Fed Raises the key interest rate for the first time this year - and just the second time in 10 years

The Federal Reserve is raising a key interest rate for the first time in a year, reflecting a resilient U.S. economy and expectations of higher inflation.

The move will mean modestly higher rates on some loans.

The Fed signaled in a statement Wednesday that additional rate increases will likely be made slowly as the economy improves and inflation edges closer to the Fed's 2 percent target.

The central bank is increasing its benchmark rate by a quarter-point to a still-low range of 0.5 percent to 0.75 percent.

The Fed last raised the rate in December 2015 from a record low near zero set during the 2008 financial crisis.

President-elect Donald Trump's plans for tax cuts and infrastructure spending have led investors to expect that inflation will pick up in coming months.

The economy, after growing at an anemic annual rate of 1.1 percent in the first half of this year, accelerated to a 3.2 percent pace in the July-September quarter. That pickup has lifted hopes that the economy will keep rising, fueled by steady hiring gains. The unemployment rate is at a nine-year low of 4.6 percent.

In the month since Trump's victory, investors have sent stock prices surging to record highs and driven up bond yields. The markets have calculated that Republican control of Congress will enable Trump to cut taxes, ease regulations and accelerate infrastructure spending — and that higher economic growth, inflation and corporate profits will result.

The Fed's action Wednesday should have little effect on mortgages or auto and student loans. The Fed doesn't directly affect those rates, at least not in the short run. But rates on some other loans — notably credit cards, home equity loans and adjustable-rate mortgages — will likely rise soon, though only modestly. Those rates are based on benchmarks like banks' prime rate, which moves in tandem with the Fed's key rate.

Mortgage rates have been surging since Trump's election victory last month on expectations that his economic program will accelerate economic growth and inflation.

Some Fed watchers expect faster growth to lead the central bank to shift its focus from trying to energize the economy to considering ways to counter the risk of too-high inflation. On that assumption, some are revising their forecasts for Fed rate hikes in 2017.

Before Trump's victory, the consensus view of economists was for two Fed rate increases next year. Now, some say they foresee three or possibly as many as four. Others think the Fed will be hesitant to step up the pace of rate hikes. For one thing, Trump's economic program still must win congressional approval and could undergo significant change along the way.

Last month after Trump's election, Yellen told a congressional committee that Fed officials would be monitoring Congress' actions and 'updating our economic outlook as the policy landscape becomes clearer.'

Other Fed officials have endorsed that wait-and-see approach.

AP

BOI Gives First Phase Of Ooni-Secured Loan To MSMEs

The Bank of Industries (BOI) has commenced the distribution of cheques to 20 beneficiaries under the first phase of the one-billion-Naira Micro, Small and Medium Enterprises Development Fund in Osun State.

The one-billion-Naira loan project is between the Bank of Industries and the House of Oduduwa under the leadership of the Ooni of Ife, H.I.M, Oba Adeyeye Ogunwusi, Ojaja the second.

At the presentation of the cheques to the beneficiaries in Ile Ife, Osun State, the acting Managing Directors of BOI, Waheed Olagunju, said the project wass to enable the unemployed become an employer of labour.

He state that the 20 beneficiaries who received 30 million Naira in the first phase have undergone capacity building programme over the last six months to enable them sustain whatever business enterprises they go into.

The BOI boss said he was confident that about 80 to 90 per cent of the beneficiaries would succeed based on the capacity building training they had received.

He further explained that the loan would cover services and Agro-allied ‎businesses with repayment plan ranging between three and five years under a single digit interest rate of 7.5.

The Bank and the House of Oduduwa in Osun State on November 16 signed the one-billion-Naira agreement that would make loan facilities available to both women and youths in Ile-Ife.

‎‎Prominent among the features of the Memorandum of Understanding is the 7.5% interest rate to the beneficiaries.

Oba Ogunwusi signed for the House of Oduduwa while Mr Olagunju, represented the financial institution.

The monarch emphasised the need to get youths empowered, saying it was necessary for the nation’s continuous growth.

Trump sold all shares in companies earlier this year - Washington Post

President-elect Donald Trump sold all of his shares in companies in June, the Washington Post said on Tuesday, a move that would have raised substantial cash ahead of the presidential election and could ease concerns about potential conflicts of interest.

Trump's stock portfolio was worth roughly $40 million as of December 2015, the Post said, citing a May financial disclosure. His portfolio at that time included shares in a number of banks, oil giants and other companies with business pending before the U.S. government, the Post said.

Trump spokesman Jason Miller did not immediately say why Trump sold the shares or how much he received for them, the Post said. When asked earlier on Tuesday whether Trump still held shares in planemaker Boeing, Miller had told reporters he sold all his shares in June, but it was not clear whether he was speaking only about Boeing stock.

Reuters

High court sides with Samsung in patent dispute with Apple

A unanimous Supreme Court on Tuesday sided with smartphone maker Samsung in its high-profile patent dispute with Apple over design of the iPhone.

The justices said Samsung may not be required to pay all the profits it earned from 11 phone models because the features at issue are only a tiny part of the devices.

Apple had won a $399 million judgment against Samsung for copying parts of the iPhone's patented design, but the case now returns to a lower court to decide what Samsung must pay.

The case is part of a series of disputes between the technology rivals that began in 2011. Apple accused Samsung of duplicating a handful of distinctive iPhone features for which Apple holds patents: the flat screen, the rounded rectangle shape of the phone, and the layout of icons on the screen.

