FOLLOW MARKETMOVES

EUR/GBP update (30th Sep 2010, 11:30)

Ireland’s announcement that the cost of its support of Bank of Ireland would amount to up to €34 billion sent the euro down against sterling this morning, as the enormity of Dublin’s financial commitment began to sink in.

The bailout costs will push the Irish fiscal deficit from 11.75% of GDP in 2010 to an eye-watering 32%, somewhat above Maastricht Treaty guidelines of 3%. The single currency was hit further by news that ratings agency Moody’s had joined its counterparts Fitch and Standard & Poor’s in downgrading Spain’s credit rating from AAA to AA1 with a stable outlook. The agency cited a weak economic outlook and doubts that Madrid will hit its deficit reduction targets. It expects the Spanish government to meet its budget target of debt as 9.3% of GDP but thinks it will be difficult for debt to reach 3% of GDP by 2013. Continuing sovereign debt worries are likely to weigh on the euro for the foreseeable future until the markets are assured that the peripheral eurozone countries are not likely to default.

comments powered by Disqus

All Forex News

Breaking News



Share this with your friends

To:
From:
Your comments:

EUR/GBP update (30th Sep 2010, 11:30)

Ireland’s announcement that the cost of its support of Bank of Ireland would amount to up to €34 billion sent the euro down against sterling this morning, as the enormity of Dublin’s financial commitment began to sink in.

Read more »

Log In or Sign up

Facebook User?

You can use your facebook account to sign up with Live streaming sport.

Connect with facebook
Remember me.
Did you forget your password?