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MARKETS HAVE REACTED positively to Ireland’s crediting rating upgrade by Moody’s on Friday.
The yield on 10-year bonds has fallen again, and is approaching levels close to what was seen before the financial collapse, currently lower than 3.45 per cent.
The rating agency upgraded Ireland’s credit rating from junk bond status to investment grade with a positive outlook.
Speaking to RTÉ’s Morning Ireland, Chief Executive of the National Treasury Management Agency (NTMA) John Corrigan welcomed the sharp reduction in yields, highlighting that each fall of 0.10 per cent represents a million in savings for the state.
He noted that Ireland still has €4 billion to borrow to fund 2015, but is now open to a wider range of investors.
“Some investors in the Middle East and Far East look for na investment grade rating from all of the three major ratings agency,” he said.
The Moody’s rating brings us into the investment universe of a new constituency of investors.
He said that the positive outlook puts ‘momentum’ behind the rating, and although hesitant to speculate as to when a future upgrade might occur, he said it is likely over the next 12 to 15 months if Ireland’s fiscal targets are reached.
He added that “caution is the byword” when it comes to Ireland’s return to bond market, reiterating that while the post-bailout return earlier this month was significant, the government must borrow at a slow and regular rate.
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Ah ha. Finally. Corner. Turned.
Foie gras all around!
Throw a lump of it onto my breakfast roll
Can we stop borrowing? And balance the books by sacking 40,000 in the PS and closing Quangos? My kids tell me they can’t afford to pay in the future, for PS lifestyles today
Can your kids do without eduction and health services provided by the 40,000 public servants you want to get rid of like teachers nurses social workers ambulance staff etc.
If that last part was 40,000 civil servants, would you agree then?
I never mentioned teachers. I said Quangos. RSA, Bord Failte etc
We don’t need tourism promotion or road safety?
Road deaths have been falling for 50 years. The RSA was only set up in 2005. Whatever it does can be handled internally by the dept of Transport
Bord Failte spends most of its budget on wages and admin, not on promotion of tourism. If hotels and airlines want to form their own Bord Failte, let them
Scrap.
That has to be one of the most economically illiterate comments I have ever seen.
Name one country that has ever down what you propose. Maybe Albania tried it once.
More in your line to remove your head from a55, that would be a big help to your kids.
There are only 32,000 civil servants in the State! Of course this would mean no govt Departments, no civil servants in the Oireachtas and no civil servants in the Courts. Kind of like Somalia now that I think of it. Why did nobody think of this before. You’re a genius!
While most of Scrap’s comment is idiotic, I believe we are aiming for a modest primary surplus this year or the next.
Spot on scrap,but who’s listening,not the socialists in government who just keep right on piling debt on to future generations.
From a €13 billion deficit in 2013? Really? A surplus in 2014?
Scrap – see http://www.irishtimes.com/news/politics/michael-noonan-makes-case-for-budget-surplus-in-2014-1.1529866
Primary surplus = State income > all outgoings excluding debt servicing
Thnx Richard. Very lonely soap box that I stand on :-(
“excluding debt servicing”
Well that’s a relief. Excluding it means we don’t have to pay it? How’d we run up €200bn+ debt in the first place? Banks account for less than half.
Debt is what creates money out of thin air.
80% of spending goes on Health, Education and Social Welfare.
The two examples you provide prove are organizations that save or make the State money.
Board Failte has long been recognized as representing an excellent return on investment.
The RSA save lives. While this may not matter to you, it actually has a direct economic benefit. It makes sense to split very important areas of focus out from departmental control – to ensure that they get the dedicated focus they require.
Most quangos do fine work, Bord Failte & the RSA being obvious examples.
Whether we could get better value for the money we put into them is one thing but to say we could do without them is slly.
To be fair there are a number of civil servant jobs that could be safely trimmed and state companies gotten rid of. Did you know Aer Rianta owns 20% of Dusseldorf Airport and shops in Moscow? Why does the state operate Horse Racing Ireland? What business has the Irish state in such things? Even if they’re turning a profit they’d be better off run privately.. And the sale of them could pay down debt.
There’s no reason to make out that any civil servant job eliminated is somebody out there saving lives.. there’s a lot of the public sector that could be safely trimmed or sold off.
wow lets all party like its the boom times and all that………..oh wait I forgot this wont make any difference to the ordinary joe soap in ireland if the markets react positively to an upgrade of our credit rating from a mafia cartel ratings agency
Read the article Tom,
The lower the interest rate the less the state has to pay in interest which can only be good.
It’s not hats in the air stuff but another small step in the right direction & to tell you the truth I will take small gradual changes over a period rather than kamikaze lurches any day of the week.
Well said Justin.
It is not a cure but it is small step forward for us.
Of course, this is Ireland, we are a great risk, pay up no matter what………
Iceland now paying more than double Ireland for 10 year sovereign debt. Lesser of two evils was to not default.
Is this the Iceland who are constantly held up to us as an example?
Surely not!!
Thanks Enda :)
As of course the markets would. Shows the value of solid reputation.
Just a show. Numbers and coloured lights. Nothing more
Saving millions is just a show & coloured lights!!!!!!!
God give me strength.
Yeah and the rotten media reported last week that irelands credit rating would remain as junk. ….
My own credit rateing has rocketed ever since i cleared all my debts years ago, it appears that because i dont need to borrow from anyone anymore,my credit rateing is such that now i would have no problem in getting sizable loans,the previous generation were right after all, short term pain for long term gain live within your means and eventually you will reap the rewards
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