Noonan predicts interest rate cut - at Easter
Published 02/11/2011 | 09:17
Finance Minister Michael Noonan today predicted there would be a cut in interest rates - but felt it would be closer to Easter than Christmas as has been speculated recently.
Mr Noonan said he believed the new European Central Bank (ECB) Chairman, Mr Mario Draghi would not bring in a cut at his first meeting after the retirement of previous incumbent Jean-Claude Trichet,
"I think when he does it , it will either be a quarter or a half per cent. Obviously, I'd prefer if it was a half because it would help people here with mortgages," he stressed.
On a more global front, the Minister said that the Greek prime minister's decision to put his country's financial plight to a referendum had come as a shock and had undermined the comprehensive solution the Euro zone was close to completing last week,
While he understood that Mr George Papandreou was making a political point inside his own country in the hope of getting a mandate, other leaders within Europe felt aggrieved at this decision.
Mr Noonan felt though that If the referendum was brought forward within the next three or four weeks,it would help clear up the situation quickly and not have it lingering over the Christmas period.
From an Irish point of view, the minister said it was important that we had no association with the Greek problems. Ireland would have to show that we were a separate economy with a separate set of values more in lines with north European economies, he emphasised.
The Greek bombshell came at a time when a comprehensive solution within Europe was being put together, chiefly with an eye on the Italian situation, but the firewall for that had not been put in place.
Claiming he was "not happy" at the way the Irish people had to pay up on Anglo bonds because of previous government's disastrous arrangements, Mr Noonan said the way the new government was working with the ECB "was a better way to go forward," as Ireland looked for alternative repayment arrangements to the ones in place.
He said it would be of great benefit if we could get a 30 year loan at the reduced interest rates as it would take over €10bn off our debt.