They are dropping like flies.With the markets anxiously watching what the New Spanish government will do to address its defecit,this morning it is the turn of Hungary which has asked the IMF and the EU for help.
According to Reuters, Prime Minister Viktor Orban's governmentwhich has pursued unconventional policies since it swept to power in April 2010, may face hard talks with lenders if it wants a deal without strict conditions attached, analysts have said.
The call appears an about face after it seemed Orban's government was quite capable of dealing with its own problems.
However the euro zone debt crisis, and Hungary's weak economic outlook coupled with the threat of a downgrade to "junk" debt status prompted the government to take this sudden U-turn.
Hungary was the first European Union country to receive an IMF-led bailout in 2008. The country had the highest public debt level among post-communist EU members at 81 percent of gross domestic product last year.
Showing posts with label euro crisis. Show all posts
Showing posts with label euro crisis. Show all posts
Monday, 21 November 2011
Wednesday, 9 November 2011
Berlusconi bounce lasts less than 12 hours
He may be on the way out but Silvio's announcement last night does not appear to have calmed the nerves of bond traders.
The country's 10-year bond yields have reached 8 per cent, a level higher than that which the Irish and Portuguese precedent suggests a bailout is necessary.
As Robert Peston points out
The country's 10-year bond yields have reached 8 per cent, a level higher than that which the Irish and Portuguese precedent suggests a bailout is necessary.
As Robert Peston points out
The subtler, more important point, is that when the implicit interest rate rises to that kind of level, investors know that a country with big debts can't afford to repay what it owes, so they stop lending to said country, they go on strike. No one wants to lend to a country when that country would use the loan to pay the interest on previous loans - that's throwing good money after bad.
Monday, 7 November 2011
Clock ticking for Berlusconi
There are rumours swirling around at the moment that Italian Prime Minister Silvio Berlusconi could be on the way out.
According to the FT
Giuliano Ferrara, editor of Il Foglio and a former minister under Mr Berlusconi, said on his newspaper’s website that it was clear that Italy’s prime minister was about to resign. “It is a question of hours, some say of minutes,”
The Italian stockmarket has reacted to the news by climbing rapidly.
With Italian borrowing rates reaching a euro-era high this morning,there are doubts as to whether he commands enough loyalty among lawmakers to ensure the quick passage of deficit reduction legislation,that European and international financial officials say Rome must achieve to avoid falling victim to a dramatic debt crisis like that bringing Greece to its knees.
The PM was forced into asking the International Monetary Fund to monitor the country's reform efforts during last week's G20.
Berlusconi though appears in fighting mood.According to Corriere della Sera
Nevertheless,the yield on the country's ten-year bonds jumped another 0.33 this morning to 6.58 percent, its highest level since the euro was established in 1999 and closer to the 7 percent threshold that has seen Ireland and Portugal accept bailouts.
According to the FT
Giuliano Ferrara, editor of Il Foglio and a former minister under Mr Berlusconi, said on his newspaper’s website that it was clear that Italy’s prime minister was about to resign. “It is a question of hours, some say of minutes,”
The Italian stockmarket has reacted to the news by climbing rapidly.
With Italian borrowing rates reaching a euro-era high this morning,there are doubts as to whether he commands enough loyalty among lawmakers to ensure the quick passage of deficit reduction legislation,that European and international financial officials say Rome must achieve to avoid falling victim to a dramatic debt crisis like that bringing Greece to its knees.
The PM was forced into asking the International Monetary Fund to monitor the country's reform efforts during last week's G20.
Berlusconi though appears in fighting mood.According to Corriere della Sera
a confident premier claimed that he can still command a parliamentary majority to pass the measures demanded by international bodies, despite announcements of defections in the government coalition: “In the past few hours, I have verified that the numbers in Parliament are secure”. In a telephone link to an Azione Popolare convention organised by Silvano Moffa, Mr Berlusconi said “no one in this Parliament is capable of putting together a credible alternative majority”. The prime minister was unequivocal: “Italy has to face a dual threat from speculation in the markets and from political speculators seeking to use the crisis as a shortcut to power”. He concluded: “That is why I said that our friends who are leaving the majority at this time are enacting a betrayal not of us but of Italy”.
Nevertheless,the yield on the country's ten-year bonds jumped another 0.33 this morning to 6.58 percent, its highest level since the euro was established in 1999 and closer to the 7 percent threshold that has seen Ireland and Portugal accept bailouts.
