The economy of the Eurozone shrank .2% in the second quarter of the year compared to the previous quarter. The economies of the full 27 European Union member nations also fell .2% during the second quarter.
The Eurozone and the EU are technically not in a recession due to the definition of recession requiring two straight quarters of negative growth and the first quarter of the year had zero growth. However, economists are pessimistic about the rest of the year and believe a recession is likely. Continue reading →
Europe’s manufacturing saw the 11th consecutive month of contraction in July. Despite an increase of .1 in the index from 46.4 to 46.5, the overall amount is still below the 50 level that indicates no growth.
The services sector rose to 47.9 in July, an .8 increase from June but all sectors reported lower levels of output in the month. Continue reading →
On the same day that Italy’s prime minister proclaimed he could see a “light at the end of the tunnel” for the Eurozone debt crisis reports surfaced that the unemployment rate is at a record high.
Italian Prime Minister Mario Monti met with French President Francois Hollande in Paris for discussions on the euro. Hollande agreed their had been “significant progress” in recent weeks and that the euro should be “defended, preserved and consolidated.” Continue reading →
The president of the European Central Bank said they will do “whatever it takes” to keep the euro solvent bringing a run on various stock markets.
The Spanish Ibex share index jumped 6% on the news with the main share index closing up 5.6% The news also drew Spain’s 10-year bonds down .6% from the record high it had been maintaining for weeks. Continue reading →
Germany’s AAA credit rating is in danger of a downgrade after Moody’s changed the outlook for the nation’s credit to negative. The move is a possible first step into downgrading the country’s overall rating.
Moody’s stated that the exit of Greece from the Euro is increasing and the increasing financial decline in Spain. A full bailout of Spain is considered to be more likely as the cost of Spanish bonds remains at a record high. Continue reading →
The continued debt problems in Spain, despite the country receiving banking bailouts, is rippling across Europe and driving the Euro down against foreign currencies.
The euro fell to 94.37 yen this morning, the lowest point for the Euro since November 2000. The fall came after news late Friday that Spain’s Valencia region had requested emergency funds from a new rescue fund. Madrid’s borrowing costs skyrocketed to levels that analysts see as impossible to sustain in the long run. Continue reading →
A creation of a European treasury is one of the key components of a new plan to create a monetary union for the members of the euro zone. The European treasury would have power over the budgets of individual countries.
“[This is] a defining moment for European integration,” European Commission President Jose Manuel told reporters. Continue reading →
Spain finally made a formal request for euro zone rescue loans to bail out banks overwhelmed with bad debts on Monday. The euro and bank shares fell mainly on speculation that the European Union summit this week will not act decisively on the crisis.
Spanish Economy Minister Luis de Guindos requested 100 billion euros in a letter sent to the Euro group chairman. The final amount of assistance could be less than the requested total. Continue reading →
Eurozone ministers are gathering in Luxembourg to discuss plans to lower government borrowing costs as Spain’s bond yields hit a 16 year high.
The government paid a yield of 6.07% on five year bonds up from 4.96% in May. The 2.2 billion euros raised will fund 61% of the Spanish government’s operations and debt payments for the rest of 2012. Continue reading →
The leader of the party winning Greece’s elections Sunday is urgently trying to form what he calls a “national consensus.”
The New Democracy party, narrow victors in the vote, are one of a number of parties who favor Greece staying within the euro. Continue reading →
