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Economy
In reply to the discussion: STOCK MARKET WATCH -- Monday, 23 July 2012 [View all]xchrom
(108,903 posts)57. Spanish Recession Probably Deepened In Second Quarter: Economy
http://www.bloomberg.com/news/2012-07-23/spanish-recession-deepens-with-0-4-gdp-drop-bank-of-spain-says.html
Spains recession deepened in the three months through June as the toughest budget cuts in the countrys democratic history pushed the economy into a third consecutive quarter of contraction, the Bank of Spain said.
The euro areas fourth-largest economy shrank 0.4 percent from the first quarter, when gross domestic product fell 0.3 percent, the central bank said in an estimate in its monthly bulletin released in Madrid today. Domestic demand fell more sharply than in the prior quarter, while exports showed a moderate recovery, it said.
Prime Minister Mariano Rajoy last week announced his fourth round of tax increases and spending cuts since Dec. 30 as he struggles to convince investors that the nation wont need a second bailout. The planned budget cuts through 2014 now amount to more than 10 percent of annual GDP. Spains 10-year note yields surged above 7.5 percent today, breaching a level that forced Ireland, Portugal and Greece to seek external aid.
Confidence suffered further following the latest Spanish news over the past couple of days, said Christian Melzer, an economist at Dekabank in Frankfurt. We dont see the breakup of the euro, but whether the euro region will still be the same in terms of members over the next two years is unclear. We dont expect Spain to leave; the latest austerity measures are definitely a positive step for the nation.
Spains recession deepened in the three months through June as the toughest budget cuts in the countrys democratic history pushed the economy into a third consecutive quarter of contraction, the Bank of Spain said.
The euro areas fourth-largest economy shrank 0.4 percent from the first quarter, when gross domestic product fell 0.3 percent, the central bank said in an estimate in its monthly bulletin released in Madrid today. Domestic demand fell more sharply than in the prior quarter, while exports showed a moderate recovery, it said.
Prime Minister Mariano Rajoy last week announced his fourth round of tax increases and spending cuts since Dec. 30 as he struggles to convince investors that the nation wont need a second bailout. The planned budget cuts through 2014 now amount to more than 10 percent of annual GDP. Spains 10-year note yields surged above 7.5 percent today, breaching a level that forced Ireland, Portugal and Greece to seek external aid.
Confidence suffered further following the latest Spanish news over the past couple of days, said Christian Melzer, an economist at Dekabank in Frankfurt. We dont see the breakup of the euro, but whether the euro region will still be the same in terms of members over the next two years is unclear. We dont expect Spain to leave; the latest austerity measures are definitely a positive step for the nation.
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