The Presidency on Sunday said President Muhammadu Buhari would not force those who will emerge as his ministers and aides to cut their salaries.
Buhari and Vice President Yemi Osinbajo had on Friday announced their decision to take only 50 per cent of the salary approved for them by the Revenue Mobilisation Allocation and Fiscal Commission.
The President’s current annual remuneration as approved by RMAFC is put at N14,058,820.00 but he had opted to be earning N7m per year throughout his four-year tenure.
The Vice President’s annual remuneration is N12,126, 290.00 but he had opted to be earning N6m per annum.
The development fuelled speculations that Buhari may force those he would appoint into his cabinet to take the same decision.
But Senior Special Assistant to the President on Media and Publicity, Mallam Garba Shehu, said that the decision taken by Buhari and Osinbajo on their salaries was personal to them.
Shehu said the fact that the President and the Vice President decided to follow that path did not make their decision a government policy.
He said if Buhari wanted to make it a government policy for public office holders to cut their salaries, he would issue a directive to that effect through the proper channel.
He said, “The decision taken by the President and Vice President was a voluntary thing.
“The decision is not a government policy, it is personal.
“You will observe that the President did not say they should issue a circular.
“If he wants it to become a government policy, he will issue the directive through a proper channel. He won’t make it compulsory, that is the position for now.”
The RMAFC approved basic salary for ministers, Secretary to the Government of the Federation, Head of Service of the Federation and chairmen of constitutional bodies which is put at N2,026,400 per annum.
They are also entitled to 200 per cent of their basic salary (N4,052,800) as accommodation allowance as well as 300 per cent of their basic salary (N6,079,200) as furniture allowance.
These public officials are also entitled to regular allowances such as motor vehicle fueling and maintenance (75 per cent of basic salary): N1,519,800 per annum; personal assistant (25 per cent): N506,600 per annum; domestic staff (75 per cent): N1,519,800; entertainment (45 per cent): N911,880 per annum; utilities (30 per cent): N607,920 per annum; newspapers and periodicals (15 per cent): N303,960; and monitoring for constitutional bodies (20 per cent): N405,280.
Their total annual remuneration is put at N7,801,640.00.
Dow futures drop 300 points as investors assess Fed update
Stock futures fell early Thursday after the Dow Jones Industrial Average and S&P 500 turned lower overnight following a Federal Reserve update by chair Jerome Powell, at the conclusion of its two-day meeting.
Futures tied to the Dow declined 311 points, or 0.91%, retracing some of the earlier declines of nearly 500 points. S&P 500 futures and Nasdaq 100 futures slipped 1.12% and 1.36%, respectively.
Some tech shares were higher in extended trading, after continued swings in the regular session. Netflix jumped more than 4% on news that Pershing’s Bill Ackman bought 3.1 million shares. Tesla gained almost 3% following a strong earnings report. Meanwhile, Intel lost 2%, despite strong earnings.
In regular trading, the Dow ended the day down 129 points, after gaining more than 500 points at one point, following the Fed update. The S&P 500 lost 0.2% and the Nasdaq Composite was little changed, with a boost from Microsoft’s post-earnings gain.
The week’s volatility continued on Wednesday and stocks took a turn lower after the Fed concluded its two-day meeting and signaled the central bank would hikes rates to fight persistent inflation. Powell said there’s “quite a bit of room” to do so before hurting the labor market. The benchmark 10-year Treasury yield climbed above 1.8% following his remarks.
“While offering some clarity on how the Fed would begin the process of removing policy accommodation, the outcome of the meeting fell short in providing the needed guidance on the timing and magnitude of the shift in policy,” said Charlie Ripley, senior investment strategist for Allianz Investment Management.
Some investors have started to bet on as many as five rate hikes this year, following Powell’s press conference. Uncertainty about the timing and magnitude of the Fed’s plans to tighten monetary policy had been building since the December meeting.
“Today’s meeting has market participants fully convinced that a March hike is certain, but with Chairman Powell not making any timing commitments, the door is slightly open for a slower moving Fed,” Ripley added.
Upholdings’ Robert Cantwell said the markets experienced a relief rally following Microsoft’s strong earnings report Tuesday night, which appeared to be a “good bellwether” for social media, gaming, software and other Nasdaq categories before the Fed update.
“The market in our view is totally overshooting and losing its mind, creating great opportunities for long term growth investors to snap up lots of great shares because, interestingly, it hasn’t really affected companies that actually carry debt,” Cantwell said of the Fed rates. “Since the end of last year the market has been most aggressively discounting companies that are going to generate more cash in the future than they’re generating today… We’re a little upside down now.”
Thursday is a packed morning for earnings, with Mastercard, Deutsche Bank, Blackstone, Southwest Air and JetBlue all scheduled to report quarterly results before the bell. Danaher, Valero and Northrop Grumman are also set to report.
European markets set to plummet at the open as investors react to Fed decision
European stocks are expected to plunge at the open on Thursday as global markets react badly to the latest monetary policy decision from the U.S. Federal Reserve.
The U.K.’s FTSE index is expected to open 147 points lower at 7,323, Germany’s DAX down 379 points at 15,071, France’s CAC 40 down 175 points at 6,804 and Italy’s FTSE MIB 675 points lower at 25,907, according to data from IG.
Global markets are reacting badly to the Federal Reserve’s indication on Wednesday that it could soon raise interest rates for the first time in more than three years.
