Opening Bell: Estate agents knock Varadkar, eurozone unemployment fund, Budget 2018 warning

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Leo Varadkar has pledged that, if chosen as the new leader of Fine Gael, he would abolish the Help to Buy scheme if it is shown to inflate prices.

According to the Irish Independent, estate agents have claimed that this could fuel short-term price increases as first-time buyers scramble to make property purchases before the grant is abolished.

It has also been suggested that buuilders could postpone developing new homes until there is certainty on the issue.

Varadkar said:

"It's already agreed by Government that there will be a review of the first-time buyers' scheme to see if it's been inflationary, I want to bring forward that review.

"If that review finds it hasn't been inflationary then it will continue. If the review finds – as some people believe - that it has driven up house prices for first-time buyers, I think it should be phased out.

"I want to use that money for something very particular which is to provide step-down housing for older people."


The European Commission is gearing up to unveil plans for a eurozone fiscal union, creating an embryonic treasury that would have powers to fight recessions and cope with shocks in hard-hit regions.

Writing in Brussels, the Telegraph's Ambrose Evans-Pritchard reveals that the EU budget authority will be backed by a joint eurozone unemployment fund.

It would entail an "unprecedented level of shared risk" among eurozone states.

Valdis Dombrovskis, the EU commissioner for the euro, revealed a "stabilisation fund" would be created to help struggling regions:

"We will give a bigger role to the aggregate fiscal stance of the whole eurozone in setting policy."


Ireland has been warned that a "substantial fiscal effort" will be required in the next budget to stay within the provision of the EU's fiscal rules.

The European Commission stated in its latest country-specific recommendations that last-minute changes to spending in Budget 2017 meant Ireland is now at risk of deviating from its targets next year.

The Irish Times reports that the commission has recommended limiting the scope of tax cuts and spending increases, whilst broadening the tax base.

It also warned against using any windfall gains from asset sales – such as the €3 billion set to be made from the sale of a 25% stake in AIB – for anything other than servicing the national debt.

Employers' group IBEC has argued that the assessment would limit the fiscal space available by €7 billion and failed to appreciate the chronic level of underinvestment in Irish infrastructure.


Sterling extended losses on Tuesday following a suspected terrorist attack at an Ariana Grande show in Manchester, England, in which 22 people were killed and 59 injured.

The Irish Independent reports that the pound dropped 0.2% to 144.40 yen, following a 0.2% loss on Monday.

The euro held gains after German Chancellor Angela Merkel said the currency had been made "too weak" by the European Central Bank's monetary policy. It hit a six-month high overnight.

The effects of the blast were limited in other areas of the market, with FTSE futures up 0.1%.

Shane Oliver, head of investment strategy at AMP Capital in Sydney, said:

"We could see a bout of nervousness re: the terror threat, but it's likely to be minor.

"Ever since 9/11, the impact on markets from terrorist events has been declining."