ECB LIKELY TO INCREASE RATES AGAIN IN JULY - Yesterday's decision by the European Central Bank to leave interest rates unchanged is good news for mortgage holders, but they should prepare for higher costs in the months and years ahead.
Frank Conway, of MoneyCoach.ie, says the ECB signalled yesterday that it is also unlikely to increase interest rates in June. However, a move upwards is likely in July as the bank continues its vigilance against rising euro zone inflation. He says the bank has always insisted that it will take very measure in controlling and reducing inflation in the euro zone. Mr Conway states that about 80% of the 780,000 residential mortgage holders are susceptible to rising interest rates with each quarter of a per cent rise in the ECB base rate results in about a €15 rise per €100,000 borrowed.
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NEW INITIATIVE TO GET START-UPS ONLINE - According to recent Central Statistics Office figures, almost one third of businesses do not have a website, and only about a fifth have an e-commerce capability. From today small businesses have a new way to get an internet domain, email, web presence and VOIP phone line all in the one place. The initiative is called www.GIBO.ie , or Get Irish Business Online, and the initiative will help small business save costs and start using web technologies in their first year online.
Conor Moran, managing director of Irish Domains, says the new initiative is open to all businesses on the island of Ireland. He says that while it is targeted at start-ups that have not yet set up a web presence, the initiative is also open to SMEs that have some online presence but would like to learn how to develop it further. He says that www.GIBO.ie will provide each SME with educational resources to help them understand the opportunities offered by the internet and connect them to local business support groups in their areas.
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MORNING BRIEFS - Ulster Bank has reported an operating loss of €441m for the first three months of 2011, mainly due to an increase in impairment losses. It said it continues to be impacted by the challenging economic climate here. Its parent bank, Royal Bank of Scotland's exposure to Ireland hit earnings overall, and RBS said it expects charges for bad debts from Ireland to remain high in the next three months. In an interim management statement, RBS said it made an overall of £528m sterling in the three month period.
*** Commodity prices are slightly higher this morning after markets were hammered yesterday by one of the biggest sell-offs in two years. Oil dropped a record $12 a barrel, while gold, silver and copper prices fell also. Falling by 12% or $5 an ounce, silver saw its biggest one-day dollar price drop since 1980.
*** After being closed for a few days this week for the Golden Week Holiday in Japan, the Nikkei reopened this morning to see Sony shares fall by 4% after the company had to apologise to customers again this week when more customers' data was stolen in a second security breach.
*** Paper firm Smurfit Kappa says its revenue for the first three months of the year rose by 18% to €1.8 billion. Its operating profits rose by 69% to €148m. Gary McGann, the company's chief executive, said that the group experienced good demand growth in the first quarter, and price recovery in its end markets was achieved at a satisfactory level. But he said the increase in raw materials, energy and other costs has proven sharper and more sustained than previously expected, causing pressure on margins.
*** On the currency markets the euro is trading at $1.4562 cents and 88.77 pence sterling.
