Eurozone: Spain the next crisis target
Concerns about the so-called PIGS - Portugal, Ireland, Greece, Spain - continue to dominate the financial news as the likelihood of a second wave to the financial crisis, this time a sovereign crisis, with countries likely to default on the huge debt they carry.
Today’s news is that spreads on Spanish bonds continue to rise, with a coming meeting between Spanish leaders and the IMF speculated to herald a call to tap into a Greek-style emergency fund for the country.
Investors have already been withdrawing from exposure to Spanish debt, much to the concern of companies such as Santander, who continue to insist on being strong and well-capitalised. What is very interestng is that some commentators raised concerns about Santander nearly two years ago, when the banking crisis was seen as primarily UK-driven.
While the Euro appears to have performed well today, as much of the news remains focused on BP, coverage in the Telegraph raises an interesting report from AXA which suggests a break-up of the Euro is an increasing likelihood, as opposed to being doom-laden speculation.
One thing remains certain, and that’s the Eurozone will remain very much under scrutiny for some time - because at the moment, it appears less a question as to whether a crisis will hit, as much as when and how much.
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