European Central Bank chief Mario Draghi has said the bank will “review and possibly reconsider” monetary policy at its next meeting in March.
He said eurozone rates would “stay at present or lower levels for an extended period” and there would be “no limits” to action to reflate the eurozone.
His comments followed the ECB’s regular meeting, where it kept the bank’s benchmark rate unchanged at 0.05%.
The overnight deposit rate was also left unchanged at -0.3%.
At the ECB meeting in December, this rate had been cut from -0.2% in an attempt to push banks to lend instead of parking money at the ECB.
In December, the ECB had also extended its €60bn-a-month stimulus programme by six months to March 2017.
Eurozone inflation is currently running at 0.2%, way below the ECB’s target of near 2%.
“We have the power, willingness and determination to act. There are no limits how far we are willing to deploy our policy instruments,” Mr Draghi said.
Howard Archer, chief UK and European economist at IHS Global Insight, said “the stimulus trigger looks cocked and ready to pull as soon as the March ECB meeting”.
Mr Draghi told a news conference: “As we start the new year, downside risks have increased again amid heightened uncertainty about emerging market economies’ growth prospects, volatility in financial and commodity markets and geopolitical risks.”
He said that could make it necessary to review – and possibly reconsider – monetary policy at the next meeting in early March.
Mario Draghi most definitely doesn’t do panic. In fact, his demeanour in the news conference after the ECB’s governing council meeting didn’t even suggest mild anxiety. Still, his words made it plain that he and his policy-making colleagues have been watching the new year’s financial market gyrations very warily.
It’s not the ECB’s job to stabilise stock markets. The Bank’s job is to keep inflation in check, but it is currently too low: 0.2% compared with the ECB’s target of below, but close to, 2%.
The financial market turbulence, especially the fall in oil prices is one reason why, as Mr Draghi said, “inflation dynamics continue to be weaker than expected”. He told us the ECB will review policy at its next meeting in March. There is a strong chance of more action, probably extra quantitative easing, to stimulate inflation a bit more (yes really).
That meeting will have a new set of ECB macroeconomic projections to work with.
He said that the recent falls in the oil price meant that inflation was likely to be “significantly lower” compared with the outlook in early December.
Eurozone inflation was below zero – that is, prices were falling – as recently as September, mainly due to falls in international energy prices, particularly crude oil.
In December, Mr Draghi said that eurozone inflation was expected to reach 1% in 2016. However, the ECB’s forecasts were based on the assumption of oil prices averaging more than $50 a barrel this year, and oil is currently below $30.
Mr Draghi’s latest comments were seen as helping to calm stock markets, with shares in Europe rising as his news conference was under way.
His comments also weakened the euro, which briefly fell below $1.08 against the dollar before regaining ground.
“ECB president Draghi once again saw the equity markets confirm his ‘super’ status as they jumped almost as soon as he started his speech,” said Alastair McCaig, market analyst at IG.
“The emphasis shifted from ‘whatever it takes’ to ‘no limits’ where action is concerned, with the small caveat that nothing will happen until they have had their March meeting.”
NNPC to Focus on Domestic Gas Growth, Says Kyari
FG, NNPC to Focus on Growing Domestic Gas Utilisation
Mr. Mele Kyari, the Group Managing Director, Nigerian National Petroleum Corporation (NNPC), has said the corporation is presenting focusing on growing domestic gas utilisation.
The Managing Director disclosed this on Tuesday during a virtual BusinessDay Energy Series Summit with the theme, “Nigeria at 60: Harnessing Nigeria’s Energy for the Future.”
The NNPC boss also said the corporation is committed to delivering key gas infrastructures such as Escravos-Lagos Pipeline System II, Obiafu-Obrikom-Oben Gas Pipeline, Ajaokuta-Kaduna-Kano Gas Pipeline, and Central Gas Processing Facilities.
He stated that NNPC was working on developing five gigawatts of power generation by 2022.
He said, “At the NNPC we are aggressively pursuing other gas development initiatives with the aim of improving Nigeria’s economy using the appropriate fuels.
“In terms of gas and power, we are developing and integrating gas and power infrastructure networks (increase interconnectivity) as well as stimulating gas demand (power generation, feedstock and transport, etc).”
Kennie Obateru, the NNPC spokesperson, quoted the NNPC boss in a statement issued in Abuja. He said the corporation was working on domestic gas utilisation to five billion standard cubic feet of gas per day.
He added that the Nigerian Liquefied Natural Gas Train 7 would be completed and delivered by 2024.
Senator Rejects Aisha Umar From North-East as PenCom DG Replacement for South-East
Law Markers Rejects President Buhari’s PenCOM Director-General Nominee
The Senate has rejected President Buhari nominated Director-General of the National Pension Commission, Aisha Umar.
Some of the Senators, who vehemently protested the nomination immediately the Senate President, Ahmad Lawan, read Buhari’s letter said Aisha Umar from the North-East should not be replacing the former DG, Mrs Chinelo Anohu-Amazu, who is from the South-East.
The aggrieved senators said the action of the president is flagrant breach of the Act that established the PenCom.
According to Section 20(1) and section 21(1) and (2) of the National Pension Commission Act 2014, states, “In the event of a vacancy, the President shall appoint replacement from the geopolitical zone of the immediate past member that vacated office to complete the remaining tenure.”
Meaning President Buhari had acted against the Act establishing the PenCom.
Speaking on behalf of the aggrieved Senators, Enyinnaya Abaribe, the Senate Minority Leader, said “I recall that the tenure of the incumbent was truncated. Therefore, the new letter from the president that has now moved the chairman of the commission to another zone may not be correct.
“It is against the law setting up the National Pension Commission and the Federal Character Commission.
“Before you (Lawan) send it to the appropriate committee tomorrow, (Wednesday), I wish to draw the attention of the committee to it.”
The Senate President, however, rejected the minority leader’s point of order and observation, saying “That is for me to interpret because I interpret the laws here. If there is any petition to that effect it should be sent to the committee.”
Electricity Regulatory Commission Suspends Tariff Increase for 14 Days
Nigerian Electricity Regulatory Commission Suspends Tariff Increase for 14 Days
The Nigerian Electricity Regulatory Commission (NERC) has suspended the increase in electricity tariff in accordance with the resolution reached between the Federal Government and the Nigerian Labour Congress and Civil Rights groups.
The commission suspended the new tariff implemented on September 1, 2020 for 14 days.
The NERC, in its Order No. NERC/209/2020 issued around 10.30 pm on Tuesday, describing the regulatory instrument as “NERC Order on suspension of the Multi Year Tariff Order 2020 for the electricity distribution licensees.”
The commission said, “This order shall take effect from 28th September 2020 and shall cease to have effect on the 11th October 2020.”
This is coming a day after the labour union agreed to halt a nationwide industrial action to allow the government fashioned out a way to address the recent increase in prices from pump price to electricity bill.
Labour had described Federal Government action as anti-people policy, especially given current economic realities.
The government on the other hand had said the hikes were touch necessary decision to advance the nation’s economy and further improve power supply and revenue generation necessary to deepen economic growth.
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