Euro continues to struggle today, with Spanish borrowing costs causing one of the issues, and underscoring the fact that eurozone leaders seem unable (or unwilling) to take the steps necessary to truly ending the crisis and integrating the eurozone countries into a more unified financial bloc.
The big deal today for the euro is that Spanish debt costs rose. The yield on 10-year notes for Spain passed the psychologically important 7 per cent mark. As a result, Spain’s finances are considered unsustainable for the medium term. With demand for Spanish debt receding, and with Spain’s ability to handle the cost of its debt fading, another Greek-like situation could be in the offing. Another round of voting for spending cuts proposed by Spanish PM Mariano Rajoy is up for Parliamentary vote, even as citizens protest in the streets.
Concerns about the eurozone continue to mount as European leaders bicker about what to do next, and as the signs point to a eurozone recession. Without solid action being take, and with the outcome of Germany’s vote on the Spanish bailout still in question, there is plenty of uncertainty to weigh on the euro.
At 16:47 GMT EUR/USD is down to 1.2282 from the open at 1.2283. EUR/GBP is down to 0.7807 from the open at 0.7846. EUR/JPY is down to 96.5330 from the open at 96.8010.
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