Optimism about Spain’s banking bailout is fading fast after reports that Spain’s borrowing costs have risen to the highest point since the creation of the euro.
The benchmark 10-year bond yield peaked at 6.81%. The news created some ripples throughout the European Union as Italy’s 10-year bond yield hit 6.28%, the highest rate since January. Continue reading
Struggling banks led Spain to be the fourth and largest European Union nation to ask for a bailout. The country will receive up to 100 billion euro, however, some of the member nations, like the UK, are not contributing to the loan.
The news of the bailout initially sent worldwide stock markets soaring but the enthusiasm quickly wore off and many markets were trading lower than opening by mid-morning. Ratings agency Fitch downgraded the rating for two Spanish banks two ranks from A to BBB+. Fitch attributed the move to last week’s downgrade of Spain’s sovereign credit rating. Continue reading
Despite Spain’s insistence that a bailout was not imminent, a Dutch official leaked out word that emergency bailout talks could take out place this weekend.
Dutch finance minister Jan Kees de Jager told the BBC the situation in Spain was “urgent” and alluded to emergency talks. EU officials have officially stated that Spain would not be asking for emergency funds as early as Saturday. Continue reading
The International Monetary Fund is lending $157 million to Malawi in an attempt to save the country’s flagging economy.
The country’s economic crisis is attributed to recently deceased leader Bingu wa Mutharika who had long been criticized for his human rights record and handling of the nation’s economy. Continue reading
Luis deGuindos, Spain’s economy minister, stated today that the country is on the verge of asking for a bailout as reported in various media sources.
Any decision on a bailout request would be dependent on the outcome of audits of all Spanish banks. The results of the audit are not expected until the end of June. Continue reading
Another member of the euro zone is on the verge of needing an EU bailout.
Cyprus has directly impacted the debt load in Greece due to loans taken from it’s banking system.
“The possibility of addressing financial stability mechanisms to support the banking system, due to the problems created by excessive exposure of banks to Greece, is a serious responsibility,” Cyprus spokesman Christos Christofides told a press conference. Continue reading
