Week Ahead (7 February)
Monday, 7 February – Bill to prevent collapse of Northern Ireland Assembly to be passed at Westminster
Following the resignation of the Northern Ireland First Minister, Paul Givan of the DUP, in protest over the Northern Ireland protocol, the UK government has sought to rush through the Northern Ireland (Ministers, Elections and Petitions of Concern) Bill, which will remove the requirement for the Northern Ireland secretary to set a date for an election if the positions of first and deputy first minister are not filled by the end of the week.
Following Givan’s resignation, a House of Lords amendment to the bill, which is expected to be approved later, allows for the legislation to be applied retrospectively. In the absence of the passage of this bill, the resignation of either the first or deputy first minister would set a seven day countdown to find replacement roles. Should no replacement be found, the Northern Ireland secretary would have to set a date for fresh assembly elections and the institutions would collapse.
Monday, 7 February - ECON committee to host monetary dialogue with Christine Lagarde
Today, the Economic and Monetary Committee of the European Parliament will hold the next in its regular monetary dialogues with the President of the European Central Bank, Christine Lagarde. Among the topics for discussion will be inflation in the context of the ECB's decision last week to hold interest rates at their current level.
Despite having insisted that the ECB would not be raising interest rates this year, the tone of Thursday's press conference strongly suggested that it could no longer be ruled out. At the press conference following the Governing Council's meeting, Lagarde adopted a much more hawkish tone than at previous conferences, stating that "concern was raised across the board" and that inflation risks were now "tilted to the upside". Over the weekend, Governing Council member Klaas Knot indicated that the ECB could raise rates in Q4 followed by a second move in Q1 2023. Knot is firmly in the hawkish camp but he has heretofore not given an approximate timeframe for an interest rate hike.
Tuesday, 8 February - European Commission to propose Chips Act
On Tuesday, the European Commission will propose a Chips Act, designed to increase European sovereignty in the manufacturing and use of semiconductors.
Speaking at the Masters of Digital 2022 event last week, European Commission President Ursula von der Leyen outlined plans which would see Europe provide 20% of the world's microchips production by 2030 - in effect a fourfold increase in production by the end of the decade, backed by investment worth up to €48 billion from the Commission, Next Generation Europe, the Horizon Europe programme and private funding.
Thursday, 10 February - European Commission Winter Forecast to be revealed
The European Commission will release its winter forecast on Thursday. The ongoing spike in fuel prices which is driving inflation to record levels across Europe was foreseen in the Commission's autumn forecast, although growth rates were calculated without knowledge of the spread of the Omicron variant of Covid-19 and the subsequent economic volatility caused.
The autumn forecast predicted that inflation would peak by the end of 2021; however, it hit a record high of 5.1% in January. Projected growth rates will continue to be affected by pressures associated with the rise in prices for gas and other fuels. The trend towards higher prices may well continue should Russia invade Ukraine, a move which is likely to have serious consequences for the security of Europe's gas supply.