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Local Germany
4 days ago
- Business
- Local Germany
'€10 a month': Germany to set up pension accounts for all children from age 6
With the planned introduction of an early start pension ( Frühstart-Rente ), the federal government aims to encourage school children in Germany to think about saving up for retirement from an early age. The plan, which was included in the black-red coalition agreement between the conservative Union and the centre-left Social Democrat parties, is that every child attending school in Germany will get €10 per month paid into an individual pension portfolio in their name. Payments would be made by the German state, and are due to start from the beginning of 2026. How would early start pensions work? The basic idea is that every schoolchild in Germany, from the age of six, gets a retirement provision account and that the state pays €10 into it monthly. The aim is to provide children with access to the capital market at an early stage, and encourage them to think about building up assets in the long term. According to current plans, these pension payments would be given to all children and young people in Germany between the ages of 6 and 17 who attend school. The money is to be put into an individual custody account, and remain tax-free until retirement. Advertisement From the age of 18, government payments would stop but children or parents and guardians could voluntarily make additional contributions to the account. According to the conservative Union parties, which brought the proposal, the deposit should be "protected from state access" and should only be paid out when an account holder reaches the standard retirement age. How much money are we talking about? In twelve years, the monthly payments add up to €1,440 per child – before interest and returns. An initial estimate by Sparkasse bank suggest that children who receive every payment could expect their account to be worth more than €100,000 by the time they retire at 67 without making any additional contributions of their own. Here's how Sparkasse calculated: Deposited money: €10 x 12 months x 12 years = €1,440 Assuming the Dax continues with a long-term return of about 8 percent per year, the custody account when the child is 18 years old would have €2,459. If no further money is added, and the growth rate remains the same, by the age of 67 that same account would be worth approximately €107,000. OR, if the account holder add a further €10 per month, by the age of 67 the portfolio would be worth around €175,000. IN STATS: Germans among the biggest money savers in the world Will it work? A number of details remain unclarified: Chiefly, how will the savings be invested and who will manage them? Financial experts are not immediately convinced that the plan will really encourage more thoughtful money management among young people. Advertisement Johannes Geyer, deputy head of the public economics department at DIW Berlin, told the US news outlet CNBC that it's "unclear" if the early start pension scheme will increase motivation to save for old age. 'When people receive money passively and basically don't have to make any investment decisions themselves, it isn't obvious how their financial knowledge is meant to be improved," Geyer said. Similarly Christoph Schmidt, president of the RWI Leibniz Institute for Economic Research, called the idea "well-intentioned," but added that, "looking more closely there are hardly any convincing benefits of the concept". Still, many of Germany's current school children, and their parents, will surely appreciate the gesture. READ ALSO: German voters back raising hourly minimum wage to €15
Irish Independent
07-06-2025
- Business
- Irish Independent
Irish shares hit all-time high despite tariff uncertainty
The Iseq 20 index of leading Irish shares hit a record high of 1963.01 yesterday, slipping back only slightly before closing at 1,956.02. The index is made up of the leading shares on the Euronext Dublin exchange, including heavyweights Ryanair, Kerry, Kingspan and Glanbia as well as AIB and Bank of Ireland. Shares hit their high after the European Central Bank (ECB) cut rates for an eighth time in 12 months on Thursday, a move that would traditionally be seen as a boost to investment, credit and consumer confidence. The MSCI global index, which draws on leading shares from across the developed world, hit an all-time high on Tuesday, boosted by particularly strong gains for Germany's Dax index. In Ireland, the Iseq 20 index only at the start of this year recovered to levels seen in 2007, at the peak of the Celtic Tiger, unlike most European and US markets where shares have long since pushed higher over the past decade. However, the composition of the Irish shares indices has also radically changed, not just since 2007 – when bank shares crashed – but in the past three years as heavyweight stocks like CRH, Flutter and Smurfit Kappa shifted their listings to the US, shrinking the potential size of the Irish index. The Irish high this week was in line with global and European trends. Wall Street rebounded yesterday after a generally upbeat employment report, and a bounce-back in Tesla shares helped put the indexes on track for weekly advances. In the US, jobs numbers yesterday were relatively weak but not as bad as feared, and markets shifted higher in response. This is a sigh of relief report The US economy added 139,000 jobs in May while the unemployment rate held firm at 4.2pc, according to the Labour Department. 'This is a sigh of relief report; people were really worried that this was going to be a kind of start of a downturn in the labour market and therefore start the downturn in the economy,' said Scott Ladner, chief investment officer at Horizon Investments in Charlotte, North Carolina. 'It came in pretty much on the screws and we've got a bit of a reprieve, at least for a month. That's leading to a pretty large relief rally,' Mr Ladner added. In Ireland and across the globe, investors are increasingly looking past the near-term risk of Donald Trump imposing further destabilising tariffs and anti-trade measures, and are focused on the underlying economy, which has so far shrugged off any real negative fallout. How long that can be sustained remains to be seen. Bank of America's influential strategist Michael Hartnett warned yesterday that global stocks are getting close to triggering a technical 'sell' signal, saying the market is running too hot after surging 20pc in just two months. He cited data points on fund flows and market breadth as evidence that investors have been rushing into risk assets and positioning is getting stretched. Traders often use that as a marker because it can theoretically indicate that the buying power in the market is likely to soon be exhausted, leaving prices vulnerable to a pullback. At the same time, the market is approaching 'overbought territory,' he said. The Bank of America data highlights a nervousness among traders about the rapid pace of recent stock gains. The combination of the Trump administration's tax-cut package to boost growth, plus a softer stance on tariffs and robust economic data, has fanned optimism. US equity futures rallied yesterday after the monthly jobs report came in stronger than expected. In Europe, the new German government's push to support industry as well as ECB easing of credit has fed into the rising stock markets. However, major risks are hovering close to the surface. Mr Trump has set a July 9 deadline for talks with the European Union to produce a trade deal, threatening a 50pc tariff on European goods if they fail. The White House has yet to lock in trade terms with China, Japan or Canada. Meanwhile, Mr Trump's public falling out with Elon Musk has been playing on stock markets as the main driver of swings in Tesla's share price, both higher and lower at different times this week.
Yahoo
05-06-2025
- Business
- Yahoo
European markets mixed as investors digest ECB interest rate decision
As of 16:12 CEST, Germany's Dax fell 0.19%, France's CAC 40 declined 0.46%, the STOXX 600 dropped 0.28%, while Spain's IBEX 35 rose 0.23% after the European Central Bank (ECB) once again cut interest rates. The ECB, as widely expected by the markets, opted to cut its key deposit rate by 25 basis points to 2%, its lowest level in more than two years. Meanwhile, the interest rates on its main refinancing operations and the marginal lending facility will also be lowered to 2.15% and 2.40% respectively, taking effect from 11 June 2025. The latest decision comes as inflation in the euro area cooled more than expected in May. Annual consumer price growth slowed to 1.9% in May, down from 2.2% in April, according to a flash estimate from Eurostat this week. The figure came in below economists' forecast of 2%, and marks the first time inflation has dipped below the ECB's 2% target since September 2024. The decline in headline inflation suggests that business uncertainty, partly driven by renewed global trade tensions and soft consumer demand, is weighing on pricing power across sectors. Core inflation, which strips out volatile food and energy prices, also showed signs of easing. It slowed to 2.4% in May, from 2.7% in April, falling below expectations of 2.5%. On a monthly basis, core prices rose by just 0.1%. Related Eurozone inflation falls below ECB 2% target in May: Rate cut in sight Meanwhile, Asian shares were mixed on Thursday, as Wall Street's big recent rally lost some momentum following a pair of potentially discouraging reports on the American economy. Japan's benchmark Nikkei 225 shed 0.2% to 37,658.46, while Australia's S&P/ASX 200 declined nearly 0.1% to 8,535.10. In South Korea, the Kospi jumped 2.1% to 2,829.48 after the country's new president and leading liberal politician Lee Jae-myung began his term, vowing to restart talks with North Korea and beef up a trilateral partnership with the US and Japan. Hong Kong's Hang Seng gained 0.9% to 23,856.54, while the Shanghai Composite was little changed, inching down less than 0.1% to 3,374.30. In the US, the S&P 500 was 0.3% lower in US morning trading, while the Dow Jones Industrial Average was down 162 points, or 0.4%. The tech-heavy Nasdaq composite was also lower, down 0.2%. In other dealings, benchmark US crude fell 8 cents to $62.77 a barrel. Brent crude, the international standard, edged up 1 cent to $64.87 a barrel. The US dollar rose to 142.87 Japanese yen from 142.78 yen. The euro cost $1.1413, little changed from $1.1418. Sign in to access your portfolio
Malay Mail
04-06-2025
- Politics
- Malay Mail
France mulls tougher sentences after PSG victory marred by violence
PARIS, June 4 — French Justice Minister Gerald Darmanin said on Tuesday that he wanted tougher punishments for anyone convicted of violence against police, after clashes and car-torchings this weekend marred celebrations of Paris Saint-Germain's Champions League triumph. Police detained hundreds of people during festivities following PSG's victory in the European football showcase in Germany on Saturday and their triumphant return home the following day. PSG thrashed Inter Milan by a record 5-0 scoreline in the final to win the biggest prize in European club football for the first time. The victory sparked delirious celebrations in France, which were marred by some violence. Police arrested 563 people on Saturday night, the interior ministry said, after more than 200 cars were torched and police clashed with youths. In the south-western town of Dax, a 17-year-old boy died after being stabbed in the chest, and a 23-year-old man riding a scooter in central Paris died after a vehicle hit him. Authorities detained 79 others on Sunday night, including for allegedly firing fireworks at security forces, trying to vandalise shops and blocking traffic. Some of these appeared in court on Monday, with three men in their early twenties receiving suspended sentences of two to eight months, along with a €500 (RM2,420) fine, the Paris prosecutor's office said. On Tuesday, eight people were sentenced to prison, with penalties ranging from a five-month suspended sentence to 15 months of imprisonment. 'Minimum' sentence Darmanin, who has expressed interest in standing in the 2027 presidential election, argued that the first court sentences were not tough enough. 'Some of the sentences for violence — including against law enforcement officers and for destruction of property — are not proportional to the level of violence our country is experiencing,' the former interior minister said on X. 'The law needs to radically change,' he added. Darmanin called for an end to the automatic softening of jail terms of fewer than six months, which for example allow detainees to serve time at home with an electronic bracelet. He called for an end to suspended sentences in such cases and a law to set up a 'systematic minimum sentence' for those found guilty. He suggested 'a minimum of three months in jail for any assault against a representative of the state or a very steep fine for any destruction'. Prime Minister Francois Bayrou said the weekend's scenes of unrest had been 'premeditated' and had 'exasperated millions of French people', and agreed that 'minimum sentences' were a good idea. 