European Economy

Another night of purchasing management index data from the Eurozone and, once again as expected, the data was a disappointment.

So, as predicted , Spain looks set to become the next Eurozone nation to fall.

It was an all round horrible night for Spain, starting with a bond auction that went a little wrong: Spain’s government just sold a bunch of short-term debt this morning.

Last week I mentioned that Spanish bank security and debt holders were in for a shock stemming from certain sections of the new Spanish banking MoU: The restructuring plans of viable banks requiring public support will detail the actions to minimise the cost on taxpayers.

As reported on MB last week Moody’s slapped Italy with another downgrade noting the following factors: 1.

Readers may remember my confusion with the jubilation shown by the Spanish public over the election win by Mariano Rajoy back in November 2011.

A draft Memorandum of understanding for the Spanish bank bailout became available overnight (available below).

Another day, another forum for Europe.

Courtesy of Sober Look The markets were not impressed by today’s policy announcement from the ECB.

Find below an awesome note from the fine mind of Russell Jones at Westpac on the ins and outs of a European Marshall Plan.

As I ‘ve been saying over the last few days, last week’s EU summit provided Europe with some political success but actual deliverables are some time off.

Sorry for the lateness and shortness of today’s post, I’m not feeling the best.

I discussed yesterday that the success of last week’s EU summit needed to be measured on a political scale not an economic one.

The EU summit ended late last week with a better than expected outcome, but as usual the devil is in the details. The summit statement (available below) was as loosely worded as these things come and many decisions are still left to interpretation and future actions.

Courtesy of Sober Look.

Day one of the EU summit and while the talkfest begins the rest of Europe continues on its downwards path: Economic confidence in the euro area slumped to the lowest in more than 2 1/2 years in June, suggesting the economic slump deepened in the second quarter as officials struggled to contain the sovereign-debt crisis.

Apologies for being late today.

Spain took a beating overnight after Moody’s downgraded the long term debt and deposit ratings of 28 Spanish banks on the back of the sovereign downgrade earlier in the month.

The most choreographed move in recent Europe economics finally occurred overnight with Spain requesting a €100bn bailout of its banking system: Spain formally requested on Monday European aid of up to 100 billion euros for its banks, the Economy Ministry said in a statement.

It’s another week and another summit for Europe.