Muted reaction to Spanish election

21 December, 2015

Despite the ruling Partido Popular losing its overall majority and the prospect of Greek style negotiations to form a coalition government the reaction from the markets has been muted with Spanish bond yields rising only a few basis points, the euro drifting sideways and European indices expected to open flat to slightly higher. Spain has come a long way since the height of the Eurozone crisis with unemployment declining from around 27% to 21% and it is now the fastest growing economy in the single currency block, but it has unquestionably benefitted from the ECB’s quantitative easing program being one of the main beneficiaries of its €60 billion a month bond buying program. In order to maintain its economic recovery it will need a government that is willing to continue much of the hard work that was undertaken in reducing the deficit and boosting competitiveness.

With Christmas celebrations on Thursday and Friday we can expect volumes to be low as we get closer to the end of the week. Today does see Eurozone consumer confidence released this afternoon and we have a busier economic calendar tomorrow and Wednesday. The low volumes could cause some volatility and we’ll see if some sort of Christmas rally can be mustered following what has so far been a very disappointing December for indices.


Source link  
Political Turmoil in Germany Hurts EUR

The EUR lost ground against many of its peers on Monday on news that Chancellor Angel Merkel’s efforts to form a coalition government had collapsed...

USD Suffers on Subpoena News

The Trump Administration is back in the spotlight with news of a report that Special counsel Robert Mueller’s investigators have issued a subpoena...

Positive data negated by tax plan opposition

The US Labor Department released data on Wednesday showing the consumer price index edged up by 0.1% in October after climbing by 0.5%...


Data Boosts EUR Can CPI Boost USD?

EUR received a boost on Tuesday, as data from Destatis showed German Preliminary GDP climbed to 0.8% in Q3, beating forecasts of 0.6%. In addition...

Chinese Data Disappoints

China’s economy has been robust throughout 2017 as a continued recovery in manufacturing and industrial sectors, a healthy property market...

Data & Polls Pressure Sterling

Sterling suffered downward pressure on Tuesday as the latest monthly report from the British Retail Consortium showed non-food sales slumping...


Closing the Year on a Strong Note

Data released on Monday indicates that the Eurozone economy is on target to close out 2017 strongly. The latest Markit composite PMI fell...

Sterling Falls on Rate Rise

In line with market expectations, the Bank of England raised the UK base rate to 0.5% (from 0.25%) on Thursday. The rise, the first in 10 years, was widely...

Another Political Headache for Trump

USD gave up some of its recent gains on news that investigators had charged President Trump’s former campaign manager regarding...

  


Share: