has agreed to acquire rival Ranbaxy in a deal worth $4bn.

The combined entity will be India's biggest pharmaceutical company and the world's fifth-biggest generic drugs maker.

Ranbaxy is under the spotlight of US regulators at the moment who have imposed import bans on drugs manufactured at some of its facilities.

The agreement still needs shareholder and regulatory approval.

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Nigeria has officially become Africa's biggest economy overtaking South Africa.

Revised figures released yesterday recalculated the economy's worth at $510 billion compared to South Africa's $353 billion.

Previous calculations excluded certain sectors like telecoms, entertainment and airline businesses.

South Africa still has a higher per-capita income and lower levels of poverty - 70% of Nigerian citizens live in poverty.