The Day at a Glance | Sep 12 2022

The Top

*EU will propose reducing electricity consumption and decreasing taxes for energy companies in order to face the energy crisis.

*US Secretary of the Treasury, Janet Yellen, expects inflation to slow down; although risks on the horizon prevail.

*Aggressive interest rate increases are meant to keep inflationary expectations anchored: Luis de Guindos, Vice President of the ECB.

*Ukraine has successfully regained control of key territories in the war against Russia.

Economic environment

EU discusses details. Representatives from EU member countries continue negotiating emergency actions regarding the energy crisis caused by the Russia-Ukraine conflict. Recent reports suggest that the European Commission is preparing an initiative that includes points to reduce electricity consumption and specific quotas to decrease demand during peak hours, a temporary tax on oil, gas, coal and refineries to allow resources to be guided towards affected consumers and price ceilings on gas-generated power in the region. It seems that the possibility of setting price ceilings on Russian imported gas has been discarded – a proposal that had been criticized by several member countries. The Commission is expected to present a concrete plan on September 14th, although some EU member countries would still need to give their approval. According to reports, negotiations have not been easy as there are many different positions among the region`s countries regarding the actions that should be taken, and it`s unclear if all of the Commission`s proposals will be approved. However, officials must define an action plan quickly as Russia suspends its supply of natural gas.

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