Thursday 19 July 2018

What it says in the papers: business pages

Paul O'Donoghue

Here are the main business stories from this morning's papers:

Irish Independent:

***China surprised global financial markets by devaluing the yuan against the dollar for the second consecutive day yesterday, sending stocks around the world lower.

The move sent shockwaves through Asian markets and sent European shares lower.

So called safe haven assets including the US dollar, Treasuries and gold gained.  China’s central bank tried to reassure investors yesterday by saying the second cut was not the start of a sustained depreciation.

***Representatives for the US vulture fund at the centre of the NAMA Northern Ireland loan portfolio controversy have agreed to appear before a parliamentary inquiry.

Officials from Cerberus Capital Management, which bought the portfolio for €1.6bn last year, have committed to giving evidence at the Northern Assembly’s committee on finance and personnel in the coming weeks.

The move is significant as the committee’s inquiry has been dogged by the refusal of key players, including a senior civil servant from the Republic and NAMA, to appear before it.

***Finance Minister Michael Noonan has told Nama to pay more interest to Irish banks in order to fend off a potential funding issue.

Nama’s board recently wrote to Mr Noonan saying the interest rate on its senior debt – the six-month Euribor, a standard European rate – will become negative if current market trends continue.

Nama owes the banks €10.8bn in the affected senior bonds. The debt was originally issued to the banks in exchange for taking on problem loans.

Irish Times:

***EY, one of the biggest accountancy firms in the country, has told Airbnb that revenue is mistaken in saying that people who use the website to rent out their properties to guests do not qualify for tax relief.

The issue has come to a head in recent days after it emerged that Airbnb has provided details of earnings of people who rent out rooms via the company’s website to Revenue.

According to the Irish Times EY is of the opinion that these people should qualify for the rent-a-room tax allowance and should not be liable to pay full income tax, which is Revenue’s current position on the subject.

***Greek MPs face a day today of marathon talks to try and pass legislation needed to secure the country’s recently-agreed €85bn bailout deal.

The parliamentary debate is scheduled to start today, one day later than Alexis Tsipras’ coalition government had intended. It has reportedly been delayed by house speaker Zoi Konstantopoulou, who is a staunch critic of the government’s decision to enter a bailout.

Mr Tsipras has said that he is hopeful of a final deal being reached, although a recent paper from the German finance ministry circulated to its euro zone counterparts said it was concerned that some of greece’s planned reforms were taking longer than expected.

***The jobs market for professionals performed better than had been expected in July, according to the latest data from an employment register.

The Morgan McKinley Irish employment monitor found that compared to the same month last year, the number of professional job opportunities available increased by 33pc to 12,887.

The number of free positions increased by 16pc compared to June. Professional jobs include positions in areas such as IT and retail banking.

Irish Examiner:

***Former suppliers of Irish Pride, the country's second biggest bakery business which recently went into receivership, are set to be paid out millions of euros in compensation, the Irish Examiner reports.

The company’s receivership in June meant that a number of suppliers were adversely affected via unpaid invoices. The Irish division of UK trade credit insurer Atradius is covering the compensation.

***Global oil prices could stay depressed for months to come, partly because of a quiet hurricane season in the US, according to a leading Irish-based expert.

A number of factors, including fields in northern Iraq pumping more oil coupled with a quiet hurricane season, will keep rigs working around the clock in the Gulf of Mexico.

Paul Harris, the head of natural resource risk management at bank of Ireland Global Markets, said that this year there would be an oversupply of oil as US output has been more robust than expected.

The bulk of the Irish Pride operation was recently sold to Longford-based firm Pat the Baker.

***British wage growth fell more than expected to its lowest in three months, in June, official data published yesterday showed, while the unemployment rate held steady.

Growth in average weekly earnings in the three months to June slumped to 2.4pc on the year, slowing down from 3.2pc in the three months to May, below economists’ forecasts of 2.8pc in a Reuters poll.

The UK Office for National Statistics also said Britain’s unemployment rate held steady, at 5.6pc, after an unexpected rise in the three months to May. May’s increase in unemployment was the first since early 2013.

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