CITI ECONOMIST CONFIDENT NTMA WILL MEET AUCTION TARGETS - The National Treasury Management Agency is currently looking at bids for Irish Government debt as it seeks to raise between €1 billion and €1.5 billion to keep the country motoring. It is probably the most severe test of the country's reputation on the debt markets given the level of adverse comment about Ireland's ability to repay its sovereign loans as it struggles to keep the country within its means and support fledgling export growth on the one hand and continue to bail out Anglo Irish Bank on the other.
An economist whose Alma Maters include Cambridge, Yale, the London School of Economics and the International Monetary Fund, says that it is clear that the last nine months have been very difficult for the country.
Willem Buiter, who is visiting Ireland in his capacity as the chief economist at Citi, says the country is in the first stage of a multi-year fiscal programme. He says that people are looking for good news, which is just not yet forthcoming. He says that the real economy growth is resuming and because of the country's 'fundamentally flexible economy' and further expected spending cuts and tax increases, things will slowly improve. But he adds that even when growth resumes, the next few years will remain painful for Irish households.
On today's bond auction, Mr Buiter says that the markets and investors should realise that Ireland is not Greece and he is confident that the auction will be successful. He says the markets are over-estimating the risk of default by the Irish Government and adds that any country can be defenceless against the force of the markets. He adds this is especially true for small countries. He says the current yield spread between Irish bonds and German bonds is 'ridiculous'.
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MORNING BRIEFS - On the currency markets, the euro is worth $1.3086 - a five week low ahead of a policy meeting of the US Federal Reserve later tonight. The euro is also worth 83.98 pence sterling this morning.