The Fed’s policymaking group said a quarter-percentage point increase to its benchmark short-term borrowing rate is likely forthcoming. It would be the first increase since December 2018.
The post-meeting statement from the Federal Open Market Committee did not provide a specific time for when the increase will come, though indications are that it could happen as soon as the March meeting. The statement comes in response to inflation running at its hottest level in nearly 40 years.
U.S. stocks initially rallied Wednesday even after the Federal Reserve pointed to an interest rate hike coming soon but overnight sentiment has changed.
U.S. stock futures fell Wednesday night; futures tied to the Dow erased earlier gains and declined 398 points, or 1.17%. S&P 500 futures and Nasdaq 100 futures slipped 1.35% and 1.57%, respectively.
Asia-Pacific markets fell across the board on Thursday overnight. Japan’s Nikkei 225 fell 3.3% while the Topix was down 2.3%. Over in South Korea, the benchmark Kospi dropped 3.13% and in Hong Kong, the Hang Seng index and the Hang Seng Tech index dropped 2.56% and 4.61%, respectively. Chinese mainland shares also declined.
Earnings in Europe come from Deutsche Bank on Thursday, as well as Unicredit, LVMH, SAP, Banco Sabadell, easyJet, Diageo and STMicroelectronics.
Renault will provides strategic update on the Nissan/Mitsubishi alliance and, on the data front, Germany’s GfK consumer sentiment figures are due.
Federal Reserve points to interest rate hike coming in March
Facing both turbulent financial markets and raging inflation, the Federal Reserve on Wednesday indicated it could soon raise interest rates for the first time in more than three years as part of a broader tightening of historically easy monetary policy.
In a move that came as little surprise, the Fed’s policymaking group said a quarter-percentage point increase to its benchmark short-term borrowing rate is likely forthcoming. It would be the first rise since December 2018.
Chairman Jerome Powell added that the Fed could move on an aggressive path.
“I think there’s quite a bit of room to raise interest rates without threatening the labor market,” Powell said at his post-meeting news conference. After being up strongly earlier, the major stock market averages turned negative shortly following Powell’s pronouncement.
The committee’s statement came in response to inflation running at its hottest level in nearly 40 years. Though the move toward less accommodative policy has been well telegraphed over the past several weeks, markets in recent days have been remarkably choppy as investors worried that the Fed might tighten policy even more than expected.
The post-meeting statement from the Federal Open Market Committee did not provide a specific time for when the increase will come, though indications are that it could happen as soon as the March meeting. The statement was adopted without dissent.
“With inflation well above 2 percent and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate,” the statement said. The Fed does not meet in February.
In addition, the committee noted the central bank’s monthly bond-buying will proceed at just $30 billion in February, indicating that program is expected to end in March as well at the same time that rates increase.
There were no specific indications Wednesday when the Fed might start to reduce bond holdings that have bloated its balance sheet to nearly $9 trillion.
However, the committee released a statement outlining “principles for reducing the size of the balance sheet.” The statement is prefaced with the notion that the Fed is preparing for “significantly reducing” the level of asset holdings.
That policy sheet noted that the benchmark funds rate is the “primary means of adjusting the stance of monetary policy.” The committee further noted that the balance sheet reduction would happen after rate hikes start and would be “in a predictable manner” by adjusting how much of the bank’s proceeds from its bond holdings would be reinvested and how much would be allowed to roll off.
“The Fed’s announcement that it will ‘soon be appropriate’ to raise interest rates is a clear sign that a March rate hike is coming,” noted Michael Pearce, senior U.S. economist at Capital Economics. “The Fed’s plans to begin running down its balance sheet once rates begin to rise suggests an announcement on that could also come as soon as the next meeting, which would be slightly more hawkish than we expected.”
Markets had been anxiously awaiting the Fed’s decision.
Investors had been expecting the Fed to tee up the first of multiple rate hikes, and in fact are pricing in a more aggressive schedule this year than FOMC officials indicated in their December outlook. At that time, the committee penciled in three 25 basis point moves this year, while the market is pricing in four hikes, according to the CME’s FedWatch tool that computes the probabilities through the fed funds futures market.
Traders are anticipating a funds rate by the end of the year of about 1%, from the near-zero range where it’s currently pegged.
Fed officials have been expressing concern lately about persistent inflation, following months of insisting that the price increases were “transitory.” Consumer prices are up 7% from a year ago, the fastest 12-month pace since the summer of 1982.
- Governors, Labour kick as NNPC presents N3tr subsidy bill to FEC
- EPL: I don’t play in my preferred positions – Pulisic becomes latest Chelsea player to hit at Tuchel
- Celebrity Big Brother Season 3 cast revealed: Meet the new famous houseguests
- Dow futures drop 300 points as investors assess Fed update
- Gunmen kidnap Ex-President Jonathan’s cousin in Bayelsa
LIFESTYLES1 day ago
These 7 surprising things lower your libido!
NEWS2 days ago
Nigerian Labour Congress suspends planned nationwide protest over subsidy
BUSINESS2 days ago
IMF cuts 2022 global growth forecast as U.S., China recovery wanes
NEWS1 day ago
Nigerian Army arrests political thugs from Ibadan with guns heading for Ekiti PDP primaries
BUSINESS16 hours ago
Global oil benchmark tops $90 for the first time since 2014
BUSINESS1 day ago
CBN retains interest rate at 11.5% to contain inflation
NEWS1 day ago
World’s oldest male gorilla dies at 61
BUSINESS16 hours ago
Federal Reserve points to interest rate hike coming in March