I think that the Cyprus situation was a dominant one during the last week. I do not want to bother you with the same information you already read somewhere else and which are not probably accurate because the situation is changing every minute. I would like just to make some small comments. First, Cyprus has…
After the optimistic version that everything is solved in the EU the economy of euro group shrank by 0.6% and EU 27 area was down by 0.5 % in the fourth quarter which was worse than forecast. Germany, France, UK, Portugal, Spain, Italy. All of them were down. The export data fell 1.8% in December…
The Euro crisis is not definitely solved. Greece unemployment rate in April 2013 was 26.9% compared to 23.1% in April 2012 and 26.8% in March 2013. The number of employed amounted to 3,636,042 persons. The number of unemployed amounted to 1,337,621 while the number of inactive to 3,337,051. It means that 3.6 million people in…
It was the week of central bank announcements – Japan (we will describe it below), Britain and ECB. Bank of England and ECB policy remained unchanged which means that interest rates are at the same low levels and the BoE maintained bond purchases. Monetary theory teaches us that once the rates are low central banks…
German elections – actually the most important EU election – ended by the victory of Angela Merkel. On the other hand the election ended with the defeat of strong right wing policy. It seems that Merkel is willing to create a strong big coalition with German socialist and as it is in politics it means…
It seems that currency wars are heating up. The US dollar has been depreciated by FED activities and Japan confirmed depreciation of yen last week. Now Swiss Finance Minister Eveline Widmer-Schlumpf told reporters that Swiss franc is too strong and more depreciation is needed. Swiss franc is still 9.1 % stronger than its five year…
Fitch Ratings has downgraded the United Kingdom to ‚AA+‘ from ‚AAA‘. The outlook is predicted as stable. The rating action reflects a weaker economic and fiscal outlook and possibility of higher UK budget deficits and government debt. The Egan-Jones rating agency which usually predicts thing more accurate than other official agencies downgraded Germany from A+…
The ECB cut basic rates last week to proceed with verbal interventions this week as well. Mario Draghi said that they are ready to cut interest rates again if needed and they will accommodate the policy to the data that arrives from the euro-area economy in the coming weeks. The Governing Council allegedly consider openly…
Euro zone finance ministers backed a 10 billion euro bailout for Cyprus and the European Commission would try to help the island’s economy grow again with better use of EU structural funds. First tranche of 10 billion euro will arrive into the island in mid-May. Cyprus will have to find another 13 billion euro by…
Outcome of Italian elections has caused a chaos within the Eurozone. European leaders were honestly sad because of stalemate political situation in Italy. You could see during first days of the week how sentiment and not fundamentals drive the European markets what is nothing extraordinary. It is just interesting how present world operates. I still…