Sunday, 6 November 2011
Papandreou on the verge of resigning
As talks continue today in Greece to solve the debt crisis,Prime Minister George Papandreou appears likely to resign maybe before the end of the night.
Sources are saying that Papandreou asked the Greek president,Karolos Papoulias to host a three-way meeting with himself and the leader of the opposition this evening after a cabinet meeting to explore the possibility of an agreement soon.
The conservative opposition offered to cooperate in forming a national unity government provided Papandreou stood aside after two years at the helm.
Papandreou and opposition New Democracy party leader Antonis Samaras are set to meet at 6.00pm tonight and Samaras has insisted that Papandreou should resign before a new coalition is set up.
Sources are saying that Papandreou asked the Greek president,Karolos Papoulias to host a three-way meeting with himself and the leader of the opposition this evening after a cabinet meeting to explore the possibility of an agreement soon.
The conservative opposition offered to cooperate in forming a national unity government provided Papandreou stood aside after two years at the helm.
Papandreou and opposition New Democracy party leader Antonis Samaras are set to meet at 6.00pm tonight and Samaras has insisted that Papandreou should resign before a new coalition is set up.
Thursday, 3 November 2011
Is he in or his he out?
So where are we after Day one of the G20 summit and has the Euro been saved?
Has he or has he not has been the main discussion.Has Greek Prime Minister George Papandreou offered his resignation and if so has the referendum been cancelled?
The answer,as I write this.is that nobody is really sure.
He is currently addressing the Greek Parliament,telling MP's that Angela Merkel and Nicolas Sarkozy said that Greece would be out of the EU for ten years if they refused to accept the terms of the bailout,urged political unity in Greece, and inviting the opposition party to "jointly negotiate" the new bailout deal.
It does appear now that the referendum will not be going ahead.
Meanwhile the new ECB boss Mario Draghi,in a bid to calm the markets cuts the ECB policy rate to 1.25 per cent from 1.5.
Whilst in the UK,the city minister Mark Hoban admitted in the Commons that the Government had drawn up contingency plans for the break up of the eurozone.
David Cameron tells the press that the UK would not contribute to any further bailouts, but would consider increasing their contribution to the IMF.
Has he or has he not has been the main discussion.Has Greek Prime Minister George Papandreou offered his resignation and if so has the referendum been cancelled?
The answer,as I write this.is that nobody is really sure.
He is currently addressing the Greek Parliament,telling MP's that Angela Merkel and Nicolas Sarkozy said that Greece would be out of the EU for ten years if they refused to accept the terms of the bailout,urged political unity in Greece, and inviting the opposition party to "jointly negotiate" the new bailout deal.
It does appear now that the referendum will not be going ahead.
Meanwhile the new ECB boss Mario Draghi,in a bid to calm the markets cuts the ECB policy rate to 1.25 per cent from 1.5.
Whilst in the UK,the city minister Mark Hoban admitted in the Commons that the Government had drawn up contingency plans for the break up of the eurozone.
David Cameron tells the press that the UK would not contribute to any further bailouts, but would consider increasing their contribution to the IMF.
Monday, 24 October 2011
The sideshow for the EU summit says Ashton on the referendum vote
A timely interview in the Indy this morning with Baroness Ashton,our EU foreign chief who tells us that whilst she was concerned when the Tories came to power last year,those concerns are dissipated
She adds that today's vote on whether to have an EU referendum is a sideshow compared to the more immediate question of the Greek bailout, the subject of the ongoing European summit
she did not know whether to expect a repeat of the sort of handbag-waving for which Margaret Thatcher is remembered.....instead she has nothing but praise for the Prime Minister and Foreign Secretary
She adds that today's vote on whether to have an EU referendum is a sideshow compared to the more immediate question of the Greek bailout, the subject of the ongoing European summit
Thursday, 29 September 2011
Germany votes Yes-Will Peter Oborne be pleased
Nick Clegg will be pleased but not sure whether Peter Oborne will be swinging from the rafters.
The German Parliament has voted for the enhanced eurozone bailout fund. The motion was easily passed, with 583 MPs for and just 85 against.
Whether the Foreign secretary will be pleased will be another mute point for William Hague has described the euro as a "burning building with no exits" for some countries in the monetary union.
Interviewed for this week's Spectator he had been proved right in opposing the euro when he served as Conservative leader.
The vote will be seeing as freeing the way for European officials to focus on what next steps may be needed to stem the debt crisis.
Germany's move increases its guarantees to Euro Zone debt to 211 billion euros from 123 billion euros.
