European region: eyes on a test of
Spanish banks and French budget plan
Budget deficit and rising public debt, one of the most important priorities of European governments at the moment, and why not in a crisis has been going on for three years and does not have access to any radical solution so far in light of the complexity of relations between the countries of the euro zone and thus further complicate the crisis.
The response markets positive after the announcement by Spain budget plan for 2013 yesterday under a plan aimed at providing 13 billion euros to reduce the deficit, which represents one of the objectives the government Rajoy according to a target that is reducing the deficit by the end of fiscal year 2013 to 4.5% from 6.3% for the current year.
In general, the government's plan Spanish depends primarily on reducing public spending without raising general tax rate in the country, and the target within this plan to reduce public spending by about 7.3% and raise government revenues by 4% by raising the value-added tax and the tax on lotteries.
This is the Fifth Plan for austerity by the Spanish government since the outbreak of the crisis, but this time might be in order to pave the way for progress to seek help from international lenders but not at the moment, especially as the government is trying to avoid the application of the conditions of such aid which corresponds to reject popular within Spanish territory.
Pricing investors of the event was positive and what appeared at the end of transactions yesterday on transactions of the euro against the U.S. dollar rose from its lowest level in two weeks, recording the day levels 1.2960, as well as the decline in yield on sovereign bonds Spanish for ten years yesterday to 5.95% from 6.06% during the this week.
However However, this effect may not last long, especially in light of the uncertainty regarding the ability of Spain to achieve the target of the plan in an economy that is still languished in recession.
Is expected to be announced tolerance test banks in Spain later in the day, which is considered one of the conditions for the aid package approved by euro zone countries in June the previous estimated value of 100 billion euros to support the banking sector crumbling in Spain.
France
Today is also expected to play the French government to announce a plan the budget in 2013, with expectations that include the largest public spending cuts since three decades as part of a plan to provide an estimated value of 30 billion euros to reduce the budget deficit.
Plan aimed at reducing the budget deficit to 3% in 2013 from 4.5% for the current year until reaching a final settlement and stable deficit by 2017 this next target growth rate of 0.3% by the end of 2013 which represents a big challenge for the government.
Especially in light of the economic weakness in the country over the last three quarters of quarterly, next to the high unemployment rate to the highest level in 13 years and high levels of 10% and this is what government pledged towards reduced during the current year.
Italy
There is no new on Italy only with respect to statements of Prime Minister "Monty" and that demonstrates an aspect of reasons tarry government to request assistance from international lenders, and from statements made by Monte, the reason of the delay in Spain and Italy in the request for assistance is not clear conditions that may put ECB when you ask for help and activate the bond-buying program. Also see Monte must set limits on intervention of the International Monetary Fund or non-existence of the base in the supervision of financial restructuring.
It is worth mentioning that the ECB may impose conditions to be activated bond-buying program to state what this next development of the International Monetary Fund as a technical assistant to the supervision and control on the progress made in the State which has requested assistance.
Budget deficit and rising public debt, one of the most important priorities of European governments at the moment, and why not in a crisis has been going on for three years and does not have access to any radical solution so far in light of the complexity of relations between the countries of the euro zone and thus further complicate the crisis.
The response markets positive after the announcement by Spain budget plan for 2013 yesterday under a plan aimed at providing 13 billion euros to reduce the deficit, which represents one of the objectives the government Rajoy according to a target that is reducing the deficit by the end of fiscal year 2013 to 4.5% from 6.3% for the current year.
In general, the government's plan Spanish depends primarily on reducing public spending without raising general tax rate in the country, and the target within this plan to reduce public spending by about 7.3% and raise government revenues by 4% by raising the value-added tax and the tax on lotteries.
This is the Fifth Plan for austerity by the Spanish government since the outbreak of the crisis, but this time might be in order to pave the way for progress to seek help from international lenders but not at the moment, especially as the government is trying to avoid the application of the conditions of such aid which corresponds to reject popular within Spanish territory.
Pricing investors of the event was positive and what appeared at the end of transactions yesterday on transactions of the euro against the U.S. dollar rose from its lowest level in two weeks, recording the day levels 1.2960, as well as the decline in yield on sovereign bonds Spanish for ten years yesterday to 5.95% from 6.06% during the this week.
However However, this effect may not last long, especially in light of the uncertainty regarding the ability of Spain to achieve the target of the plan in an economy that is still languished in recession.
Is expected to be announced tolerance test banks in Spain later in the day, which is considered one of the conditions for the aid package approved by euro zone countries in June the previous estimated value of 100 billion euros to support the banking sector crumbling in Spain.
France
Today is also expected to play the French government to announce a plan the budget in 2013, with expectations that include the largest public spending cuts since three decades as part of a plan to provide an estimated value of 30 billion euros to reduce the budget deficit.
Plan aimed at reducing the budget deficit to 3% in 2013 from 4.5% for the current year until reaching a final settlement and stable deficit by 2017 this next target growth rate of 0.3% by the end of 2013 which represents a big challenge for the government.
Especially in light of the economic weakness in the country over the last three quarters of quarterly, next to the high unemployment rate to the highest level in 13 years and high levels of 10% and this is what government pledged towards reduced during the current year.
Italy
There is no new on Italy only with respect to statements of Prime Minister "Monty" and that demonstrates an aspect of reasons tarry government to request assistance from international lenders, and from statements made by Monte, the reason of the delay in Spain and Italy in the request for assistance is not clear conditions that may put ECB when you ask for help and activate the bond-buying program. Also see Monte must set limits on intervention of the International Monetary Fund or non-existence of the base in the supervision of financial restructuring.
It is worth mentioning that the ECB may impose conditions to be activated bond-buying program to state what this next development of the International Monetary Fund as a technical assistant to the supervision and control on the progress made in the State which has requested assistance.
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