At issue was how much Samsung is required to compensate Apple under an 1887 law that requires patent infringers to pay "total profit." Apple said that meant all the profits from the phone sales, while Samsung argued it was limited to profits related to the specific components that were copied.

Justice Sonia Sotomayor wrote for the court that the law does not require damages to be based on the entire product, but can be limited to only a component of the product. The decision overturned a ruling from a federal appeals court in Washington, which said that Apple was entitled to all the profits.

But the high court declined to lay out a specific test for how such damage awards should be calculated. Sotomayor said doing so was not necessary and the justices left it up to lower courts to resolve.

Samsung had argued that the hefty award ignored the fact that its phones contain more than 200,000 other patents that Apple does not own. Apple said the verdict was fair because the iPhone's success was directly tied to its distinctive look.

AP

Rice farmers seek total ban on sale of foreign rice

Rice farmers have urged state governments to follow the footstep of Ebonyi and ban the sale of foreign rice as a means of boosting local production.

Mr Aminu Goronyo, the National President, Rice Farmers Association of Nigeria (RIFAN), made the call in a telephone interview with the News Agency of Nigeria in Abuja on Monday.

Goronyo was reacting to the current ban by the Ebonyi State Government on the sale of foreign rice in the state.

He said the ban would encourage local production of rice and impact positively on the economy of the country.

“We are going to Ebonyi State to pay a solidarity visit to the governor for that kind of effort that he made. It is a commendable effort and we urge all the state governors in this country to follow suit.

“I think, it is part of efforts to make Nigerians to eat Nigeria’s homegrown rice. We have available rice that we produce locally,’’ the national president said.

Expert disagrees with Senate over bill to establish chartered institute of entrepreneurs …calls for a more friendly entrepreneurial ecosystem

The President of Africa's Young Entrepreneurs, Mr. Summy Smart Francis has disagreed with the Senate over the passing of a bill that will establish the Chartered Institute of Entrepreneurs which would regulate the practice of entrepreneurs in Nigeria.


The bill which was sponsored by Senator Ganiyu Solomon seeks to “advance the study, training and practice of entrepreneurship and determine the standards of knowledge for persons seeking to become entrepreneurs.”


In a release exclusively obtained by BRANDINFO, Francis said entrepreneurs in the country does not need such bill, adding that what entrepreneurs need is for the government to create a more friendly entrepreneurial ecosystem by forming policies that could aid business growth.


According to him, having a “Chartered Institute of Entrepreneurs” will mean one day, we could have a “Chartered Institute of Smart People” or better still a Chartered Institute of Pure water sellers.

He noted that entrepreneurship most times is solely built on passion and perseverance to dare to tread where others have not, saying that in developed countries it is even considered as a behavioral characteristics of a person who desires to make profit from what he/she loves doing but due to the high level of unemployment in many African countries, it has become an alternative for job creation.

“Entrepreneurship is the process of designing, launching and running a business, offering a product, process or service for sale or hire. It is the capacity and willingness to develop, organize and manage a business venture along with its attendant risks in order to make a profit. An entrepreneur is any individual who identifies opportunities, new possibilities, unmet market needs, evaluate them as viable, decide to exploit them (where others do not) and in turn, create wealth.”

“Chartered status on the other hand, is a form of accreditation and a mark of professional competency. Many chartered statuses require initial academic preparation, normally to bachelor’s level but sometimes to master’s level (or equivalent experience). From the woman selling groceries on the roadside to the CEO of a multi-million conglomerate, the young boy who sells sweets to his friends during lunch break in school to the old farmer who supplies milk to his community are all entrepreneurs. Who then are we regulating?” Francis stated.

How true is this news about MMM Nigeria?

How true is this news about MMM Nigeria?

Nigeria's Naira Depreciates Further Against Dollar

The Naira is seen weakening further against the United States dollar next week amid a crackdown in the parallel market currency traders and the persistent scarcity of the greenback.

Reuters reported that foreign exchange demand by small businesses was set to surge ahead of holiday season sales.

The local currency fell 2.08 per cent week-on-week on Thursday to 480 to the dollar on the parallel market against 470 a dollar last week, while it was quoted by commercial lenders at 314.80 a dollar on the interbank market.

The Naira has, however, consistently closed around 305.5 a dollar level since August via the official window.

“The consistent clampdown on black market operators by security agents has driven some currency retailers underground, putting more pressure on available hard currency,” one dealer said.

But the Kenyan shilling could strengthen against the dollar in the coming week due to subdued importer demand and increased inflows from overseas remittances, traders said.

At 0742 GMT, commercial banks quoted the shilling at 101.80/102.00 to the dollar, the same as last Thursday’s close.

“From the data we’ve seen in the past, we normally tend to see an uptick in the Diaspora inflows during this month of December,” said a trader at a commercial bank.

Ghana’s cedi is expected to regroup in coming weeks on improved forex inflows as the central bank launches a $40m fortnightly interbank auction, traders say.

The cedi has been fairly stable this year but began sliding last month on a seasonal surge in end-of-year import demand and election-year shocks. It was trading at 4.3000 to the dollar at 1020 GMT on Thursday, compared with 4.1000 a week ago.

“We see the local unit potentially taking back some gains should the regulator keep the amount offered at $40m in the upcoming fortnightly auctions,” a Barclays Bank Ghana analyst, Andrews Akoto, said.

The Punch