As for Mr Oborne,his behaviour on last night's newsnight programme was quite disgusting.
The Telegraph's political editor was primarily promoting his book,the Guilty men which throws hot coals at those who advocate Britain's entry to the Eouro.
Face to face with former FT editor Richard Lambert,whose paper was once a strong supporter of the policy,he threw his book on the table,accusing him of being one of the 'guilty men'
His strongest outburst though was reserved for Amadeu Altafaj-Tardio, a representative from the European Commission,who fortunately was not in the studio but on a live link from Brussels.
After telling the show that the Euro issue was primarily a political one,the said Oborne repeatedly called him an idiot in Brussels.
After three times,the "idiot" unclipped his mic and left the studio
The German Parliament has voted for the enhanced eurozone bailout fund. The motion was easily passed, with 583 MPs for and just 85 against.
Whether the Foreign secretary will be pleased will be another mute point for William Hague has described the euro as a "burning building with no exits" for some countries in the monetary union.
Interviewed for this week's Spectator he had been proved right in opposing the euro when he served as Conservative leader.
The vote will be seeing as freeing the way for European officials to focus on what next steps may be needed to stem the debt crisis.
Germany's move increases its guarantees to Euro Zone debt to 211 billion euros from 123 billion euros.
As for Mr Oborne,his behaviour on last night's newsnight programme was quite disgusting.
The Telegraph's political editor was primarily promoting his book,the Guilty men which throws hot coals at those who advocate Britain's entry to the Eouro.
Face to face with former FT editor Richard Lambert,whose paper was once a strong supporter of the policy,he threw his book on the table,accusing him of being one of the 'guilty men'
His strongest outburst though was reserved for Amadeu Altafaj-Tardio, a representative from the European Commission,who fortunately was not in the studio but on a live link from Brussels.
After telling the show that the Euro issue was primarily a political one,the said Oborne repeatedly called him an idiot in Brussels.
After three times,the "idiot" unclipped his mic and left the studio
Tuesday, 20 September 2011
Standard put the boot in to Poor Italy
More problems in the happy land of the Euro this morning as Standand & Poor downgrade's Italy’s credit rating.
Italy has the second highest fiscal deficit within the European community and it appears that the government of Silvio Berlusconi is unable to deal with it.
The announcement by Standand & Poor said that the nation's weakening economic growth and political uncertainty have dented its financial stability.
"Italy's fragile governing coalition and policy differences within parliament will likely continue to limit the government's ability to respond decisively to the challenging domestic and external macroeconomic environment." said the agency whose downgrading of the US rating a couple of months ago threatened to spill over into another chapter in the world's economic crisis.
The news could hardly have come at a worst time for the Italian PM who faces growing pressure to resign, after new wiretaps of him boasting about having sex with eight women in one night along with him claiming that he is "only prime minister in his spare time" were released over the weekend.
For Italy which has the eighth largest economy and whose debt exceeds 120 per cent of its GDP and is the world's third largest issuer of debt after the US and Japan,it is not all bad news.Last week it announced that its officials had held talks with China’s $340 billion sovereign wealth fund about buying Italian government bonds.
Meanwhile in the last hour,Mr Berlusconi has blasted the downgrading of his country's debt saying it was more influenced by politics and newspaper reports than by economic reality and the Chinese have joined the party defending Italy's economic management.
Italy has the second highest fiscal deficit within the European community and it appears that the government of Silvio Berlusconi is unable to deal with it.
The announcement by Standand & Poor said that the nation's weakening economic growth and political uncertainty have dented its financial stability.
"Italy's fragile governing coalition and policy differences within parliament will likely continue to limit the government's ability to respond decisively to the challenging domestic and external macroeconomic environment." said the agency whose downgrading of the US rating a couple of months ago threatened to spill over into another chapter in the world's economic crisis.
The news could hardly have come at a worst time for the Italian PM who faces growing pressure to resign, after new wiretaps of him boasting about having sex with eight women in one night along with him claiming that he is "only prime minister in his spare time" were released over the weekend.
For Italy which has the eighth largest economy and whose debt exceeds 120 per cent of its GDP and is the world's third largest issuer of debt after the US and Japan,it is not all bad news.Last week it announced that its officials had held talks with China’s $340 billion sovereign wealth fund about buying Italian government bonds.
Meanwhile in the last hour,Mr Berlusconi has blasted the downgrading of his country's debt saying it was more influenced by politics and newspaper reports than by economic reality and the Chinese have joined the party defending Italy's economic management.
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