While Greece is taking a breather, Spain's borrowing cost is escalating, its 10-year bond yield set a historical high of 7.158% on Monday.
It is a well-know fact that Spain is having big trouble despite getting a 100 billion euro for its banks recently. Spain's unemployment rate is 25%, youth unemployment rate is 51%, GDP is projected to shrink 1.8% this year, house prices have dropped 30% so far and now with a bond yield exceeding 7%, Spain, with the fifth largest economy in Europe, is going to create a much bigger problem than that of Greece. At the back, following closely is the Italian debt problems. EU really needs to print a lot of euro to reinforce its firewall. But, can it work?
.
No comments:
Post a Comment