The vagueness of the statements made last night still gives EU and national politicians plenty of room to manouvere in future crises. These may not take long to appear – as bond market investors have already made clear their worries about other countries, namely Spain, Portugal and Belgium.
In the first four months of next year, the combined refinancing requirement for the Spanish government and banks is €72bn, while the Belgian government must replace €62bn of its bonds in 2011 – more than Ireland and Portugal combined.
The hope is that markets will improve over the next months and that securing new funding will prove possible, but the recent rhetoric from European politicians about "haircutting" bondholders in Irish banks is already starting to lead to a buyers' strike among investors.
This whole crisis has years to run yet before we are even close to a stable situation
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