Moody’s downgrades Spanish banks
The potential “Grexit” is killing the markets as they run for safety in the last day of the week. Uncertainty is all over, and regardless of the new elections being held in June 17, investors still don’t want to risk it.
Not only Greece is in trouble. 16 Spanish banks have been downgraded by Moody’s last night. Meanwhile in the US, jobless claims and the Philly Fed Index have disappointed the markets, with investors getting anxious as crisis is everywhere.
Key Eurozone data remains light today, although we have already witnessed the release of German April Producer Prices. Italian March Industrial Orders and Sales are released at 09.00GMT Past Industrial orders data have made for gloomy reading with Total Orders falling a further -13.2% in February from -5.6% in January, while domestic orders tumbled from -7.6% in January to -18.7% in February. The March reading is unlikely to have a significant impact however it will highlight the significant divergence of economic growth within the Eurozone. In this context it appears the strength of the German economy is keeping the eurozone’s head above water, the question is how long can that be maintained?
On the FX markets, despite the mix of disappointing US data, the Euro remained under pressure and has slipped through the $1.2650 level against the USD in this morning’s trading. Sterling also made major losses against the USD surrendering over 1.5c in the last 24 hours.
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