Spain suffers cut from Standard and Poor's
Credit rating agency Standard and Poor's has today reduced the credit rating on Spanish national debt from AAA to AA. This is a major blow for the Spanish economy and the Spanish government and comes amid signs that the Greece debacle is now affecting other European economies. Yesterday we saw Portugal suffer the indignity of a credit rating downgrade and experts believe more downgrades are on the way.
The ongoing problems within the Eurozone have impacted upon the euro itself which has come under significant selling pressure over the last few days. Despite the fact that only a few days ago it looked highly unlikely that any European country would default on its national debt, the chances of this happening have increased dramatically over the last 48 hours. There is also concern that the global economy could be impacted by the debt problems within Europe and we could move back towards another worldwide economic downturn.
Even though the UK stock market was fairly steady today, compared to yesterday, we did see significant falls in France, Germany and Spain and there is growing concern amongst investors. Despite the fact that the German authorities appear to have been dragging their heels regarding a solution for the Greek debt problem, it was the German government who today called for a "speeding up" of negotiations between the Greek government, the IMF and the European Union.
Rising inflation predicted by public
Consumers expect living costs to rise still further over the next year, Citigroup has claimed.The bank found that the current average inflation expectation among the general public for 12 months' time stands at 4.6 per cent - an increase over last month's prediction of 4.1 per cent.Moreover, both of these figures are above the latest government inflation benchmark of 3.3 per cent - which itself ex...Read More
European Union ministers cast doubt on economic recovery
EU ministers have today cast doubt on any significant potential for recovery in the European economy before 2010. While only three months ago the EC was predicting a fall of 1.9% across-the-board for the European economy, and growth in 2010 the region of 0.4%, these figures have been severely downgraded of late.
The EU now expects the Eurozone economy to fall by 4% this year and by...
George Osborne looking to reduce budgets by 40%
George Osborne, the Chancellor of the Exchequer, has this weekend sent out letters to all ministers of the coalition government asking them to put together cost-saving plans of 25% and potential cost savings of up to 40% for their departments. It is only when George Osborne is in receipt of these very suggestions that he will look at the specifics for each department and arrive at a figure which w...Read More
What would happen if the US economy collapsed?
Rumours and murmurs from within the US authorities seem to indicate that a major fiscal stimulus program is on the verge of being announced as the US economy takes a further downward turn. But what would happen to the worldwide economy, and local economies, if the US economy was to collapse? The simple fact is that governments around the world cannot afford to see the US economy collapsed becau...Read More
Greek problem returns to hit European markets
European markets were today under pressure amid signs that the European led bailout of the Greek economy has floundered and the situation is nowhere near being resolved. Despite a European Union and International Monetary Fund deal announced just a few days ago it would appear that the Greek authorities are not happy with the terms. Despite the fact that the economy is literally on the verge of co...Read More