'The hardening of sentences linked to group and premeditated violence... needs to be starker,' he told parliament. 'Physically not possible' But Aurelien Martini, deputy secretary-general of the magistrates union, responded that minimum sentences — previously tried from 2007 to 2014 — did not work. If the goal is 'to put more people in prison, it's physically not possible', he said, alluding to overcrowding. France's prison population hit a record high on May 1, with more than 83,600 inmates held in facilities that have a capacity of around 62,500, justice ministry data has shown. Socialist leader Olivier Faure added that the judiciary should first and foremost be 'fair' and examine each individual case, not respond 'to collective emotion'. The right-wing head of the Paris region Valerie Pecresse supported Darmanin's idea, saying it was the 'only hope for this violence, this ransacking to never happen again'. Receiving the triumphant team at the Elysee Palace on Sunday, President Emmanuel Macron condemned what he called 'unacceptable' violence during the festivities. Many of the stars of PSG, one of the youngest squads in the competition, are drawn from the huge football talent pool in the Paris suburbs. A total of 11.5 million people tuned in across France to watch the match. — AFP
Khaleej Times
03-06-2025
- Politics
- Khaleej Times
French minister eyes tougher sentences after violence mars PSG celebrations
French Justice Minister Gerald Darmanin on Tuesday said he wanted tougher punishments for anyone convicted of violence against police, after clashes and car-torching this weekend marred celebrations of Paris Saint-Germain's Champions League triumph. Police detained hundreds of people during festivities following PSG's victory in the European football showcase in Germany on Saturday and their triumphant return home the following day. PSG thrashed Inter Milan by a record 5-0 in the final to win the biggest prize in European club football for the first time. The victory sparked delirious celebrations in France, that were marred by some violence. Police arrested 563 people on Saturday night, the interior ministry said, after more than 200 cars were torched and police clashed with youths. In the southwest town of Dax, a 17-year-old boy died after being stabbed in the chest. A 23-year-old man riding a scooter in central Paris also died after a vehicle hit him. Authorities detained 79 others on Sunday night, including for allegedly firing fireworks at security forces, trying to vandalise shops and blocking traffic. Some of these appeared in court on Monday, with three men in their early twenties receiving suspended sentences of two to eight months, along with a 500-euro ($570) fine, the Paris prosecutor's office said. Others were set to appear before a magistrate on Tuesday. Darmanin, who has expressed interest in standing in the 2027 presidential election, argued the first court sentences were not tough enough. "Some of the sentences for violence, including against law enforcement officers and for destruction of property, are not proportional to the level of violence our country is experiencing," the former interior minister said on X. "The law needs to radically change," he added. Darmanin called for an end to obligatory adjustments for jail terms of fewer than six months, which for example allow detainees to serve time at home with an electronic bracelet. He called for an end to suspended sentences in such cases and a law to set up a "systematic minimum sentence" for those found guilty. He suggested "a minimum of three months in jail for any assault against a representative of the state or a very steep fine for any destruction". Aurelien Martini, deputy secretary-general of the magistrates union, responded that minimum sentences — previously tried from 2007 to 2014 — did not work. If the goal is "to put more people in prison, it's physically not possible," he said, alluding to overcrowding. France's prison population hit a record high on May 1, with more than 83,600 inmates held in facilities that have a capacity of around 62,500, justice ministry data has shown. Socialist leader Olivier Faure added that the judiciary should first and foremost be "fair" and examine each individual case, not respond "to collective emotion". The right-wing head of the Paris region Valerie Pecresse supported Darmanin's idea, saying it was the "only hope for this violence, this ransacking to never happen again". Receiving the triumphant team at the Elysee palace on Sunday, President Emmanuel Macron condemned what he called "unacceptable" violence during the festivities. Many of the stars of PSG, one of the youngest in the competition, are drawn from the huge football talent pool in the Paris suburbs. A total of 11.5 million people tuned in across France to watch the match.
